Is There an Underside to Economic Growth? A Mixed-Methods Analysis of Malaysia (Washington, DC: World Bank , 2024-11-15 ) Asadullah, M Niaz; Biradavolu, Monica; Rao, Vijayendra; Simler, Kenneth This paper sheds light on a Malaysian paradox that may have lessons for the rest of the world. Despite high gross domestic product growth with concurrent sharp reductions in income poverty and inequality, there was widespread discontent in the country. The paper first documents various dimensions of the Malaysian “miracle” with diverse data. It then draws on qualitative, open-ended focus group discussions to go below the surface of the quantitative data to analyze how Malaysian citizens perceive these changes, the challenges they face, and their sources of discontent. The findings reveal a broad consensus that while material living standards have improved, they have been accompanied by an underside such as a large “imbalance” between income and expenses, a need to rely on dual incomes and multiple jobs, growing indebtedness, increased stress, and polarization across ethnic groups. The paper argues that the Malaysian paradox may reveal something more general about the underside of economic growth.
Can Facebook Ads Prevent Malaria? Two Field Experiments in India (Washington, DC: World Bank , 2024-11-13 ) Donati, Dante; Rao, Nandan; Orozco-Olvera, Victor; Muñoz-Boudet, Ana Maria This study uses a cluster randomized controlled trial to evaluate the impact of a nationwide malaria prevention advertising campaign delivered through social media in India. Ads were randomly assigned at the district level, and the study relies on data from two independently recruited samples (8,257 individuals) and administrative records. Among users residing in solid (concrete) dwellings, where malaria risk is lower, the campaign led to an 11 percent increase in mosquito net usage and a 13 percent increase in timely treatment seeking. Self-reported malaria incidence decreased by 44 percent. Consistently, recorded health facility data indicate a reduction in urban monthly incidence of 6.2 cases per million people, corresponding to 30 percent of the overall monthly incidence rate of malaria. Conversely, the study finds no impact on households living in non-solid dwellings, which face higher malaria risk, nor among rural settlements where such dwellings are more prevalent. To disentangle if this lack of impact stems from ineffective content or insufficient reach, an individual-level trial was conducted (1,542 individuals), ensuring campaign exposure for both household types. The findings indicate an increase in bed net usage and timely treatment seeking for both groups, underscoring the need for improved targeting in social media campaigns to fulfill public health goals.
Perceptions of Economic Mobility and Support for Education Reforms (Washington, DC: World Bank , 2024-11-12 ) Cojocaru, Alexandru; Lokshin, Michael; Torre, Iván This paper investigates the relationship between the expectations of economic mobility and support for tax-financed education reforms using data from the Life in Transition Survey, which covers 39 countries in Europe, Central Asia, and the Middle East and North Africa. The analysis demonstrates that individuals who expect themselves or their children to be upwardly mobile are more likely to support tax-financed education reforms. This correlation is robust to different formulations of mobility expectations and persists over a decade, encompassing both stable and post-crisis economic environments. The relationship is partially mediated by beliefs about the fairness of economic opportunities in society and individuals’ readiness to embrace risks.
Maximizing Output and Government Revenues from Mining in Developing Countries (Washington, DC: World Bank , 2024-11-12 ) Davis, Graham A.; Bou Habib, Chadi; Solheim, Gaute; Lokanc, Martin This paper investigates the determinants of mining projects, with a focus on green minerals. The research question is the effect of political risk on investment decisions, the size of projects, the volume of ore mined, and the ensuing resource rents captured by the host country. The paper shows the challenges of measuring and capturing resource rents, using a mathematical model of resource rent maximization for the host country under the constraint of a positive after-tax cash flow for investors. The analysis finds that the optimal approach for taxing extraction is a progressive profit tax on mining revenues that generates revenues for the country while minimally deterring investment. Alternatively, taxing cash flow, which can be non-distortionary, can be implemented. Using the S&P Capital IQ database, the analysis finds that the low-quality of governance, institutions, infrastructure, skills, and services dampens the exploration and exploitation of copper, a key mineral for green energy. The opportunity cost in terms of unexplored or underexploited deposits translates into suboptimal global copper production and forgone revenues for the poorest host countries. To unlock exploration, the paper proposes measures to mitigate political risk, including investing in geological surveys and institutions and designing stable tax systems. For underexploited projects, it proposes that countries not only invest in infrastructure, skills, and services, but also improve governance and institutions. This would lower the metal grade at which investors would be willing to commit, ultimately producing more metal from identified mineral deposits. Interventions from international financial institutions can help to alleviate all country risks, including political risks, that hinder credible intertemporal commitments between investors and countries.
The Worldwide Governance Indicators (Washington, DC: World Bank , 2024-11-07 ) Kaufmann, Daniel; Kraay, Aart This paper provides an overview of the data sources and aggregation methodology for the Worldwide Governance Indicators (WGI). The WGI report six aggregate governance indicators measuring Voice and Accountability, Political Stability and Absence of Violence/Terrorism, Government Effectiveness, Regulatory Quality, Rule of Law, and Control of Corruption in a sample of 214 economies over the period 1996–2023. The aggregate indicators combine information from 35 different existing data sources, capturing subjective perceptions of the quality of various dimensions of governance reported by experts and survey respondents worldwide. The paper briefly discusses how to use reported margins of error when interpreting cross-country and over-time differences in the aggregate indicators. The paper also updates and extends earlier analysis on three key issues relating to the WGI methodology: (a) the effect of correlated perception errors, (b) the robustness of the aggregate indicators to alternative weighting schemes, and (c) the existence on trends in global averages of governance.