The 2017 World Development Report on ‘Governance and the Law’

The World Development Report (WDR) 2017 believes that ‘…The global development community needs to move beyond asking ‘what is the right policy’? and instead ask: ‘What makes policies work to produce life-improving outcomes’? It confidently proclaims that the ‘answer is better governance – that is, ‘…the ways in which governments, citizens, and communities engage to design and apply policies’.

WDR 2017 makes an admirable attempt to decipher what good governance means and how it can be acquired. There is a judicious combination of theory and evidence – with the latter diligently marshalled from country-specific, regional and global experiences. Yet, one ends up, perhaps inevitably, with abstract and grand proclamations. Thus, in order to ‘…to improve policy effectiveness and ultimately expand the set of implementable policies, it is necessary to reshape the policy arena where actors bargain. This can be accomplished by enhancing contestability…by changing the incentives of the actors involved, or by reshaping their preferences and beliefs’.

Perhaps the most problematic part of WDR 2017 is the presumption that a consensus exists on ‘right policies’. Really? To take a few  examples, what about the debate on central bank independence and inflation targeting regimes for developing countries? Has the debate  been resolved? And what about fiscal rules as the basis of appropriate fiscal policies? How do we establish robust evidence about ‘right policies’? Cross-country and country-specific econometric investigations? The persistent use of RCTs (randomized control trials)? One cannot ignore the fact that a lively discourse on these and many other development policy issues – inevitably coloured by ideological predilections – continues unabated.

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