An Evaluation of World Bank Group Support to Jobs and Labor Market Reform through International Development Association Financing (Approach Paper)
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The International Development Association (IDA) has included jobs as a special theme since the 17th Replenishment of IDA (IDA17) in 2014, when it explicitly recognized the role played by labor markets in intermediating between growth and inclusion. This acknowledgment of jobs marked a shift in IDA’s inclusive growth strategy. Before the IDA17 strategy paper, IDA emphasized growth and the use of Show MoreThe International Development Association (IDA) has included jobs as a special theme since the 17th Replenishment of IDA (IDA17) in 2014, when it explicitly recognized the role played by labor markets in intermediating between growth and inclusion. This acknowledgment of jobs marked a shift in IDA’s inclusive growth strategy. Before the IDA17 strategy paper, IDA emphasized growth and the use of social safety nets to mitigate the effects of poverty. Beginning in 2014, however, jobs became more central to IDA’s strategy for inclusive growth and for achieving the twin goals. IDA17, the 18th Replenishment of IDA, and the 19th Replenishment of IDA established specific policy commitments and results indicators under the jobs-related special theme. At the same time, the World Bank Group expanded and deepened its attention to jobs, resulting in an increasingly multidimensional jobs agenda characterized by a growing body of lending, technical assistance and diagnostics, and a strong focus on IDA-eligible countries, including through use of the Country Private Sector Diagnostic and IDA’s private sector window.
🎧 Lessons for Future Crises from the World Bank Group’s Response to the Covid-19 Pandemic
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The World Bank Group delivered a response of unprecedented scale and speed to COVID-19, aiming to address both the immediate health crisis and the economic and social consequences of the pandemic.
In this episode, IEG’s Jenny Gold and Raghavan Narayanan join host Brenda Barbour to unpack valuable lessons about factors that facilitated the World Bank Group’s strong response and explore areas Show More
The World Bank Group delivered a response of unprecedented scale and speed to COVID-19, aiming to address both the immediate health crisis and the economic and social consequences of the pandemic.
In this episode, IEG’s Jenny Gold and Raghavan Narayanan join host Brenda Barbour to unpack valuable lessons about factors that facilitated the World Bank Group’s strong response and explore areas that can be strengthened to boost crisis preparedness in the Bank Group and its client countries as we navigate compounding crises. Jenny Gold co-led IEG’s recent evaluation of the World Bank’s health and social response to the pandemic and Raghavan Narayanan led IEG’s evaluation of the World Bank Group’s response to the economic implications of the pandemic.
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Related Resources
IEG Evaluation: The World Bank’s Early Support to Addressing COVID-19 Health and Social Response
IEG Evaluation: The World Bank Group’s Early Support to Addressing the Coronavirus (COVID-19): Economic Response (April 2020-June 2021)
Blog: Lessons for building on the World Bank’s unprecedented health and social response to COVID-19
Blog: https://ieg.worldbankgroup.org/blog/ecuador-case-study-crisis-response
Ecuador Country Program Evaluation (Approach Paper)
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The Country Program Evaluation (CPE) for Ecuador seeks to assess the performance of the World Bank Group in helping Ecuador address its main development challenges. The objective of this CPE is to assess how the Bank Group supported Ecuador in addressing key challenges that constrained its development and how that support adapted over time to respond to changing circumstances, an evolving Show MoreThe Country Program Evaluation (CPE) for Ecuador seeks to assess the performance of the World Bank Group in helping Ecuador address its main development challenges. The objective of this CPE is to assess how the Bank Group supported Ecuador in addressing key challenges that constrained its development and how that support adapted over time to respond to changing circumstances, an evolving relationship, and lessons from experience. The evaluation will cover the period FY07–22. The time period is selected to include the earliest efforts at normalizing relations after the break in July 2007. Because this was such a pivotal aspect of the World Bank’s support to Ecuador over the past decade, the CPE considers a somewhat expanded time period.
Addressing Gender Inequalities in Countries Affected by Fragility, Conflict and Violence: An Evaluation of WBG Support (Approach Paper)
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The WBG recognizes that achieving gender equality is particularly challenging in those settings, but it is critical to make progress in peace building and resilience to crisis. Addressing gender gaps is a priority in FCV-affected countries because fragility and conflict disproportionally affect women and girls and exacerbate gender inequalities. The World Bank Group recognizes that effective Show MoreThe WBG recognizes that achieving gender equality is particularly challenging in those settings, but it is critical to make progress in peace building and resilience to crisis. Addressing gender gaps is a priority in FCV-affected countries because fragility and conflict disproportionally affect women and girls and exacerbate gender inequalities. The World Bank Group recognizes that effective responses to gender inequalities in FCV-affected countries need to be context-specific, country-owned, systemic, and sustainable. The goal of this formative evaluation is to provide lessons on what worked well, less well, and why, regarding the World Bank Group’s support to FCV-affected countries to achieve transformational change towards gender equality in two areas: women’s and girls’ economic empowerment and gender-based violence.
Adapting development in response to population aging
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Population aging is no longer just a rich country phenomenon. Thanks to dramatic improvements in nutrition, sanitation, health, education, and—more generally—economic well-being, longevity has increased everywhere in the world, while fertility has decreased in most countries. This increasingly global demographic shift, unfolding in the developing world at a striking pace, brings a range of new Show MorePopulation aging is no longer just a rich country phenomenon. Thanks to dramatic improvements in nutrition, sanitation, health, education, and—more generally—economic well-being, longevity has increased everywhere in the world, while fertility has decreased in most countries. This increasingly global demographic shift, unfolding in the developing world at a striking pace, brings a range of new policy challenges, including critical implications for economic growth, inter- and intragenerational equity, and the inclusiveness of the development process.
IEG’s recent report, World Bank Support to Aging Countries, offers the first assessment of World Bank efforts to help developing countries think through the challenges associated with population aging, and adapting policies and institutions to prevent and address those challenges.
Demographic Transition Stage World Map
Population aging can put downward pressure on long-term economic growth through reductions in employment and labor productivity, higher dependency, and lower savings and investments. However, these negative impacts do not materialize if longevity is achieved by adding healthy years, which allows individuals to stay productive and independent for longer, and if the economy uses opportunities to produce higher savings and investments during the first demographic dividend (see box).
The Demographic Transition
The 2015/2016 Global Monitoring report classifies countries into four stages of demographic transition:
pre-dividend countries (where fertility is greater than 4 births per woman);
early-dividend countries (where fertility is lower than 4 births per woman, but there is an increasing working-age population);
late-dividend countries (with a shrinking working-age population but where fertility fell only recently); and
post-dividend countries (with a shrinking working-age population and where fertility fell below the replacement level, or 2.1 births per woman, three decades earlier).
The latter two stages characterize aging countries. The first demographic dividend is the accelerated economic growth that may result from a decline in a country’s birth and death rates and the subsequent change in the age structure of the population.
The report found that the World Bank’s understanding of aging has improved over time, from a narrow focus on the sustainability of pension systems to a much broader perspective that explores the interconnections among different sectors of the economy and calls for coordinated policy responses.
Yet there is still not enough attention paid to the profound distributional issues that population aging can cause. These include gender gaps, intergenerational disparities, and various types of inequalities: spatial, rural versus urban, and socioeconomic. A focus on gender is especially important, as there are multiple sources of gender inequalities in relation to aging. These are a result of gender differences in life expectancy, employment patterns, accumulation of pension entitlements, and care responsibilities.
The evaluation found good examples of World Bank’s analytical work providing a solid and substantial empirical base and directly influencing the policy discussion. Country aging reports have been in some cases instrumental in stimulating the need to act to address the many challenges of population aging and have generated concrete responses by governments. The Country Aging Report for Uruguay, for instance, generated a new sense of local urgency and led to a country development strategy strongly centered on aging.
In other cases, high-quality diagnostic work has helped countries to develop approaches to tackle specific issues, such as long-term care. Analytical work for China supported the design and implementation of the country aged-care system, with a strong emphasis on home- and community-based care, while promoting an efficient market for provision of care services.
While the evaluation identified good examples of analytical work, for the World Bank to better help its client countries address their aging challenges, it needs to focus more on preparedness and improve its cross-sectoral thinking.
Focusing on preparedness means promoting healthier behaviors for a healthy longevity, supporting productivity throughout the working life, and introducing incentives to save for retirement. It also means promoting financial awareness, age-friendly environments such as smart cities, or changing negative attitudes toward older people.
Thinking cross-sectorally means recognizing the linkages across issues and the broader impacts that sectoral interventions can have, some of them unintended. For example, elderly care interventions can deepen the occupational segregation of women in mostly informal and low-paid long-term care jobs; pension reforms that aim at making a system more financially sustainable tend to penalize women, who have more irregular working patterns, earn lower wages, and contribute less to a pension system.
The speed of demographic change requires new approaches to development that recognize the importance of supporting a healthier and more productive population to reduce the potential negative impact of population aging on future growth and prosperity. For the World Bank, this means articulating a clearer and more coordinated position with respect to population aging that will facilitate dialogue with client countries and improve the Bank’s capacity to provide support.
Pictured above: Old and young holding hands. Photo credit: Shutterstock/Africa Studio
World Bank Support to Aging Countries
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This evaluation is the first at the Independent Evaluation Group to assess the World Bank’s contribution to diagnosing client countries’ demographic issues related to population aging.
This evaluation is the first at the Independent Evaluation Group to assess the World Bank’s contribution to diagnosing client countries’ demographic issues related to population aging.
The COVID pandemic and global hunger
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Lessons from past crises to improve food security. Lessons from past crises to improve food security.
Covid-19 has exposed the fragilities of aging countries
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An IEG report focuses on much needed areas of attention.An IEG report focuses on much needed areas of attention.
Argentina: Basic Protection Project (PPAR)
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The Basic Protection Project was prepared in the aftermath of the 2008 financial crisis, in the context of increased pressure to expand coverage and accessibility of Argentina’s social protection policies. The social protection system had historically been linked to the formal labor market through contributory schemes (pension benefits, unemployment insurance, family allowances, health and Show MoreThe Basic Protection Project was prepared in the aftermath of the 2008 financial crisis, in the context of increased pressure to expand coverage and accessibility of Argentina’s social protection policies. The social protection system had historically been linked to the formal labor market through contributory schemes (pension benefits, unemployment insurance, family allowances, health and housing insurance coverage). Noncontributory programs—for children, the unemployed, and informal workers—were limited. The project aimed at strengthening and expanding Argentina’s social protection system by supporting expansion of coverage and improving the design of two income transfer programs for the unemployed and families with children.
Ratings for this project are as follows: Outcome was moderately satisfactory, Risk to development outcome was low or negligible, Bank performance was satisfactory, and Borrower performance was moderately satisfactory. This assessment offers the following lessons: (i) The choice of indicators is critical for incentives to be effective, especially when a short implementation time is expected; but the definition of some of the DLIs and the information used to determine their targets were not discussed in detail at appraisal. (ii) This PPAR had to clarify the understanding of “effectiveness,” as it was not made explicit in project documents. (iii) Institutional strengthening of the MTESS statistics area was an important additional aspect of the World Bank’s support, given the peculiar context in which this project was implemented.
State Your Business!
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This is IEG’s first systematic assessment of World Bank Group’s support for the reform of State-Owned Enterprises (SOEs), looking at what works and the factors of success. It parallels Bank Group efforts to provide more integrated support to SOE reform in client countries and to empower staff with new tools.
This is IEG’s first systematic assessment of World Bank Group’s support for the reform of State-Owned Enterprises (SOEs), looking at what works and the factors of success. It parallels Bank Group efforts to provide more integrated support to SOE reform in client countries and to empower staff with new tools.