infrastructure, gender equality and development: overview...
TRANSCRIPT
MDB-Sponsored Regional Workshops to
Mainstream Gender Equality in
Infrastructure Policies and ProjectsMarch 22-24, 2011
Hippolyte Fofack
The World Bank Group
Infrastructure, Gender Equality
and Development: Overview of
Challenges and Analytical Issues
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Outline
Background and context;
Objectives
Dynamics of growth and development in a context of infrastructure crisis;
Infrastructure and growth: Possible transmission channels under the new engendered growth model;
Analytical issues;
Perspectives;
Background and context
Persistence of poverty and high vulnerability of
countries to adverse shocks;
In the past, commodity price volatility led to
balance of payment crisis and growing
external imbalances;
The accumulation of external liabilities in
response to BoP crises resulted in debt
overhang, with adverse effects on public
capital accumulation and infrastructure;
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More recently, the vulnerability of
African countries was further highlighted
by the effects of the global financial
crisis;
In the process African countries, and
especially the most vulnerable one
became the collateral damage of US
subprime crisis;
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Poor state of Africa’s infrastructure and
growing infrastructure gap between Africa and
other regions of the developing world;
Yes indeed, the Africa infrastructure crisis is
real, widespread and profound;
For instance, the overwhelming majority of
countries is affected by the energy crisis;
Energy and power crisis in Nigeria;
Energy and power crisis in Senegal;
In some cases, the crisis has been going on for
decades;
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At the same time, empirical evidence are
increasingly showing that projects which integrate
gender considerations have higher chances of
meeting their underlying development
objectives…
…suggesting that integrating gender in
investment projects may increase their benefits in
terms of growth and economic development;
Still, the context is also dominated by analytical
gaps on gender and development;
The questions ―how‖ and ―why‖ gender equality
matters for development are not yet settled;
Addressing these gap is one of the key objectives of
WDR 2012 on “Gender Equity and Development‖ 7
Objectives of the presentation
Contrast Africa and other regions of the
developing world on the infrastructure ladder …
…and highlight the implications of infrastructure
gaps for growth and economic development;
Provide an overview of the possible transmission
channels from infrastructure to growth;
Discuss how the transmission channels are
evolving, with the increasing attention to gender
issues and considerations, and highlight
possible challenges and implications;
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Dynamics of growth under infrastructure
crisis in Africa
Africa’s growth and development prospects were
seen as superior to those of the overpopulated
Asia by many experts;
This view was particularly well captured by
Gunnar Myrdal in the Asian Drama;
Over time however, the overwhelming majority of
African countries fell to capitalize of these
favorable initial conditions—abundance of
natural resources and arable lands—to achieve
sustained economic growth and income
convergence;
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PPP-based per capita GDP comparison
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Singapore Gabon
Instead, growth rates fell far below expectations,
with negative averages after the 1974 oil shock;
Negative 0.5% in the late 1970s;
Negative 1.2% between 1980-1985;
Up to the first half of the 1990s, Africa average
growth rate fell to a record of negative 1.5%;
Noted scholars have referred to Africa’s growth
record as ―the economic tragedy of the 20th
century‖—Easterly and Levine (1997), Artadi
and Sala-i-Martin (2003);
Indeed, Sub-Saharan Africa is the only region of
the developing world that will miss most MDGs;
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Tracking progress toward halving poverty
0
10
20
30
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50
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1990 2000 2015
East Asia and Pacific
South Asia
Sub-Saharan Africa
Explaining Africa’s abysmal development
outcomes
Several models have been used to explain the
Africa’s economic tragedy and widening income gap
with other regions of the world, including:
Dutch Diseases;
Institutions, governance and rent-seeking;
Deficit of economic diversification;
Falling investment rates and infrastructure crisis;
Of all these models, sustained decline in capital
accumulation and investments, which over time
has led to infrastructure crisis appears as one of
the most consequential policy failure in the
region;13
Not least because several studies have
established the existence of a strong and positive
correlation between infrastructure and growth
(Ayogu (2007, Calderon and Serven (2008));
In fact, since the industrial revolution, any
progress on the development ladder has been
either paralleled or preceded by improvement
in infrastructure;
―Since the emergence of modern Europe … and
rise of capitalism, idiosyncratic energy regimes
have been important to the making of the three
successive leading world economic powers‖, Kevin
Phillips (2008);
14
Idiosyncratic referring to leading-edge energy
source or fuel in which a particular nation is, not
only well endowed, but made expert by a
unique acquaintance and economic and cultural
interaction;
Dutch: Wind and water to the seventeenth-
century—the Dutch empire captured wind for
power on sea and land through sails and
windmills with unmatched skills then;
Britain: Coal to the late-eighteenth-century;
USA: Oil to the early-twentieth-century;
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Correlation between transport indicators and PPP-
based PCGDP
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The infrastructure development-link is strong and
can be assessed from the standpoint of service
provision and export competitiveness;
Infrastructure serves two major purposes:
Provides services that are part of the consumption
bundle of residents;
Serves as input into production by augmenting the
productivity of labor and capital;
Conversely, the deficit of infrastructure can:
reduce productivity in the business sector;
reduce the rate of return to private capital formation,
and hence private capital accumulation;
lead to decline in real income in a context of increased
international competition;
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Definition: Infrastructure generally refers to the
relatively large physical capital facilities and
organizational knowledge and technological
frameworks that are fundamental to the
organization of communities and their economic
development;
Infrastructures include:
Highways and roads;
Mass transits and airport facilities;
Education, scientific and technological
infrastructures;
Electricity, gas and water supply facilities and
distribution systems;
Waste treatment and management systems;18
While Asian countries’ investments in key
infrastructures increased significantly and
consistently in the post-independence era, …
…Africa went through a long period of sustained
decline of public investments, which have
resulted in major infrastructure crisis with
long-term consequences;
With the exception of very few countries (Tunisia
and South Africa), a comparison between Africa
and other regions of the developing world on
most dimensions of infrastructure shows a
significant gap, reflecting Africa’s infrastructure
crisis—”Africa’s infrastructure stone age”;
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Table Comparative infrastructure indicators
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Power Tele
1996 2002 2008 1996 2002 2008
EAP 728.70 1029.07 1665.46 4.10 13.16 22.53
ECA 3272.48 3358.69 3845.32 17.04 22.79 25.52
LAC 1427.16 1578.43 1812.28 9.65 16.42 18.91
MENA 900.86 1143.92 1394.47 5.90 10.67 18.34
SSA 508.35 508.91 533.99 1.15 1.43 0.86
Note: ―Power‖ is electricity consumption (kwh per capita), and ―Tele‖ refers to
telephones lines (per 100 people).
Burden of electricity lost (share of working hours
lost due to power outages)
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Quality of road infrastructure by region (1991-2005)
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More than one in every three cities say that street capacity is a barrier to economic development.
The 2005 Transportation Partnership Package provided $16 million per year in new fuel tax distribution revenues
for cities. For municipalities serving 3.9 million residents, that $16 million builds approximately one mile of new
road.
Of the nearly 700 city owned bridges that are federally reported, 1 out of 4 are functionally obsolete, and
approximately 1 out of 10 are structurally deficient or weight restricted. This does not include the millions of dollars
needed to repair and replace structures under 20 feet.
Nearly 60% of our cities will need to replace a portion of their water distribution systems in the next 10 years.
One in every five cities report that the lack of drinking water capacity is a barrier to economic development.
Over 50% of our cities will need to replace a portion of their pump stations and collection systems in the next 10
years.
In more than one of every four cities, the lack of sewer/waste water capacity is a barrier to economic development.
98 cities face new Phase II state and federal stormwater requirements without any dedicated state assistance.
Numerous urban, commercial properties need new infrastructure and redevelopment if growth management is to
be successfully implemented. Yet these same properties are confirmed or
suspected as sites of contamination. Local governments want to take action but lack sufficient tools. Grants for
environmental cleanup of small sites is one glaring gap.
As cities struggle to accommodate increasing density, citizens are also demanding enhanced parks and open
space, trails, ballfields, and greenway corridors that help promote livability, recreation and
healthy lifestyles. Even with recent increases in the Washington Wildlife, Recreation and Parks (WWRP) program,
the state receives nearly $4 in requests for every $1 available –and several kinds of parks and community projects
don’t qualify for the funding.
Roads
Bridges
Drinking Water
Wastewater
Stormwater
Brownfields
Parks and
Open Space
Our Crisis:
The Africa’s infrastructure crisis has come
with long-term economic and social costs to
the region;
The crisis has adversely affected economic
growth rates;
Possible transmission channels include:
Private capital accumulation, with the poor
state of infrastructure not crowding-in private
investment;
FDI inflows;
Human capital accumulation;
Productivity and efficiency;
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Transmission Channels
Private Capital
Accumulation
Public capital
accumulation
infrastructure
Public capital
accumulation
infrastructureHuman capital
development
Private capital
accumulation
Human capital
accumulation
Productivity
enhancement
Economic
growth &
development
Productivity
enhancement
Economic
growth &
development
AFR
ASIA
ECA
Contrast between Africa and other regions
Africa is trailing other regions in the area of public
infrastructure and capital formation;
Africa is also lagging on human capital formation,
with 83 engineers per million, when the average
across developing world is about 514;
Consistent gaps across the growth chain have
been mirrored by income disparities between
Africa and other regions;
At the same time, the gender parity gap between
Africa and other regions has been less stark;
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Number of Researchers and Scientists
Countries and regions Scientists/engineers
in R&D
Sector of
performance (%)
Per mill. pop. Higher education Prod. enterprise Prod. sector
Industrialized economies 1102 22.9 1.037 1.043
Developing economies 514 22.2 0.041 0.054
Sub-Saharan Africa (exc. S. Africa) 83 38.7 0.002 0.000
North Africa 423 n/a n/a n/a
Latin America & Caribbean 339 23.4 0.041 0.082
Asia (excluding Japan) 783 25.8 0.244 0.231
European transition economies 1857 21.4 0.288 0.275
World (79-84 countries) 1304 24.7 0.318 0.337
Source: Calculated from UNESCO (1997). Regional propensities for R&D spending are simple averages.
R&D by financing
(% of GNP)
R&D propensities and manpower in major country groups (latest year available)
Infrastructure and growth: possible
transmission channels under engendered
growth models
The policies and programs promoting
gender equality may positively affect
growth through several channels:
Human capital development—increased
productivity of labor and other
complementary inputs to the production
process (higher marginal returns to schooling
for women);
Increased efficiency in the allocation of
different inputs;
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Differential marginal propensities to save—with
women potentially enjoying greater incentives
to save than men;
Stronger bequest motives and
intergenerational altruism;
Private capital accumulation, as the increasing
equalization of economic opportunities has
fueled the rising number of women
entrepreneurs;
For instance the power of microcredit
expanding the pool of women entrepreneurs;
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Public
Infrastructure
Development
Human capital
Accumulation
(Men)
Private Capital
Accumulation
Human capital
Accumulation
(Women)
Productivity
Channel
Higher growth
rate and
development
prospects
Transmission Channels
Although gender equality in access to public
infrastructure may indeed raise capital
accumulation and stock of infrastructure, …
… such a process may also be affected by intra-
household bargaining process;
Inter-temporal allocation of resources and time
preference resulting from that bargaining
process will affect saving and investment
decisions;
The relative bargaining power of women is
assumed to evolve as a function of the relative
wage of husband and wife and education level
of the latter;
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Initial conditions are equally important;
In the case of public infrastructure, access is
not always guaranteed by the provision;
Poverty-stricken households may continue to
have less access, even with the
implementation of policies to mainstream
gender;
However, even the emerging gender-neutral
growth theory—underpinned by long-run
public investment in education, health,
infrastructure and market access—has shown
predictably higher growth prospects;
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The theory emphasizes the
complementarity of efficiency and
equity—with the state investing in
services that supports and ―crowd-in‖
private investments;
Once again, these findings suggest that
infrastructure development may be
critical for growth and economic
development…
…even under the gender-neutral
assumption;
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Issues associated with infrastructure, gender
and development for consideration
It becomes important to show that growth
prospects of infrastructure development
are actually higher under the non-gender-
neutral model;
This is one of the main analytical gap that we
expect WDR2012 to address;
Can gender equality lead to sustainable growth
and development in the absence of basic
public infrastructure?
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Can frontier public infrastructure lead to sustainable
economic growth and development when designed
in a gender-neutral framework?
What would be the ideal development model for
sustainable growth?
Invariably frontier perspectives and thinking on both
infrastructure and gender equality;
Or inter-temporal trade-offs between gender equity and
infrastructure;
How would the production function under that
frontier thinking development—combined frontier
infrastructure development and gender equality—
be affected by country initial conditions—
income and threshold effects?36
How would that model be affected by intra-
household bargaining?
Consciously making irrational choice as the
price to pay for peace and stability;
Issue of sustainability of frontier perspectives in a
context of vulnerability to shocks and deficit of
human capital;
As the gender equality agenda take strong hold
across Africa, what should be the contours and
parameters of the vision underlying that agenda?
Could increased public investment in education,
scientific and technological infrastructure be the
real path towards irreversible attainment of gender
equality in Africa?37
Perspectives
In Africa, that infrastructure crisis is real and
was triggered by another economic crisis;
Over time, it took historical and dramatic
proportion, with most countries locked into the
stationary state of ―infrastructure stone age‖,…
…which has become one of the main constraints
to both women and men economic
empowerment and gender equality;
Unemployment rates are at Great Depression
levels in most countries throughout the region,
disproportionately affecting women;
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Bridging that infrastructure gap is a sine-qua-
none condition for economic development and
integration into the global economy;
Existing empirical studies are encouraging;
Calderon and Serven (2008) find that reducing in
half the gap between Africa’s infrastructure
development and the average in the comparable
income category would result in a 2.2 percentage
points gains in growth in Central African LIC;
This empirical result is not surprising—
infrastructure development has been the engine
for economic growth and development since
the industrial revolution;
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In the decades and centuries following the
industrial revolution, infrastructure development
played a key role in the advancement of
industrialized nations in Europe;
More recently, it has played in critical role in the
transformation of emerging market economies
in Asia;
In a book titled ―Lives of the Engineers‖
published in 1861, Samuel Smiles explained
how the English nations evolved from being
dependent on their European rivals to
becoming the commercial giant of the 19th
century;
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He credited scientists and engineers with playing a
significant role in the various development and
industrial projects that created the best
infrastructure in the world, then;
African countries can follow the same path
embraced by Britain then and more recently by
Asian EME, to ultimately exit the stationary state of
―infrastructure stone age‖ and poverty trap…
… bridge their technological and scientific
infrastructure gaps and effectively enter a virtuous
cycle of sustained growth and economic
development;
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Doing so a la Nordic—under a frontier perspective
underpinned by the development of gender-
informed modern infrastructure—may actually
create more prosperous and inclusive societies;
Incentives to enter that virtuous path will be further
enhanced by our ability to address the remaining
analytical gaps;
―how” and “why” gender equality matters for
the development of infrastructure and for
development in general;
Should African countries follow such a path, then
more than bridging the income gap with other
regions of the world, they could attain income
convergence a la Asian EME; 42
Income convergence (PCGDP in constant 2000 $US)
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What is the end objective of gender equality?
―Equality consists in the same treatment of
similar persons‖— Aristotle.
―Nobody will ever win the battle of the sexes.
There is just too much fraternizing with the
enemy‖— Henry Kissinger.
Thank You!
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