Organizer of the core conference: Michèle Tertilt (University of Mannheim)
Germany spends annually about 10 billion euros, almost half of one percent of its gross national product for development aid. More than 650 billion euro per year are spent worldwide for development aid. This corresponds to the gross national product of Turkey or New Zealand. Currently, there are more than 1000 German development aid workers in service. Nonetheless, many people are living in extreme poverty. The so called “Bottom Billion” has less than one euro per day available. Everyday 8500 children die because of hunger.
More than 35 countries have a per capita income lower than 1000 euro per year, which is less than three percent of the German per capita income. It is eminent to find out which kind of development aid is most effective. Should we supply technical help, for example water supply or medical care? Should we deliver aid at the macroeconomic level, e.g. establishment of better institutions, or would it be better to give and relinquish money for the countries which they can use on their own? Which strategies should the countries pursue for reaching a sustainable growth path?
Recent research applies more and more frequently field experiments in order to find out what is most effective in reducing poverty. Field experiments are used in many research areas: education, health and also corruption. Moreover, field experiences are useful for investigating in how far tutoring in management strategies generates more profit and long-lasting growth.
The improvement of understanding the factors of success is obtained by comparative analyses. Analogies to the development of nowadays rich countries are drawn. As it is not possible to use field experiments on the macro-economic level, recent researchers makes use of quantitative methods. Mechanisms of success are analyzed and quantified with the help of calibrated models.
We succeed in inviting internationally renowned researchers with a wide range of experience in various areas of research as keynote speakers. They will present the different perspectives of development aid.
Pascaline Dupas (Stanford University) research is dedicated to health care. Her tools of research a.o. are field experiments in order to solve health care issues of developing countries. She studies potential incentives to make people investing in their own health care and furthermore the improvement of health care systems. For instance, she explores incentive problems of distribution and usage of malaria meshes with the help of field experiments in Kenya.
Oriana Bandiera (London School of Economics) focuses on incentives in the public sector. A well-functioning public sector is the precondition for the development of human capital (e.g. schools) and physical capital (e.g. contract certainty). The role of individual incentives of different actors within the public sector (e.g. teachers, tax collectors, doctors) comes under her scrutiny. Based on field trials she analyses the crucial incentives for their motivation.
Fabrizio Zilibotti (University of Zurich) holds a chair of Macroeconomics. He analyses the secrets of China´s growth success. China was a poor country till the 1970s. Since the beginning of the 1980s, reforms have taken China on an extraordinary growth process. China reached an average growth rate of 9 percent per year in the first decade of the 2000s. Zilibotti examines the reasons for China´s poverty in the years prior to the 70s, the factors of success and gives an outlook for the future: Which factors are important to maintain the course of success?
Furthermore Matthias Doepke (Northwestern University) offers a macro-economic perspective. He focuses on the role of human resources in the development process. An important question is the creation of new ideas and how these can generate growth. Doepke uses theoretical models in order to get answers to these questions. He considers human capital from different perspectives: the transmission of knowledge from master to apprentice, the function of parents in the accumulation process of human capital from children and the role of the state offering public education. He identifies strategies of success for developing countries by taking the historical development of Europe as an example.
Moreover, a discussion about the challenges of development aid with recognized experts (from research and practice) will take place. Cornelia Richter (member of the board of Deutsche Gesellschaft für internationale Zusammenarbeit – GIZ), Dr. Norbert Kloppenburg (member of the board of Kreditanstalt für Wiederaufbau – KfW) and possibly Dr. Friedrich Kitschelt (State Secretary in the German Federal Ministry for Economic Cooperation and Development) will participate in a discussion round. Robin Burgess (London School of Economics and director of the International Growth Centers) and Karen Macours (Paris School of Economics) will also take part.