Small-scale water technology
for livelihoods
7 Sanitation and water
Community-managed water
supply and sanitation
8 Sanitation and water
Research on water productivity
in food production
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CHALLENGE
OPPORTUNITY
9 Governance and corruption
Lowering the cost of starting a
new business
FAIR
10 Migration
Lowering barriers to migration
for skilled workers
11 Malnutrition and hunger
Improving infant and child
nutrition
12 Communicable diseases
Scaled-up basic health services
13 Malnutrition and hunger
Reducing the prevalence of Low
Birth Weight
BAD
14 Migration
Guest-worker programs for the
unskilled
15 Climate change
Optimal carbon tax
16 Climate change
The Kyoto Protocol
17 Climate change
Value-at-risk carbon tax
Ranking the proposals
In ordering the proposals, the panel was guided predom-
inantly by consideration of economic costs and benefits.
The panel acknowledged the difficulties that cost-benefit
analysis (CBA) must overcome, both in principle and as a
practical matter, but agreed that CBA was an indispens-
able organizing method. In setting priorities, the panel
took account of the strengths and weaknesses of the spe-
cific cost-benefit appraisals under review, and gave weight both to the institutional preconditions for success and to the demands of ethical or humanitarian urgency. As a
general matter, the panel noted that higher standards of
governance and improvements in the institutions required
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to support development in the world’s poor countries were
of paramount importance.
Some of the proposals (for instance, the lowering of
barriers to trade or migration) face political resistance.
Overcoming such resistance can be regarded as a “cost” of
implementation. The panel took the view that such political costs should be excluded from their calculations: They concerned themselves only with those economic costs of delivery, including the costs of specific supporting institutional reforms, which would be faced once the political decision
to proceed had been taken.
For some of the proposals, the panel found that informa-
tion was too sparse to permit a judgement to be made. These proposals, some of which may prove, after further study, to be valuable, were therefore excluded from the ranking.
Each expert assigned his or her own ranking to the pro-
posals. The individual rankings, together with commen-
taries prepared by each expert, will be published in due
course. (The chapters and other material have already been placed in the public domain.) The panel’s ranking was calculated by taking the median of individual rankings. The
panel jointly endorses the median ordering shown above as
representing their agreed view.
Communicable diseases
The panel ranked at 1 new measures to prevent the spread of HIV/AIDS. Spending assigned to this purpose would yield
extraordinarily high benefits, averting nearly 30 million
new infections by 2010. Costs are substantial, estimated at $27 billion. Even so, these costs are small in relation to what
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stands to be gained. Moreover, the scale and urgency of the problem – especially in Africa, where AIDS threatens the
collapse of entire societies – are extreme.
New measures for the control and treatment of malaria
were jointly ranked at 4. At $13 billion in costs, the benefit-cost ratio (BCR) was somewhat lower than for the pro-
posals on HIV/AIDS and malnutrition and hunger, but
still extremely high by the ordinary standards of project
appraisal, especially for the provision of chemically treated bednets (ITNs). Again, the scale and urgency of the problem are very great. Scaled-up basic health services were ranked at 12.
Malnutrition and hunger
Policies to attack malnutrition and hunger were ranked
at 2. Reducing the prevalence of iron-deficiency anaemia
by means of food supplements, in particular, has an excep-
tionally high BCR; of the three proposals considered under this heading, this was ranked highest at $12 billion. The
expert panel ranked a second proposal, to increase spending on research into new agricultural technologies appropriate for poor countries, at 5. Further proposals, for additional spending on infant and child nutrition and on reducing the prevalence of LBW, were ranked at 11 and 13, respectively.
Global trade reform
The panel considered three main proposals for global
trade reform: first, multilateral and unilateral reduction of tariffs and non-tariff barriers (NTBs), together with the
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elimination of agricultural subsidies; second, extension of regional trade agreements (RTAs); third, adoption of the
‘Everything But Arms’ (EBA) proposal for non-reciprocal
lowering of rich-country tariffs on exports from the least developed countries (LDCs). In the case of trade reform,
lives are not directly and immediately at risk. However,
the first proposal – free trade – was agreed to yield excep-tionally large benefits, in relation to comparatively modest adjustment costs, both for the world as a whole and for the developing countries. Accordingly it was ranked at 3. (Some members of the panel argued that since this proposal need
not involve any budgetary outlays, it should be acted upon in any case, regardless of the resources available for additional budget outlays.) The proposal to extend regional free trade areas (FTAs) was not ranked, for lack of information on particular agreements. The proposal for non-reciprocal
lowering of barriers to exports of the LDCs was also not
ranked, with some members of the panel noting that this
proposal would harm many poor countries not participat-
ing in the arrangements, and encourage those that did par-
ticipate to invest in activities that were not internationally competitive.
Sanitation and access to clean water
The panel agreed with Chapter 8 on sanitation and access to clean water that the lack of safe and affordable access to these services is a great burden for more than a billion of the world’s poorest people. Almost half of the people living in developing countries suffer at any given time from one
or more water-borne diseases. Three proposals,
including
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small-scale water technology for livelihoods, were regarded as likely to be highly cost-effective and were ranked at 6, 7, and 8.
Governance and corruption
The experts considered five proposals for improving gov-
ernance in developing countries. Although agreeing, as
already noted, that better governance is very often a precondition for progress of any kind, the panel thought it inappropriate to include four of these proposals in their ranking.
This is because these reforms involve costs of implementa-
tion that will differ greatly according to each country’s particular institutional circumstances. The experts felt they had too little specific information to make a judgement about
what those costs might be. The panel did, however, express its support for the proposal to reduce the state-imposed
costs of starting a new business, on the grounds that this policy would not only be enormously beneficial but also
relatively straightforward to introduce. This proposal was ranked at 9.
Migration
Policies to liberalize international migration were regarded as a desirable way to promote global welfare and to provide economic opportunities to people in developing countries. A lowering of barriers to the migration of skilled workers was recommended, and ranked at 10. Guest-worker programs,
of the sort common in Europe, were not recommended,
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owing to their tendency to discourage the assimilation of
migrants.
Climate change
The panel looked at three proposals, including the Kyoto
Protocol, for dealing with climate change by reducing emissions of carbon. The expert panel regarded all three pro-
posals as having costs that were likely to exceed the ben-
efits. The panel recognized that global warming must be
addressed, but agreed that approaches based on too abrupt
a shift toward lower emissions of carbon were needlessly
expensive. The experts expressed an interest in an alter-
native, proposed in Mendelsohn’s perspective opposition
paper, which envisaged a carbon tax much lower in the first years of implementation than the figures called for in Clinés paper and Chapter 1 rising gradually in later years. Such a proposal, however, was not examined in detail in the presentations put to the panel, and so was not ranked. The panel urged increased funding for research into more affordable
carbon-abatement technologies.
Access to education
The panel considered proposals to improve the provision of education in developing countries. It agreed that in countries where spending on education at present is very low,
the potential exists for large benefits in return for modestly increased spending. However, the institutional preconditions for success are demanding and vary from case to case:
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Experience suggests that it is easy to waste large sums on education initiatives. Given this variety of circumstances and constraints, the panel chose not to rank any proposals in this area. However, the experts did endorse the view that externally supervised examinations improved accountability of schools and should be promoted. They also expressed an interest in schemes to reduce, in a targeted way, the fees charged in many developing countries for public education, and to pay grants to families that send their children to
school. More research on experience with such schemes is
needed.
Conflicts
In considering a series of proposals for reducing the incidence of civil wars, the panel unanimously agreed with
Chapter 3’s assessment that the human and economic costs of such conflicts are enormous – even larger, in fact, than is generally assumed. Measures to reduce the number, dura-tion, or severity of civil wars would stand very high in the ordering, if they could be expected with any confidence to succeed. Members of the panel were not persuaded that the
proposals put before them met that test. The panel noted
the strong prima facie case for additional financial support for regional peacekeeping forces in post-conflict countries that meet certain criteria, but felt that the information before them was insufficient for them to assign a ranking.
The experts also noted the evidence that growth in incomes reduced the long-term incidence of civil war; to the extent that should their highest ranked proposals raised incomes,
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they would have the additional benefit of reducing the incidence of conflict.
Financial instability
Four proposals before the panel addressed the issue of international financial instability. The panel, noting the complex-ities and uncertainties in this area, chose not to come to a view about which, if any, of these proposals to recommend.
They were therefore not ranked.
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Index
Abatement costs of carbon
in corruption control, 89, 93
dioxide emissions, 7–9, 12,
education and, 67–68, 69
15
Alleviation strategies
Accountability
HIV/AIDS, 29
in education, 68, 72
malaria, 25
in government, 82–84, 89
Anemia, reduction in, 104–105,
in water management, 131
169
Active selection systems, 116,
Artimisinin-based combination
117–119, 126, 128
therapy (ACT) for malaria,
Africa
26
HIV/AIDS in, 169
Asia, irrigation technology in,
malaria deaths in, 23
139
water challenge in, 137, 139
Asia Pacific Economic
Agriculture
Cooperation (APEC), 151
and malnutrition, 105–106,
169
Benefits of discounting, 5
peri-urban, 133
Breastfeeding, promotion of,
subsidies, removal of, 152–153
103–104
trade liberalization
Bribery
and civil war, 54
annual expenditure on, 77
migration and, 123
and government, 80
water use by, 130, 132, 134,
reduction of, 86
138–140, 143
Businesses and corruption, 79,
in wetlands, 134
86, 88, 89, 92
Aid
and civil war, 46, 49–50, 52, 54
Canada, migration to, 117
175
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Index
Carbon dioxide
opposing views of, 53–56
emissions
overview, 39, 51
abatement costs of, 7–9, 12,
post-conflict risk reduction,
15
49–51, 54, 56
economic damages by, 6
prevention strategies, 44–48,
policy standards for, 3–4
55–56
taxation of, xvii, 9, 10, 13,
shortening, opportunities for,
15, 16–18
48–49, 54, 56
in global warming, 2
welfare and, 40
sequestration, 15
Class size and learning
Children
achievement, 62–64
education, cost of, 61
Climate change. See also global
health services for, 31
warming
malaria deaths in, 23
policy, international, 3–4
mortality rates of, 19, 99
as priority, xvii, 14–18, 172
nutrition, improvement of,
Climate Sensitivity parameter, 11
103–104
Commodity trading system
Chile, trade liberalization in, 161
reform and civil war,
China
47–48, 52
trade liberalization in, 161, 162
Condoms and HIV/AIDS, 29
water challenge in, 136, 142
Conflict diamonds, 48, 49, 54
worker education in, 123
Conflict trap, 43
Citizen involvement in policy
Conflicts. See Civil wars,
reform, 82–84, 89
reduction of; War
Civil service reform, 84–85
Consumption and prioritization,
Civil wars, reduction of
5
benefits, 40–44, 54
Contracting, corruption in,
commodity trading system
84–85
reform and, 47–48, 52
Copenhagen Consensus 2004
conflict intensity reduction, 55
criticism of, xvii, xviii–xix
cost analysis of, 53
described, xii–xiv
economy and, 40, 44–48
proposals, ranking of, 167–168
global impact of, 43
purpose of, xi, xx, 165–166
health and, 42, 43
results of, xiv, xvi–xix, xx
migration and, 43
Copenhagen Consensus Youth
military spending and, 40, 42,
Forum, xviii
50–51
Corruption
natural resource income and,
businesses and, 79, 86, 89, 92
46–48, 54
causes/consequences of, 78–80
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