Globalisation has transformed agriculture trade in fundamental ways. There is a rising share of high-value and processed food products and falling importance of bulky low-value items. At the same time, marketing channels have changed structurally, with larger and more concentrated sellers of final products and inputs involving multinational enterprises. With the growth in demand for processed products, globalisation has also resulted in a concentration in processing. Further, food services sectors and intellectual property issues have become important in agricultural trade. As these changes occur, developing countries have been beset with continuous fragmentation of land holdings, pitching smaller farmers against oligopsonistic buyer and oligopolistic sellers. However, because of changing demand for types of product and product attributes, as well as greater value addition, poor countries and smaller farmers have significant opportunities from globalisation. Exploiting these opportunities requires innovations that incorporate the comparative advantage of smaller countries and farmers and coordination to improve bargaining power.
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Since the early 1990s, several emerging market and developing economies (EMDEs) have opened up their markets for domestic as well as international financial liberalisation. While we can observe considerable variations in the details of the policies adopted by individual countries, the common denominator across such policy initiatives remains a consistent attempt to invite cross-border flows of private capital into their financial systems involving both domestic and foreign players. With the wave of banking globalisation paving the way to increased foreign bank penetration in emerging and developing economies, this chapter surveys the implications of foreign bank entry in emerging market and developing economies on economic development.
Lena Rethel and Iain Hardie
Bond finance plays an increasingly important role in debates about financial development, if not economic development more broadly. In this chapter, we first situate bond finance vis-à-vis other financing techniques. We will then provide a brief overview of the historical evolution of bond finance and how this has in turn informed the research field. In the section thereafter, we discuss challenges with measuring bond market development. The final section looks at two new and emerging areas of bond finance research of particular importance to low- and middle-income countries, namely, attempts to develop a regional bond market in Asia and the emergence of sukuk, bond-like financial instruments that seek to comply with Islamic principles.
Zovanga L. Kone and Çağlar Özden
While total global migration has been relatively stable as a share of world population, we are witnessing a rapid increase in the number of high-skilled migrants. After identifying interesting patterns revealed by the existing data, the chapter focuses on the economic impact on the sending, mostly developing, countries. The initial focus of the literature was brain drain and the potential losses of tax revenue and productivity spillovers in origin countries. More recent contributions, however, identified several channels through which high-skilled emigration might bring benefits. Among these are the brain gain (endogenous increase in human capital investment) and brain circulation and network effects (knowledge diffusion and global economic integration).
‘Capital controls’ are regulations implemented by governments in order to manage international financial transactions. Recently these have been referred to as ‘capital flow management’ techniques (CFMs) or capital account regulations (CARs). There has been a sea change in recent years in the ‘official’ perception by economists and policy makers with respect to the desirability and viability of capital controls (CARs, CFMs). Whereas previously, capital controls were seen as a costly and inefficient intrusion into the free market allocation of global finance, now, capital flows are perceived to be highly variable – even ‘fickle’ – and capital account regulations are seen as a potentially useful tool to manage these flows. Empirical evidence on the efficacy, benefits and costs of capital account regulations is growing.
Culture is a complex concept that needs to be defined in itself, even as we take into account its dominant uses that tend to do otherwise. Setting out a workable definition requires an understanding of the process of culture while relating the concept to its conceptual framing. In the context of globalisation and development this becomes difficult because culture tends to be treated as secondary. Rather than discussed directly as part of a triangle of processes and outcomes – culture, globalisation and development – culture tends to be treated, first, as an add-on to other primary processes, such as economic development or modernisation, secondly, as the outcome of those processes with the emphasis on content, and/or thirdly, as a relatively unchanging background feature. This chapter brings culture ‘back in’ as critical to debates about globalisation and development, defining it as a social domain that emphasises the practices, discourses, and material expressions, which, over time, express the continuities and discontinuities of social meaning of a life held in common.
James K. Boyce and Léonce Ndikumana
Many developing countries have experienced large-scale capital flight at the same time as they were borrowing from external creditors. The dual phenomena of external debt and capital flight raise important questions. Why does capital flee developing countries even as foreign creditors continue to lend to them? Is there a link between inflows of borrowed money and outflows of capital flight? If so, what is the connection? Simultaneous external borrowing and capital flight reflect perverse incentive structures on both sides of the transactions that foster behaviour that is harmful from the standpoint of the borrowing country and, if the borrower ultimately cannot repay, from the standpoint of creditor institutions as well. Strategies to address the problem of capital flight must include mechanisms to curtail corruption, recover stolen assets, relieve the burdens of external debts, and promote transparency and due diligence in banks and other financial institutions. If well designed and rigorously implemented, such initiatives can curtail malfeasance, improve incentive structures, and contribute to a more efficient and equitable international financial architecture.
Enrique Desmond Arias
This chapter examines the complex security implications of the global illicit drugs market. Building on an analysis of the narcotics supply chain from production to consumption this chapter focuses on the implications of this trade for the economy, politics, corruption, criminal violence, and health. Through this empirical analysis, the chapter argues that standard security approaches, which concentrate on the projection of state power over territory, fail to account adequately for the nuanced effects that the narcotics trade has on political and social life. A human security approach that focuses on the effects of the drug trade on individuals and communities, rather than primarily on institutions and territory, offers a pathway to development of more effective public safety and broader security policies that address the needs of citizens and well as states.
Beginning with an outline of the origins of economic and social rights found within the Universal Declaration of Human Rights and the International Covenant on Economic, Social, and Cultural Rights, this chapter provides an overview of the current state of quantitative economic and social rights research. The focus begins with general indicators of economic and social rights outcomes, such as the Social and Economic Rights Fulfillment Index and ultimately considers the nascent research on specific rights including the rights to social security and work, the right to a healthy environment, and the rights to education and health.
Odongo Kodongo and Kalu Ojah
Several years after the beginning of the implementation of liberalisation policies, particularly promoted by the Washington-based global development institutions, there has been increased interaction between emerging equity markets and other equity markets that has heightened volatility transmission and covariation in liquidity risks across markets. However, currency risk, liquidity risk and other asset price- and market-impacting factors still remain, and still provide international investors a platform for diversification. Several of these important factors command a premium which suggests that the costs of external equity capital still face upward pressures, in spite of liberalisation policies implicitly aimed at driving them down. Our attempt to make sense of the evolving body of works in the area suggests that emerging market economies should carefully sequence the implementation of financial policies with, preferably, institutional and legal reforms preceding financial openness and/or that financial openness must be approached wisely in ways that minimise its destabilising effects on the cost of equity (for example, by concurrently provisioning requisite institutional infrastructure that foster efficiency of markets and mitigation of asset price distortion). Furthermore, we conspicuously flag areas needing future research.