Optimizing Finance for Development
The World Bank Group recently adopted the "cascade framework" to "maximize finance for development." The cascade recommends that reforms be tried first, followed by subsidies, and then public investments. To understand the econo...
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| Format: | Working Paper |
| Language: | English |
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World Bank, Washington, DC
2018
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| Online Access: | http://documents.worldbank.org/curated/en/859191517234026362/Optimizing-finance-for-development http://hdl.handle.net/10986/29286 |
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okr-10986-292862021-06-08T14:42:48Z Optimizing Finance for Development Cordella, Tito CASCADE FRAMEWORK FINANCE DEVELOPMENT AID GOVERNANCE SUBSIDIES PUBLIC INVESTMENT REFORMS PUBLIC SECTOR MANAGEMENT The World Bank Group recently adopted the "cascade framework" to "maximize finance for development." The cascade recommends that reforms be tried first, followed by subsidies, and then public investments. To understand the economics of the cascade, this paper presents a model where reforms, subsidies, and public investments can be used to fill the investment gap, and computes the welfare associated with their different sequencing. The cascade is optimal when reforms increase efficiency at no cost. When they are costly, if policies can be project specific, their sequencing does not matter; if not, the cascade can be optimal if agents are myopic, but not if they are forward-looking. Tensions may thus arise between maximizing private financing and optimizing financing for development. 2018-01-31T20:12:38Z 2018-01-31T20:12:38Z 2018-01 Working Paper http://documents.worldbank.org/curated/en/859191517234026362/Optimizing-finance-for-development http://hdl.handle.net/10986/29286 English Policy Research Working Paper;No. 8320 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper |
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Digital Repository |
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Foreign Institution |
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Digital Repositories |
| building |
World Bank Open Knowledge Repository |
| collection |
World Bank |
| language |
English |
| topic |
CASCADE FRAMEWORK FINANCE DEVELOPMENT AID GOVERNANCE SUBSIDIES PUBLIC INVESTMENT REFORMS PUBLIC SECTOR MANAGEMENT |
| spellingShingle |
CASCADE FRAMEWORK FINANCE DEVELOPMENT AID GOVERNANCE SUBSIDIES PUBLIC INVESTMENT REFORMS PUBLIC SECTOR MANAGEMENT Cordella, Tito Optimizing Finance for Development |
| relation |
Policy Research Working Paper;No. 8320 |
| description |
The World Bank Group recently adopted
the "cascade framework" to "maximize finance
for development." The cascade recommends that reforms
be tried first, followed by subsidies, and then public
investments. To understand the economics of the cascade,
this paper presents a model where reforms, subsidies, and
public investments can be used to fill the investment gap,
and computes the welfare associated with their different
sequencing. The cascade is optimal when reforms increase
efficiency at no cost. When they are costly, if policies can
be project specific, their sequencing does not matter; if
not, the cascade can be optimal if agents are myopic, but
not if they are forward-looking. Tensions may thus arise
between maximizing private financing and optimizing
financing for development. |
| format |
Working Paper |
| author |
Cordella, Tito |
| author_facet |
Cordella, Tito |
| author_sort |
Cordella, Tito |
| title |
Optimizing Finance for Development |
| title_short |
Optimizing Finance for Development |
| title_full |
Optimizing Finance for Development |
| title_fullStr |
Optimizing Finance for Development |
| title_full_unstemmed |
Optimizing Finance for Development |
| title_sort |
optimizing finance for development |
| publisher |
World Bank, Washington, DC |
| publishDate |
2018 |
| url |
http://documents.worldbank.org/curated/en/859191517234026362/Optimizing-finance-for-development http://hdl.handle.net/10986/29286 |
| _version_ |
1764468964459544576 |