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In his introductory essay in the European Journal of Development research, Juergen Wiemann concludes that the rise of the middle class in the developing world is a cause for optimism. Whether it is seems to me to depend on two factors in each developing country: the proportion of the population that meets a reasonable standard of being not only above some poverty line but sufficiently above that line to constitute a reasonably income-secure “middle class”; and the extent to which the middle class gets richer and bigger as a result of sufficient and sufficiently shared economic growth over the next 15 to 25 years. In other words, the middle class has to be big enough, and it has to continue (as it has in the last 15 years or so) to get richer and bigger still to warrant “optimism” about its role.

In early April 2015, the Cabinet of the Government of Bangladesh approved in principle its new National Social Security Strategy (NSSS), subject to some changes. Since independence, Bangladesh has instituted a range of social security schemes although the level of investment in conventional cash-based schemes has remained relatively low, at no more than 0.7% of GDP, while overall spending on social protection – once civil service pensions and food transfers are included – is over 2% of GDP). Research by Development Pathways has indicated that the impact of the current social security system is minimal, reducing the poverty rate by a mere 4.5%. The Government of Bangladesh has also been concerned about inefficiencies in the system as well as a proliferation of small schemes across a wide range of Ministries (often promoted and financed by development partners). The NSSS is an attempt by the government to bring coherence to the national social security system while also developing a long-term vision for a more modern and comprehensive system. Development Pathways – in collaboration with the Policy Research Institute (PRI) and SANEM – were contracted to support the Planning Commission in developing the Strategy.

Economists love free trade, not least for its positive effects on residents of poor countries, and naturally this has become a frequently invoked argument on behalf of the Trans-Pacific Partnership trade pact. "Here is an assessment from the Peterson Institute that Vietnam will be the biggest gainer from TPP," Tyler Cowen writes. "Do you get that, progressives? Poorest country = biggest gainer. Isn’t that what we are looking for?"

 

But Kimberly Ann Elliott, an economist at the Center on Global Development who studies the effects of trade policy on the global poor, says the issue is more complicated. Overall, she's neither strongly for nor strongly against TPP, and thinks its effects are likely to be small. But she also argues that supporters often exaggerate the benefits for developing countries, and that some of its effects will actually hurt the world's poorest people.

Income and wealth inequalities in most countries – in the West, the former

‘communist’ economies and in the developing world – have been on the rise in the

last three decades with some notable exceptions. Inequalities in the 19th century

(Figure 1) were much higher than before the Industrial Revolution. Following the

rise of workers’ movements in the West and the 1917 Bolshevik revolution, the

growth of inequalities of the previous century was reversed for over half a century

until the 1980s as the threat of the spread of communism inspired welfarist

redistributive reforms, giving capitalism a more human face. Such checks and

balances have been greatly weakened in recent decades, even though improved

economic performance in many developing countries, including sub-Saharan

Africa in the last decade, contributed to some convergence of incomes between rich

and poor countries.

Read the Report

 

The new issue of the South Bulletin focuses on the preparations and progress made towards a new climate agreement in the Twenty-first session of the UNFCCC Conference of the Parties (COP-21) to be held in Paris in December 2015, particularly during the COP-20 in Lima and a UNFCCC session in Geneva in February 2015.  These articles include:

• Substantive Negotiations to Begin in June for New Climate Agreement

• Understanding the Lima Climate Conference A Proxy Battle for the 2015 Paris Agreement

• Highlights of the Lima Decision on the Durban Platform

• The Climate Crisis is a Result of Corporate Profit, a New System is Needed – President Evo Morales of Bolivia’s Address in COP 20

• Equity as the Gateway to Environment Ambition

• Social justice, energy transition and climate change on the eve of the COP-21

 

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