Global Redistribution and the Challenges of Externally Financing Social Policy and Development
The first international symposium of the AIDSOCPRO (Aiding Social Protection: the Political Economy of Externally Financing Social Policy in Developing Countries) research project, funded by the European Research Council and based at ISS in The Hague, part of Erasmus University Rotterdam.
16-17 February 2017 at ISS.
Please fill in this registration form if you would like to attend the symposium. You can attend either one day or both days, for part of a day or for the whole day. Please indicate on the form on which days you plan to attend.
The symposium is free to attend, but attendees are responsible for their own food, accommodation and transport costs.
About the symposium
The symposium will address a series of big thematic questions related to the AIDSOCPRO research project (see below for further details on this project). The principle aim is to stimulate critical reflections on global redistribution as an imperative to deal with the fundamental issues facing the world in the twenty-first century and also in terms of its potential consequences on development. Within this, the symposium will have a particular focus on the evolution of social policy systems in developing countries.
The symposium starts with the normative (and increasingly idealist) position that a bolder and more radical scaling up of global redistribution is urgently needed to confront the myriad challenges of contemporary development, as argued again by Andrew Fischer in a recent HDR background paper (and with regard to climate change). Such scaling up arguably needs to go well beyond the meagre levels garnered by the current aid system, which in many respects has failed to induce any significant degree of global redistribution and might have even contributed to broader processes that encourage reverse redistribution, towards wealthier rather than poorer countries.
From this starting position (which may be contested at the symposium), we will address the following thematic questions:
1) If we accept the need for large scale global redistribution, how might this actually occur, particularly in light of the evolution of international financial and trade flows in developing countries today? As discussed in the first working paper of the AIDSOCPRO project, global redistribution requires recipient countries to run trade deficits. How can this be achieved in light of the evolution of global imbalances, as discussed in the seminal work by Kregel (e.g. 2008) or Akyüz (e.g. 2015)? Is there an alternative to such macroeconomic patterns of redistribution? How can this be achieved in a manner that does not further reinforce the dependency and subordination of recipient countries, or else further provoke the already mounting momentum of populist right-wing reactions in wealthier countries?
2) Related to the first point, could the current aid system be fit for the purpose of scaling up of global redistribution despite its limited redistributive impact today, or should other modalities of global redistribution be conceived?
3) Should global redistributive flows be directed towards social expenditures in poor countries, e.g. social protection, or towards productive sectors and economic infrastructure? This relates to the relation of global redistribution with productive strategies of development, which can be explored at both global and national levels. For instance, aid and official debt played crucial roles in South Korean development by relaxing the external constraints that could have otherwise stifled or subverted many of the well-known domestic factors that contributed to its rapid industrialization (Fischer 2016). However, as pointed out by Bangura (2015), aid to South Korea was primarily focused on productive sectors and economic infrastructure rather than social programmes. This observation runs counter to current aid agendas, particularly the MDGs and now SDGs, that have given prominence to social infrastructure and services, whereas aid to productive sectors collapsed in the early 1990s as a proportion of total aid flows and never recovered.
4) What are the implications and consequences of directing aid towards social spending, in particular social protection, on the evolution of social policy in recipient countries and on development more generally? Here we are concerned about two aspects. One is on the struggles over the nature of social and development policies, between those lobbied by donors and international financial institutions versus those favoured by recipient governments, such as targeted cash transfers versus generalized price subsidies. The other concerns the perverse dynamics that are engendered when aid is directed towards sectors that, in principle, do not need aid and that some argue should not be financed by aid.
A concept note with further background and the symposium programme will be available shortly.
Keynote sessions and plenary panels
The symposium will be run as a series of keynotes and plenary panels with about 30 invited international experts from across the fields of social policy and finance and development.
The gathering is purposely eclectic in order to encourage new insights on the issues discussed. To this effect, panel presentations will be short and the time for debate and discussion will be privileged, both among the participants and with the general audience.
Jayati Ghosh, Professor of Economics, Jawaharlal Nehru University, New Delhi, India
‘The impact of monetary policy on social protection in developing countries, with lessons from recent demonetization in India.’
Jan Kregel, Director of research at the Levy Economics Institute, Head of the Institute’s Monetary Policy and Financial Structure program, and Professor of Development Finance at Tallinn University of Technology
‘International Financial Stability versus International Development Assistance.’
Thandika Mkandawire, Professor of African Development, London School of Economics, and former Director of the United Nations Research Institute for Social Development
‘The importance of bringing back functional income distribution in discussions about globalization and inequality, and its relation to global/national redistribution.’
Other participants include:
- Jimi Adesina, Professor and DST/NRF SARChI Chair in Social Policy, University of South Africa, Pretoria
- Getnet Alemu, Director, Institute of Development and Policy Research, Addis Ababa University
- Aysa Bugra, Professor of Political Economy and one of the founders of Social Policy Forum research centre at Bogazici University, Istanbul
- Lavinia Barros de Castro, Planning and Research Department, BNDES (Brazilian National Development Bank)
- Ana Celia Castro, Professor of Economics, Universidad Federal de Rio de Janeiro
- Amrita Chhachhi, Associate Professor, Institute of Social Studies, The Hague
- Sarah Cook, Director, Office of Research Innocenti, UNICEF, Florence.
- Geske Dijkstra, Endowed Professor of Governance and Global Development at Erasmus University Rotterdam
- Gary Dymski, Professor and Chair in Applied Economics at the Leeds University Business School
- Rolph van der Hoeven, Professor on Employment and Development Economics, ISS, The Hague
- Katja Hujo, Senior Research Coordinator in the Social Policy and Development Programme of UNRISD and member of the Institute’s Senior Management Group
- KS Jomo, former Assistant Secretary General for Economic Development in the United Nations system during 2005-2015
- Huck-Ju Kwon, Professor at Graduate School of Public Administration, Seoul National University
- Tom Lavers, Lecturer in politics, governance and management at the Global Development Institute, University of Manchester
- Lena Lavinas, Professor, Economics Institute, Federal University of Rio de Janeiro
- Manuel Montes, Senior Advisor on Finance and Development, South Centre, Geneva
- Yoshimi Nishino, Chief, Social Policy and Governance Programme, UNICEF Vietnam
- Isabel Ortiz, Director Social Protection, International Labour Organization (ILO)
- James Putzel, Professor of Development Studies and Director of the Crisis States Research Centre, London School of Economics
- Joel Rocamora, Former Co-Director of Transnational Institute, former Secretary/Lead Convenor of the National Anti-Poverty Commission, Philippines.
- Diego Sanchez-Ancochea, Director of the Latin American Centre; Associate Professor in the Political Economy of Latin America, University of Oxford
- Jeannette Sánchez Zurita, Professor of Macroeconomic and Economic Policy, Central University of Ecaudor; Adviser of the Vice-Presidency on Economic Affairs and Productive Transformation, Ecuador
- Charlotte Harland Scott, Fund Direct of Mwabu, former Chief of Social Policy and Economic Analysis for UNICEF Zambia and former First Lady of Zambia
- Verónica Serafini Geoghegan (Paraguay), Research Director at the Centro de Análisis y Estudios de la Economía Paraguaya (CADEP), former Coordinator of the Unit of Social Economy in the Ministry of Finance of Paraguay
- Alejandro Vanoli, Associate Professor of International Economics, University of Buenos Aires, former Chairman of the Central Bank of Argentina and Vice Governor from Argentina at the International Monetary Fund
- Rob Vos, Director, Agricultural Development Economics (ESA), Economic and Social Development Department, Food and Agriculture Organization of the United Nations (FA)
The contributions of ISS and, within ISS, the Political Economy of Resources, Environment and Population research group (PER) are gratefully acknowledged.
AIDSOCPRO (Aiding Social Protection: The Political Economy of Externally Financing Social Policy in Developing Countries; grant no. 638647) is a research project funded by the European Research Council (ERC) Starting Grant scheme.
The project officially started in May 2015 and runs for five years, led by Andrew M. Fischer, Associate Professor of Social Policy and Development Studies at ISS, and supported by a team of three PhD researchers, Ana Badillo Salgado, Emma Dadap-Cantal, and Benedict Yiyugsah, and one postdoctoral researcher, Charmaine Ramos.
It examines the tensions between the increasing emphasis by large bilateral and multilateral donors of directing aid towards social expenditures, in particular social protection, versus the political economy factors involved in donor-recipient relations that constrain and arguably undermine both global redistribution and national development, and how these influence the trajectories of social policy in developing countries. The objective is to re-orient our thinking towards a deeper appreciation of the systemic political and economic challenges facing global redistribution towards poorer countries.
Examining these tensions is urgent given the tightening financial cycle currently facing developing countries, which reinforces the leverage of donors as strategic providers of concessional foreign exchange to countries facing resurgent balance of payments constraints, even in situations where aid might only amount to a marginal addition to overall external financing needs. In such contexts, donor influence over policy making in recipient countries is enhanced in the name of redistribution, even when very little if any net redistribution might actually prevail.
The various financial and political quandaries involved in directing external financing towards social expenditures denominated in domestic currency (such as cash transfers) might also exacerbate ongoing tensions between donors and recipients regarding policy autonomy and so-called ‘national ownership’ of development policies. The confluence of these dynamics could quite possibly result in a variety of perverse and unexpected consequences for development in poorer countries, as explored by the project in relation to the social protection agenda currently favoured by donors, based on case studies in seven countries (Ecuador and Paraguay in Latin America, Ethiopia, Ghana and Zambia in Africa, and Cambodia and Philippines in South East Asia).
Set up in 2007 by the EU, the European Research Council is the first pan-European funding organization for frontier research. It aims to stimulate scientific excellence in Europe by encouraging competition for funding between the very best, creative researchers of any nationality and age.
It operates according to an investigator-driven approach, allowing researchers to identify new opportunities in any field of research, without thematic priorities, and with the aim to support up-and-coming research leaders to establish a proper research team and to start conducting independent research in Europe. Since 2007, the ERC has funded over 4,000 projects throughout Europe and across all scientific fields.