GlobalPublicPolicies_0515.qxd 8/15/01 9:21 AM Page i WORLD BANK OPERATIONS EVALUATION DEPARTMENT Global Public Policies and Programs: Implications for Financing and Evaluation Proceedings from a World Bank Workshop Edited by Christopher D. Gerrard Marco Ferroni Ashoka Mody 2001 The World Bank www.worldbank.org/html.oed Washington, D.C. GlobalPublicPolicies_0515.qxd 8/15/01 9:21 AM Page ii Copyright ©2001 The International Bank for Reconstruction and Development/THE WORLD BANK 1818 H Street, N.W. Washington, D.C. 20433, U.S.A. All rights reserved Manufactured in the United States of America First printing June 2001 1 2 3 4 04 03 02 01 The opinions expressed in this report do not necessarily represent the views of the World Bank or its member governments. The World Bank does not guarantee the accuracy of the data included in this pub- lication and accepts no responsibility whatsoever for any consequence of their use. 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Mody, Ashoka. HG3881.5.W57 G55 2001 338.91—dc21 2001035187 GlobalPublicPolicies_0515.qxd 8/15/01 9:21 AM Page iii This volume is based on a workshop that was organized by UNDP Evaluation Office World Bank Development Economics World Bank Operations Evaluation World Bank Resource Mobilization and Cofinancing With financial support from The Swiss Agency for Development and Cooperation GlobalPublicPolicies_0515.qxd 8/15/01 9:21 AM Page iv GlobalPublicPolicies_0515.qxd 8/15/01 9:21 AM Page v Contents IX FOREWORD Robert Picciotto XIII ACKNOWLEDGMENTS XV CONTRIBUTORS XXV ACRONYMS AND ABBREVIATIONS OPENING REMARKS 1 The World Bank and Global Public Goods Jan Piercy 7 UNDP and Global Public Goods Khalid Malik 13 PART I: KEYNOTE ADDRESS 15 Financing International Public Goods: A Historical Overview and New Challenges Richard N. Cooper 27 Floor Discussion 31 PART II: PANEL DISCUSSION 33 Six Reasons for a Global Public Goods Perspective on Development Inge Kaul 39 The Intersection of Development Assistance and International Public Goods Ravi Kanbur 43 Walking the Talk: Global Public Policy in Action Wolfgang Reinicke 49 Floor Discussion 55 PART III: ENVIRONMENTAL ISSUES 57 A Water-Secure World Ismail Serageldin 65 Floor Discussion GlobalPublicPolicies_0515.qxd 8/15/01 9:21 AM Page vi vi Global Public Policies and Programs 71 The Prototype Carbon Fund: Mobilizing Private and Public Resources to Combat Climate Change Ken Newcombe 79 Discussion: The Carbon Fund in the Bigger Picture Scott Barrett 83 The World Commission on Dams: Lessons Learned About Setting Global Standards John Briscoe 89 Floor Discussion 97 PART IV: HEALTH ISSUES 99 Creating Markets for New Vaccines Michael Kremer 107 WHO, Global Public Goods, and Health Research and Development Dean Jamison 113 Floor Discussion 123 PART V: KNOWLEDGE ISSUES 125 Lessons from the CGIAR: A Perspective from the South Francisco J. B. Reifschneider 131 Knowledge and Global Public Goods: Implications of the WTO’s TRIPS Agreement Jayashree Watal 139 The CGIAR at a Crossroads? Henry Shands 145 Reforming the Intellectual Property Rights System Carlos Correa 149 Floor Discussion 155 PART VI: ECONOMIC AND FINANCIAL GOVERNANCE 157 Global Financial Stability: Recent Achievements and Ongoing Challenges Morris Goldstein 163 Promoting Financial Stability as a Global Public Good Barry Eichengreen 171 Renovating the World’s Financial Architecture Matthew Fisher 175 Floor Discussion GlobalPublicPolicies_0515.qxd 8/15/01 9:21 AM Page vii Contents vii 181 PART VII: IMPLICATIONS FOR FINANCING GLOBAL PUBLIC GOODS 183 Financing Global and International Public Goods Todd Sandler 193 Financing Global Public Goods Scott Barrett 205 Global Public Goods and Official Development Assistance Karel van Kesteren 209 Floor Discussion 217 PART VIII: IMPLICATIONS FOR EVALUATING GLOBAL PUBLIC POLICIES AND PROGRAMS 219 Evaluating Global Public Policies and Programs Michael Scriven 223 Participatory or Bottom-up Evaluations: Preventing Global Public Goods from Becoming Club Goods Frans Leeuw 227 Important Questions for Evaluation Greg Ingram 231 Floor Discussion 237 ANNEX 239 Participants GlobalPublicPolicies_0515.qxd 8/15/01 9:21 AM Page viii GlobalPublicPolicies_0515.qxd 8/15/01 9:21 AM Page ix Foreword Robert Picciotto The volatility of cross-border private capital flows, the uncertain fate of na- tions disconnected from the knowledge-based global economy, and the en- vironmental stresses associated with current consumption patterns call for new approaches to the development assistance business. A combination of market failure and limited institutional capacity to in- fluence economic and social change across national borders underlies pub- lic discontent with aid. The time has come to reshape the development architecture to take account of the growing integration of the global econ- omy. It is now widely recognized that aid works better in countries that adopt fair, favorable, and predictable rules of the game for trade and investment. But the magic of the market has limits, especially for the poorest countries. The growing inequality and instability associated with globalization call for new development initiatives to help reduce poverty. Beyond supporting mar- ket-friendly reforms, aid strategies must be designed to overcome social and structural constraints to sustainable development. A reconsideration of development assistance practices has become nec- essary to emulate changes that have already taken hold in the private and voluntary sectors. By now, globalization has revolutionized the behavior of private entrepreneurs and financiers in open economies. A far-reaching trans- formation is also under way in civil society, with the advent of global al- liances of nongovernmental organizations. The emerging development assistance paradigm will be characterized by shared international develop- ment goals, improved coordination, harmonized practices, and reduced trans- action costs. GlobalPublicPolicies_0515.qxd 8/15/01 9:21 AM Page x x Global Public Policies and Programs The change process has just begun. Development assistance is still prof- fered largely through the funding of investment projects. These are not al- ways selected to be consistent with the demanding requirements of poverty reduction strategies. Yet, unless projects are specifically designed to improve policies and/or build institutions, they are not justified for external funding given the imperatives of development effectiveness under the globalized de- velopment order. The share of aid resources devoted to global policies and programs is still very small even though national economies are buffeted by global market trends, knowledge has overtaken capital as the main factor of production, and public policy specifically adapted to the integrated global economy has replaced public investment as the engine of growth. As long as national governments held sway over the commanding heights of the economy, the development system was bound to be focused on proj- ect financing and country-based plans. But it is by now clear that the weak- ening of national public bureaucracies to make room for a burgeoning civil society—as well as far-flung multinational businesses—calls for fundamen- tal adjustments in the modalities of development assistance. To be sure, a large gap needs to be filled in the provision of national pub- lic goods. Aid flows are still far too small to trigger and sustain the reform of economic, social, and environmental policies in developing countries. But increasingly the new development paradigm will have to make room for sup- port to global public policies and programs. Critical development problems that cannot be handled at the country level alone are rising in intensity. As a result, businesslike partnerships will grad- ually supplant national