The Belt and Road Initiative (BRI) is the Chinese government's effort to promote global development and interconnectivity through a vast network of transportation, energy, and telecommunications infrastructure projects. Involving over 140 countries, Beijing has clearly stated aims and methods for the Belt and Road, including that BRI contributes to economic development in participant countries and that all projects be carried out according to ‘five cooperation priorities’ representing win–win partnerships between China and BRI-participant countries. Taking China's stated aims as given, this paper argues that Beijing faces information and institutional constraints that prevent the successful planning, implementation, and operation of BRI. By employing ill-suited means to achieve their stated ends, Beijing undermines their own ability to carry out BRI successfully. This paper explores the mechanisms at work on the ground within BRI, utilizing case studies of BRI's flagship projects and BRI contract data as evidence for the theory.

It is now abundantly clear that social norms channel behaviour and impact economic development. This insight leads to the question: How do social norms evolve? In a companion paper (Voigt (2023). Journal of Institutional Economics, 20), I survey studies showing that geographical conditions can have direct and long-lasting effects on social norms. This paper goes one step further: It surveys studies that show how different geographical conditions affect both religious beliefs as well as traditions of family organization and how these, in turn, affect social norms.

We show that the exposure to war-related violence increases the quantity of children temporarily, with permanent negative consequences for the quality of the current and previous cohorts. Our empirical evidence is based on Nepal, which experienced a 10 year long civil conflict of varying intensity. We exploit that villages affected by the conflict had the same trend in fertility as non-affected villages prior to the onset of conflict and employ a difference-in-differences estimator. We find that women in affected villages increased their fertility during the conflict by 19%, while child height-for-age declined by 10%. Supporting evidence suggests that the temporary fertility increase was the main pathway leading to reduced child height, as opposed to direct impacts of the conflict.

It is now abundantly clear that social norms channel behaviour and impact economic development. This insight leads to the question: How do social norms evolve? This survey examines research that relies on geography to explain the development of social norms. It turns out that many social norms are either directly or indirectly determined by geography broadly conceived and can, hence, be considered largely time invariant. Given that successful economic development presupposes the congruence between formal institutions and social norms, this insight is highly relevant for all policy interventions designed to foster economic development. In a companion paper, the role of religion and family organization as potential mediators between geography and social norms assumes centre stage.

There is limited evidence about the role that participating in international trade has on the diffusion of technologies. This paper analyzes the impact of exporting on firms’ adoption of technologies that are more sophisticated, using a novel dataset, the Firm-level Adoption of Technology (FAT) survey, that includes more than 1,500 firms from Brazil. The survey provides detailed information about the use of more than 300 technologies, combined with data from Brazil's census of formal workers (RAIS) and Brazil’s exports data from the Ministry of Trade. To address some critical endogeneity concerns, we apply a difference-in-differences estimation with multiple periods to examine the effects of entering export markets on technology adoption. We find that exporting has positive effects on firms’ likelihood of adopting advanced technologies in business functions related with business administration, production planning, supply chain management, and quality control, which are important to manage tasks associated to export activities.

This paper deals with the phenomenon of poverty-trap regimes in Mexico, that is, self-reinforcing mechanisms in which municipalities which start poor remain poor. We develop a coordination game of poverty traps driven by strategic interactions of economic agents: people choose to complete or not their education levels since it might be excessively costly and unprofitable. A one-shot game is constructed and then converted into a system of differential equations in which strategies that perform relatively better become more abundant in the population. Applying evolutionary games and symbolic-regimes dynamics (nonparametric and nonlinear techniques), we show that Mexican regions are in poverty-trap regimes (stable and dynamically evolving low-level equilibria) characterized by incomplete education and low income since initial conditions (education and income per capita) are such (very precarious) that poverty is the stable steady-state situation. We examine scenarios to show that to overcome the high-poverty regime by the year 2030, it is necessary to reduce incomplete education by 10% in the 5-year periods 2020–2025 and 2025–2030 and increase per-capita income by 10% in both periods.

In response to Stephen Marglin’s call for new economies, the article points to the strong and vibrant tradition of feminist scholarship inside and outside academe, which is exploring alternatives to capitalism. The article takes up the concepts of meshworks, politics of place, feminist political ecology and community economies. It argues that feminist approaches are contributing to a new analytic that goes beyond developmentalism and recognises the importance of building a new economics based on the many progressive alternatives that are being imagined and articulated in local economic practices.

The current unsustainable growth of the world economy is largely a consequence of the crisis of social capital experienced by much of the world’s population. Declining social capital leads economies towards excessive growth, because people seek, in economic affluence, compensation for emotional distress and loss of resources caused by scarce social and affective relationships. To slow down economic growth requires an increase in social capital that is a fundamental contributor to happiness. From a wide range of possible approaches to increasing present happiness, this article suggests policies that would shift the economy to a more sustainable path. It focuses on a more politically sustainable set of proposals for a green ‘new deal’ than some of those currently under discussion.

This article uses empirical evidence, based on labour market indicators, to analyse the factors influencing the incidence of child labour in Pakistan, from both supply and demand sides. The level of demand for child labour is shown to be linked mainly to adult wage levels, the adult unemployment rate in an area, and the size of the informal and agriculture sectors. The supply of child labour is seen to be positively linked to the proportion of adult unemployment in the household. Unlike previous studies, the article analyses both demand and supply side factors in a context of poverty and takes account of the co-existence of formal and informal labour markets. Furthermore, to generalise the issue for a longer span of time (which previous studies fail to do), it adopts the methodology of a pseudo-panel approach based on that proposed by Deaton. This approach makes it possible to pinpoint more accurately the factors, and their interaction, that need to be considered in any effective policy approach to the issue of child labour. To prevent unintended consequences, a multi-faceted development approach is required.

This article critically analyses the opportunities for Australia to revitalise its strategically important manufacturing sector in the wake of the COVID-19 pandemic. It considers Australia’s industry policy options on the basis of both advances in the theory of industrial policy and recent policy proposals in the Australian context. It draws on recent work from The Australia Institute’s Centre for Future Work examining the prospects for Australian manufacturing renewal in a post-COVID-19 economy, together with other recent work in political economy, economic geography and labour process theory critically evaluating the Fourth Industrial Revolution (i4.0) and its implications for the Australian economy. The aim of the article is to contribute to and further develop the debate about the future of government intervention in manufacturing and industry policy in Australia. Crucially, the argument links the future development of Australian manufacturing with a focus on renewable energy.

Although the issue of redistribution is glossed over by Marglin, there are three reasons why decarbonisation must be accompanied by a massive scaling up of redistribution from the global North to South if the agenda is to be founded on a social justice approach. First, constructing a capital infrastructure in the South in a manner that maximises the potential for decarbonisation would tend to be very import-intensive. Hence, it would require external financing or else risk running aground through balance of payment constraints. Second, there is already a tendency in the global economy of siphoning resources from South to North, in particular through the increasing control over flows of value and wealth by Northern corporations from their commanding positions within international networks. Southern productivity needs to be contextualised from this perspective given the risk that climate negotiations lock in the subordination of Southern countries within these global networks, rather than seeking ways for Southern producers to leverage more value for the output and carbon emissions they are already producing. Third, population and labour transitions in the South place relatively greater pressure than in the past on employment generation in tertiary (service) sectors, in which distributive and redistributive processes play essential roles in bolstering labour demand. The neglect of global redistribution could undermine the capacity of Southern countries to face these broader development challenges, which are already immense even in the absence of decarbonisation. A key question is how to organise global redistributive transfers in a manner that does not continue to subordinate Southern populations to Northern interests. The challenge for decarbonisation is the forging of a political will for redistribution that is motivated by climate change rather than geopolitics, and that respects national ownership and self-determination.

Economic freedom is robustly associated with income growth, but does this association extend to the poorest in a society? In this paper, we employ Canada's longitudinal cohorts of income mobility between 1982 and 2018 to answer this question. We find that economic freedom, as measured by the Fraser Institute's Economic Freedom of North America (EFNA) index, is positively associated with multiple measures of income mobility for people in the lowest income deciles, including (a) absolute income gain; (b) the percentage of people with rising income; and (c) average decile mobility. For the overall population, economic freedom has weaker effects.

We employ a novel approach for analyzing the effects of relative consumption and relative wealth preferences on economic growth. In the pertinent literature, these effects are usually assessed by examining the dependence of the growth rate on the two parameters of the utility function that seem to measure the strength of the relative consumption and the relative wealth motives. Applying our fundamental factor approach, we identify specifications in which the traditional approach yields incorrect qualitative conclusions. The problematic specifications have the common unpleasant property that the parameter that seems to determine the strength of the relative consumption motive actually also affects the elasticity of intertemporal substitution of absolute consumption (and the strength of the relative wealth motive). Since the standard approach is unaware of the additional effect(s), it attributes the total change in the growth rate incorrectly to the change in the strength of the relative consumption motive.

This paper examines the implications for regional policy of new research on the role played by a failure in the ‘capacity to aspire’ [Appadurai, A. (2004), ‘The capacity to aspire’, in Rao, V. and Walton, M. (eds), Culture and Public Action, Washington, DC: World Bank.] in perpetuating disadvantage traps. After a brief review of the magnitude of the challenge that regional policy needs to confront, it provides a summary of the theoretical and empirical literature on poverty and aspirations failure (and the associated loss of agency, beliefs and self-efficacy). The key implication for the design of an inclusive regional policy is that it needs to address simultaneously the sources of external constraints (such as the availability of resources or adequate infrastructure) and mitigate the aspirations failure inherently linked to persistent disadvantage.

This special issue contains a selection of six articles in the field of environmental and resource economics, which were presented in INFER workshops and supported events over the last two years. The topics include the effects of income inequality and freedom of the press on environmental stringency; the trade-environment nexus in China; the behavior of cross-country growth rates with respect to resource abundance and dependence; a stochastic frontier analysis to show that technological change is biased more towards energy rather than labor; how recycling and environmental taxes can affect the imbalances between the availability of and the demand for rare earth elements; and the interaction between demographic features and environmental constraints in Caribbean small island developing states. The papers include three empirical contributions and three methodological approaches, which help to improve our understanding of these topics.

Despite complex interlinkages, insights into the multifaceted relationship between environmental risks and poverty can be gained through an analysis of different risks across space, time and scale within a single context using consistent methods. Combining geo-spatial data on eight environmental risks and household survey data from 2010–2014 for the case study of Vietnam, this paper shows: (i) at the district level, the incidence of poverty is higher in high risk areas, (ii) at the household level, poorer households face higher environmental risks, (iii) for some risks the relationship with household-level consumption varies between rural and urban areas, and (iv) environmental risks explain consumption differences between households, but less so changes over time. While altogether these analyses cannot establish a causal relationship between environmental risks and poverty, they do indicate that Vietnam's poor are disproportionally exposed. Given growing pressures due to climate change, addressing such risks should be a focus of poverty reduction efforts.

We assess Africa's prospects for enjoying a demographic dividend. While fertility rates and dependency ratios in Africa remain high, they have started to decline. According to UN projections, they will fall further in the coming decades such that by the mid-21st century, the ratio of the working age to dependent population will be greater than in Asia, Europe, and Northern America. This projection suggests Africa has considerable potential to enjoy a demographic dividend. Whether and when it actually materializes, and also its magnitude, hinges on policies and institutions in key realms that include macroeconomic management, human capital, trade, governance, and labor and capital markets. Given strong complementarities among these areas, coordinated policies will likely be most effective in generating the momentum needed to pull Africa's economies out of a development trap.

This paper comments on studies that aim to quantify the long-term economic effects of historical European settlement across the globe. We argue for the need to properly conceptualise «colonial settlement» as an endogenous development process shaped by the interaction between prospective settlers and indigenous peoples. We conduct three comparative case studies in West, East and Southern Africa, showing that the «success» or «failure» of colonial settlement critically depended on colonial government policies arranging European farmer’s access to local land, but above all, local labour resources. These policies were shaped by the clashing interests of African farmers and European planters, in which colonial governments did not necessarily, and certainly not consistently, abide to settler demands, as is often assumed.

Interpretations of the role of the state in economic change in colonial (1858-1947) and post-colonial India (1947-) tend to presume that the colonial was an exploitative and the post-colonial a developmental state. This article shows that the opposition does not work well as a framework for economic history. The differences between the two states lay elsewhere than in the drive to exploit Indian resources by a foreign power. The difference was that British colonial policy was framed with reference to global market integration, whereas post-colonial policy was framed with reference to nationalism. The article applies this lesson to reread the economic effects of the two types of state, and reflects on ongoing debates in the global history of European expansion.

In this paper we explore the relationship between the presence of agglomeration economies and regional economic growth in Spain during the period 1870-1930. The study allows us to revisit the existence of a trade-off between economic growth and territorial cohesion, and also to examine whether the existence of agglomeration economies could explain the upswing in regional income inequality during the early stages of development. In doing so, we present alternative indicators for agglomeration economies and estimate conditional growth regressions at province (NUTS3) level. In line with new economic geography models, agglomeration economies in a context of market integration widened regional inequality in the second half of the 19th century and hindered its reduction during the early decades of the 20th.