Charles Kenny

An End to the Investment Project?

This is an *old* paper  (2012) that I submitted to CGD for peer review and it got shot down. I can't remember why, and I re-used some of the material in Results not Receipts but it has some interesting data in it and I still think I broadly agree with it so, with that caveat lector, here it is.  For many donors throughout most of their history, the major assistance model has involved the tool of the investment project.  This is based on a theory of aid and development that the key constraint facing developing countries seeking rapid growth is lack of investment and that donor financing to overcome that ‘investment gap’ can be overseen through the project process to ensure that it is efficiently spent to generate high returns.  In reality, filling an ‘investment gap’ is neither an empirically well justified nor a practically well-implemented aid strategy.  Furthermore, procurement oversight mechanisms appear to be doing a poor job at ensuring the average effectiveness of an investment portfolio in a country is significantly enhanced, or transferring knowledge, or building institutions.  The procurement-focused project investment model should be limited in use to in cases where (i) a project design is significantly innovative and/or delivers regional or global public goods and/or aid is a large percentage of country investment and no agreement can be reached between donors and government on overall investment priorities in that country and (ii) alternate project approaches like output-based or cash on delivery models are deemed inappropriate.

The Case for Transparency in Power Project Contracts: A Proposal for the Creation of Global Disclosure Standards and PPA Watch

A GCD Policy Paper with Todd Moss and Mohamed Rali Badissy.  The purpose of a nation’s power sector is to deliver reliable electricity at the lowest cost and for the greatest benefit. At the heart of any private electricity generation project is a Power Purchase Agreement (PPA), a contract that contains key provisions such as price, payment stipulations, and obligations by the offtaker utility and/or host-government. Despite their significant effects on service quality and public finances, these contracts are often negotiated and signed in secret, with even the most basic terms shielded from the citizenry. This opacity has created risks and, in a growing number of cases, contributed to costly and damaging outcomes, such as overpayment, overcapacity, large debts, and grid instability. Drawing on examples from enhanced transparency in public budgets, sovereign debt, and extractive industries, we propose that governments agree to publish PPAs with any public sector obligation and that funders of private generation projects also agree to minimum disclosure standards. The objective is to create incentives for better practice, improve governance of the power sector, reduce transaction costs, and ultimately, to deliver cheaper and more reliable power for people and businesses. Transparency of PPAs would support the efforts of government policymakers and planners, investors, and development finance institutions to accelerate energy market development and to reap the benefits of open competition. Greater disclosure would also provide crucial information for citizens to hold their own governments accountable for the contracts they sign on behalf of the public.

Your World, Better

Your World, Better: Global Progress and What You Can Do About It is a book written for the smart and engaged middle school student.  It looks at how America and the World has changed since the reader's parents and grandparents were young: what has happened to health and wealth, homes, school and work, rights and democracy, war and the environment, happiness and depression.   It talks about the things that have gotten better, the sometimes-intensifying challenges that remain, and what readers can do about them. 

Your World Better is optimistic, but it doesn’t shy away from the considerable problems we face: from inequality through discrimination and depression to climate change and infectious threats.  It is meant to encourage kids to help make the world better themselves: tip them from a sense of powerlessness toward action, not into complacency.

The pdf of Your World Better is available to download here for free.  Or you can buy a kindle version for 99 cents or a hard copy for $8.10 on Amazon (or six pounds on UK Amazon here).  Any author royalties from those sales will be donated to UNICEF (so far, a bit more than $800 has been donated, thanks!). I talk about the book to Marian Tupy for the Human Progress podcast and to two (fantastic) middle schoolers for NPR.  Then I did a Slack chat with five middle schoolers for Slate. A CGD discussion about the book and talking to children about progress is here. And here's a fifteen minute video about the book (or try it on Youtube).  I am happy for the *text* (not pictures) to be copied or redistributed in any medium, and/or remixed or transformed for any purpose, with attribution.

"Everyone, no matter how old, or how young, should read this. I’m sending to grandkids and their parents." --Nancy Birdsall

"Great read for middle school kids who want to understand how the world is getting better -- and can become even more so!" --Parag Khanna

"How can you pass up a free book?! And one that is so relevant for today? If you know a middle school student or teacher, pass this along! Incredibly fresh and honest." --Karen Schulte 

"Kids are taught that everything's getting worse and we're all doomed--factually incorrect, and a message that leads to cynicism & fatalism, not constructive action. An antidote: Charles Kenny's new Your World, Better..." --Steven Pinker

 

Five Principles for Use of Aid in Subsidies to the Private Sector

A policy paper for CGD.  There is a significant and ongoing ramp-up in support for explicitly subsidized official development finance to the private sector around the world, but its role remains poorly defined. Lessons from the aid effectiveness literature as a whole and principles on effective use of aid suggest the need for approaches that do not merely finance the marginal private investment. Regarding experience of government intervention in markets, subsidies are only one of many options to incentivize the private sector, and bespoke subsidies provided by outside actors are rarely likely to be the most efficient form. This paper discusses where outside subsidy of the private sector may make sense and develops principles for the use of aid in subsidies based on that analysis. Subsidies should be allocated on the basis of necessity in meeting public policy goals; the norm for subsidy allocations should be competitive approaches or open offers; non-competitive subsidies should only support market making; subsidy levels should be capped; and subsidy levels should be transparent. Much of the content of these “new” principles is already implied or specified by the existing Multilateral Development Bank Principles to Support Sustainable Private Sector Operations, but they suggest that development finance institutions should not use their standard business model when using subsidies.

New procurement guidelines shed light on secrecy versus public right to know

A piece for the Contracting Excellence Journal with Caroline Anstey, summarizing The Principles on Commercial Transparency in Public Contracts.  

Examining the Impact of E-Procurement in Ukraine

A CGD Working Paper  examines the impact of Ukraine’s ambitious procurement reform on outcomes amongst a set of procurements that used competitive tendering. The ProZorro system placed all of the country’s government procurement online, introduced an auction approach as the default procurement method, and extended transparency. The reform was introduced with a dramatic increase in the proportion of government procurement that was conducted competitively. This paper examines the impact of ProZorro and reform on contracts that were procured competitively both prior to and after the introduction of the new system. It finds some evidence of impact of the new system on increasing the number of bidders, cost savings, and reduced contracting times.

Fighting crony capitalism at the World Bank

In The Hill, railing about the the IDA Private Sector Window.

What Should Silicon Valley Companies With Saudi Money Do?

Discussing Anand Giridharadas' idea for a boycott on accepting Saudi investment money, in Slate.

How political leaders shape public opinion

In the Economist.

Anti-corruption policies are hurting the world's poorest. Here's how to make them better

A summary of the messages in Results Not Receipts in DevEx.