Development Impact Group

Overview

Public finance research is crucial for understanding and shaping public finance systems, informing policy decisions, and promoting sustainable development. The Development Impact Group Public Finance Lab collaborates with tax and procurement administrations to conduct impactful research, enhance institutional capacities, and support World Bank operations. Focused on key areas of the public finance cycle, like tax policy, public spending, and procurement systems, our work examines their impact on economic efficiency and market dynamics.  

Four Areas of Work

• Tax policy: Understanding how governments raise revenue through taxes and the implications of different tax structures.

• Public procurement: Examining the impact of public sector procurement activities on the economic behavior of firms, as well as markets and economic efficiency.

• Public budgeting: Analyzing how government allocates, manages, and accounts for public expenditures.

• Cross-cutting and collaboration areas: Gender, subnational governments, digital tools, and private sector.

Three Pillars of the Public Finance Lab

• Long-term collaboration: The Public Finance Lab fosters long-term collaborations by actively engaging with tax and procurement administrations in client countries. Together, we create  a joint research and capacity-building agenda.  

• Sustainable capacity building: Through a demand-driven approach, the Lab offers a range of capacity-building activities such as workshops, guidance notes, manuals, and trainings. These activities enhance the ability of government partners to obtain, clean, and analyze vast amounts of tax micro-data, facilitating a data-driven approach evidence for policy making. 

• Rigorous policy evaluation: Leveraging our expertise in conducting administrative micro tax data research and impact evaluations, we provide evidence-backed policy recommendations that directly address open research and policy questions in public finance.

Partnerships

The Public Finance Lab has established partnerships with tax and procurement authorities in Honduras, Chile, Brazil, The Dominican Republic, Georgia, and Lithuania. Within these collaborations, the team addresses crucial issues related to Public Finance. The Lab is also part of the DaTax Lab initiative which is a broader bank effort to support the development of equitable and sustaibalne public finance systems.

The Public Finance Lab aims to strenghthening its partnerships with bank operations and government clients, fostering regional agendas on tax policy research and enhanced tax capacity, and producing impactful public goods by providing new evidence to close knwodlege gaps.