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Cities are one of the major engines of economic growth. By 2050, it is estimated that more than 2 billion workers will live in cities, and most of this rapid urbanization will occur in low- and middle-income (LMIC) countries. While urbanization can provide broad economic opportunities, it also brings significant challenges for policy makers, especially in LMICs where cities grapple daily with difficult decisions on allocating scarce resources. Without a complete picture of both the direct and indirect benefits that various urban policies can have—in particular in the transportation sector—governments may underinvest or poorly target their limited resources.
In this Policy Research Talk, World Bank economist Román Zárate will discuss recent models developed in the urban research literature, how they have been applied to cities within LMICs, and what they reveal about not only the direct but also the indirect effects of transportation investments. Investments in transportation benefit citizens not only through the obvious channel of reducing commute times, but also through broader-scale transformations of the structure of the economy. New research shows the substantial benefits that can accrue through mechanisms like increasing workers’ bargaining power and shifting labor from the informal to the formal sector. Zárate will conclude by presenting an open-source toolkit developed in collaboration with IGC available to researchers and policy makers to simulate the impact of urban policies.
Roman David Zarate is an Economist in the Trade and International Integration Team in the Development Research Group. His research lies at the intersection between international trade and development economics. In particular, he studies how different forms of market integration across and within countries impact welfare, aggregate productivity, and growth in developing countries. Methodologically, his research combines quasi-experimental variation with structural evaluations. He holds a Bachelor and Masters in Economics from Universidad de Los Andes in Colombia, and a Ph.D. in Economics from the University of California, Berkeley.
Somik Lall is a Lead Economist in the Office of the Chief Economist for Equitable Growth, Finance and Institutions at the World Bank and is also Head of its Climate Economics team. Previously, he was the Bank’s Global Lead for territorial and spatial development and Lead Urban Economist in the Global Practice for Urban, Disaster Risk, Resilience, and Land. Dr. Lall joined the World Bank in 1999 as an Economist in the Development Economics Vice Presidency.
Deon Filmer is Director of the Development Research Group at the World Bank. He has previously served as Acting Research Manager in the Research Group, Co-Director of the World Development Report 2018: Learning to Realize Education’s Promise, and Lead Economist in the Human Development department of the Africa Region of the World Bank. He works on issues of human capital and skills, service delivery, and the impact of policies and programs to improve human development outcomes—with research spanning the areas of education, health, social protection, and poverty and inequality. He has published widely in refereed journals, including studies of the impact of demand-side programs on schooling and learning; the roles of poverty, gender, orphanhood, and disability in explaining education inequalities; and the determinants of effective service delivery.
The monthly Policy Research Talks showcase the latest findings of the World Bank’s research department, challenge and contribute to the institution’s intellectual climate, and re-examine conventional wisdom in current development theories and practice. These talks facilitate a dialogue between researchers and operational staff and inform World Bank operations both globally and within partner countries. Read More »