About the Macroeconomics and Growth Research Program

The Macroeconomics and Growth Research Program focuses on the effect of policies and reforms on growth and macroeconomic stability. It combines a variety of data and methodological approaches – micro and macroeconomic, single-country and cross-country studies, structural and model-free. 

The research program is devoted to three broad areas:

1. Foundations of Growth

Previous growth research has helped identify the policies and institutional factors robustly correlated with long-term growth. Current research investigates the translation of policy actions and reforms into growth, with special attention to the role of country-specific initial conditions and complementarities among policies.

The research also examines firm behavior and microeconomic efficiency, and how they contribute to aggregate growth performance, as well as the effects of the policy and institutional environment on innovation and technological upgrading.

Key Researchers

Roberto Fattal | Norman Loayza | Steven Pennings | Rishabh Sinha

2. Macroeconomic Stability, Financial Globalization, and Financial Development

Macroeconomic instability is a major growth deterrent, especially for poor countries. The research program on financial stability examines the contribution of policy and non-policy forces (such as external shocks and other exogenous disturbances) to aggregate volatility. It assesses the scope for reforms to limit the frequency and impact of shocks and seeks to identify suitable macroeconomic policies and measures to tackle microeconomic inflexibility.

Financial globalization and financial development are importantly related to economic growth and macroeconomic stability. The research program in this area examines, among many other things, the benefits and challenges of financial globalization and financial development, the causes and consequences of capital flows, exchange rate policy in a financially globalized world, the macroeconomic effects of aid and debt forgiveness, the functioning of financial institutions and markets, risk management, and access to finance.

Key Researchers

Norman Loayza | Steven Pennings | Sergio Schmukler

3. Governance and Political Economy

Good governance is robustly associated with improved economic performance, but its effects continue to be poorly documented and understood. The research program investigates the effects of governance in multiple dimensions—on service delivery and infrastructure services; on firm investment decisions; on the degree to which pro-growth policies actually promote growth.

The research is concerned also with government’s incentives to set policies in the interests of their citizens -- the conditions under which elections yield more accountable politicians, and generations of social discrimination yield less -- and the efficacy of policy responses to poor governance environments, including information available to citizens, report cards, and community-driven development.

Key Researchers

Pierre Bachas | Stuti Khemani

Last Updated: Apr 27, 2020

Acting Research Manager

Sergio Schmukler

Research Manager, Macroeconomics and Growth