80236 Using History to Inform Development Policy The Role of Archives Workshop Summary October 25–26, 2012 The World Bank Washington, DC worldbank.org/historyworkshop Using History to Inform Development Policy The Role of Archives Workshop Summary October 25–26, 2012 The World Bank Washington, DC worldbank.org/historyworkshop © 2013 International Bank for Reconstruction and Development / The World Bank 1818 H Street NW Washington DC 20433 Telephone: 202-473-1000 Internet: www.worldbank.org This work is a product of the staff of The World Bank with external contributions. The findings, interpreta- tions, and conclusions expressed in this work do not necessarily reflect the views of The World Bank, its Board of Executive Directors, or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. 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Contents Foreword v Preface vii Introductory Comments ix Facilitating Research by Broadening Access to the Past ix Delivering Results by Harnessing Knowledge xi Legal Interpretation at the World Bank: Learning from History to Help Shape the Future xii Keynote Address 1 Glance Back, Drive Forward: Reflections on the World Bank’s History 1 Session 1—From Bank to Development Agency: Implications for the World Bank’s Mission, Governance, and Policy 11 American Politics, the Presidency of the World Bank, and Development Policy 12 Not a Knowledge Bank: Economic Research at the World Bank in the Early 1950s 14 The World Bank and Governance: The Bank’s Efforts to Help Build State Capacity 16 Session 2—Constructive World Bank–Client Partnerships: Three Case Studies 19 The Role of the World Bank Group Archives in Research: Finding the Tipping Point in Economic Ideas in India 20 A Constructive Partnership: The World Bank and the Republic of Korea Early in the Country’s Economic Takeoff 22 Urban Development in Cairo, 1976–93: The Perils of “Everyday State Building� in the Arab Republic of Egypt 24 Session 3—Dialogues of Development: Past Contestations, Present Policy 27 Before Social Capital: The Forgotten History of Community Development in the Cold War Era 28 History, Historians, and Development Debates: Using the World Bank’s Archives to Address Five Key Issues 30 Archival Research as Unfinished Business 32 Session 4—The Role of Archives in International Organizations 35 The World Bank’s Archives: 60 Years of Development Knowledge on the “Science of Delivery� 36 The International Monetary Fund’s Archives for Economic Research 37 Archives of Development in the United Nations Secretariat: Murky Past, Unclear Future 38 iii Session 5—Exploring Archives on the Role of Development Practitioners: Africa 41 United Nations Economic and Technical Assistance during the Congo Crisis, 1960–64 42 Translating Theory into Practice: The World Bank’s Economic Advisers in Ghana, 1960–85 44 History, Archives, and Development Policy in Africa 46 From Parliamentary Accountability to Records Management: The Decline of Archival Authority in 20th-Century South Africa 48 Session 6—The United Kingdom, the United States, and the World Bank’s Development Policy 51 The Archival History of Britain and Its Dialogue with Development Policy during the World Bank Era, circa 1945 to the Present 52 What the Developing World Can Learn from the Economic History of the United States— and Vice Versa 54 Session 7—Sailing Back to the Future: History and Policy Making at the World Bank 57 History and Policy Making at the World Bank: The Evolving Approach to Governance Issues 58 The International Development Association and Debt Relief 60 The World Bank’s Mediation of Disputes 62 Closing Remarks 63 iv Foreword All of us recognize the importance and the power of open information, accountability and citizen-participation for effective development. At the World Bank, we believe that transparency and accountability are essential to the development process and central to achieving the Bank’s mission of ending extreme poverty and boosting shared prosperity. In October 2012, the Bank organized a workshop on the role of archives in using history to inform development pol- icy. It linked the growing scholarly interest in the history of development with the Bank’s Open Agenda Initiative and the new openness resulting from our 2010 Access to Information Policy. The workshop assembled scholars who demonstrated the possibilities for bringing historical approaches to bear on the practices and ideas of international financial institutions and international development agencies. This publication is a result of that workshop—which was centered on three main themes: the early years of the Bank and the evolution of its ideas and practices; Bank-client rela- tionships, including both lending and advice on development policy; and the influence of donors and shareholders on the thinking and practices of the Bank. The Bank’s Archives are a global resource, both geographically (spanning all 6 regions of the globe) and over time, capturing development work over 60 years. They reflect both our successes and our failures. Thanks to the Open Agenda initiative and the Access to Information Policy, the World Bank’s vast collection of archival material—dating back to its inception in the 1940s—offers new potential for bringing historical research to bear on development policies and practice. In effect, we have handed over the keys to the World Bank’s knowledge vault. You can access this ‘vault’ through the Bank’s website or by contacting the archivists to tap their knowledge of the vast collection of records, oral histories, photographs and other materials that have not yet been digitized but which contain significant information for research. By providing the infrastructure to share and protect our history, the Bank and its Archives ensure that our work will be available for future generations. I hope you enjoy the summaries in this publication and that they will inspire you to do your own research into the history of development policy. Caroline Anstey Managing Director The World Bank Group v vi Preface The front lines of development circle the globe. The people working tirelessly on those front lines need access to information—and that information needs to be delivered swiftly and securely. The World Bank Group is working to offer better, faster, and easier access to our information, in part by continuing to invest heavily in providing electronic access. The World Bank Group’s archives are an enormous resource, but for too long they have been underused—by Bank staff, external researchers, and the general public. I am excited to share the news that to improve access to this resource, containing more than 60 years of development history, we are embarking on a project to digitize our records and make them available on our website. Our plan is to start with some of the most important records of the Bank, including records that show the history of who we have been and who we are. We also want to share records that highlight how we work and what we have learned from our partners as well as our critics. As we develop a body of digitized records, I hope that you will take advantage of these first offerings. Digitizing the archives is one more way of making the World Bank Group’s information accessible. The knowledge stored in our archives—especially the lessons that can be learned from both our successes and our failures—is an untapped resource that I believe can play an influential role in future develop- ment policy. We need to continue working to ensure that our information gets into the hands of those who are working on the front lines of development to improve the lives of the world’s poorest people. Stephanie von Friedeburg Chief Information Officer and Vice President of Information and Technology Solutions The World Bank Group vii viii Introductory Comments Facilitating Research by Broadening Access to the Past In an October 2012 speech to the World Knowl- We archivists are the facilitators of research. We edge Forum in Seoul, World Bank President Jim have no opinion on the direction that the research Yong Kim asked, “What kind of knowledge do we takes or the conclusions that are reached. We want?� In answering this question, he announced want to make sure that the records are available plans for “knowledge hubs for development� to to the greatest extent possible while protecting enable findings on development—both success- the legitimate needs for personal privacy and cor- es and failures—to be widely shared. The World porate confidentiality. The Access to Information Bank Group Archives is thrilled to be part of this Policy adopted by the Bank in 2010 has been an thrust to use information about the past to inform enormous step forward for us, as we are now able the future. As President Kim said in Seoul, “The to make available millions of items that had not Bank serves its partners by doing something been available before. that none of them can do in isolation: creating Now we are taking the next step and making knowledge-related global public goods that support more and more of the records of the past avail- shared learning processes at global, regional, able online. For many years we have made formal, national, and subnational levels.� final documents available through our Imagebank The archives of the institutions that make up service, documents accessed by millions of peo- the World Bank Group hold massive historical ple every month. But now we are going back to records extending from 1944 and the Bretton digitize key series of records from the archives Woods conference to today. These records show that will provide the color and rich deliberations many successes in the work by Bank staff and behind those formal documents. We are beginning their country counterparts to improve people’s with the records of President Robert McNamara, lives. They also show failures, and studying those putting them online to allow researchers to look at failures allows us to learn if we will. the remarkable era of his World Bank presidency. President Kim proposes building a library of History matters—as a method, as a discipline, delivery case studies and using these as a resource and as a perspective. Archives matter too. The for training Bank staff, country partners, and anyone value of archives is richly evident in this booklet, else who wants to learn the lessons of the past. which provides a glimpse of the presentations at Archives can contribute by making this knowledge an October 2012 workshop sponsored by the World available and bringing in the crucial dimension of Bank Group Archives, the Development Economics time. Change, like success and failure, has many Vice Presidency, and the Legal Vice Presidency. causes, and using archives enables researchers The workshop grew out of a panel discussion to tease apart the threads of the causes and organized by Giovanni Zanalda, a historian at understand the complexity of the decisions made Duke University, at the 2011 annual meeting of by development professionals in the past. the Southern Economic Association to consider ix the role of history in promoting development. The and history; Michael Woolcock, also in the World success of that panel, linked to President Kim’s Bank’s research department, for fostering the interest in case studies, encouraged us to more dialogue between history—the past and the dis- fully explore the evidence base in archives that cipline—and development policy; Hassane Cissé researchers can draw on to analyze development. in the Bank’s legal department for his openness We have chosen to reprint the keynote address to looking at the past as a driver of innovative, in full but to provide only summaries of the other evidence-based decision making; Giovanni Zanalda papers, which we hope the authors will publish in at Duke University for advice, hands-on work, and journals of their choice. An illustration from the encouragement throughout the process; Trudy World Bank Group’s archives accompanies each Peterson, who inspires the work of the World Bank entry. While we emphasize the resources in the Group Archives team every day with her years of World Bank Group’s archives, we also point to the leadership at the National Archives of the United important archival holdings of our sister institutions States, the Open Society Archives, and the United the International Monetary Fund and the United Nations High Commissioner for Refugees Archives Nations as well as many other archives around the and with her contribution to building and preserving world. We hope that by offering this small sample of Truth Commissions archives to keep the evidence the archives’ holdings and the important research alive for the rights of people; and Denis Robitaille, they can support, we will encourage researchers the Bank’s Chief Information Officer for Operations from many disciplines to use the evidence that and Knowledge, for believing in this unusual project the archives preserve. and never letting us down. Without the skilled and A final word of thanks to a few people who dedicated work of Gale King and the knowledge made the workshop possible through their con- and dedication of staff in the World Bank Group stant support and guidance: Jean-Jacques Dethi- Library & Archives of Development, neither the er in the World Bank’s research department for workshop nor this publication would have seen sharing his knowledge and believing in archives the light. Elisa Liberatori Prati Chief Archivist The World Bank Group x Delivering Results by Harnessing Knowledge Despite periodic global imbalances and supply field of delivery science, the World Bank Group shocks, the world has seen big improvements in will help its partners learn from one another and living standards and a sharp decline in poverty maximize the impact of every dollar spent to end since the 1990s thanks to the economic perfor- poverty and promote shared prosperity. Because mance of such countries as China, India, Brazil, of its convening power and amassed knowledge and Indonesia. With ample global liquidity and low on what works and what does not, the World Bank interest rates fueling strong global growth, many Group can make huge strides in delivering results. client countries have found themselves in less Understanding development successes and need of World Bank Group financing. But these failures is essential in this process, and this is countries have maintained, to varying degrees, where the role of the World Bank Group’s archives active partnerships with the World Bank based on becomes important. The World Bank influences analytical and advisory activities. Indeed, World development through its projects and through the Bank partnerships have consistently evolved policies that it advocates, and mining the archives toward more such activities even as lending to is critical in better understanding the role of specific many middle-income and all low-income client ideas and technical solutions promoted by the countries continues. Bank—and where and why they have succeeded The World Bank has been cognizant since the or failed. The number of issues to consider is late 1990s of the key role of knowledge for devel- almost as vast as the dimensions of development. opment and the need to rebalance its services by Providing professional researchers access to shifting away from a predominant focus on lending the archives can generate new ideas and new ways toward more effective use of country experiences to look at problems, benefiting the entire develop- and global knowledge to meet client needs. The ment community. Good examples include Jeremy Bank started repositioning in 1997 and was reor- Adelman’s recent biography of Albert Hirschman ganized in a matrix management system—seen as and Michele Alacevich’s study of the Currie Mission a more effective means of leveraging the Bank’s in Colombia and the early years of the World Bank; global knowledge, its technical sector know-how, the work of economists looking at time series and its country-specific expertise from lending of agricultural prices, fuel prices, or exchange and policy advice. rates over long periods under different fiscal and To improve its agility in capturing and sharing monetary regimes; and the work of economists, the knowledge embedded in its lending services, anthropologists, or historians on the Narmada Dam the World Bank Group has now embarked on in India, on the effectiveness of conditionality, or major reforms, known collectively by the phrase on resettlement policy in Indonesia. “mastering the science of delivery,� introduced by This is why the Development Economics Vice President Jim Yong Kim. These include developing Presidency is proud to partner with the World ways to track progress and measure success and Bank Group Archives in initiatives to explore the establishing routines and crisis management historical evidence based in archives—evidence approaches in order to transform the Bank into that researchers can draw on to better understand a “solutions bank.� In advancing the emerging development policy. Jean-Jacques Dethier Research Manager, Development Economics The World Bank xi Legal Interpretation at the World Bank: Learning from History to Help Shape the Future Any modern system of law with claims to legitimacy With every new legal issue that is addressed in depends critically on access to its own recorded the course of the Bank’s development work, the history. If law is to be respected, it cannot be Bank’s body of law expands. conjured out of thin air. Rather, it must evolve in a The history of the creation of this sui generis principled fashion in reference to its own history. legal system, and therefore the existence of the A lawyer identifies what the law is, or what it will system itself, depends greatly for its preservation become or should be, through a deep understand- on the work of the World Bank’s archivists. The ing of all the law that has come before. That is World Bank is the custodian of its own history. As the essence of the familiar doctrine of precedent. the presentations summarized here demonstrate, Most of this history exists as words, in one form it is to the archives that the Bank’s lawyers must or another. Despite all the tremendous advances go when they are asked to help address complex in digital technology, the business of law will never legal challenges in Bank operations. All the stop being about words, because so much of law’s legal opinions issued by successive World Bank history exists solely as words: words scratched, general counsels are based on a rigorous study written, typed, or uploaded on cave walls, tablets, and analysis of history and legal precedents in paper, or the digital cloud. The preservation of these the Bank. Whether dealing with the issues of words, in the form of archives, is fundamental to governance, anticorruption, debt relief, criminal the legitimacy and operation of the law. justice, anti–money laundering, or postconflict This is true of any modern legal system, but all reconstruction, these opinions referred to history the more so in the case of the World Bank. The to better understand the present and help chart World Bank as an institution exists in a unique a sound new course for the future. International legal universe that has been shaped by the need development is an immensely complex field to interpret the Bank’s Articles of Agreement and that constantly presents new challenges and understand the scope of its mandate and mission lessons that must be recorded if the Bank and the in a changing world. The role of the Bank’s lawyers development community are to learn from them. is to develop sound legal solutions to enable the As lawyers in the Bank, we are heavy users of institution to successfully respond to the evolving the archives and happy to partner with the World needs of its members and address new challenges Bank Group Archives to raise awareness of this in a way that remains true to its Articles of Agree- important resource for development knowledge ment and to general principles of international law. and solutions. Hassane Cissé Deputy General Counsel, Knowledge and Research Legal Vice Presidency, The World Bank xii Keynote Address Glance Back, Drive Forward: Reflections on the World Bank’s History Devesh Kapur Madan Lal Sobti Associate Professor for the Study of Contemporary India and Director, Center for the Advanced Study of India, University of Pennsylvania dkapur@sas.upenn.edu In a sense, the history of changing ideas less prudent than my of development is most encapsulated coauthors, unwisely and embodied in the history of the World went through each of Bank itself the 10 innovations The title of this talk relates to one of my first inter- and how and when views with former World Bank president Robert the Bank had already McNamara, conducted for the book The World Bank: tried them and with Its First Half Century (Washington, DC: Brookings what consequences Institution Press, 1997). My coauthors and I were . . . at which point asking him about various incidents, and he would the interview was spend barely a minute on our question and then over and we left. shift the topic to what he was doing then, such as What that expe- agricultural development in Africa (his passion at rience taught me the time). is that by definition Reflecting on this, one of my coauthors, John everything is innovative if there is no history. Without P. Lewis (who had briefly served with McNamara history, there is no past; everything is new. in the Kennedy administration), remarked that if I have to confess that writing the Bank’s history McNamara were to drive a car, he would almost was personally expensive for all of us. We weren’t never look back through the rearview mirror. paid in the last year and it was financially hard. But A few years later, as we were nearing completion I have to say that it was the most fabulous intellec- of the book, a new president of the World Bank tual experience anyone could have. Especially for came in and he invited us to his house. He said me, as a young scholar starting off in his career, that he wanted to learn from the history. So we writing the Bank’s history was like being a kid in a went there, and as soon as we sat down he said, candy store. The sheer intellectual range—issue “Well, let me tell you the 10 things I’m going to do, areas, countries, people whom one got to meet and all these innovations.� So he went through the 10. interview, talk to, read about—was unparalleled, and I, being much younger then and therefore much I would never exchange that experience for anything. 1 I owe a deep debt of gratitude to many people in from capital markets, from a low- or middle-income the Bank—and to its archives (and archivists) and borrower, or from a major nonborrowing shareholder. a small treasure-house few people have access to, I have to say that the attempt was not very suc- the Executive Directors’ Library, which also houses cessful—in part because many of the authors had the transcripts of all the Board meetings. I still have little access to related historical records on their warm memories of that archival experience. Some of end—and we had to put in a lot of effort to improve you who are older might remember a person called many of those papers. Ernie Stern—perhaps one of the most powerful That experience taught me two lessons: First, senior managers in the Bank’s history. I must have just because someone is a big name does not read around 24,000 memos by Ernie Stern alone. mean that that person can write thoughtful and And I have to say that if you ever want to teach well-researched papers. And second, the history of participants in the Bank’s Young Professionals the development of many countries is better found Program how to write concisely and precisely—and in the archives of the Bank than in the countries sometimes with brutal frankness—get them to read themselves. The second fact should not be forgot- his memos. For me, reading those memos was a ten, for it tells how records are kept by countries wonderful way to learn about what was happening themselves, how they think about their own histories. around the world—and in the Bank. Unlike for the first Bank history, in this case there was consensus that one of the authors Demystifying the Bank should come from a developing country. Originally, What I wanted to share with you is what we sought the current prime minister of India, Manmohan to do in writing the Bank’s history and my reflections Singh, was considered as a coauthor along with on the broad themes, the principal threads as it John P . Lewis, a Princeton University professor who were, of that history. I think first of all we wanted had a long and distinguished career in the devel- to demystify the Bank, in the sense of just laying it opment field, especially in South Asia. The Bank, open more, especially to developing countries. Much however, made the point that the expertise of both to our regret, despite all the efforts and resources prospective authors was in South Asia and a more that went into writing the Bank’s history, for many diversified expertise might be better. So Richard years the book was virtually invisible. It was reviewed Webb, who had been the governor of the Central almost nowhere. We wanted to have it translated Bank of Peru and had worked at the World Bank in and brought out in cheap editions in the languages the 1970s, became the second coauthor. I joined of the developing countries. That was the way to as the head of research and gradually became the empower them, not by having it circulate in a very third coauthor. So that is the background on how I expensive edition that hardly anyone could afford. got involved in the project. But that did not happen. Fortunately, now it is freely available on the web. A History of Ideas We also wanted to have a sense of what the Bank If we ask ourselves what the big themes of this his- meant for its principal stakeholders—the borrowers tory are, I think the fundamental guiding principle, and major shareholders. So we put together a par- what we sought to write about in this history, was allel volume that looked at aspects of the Bank’s a history of ideas—the ideas that have shaped history from specific vantage points. Indeed, the development. In a sense, the history of changing usual parallel when we think about history is the ideas of development is most encapsulated and Rashomon analogy that there is a subjectivity of embodied in the history of the World Bank itself. perception depending on one’s vantage point. To What struck me then—and continues to strike me this end we invited various well-known people to now—is how strongly the Bank, and the ideas that write papers on different subjects, whether a view have shaped it, are rooted in and influenced by the 2 Anglo-Saxon world, whether through language or that it is necessary to work with the countries first, the enormous influence that university econom- and then with people. ics departments, especially in the northeastern This tension around sovereignty has also been United States, have always had and continue to reflected in perennial debates on governance and have on the Bank. lending. Poorly governed countries are less deserving In the 1950s planning (and planning models) of Bank lending, but the people of the same countries was the flavor of the day among academics in are in greater need of lending—precisely because the economics departments of elite northeastern they need help to counter the adverse effects of universities (and in the United Kingdom). A quarter poor governance. But more lending might simply century later the same elite northeastern universi- be pouring water onto sand. ties said what a terrible idea it was. If the Harvards and MITs were pushing planning in the Bank in the The Context Shaping the History 1950s—fast-forward to 60 years later, the same A second thread that runs through the Bank’s small set of elite universities is shaping the latest history (and that was bypassed in the first official new ideas (or fads, depending on one’s point of history of the Bank) is just how much its history view), such as randomized trials. In between there until the late 1980s was shaped by the Cold War. have been social cost-benefit analysis, general equi- This fact comes out repeatedly through that history. librium models, cross-country regressions—ideas The person who really made the Bank in a sense, that have modest half-lives, alive only until they are its second president, John McCloy, was serving as pushed aside by the next set of ideas, all of which president of the Bank at the same time that he was are as much about the incentives of academia as also engaged in laying the foundations for the U.S. they are about development. Central Intelligence Agency. Now that’s a very inter- Make no mistake; I am not putting a value judg- esting juxtaposition—something that would become ment on the interplay of ideas between academia impossible in later years. But it shows that in the and the World Bank. That’s just the way it was. Bank’s early years the relationship for those at the And I do believe that it continues to be like that, top was seamless, and certainly the relationship for better and for worse. between which countries to favor in lending and In the history of ideas, one of the things you which not to was very much shaped by the Cold see, then and now, is a perennial tension that the War–driven geopolitics. Given that relationship, it Bank has faced with respect to development: is it is not surprising that Keynes was insistent that the about people or countries? A poignant example is Bank not be located in Washington. He wanted it to a personal memo that World Bank President Barber be located in New York, believing that Wall Street’s Conable wrote to then chief economist Stan Fischer, influence could be leveraged to counter political after returning from a trip to Africa that included a pressures from Washington, because he knew that visit to a country in the Sahel. In the memo Conable location mattered and that the location would also said that this country was a giant sandbox—what shape influence. could the Bank do there? Indeed, one could argue If one looks back at the Bank’s lending in the that the best thing the Bank could have done 1950s, it was directed almost entirely to the rim there was to give everyone in that country a one- countries around the Soviet Union. Only after Castro way ticket out of it. And herein lies the problem. came to power in 1959 did the Bank really begin to Should the Bank care about a country or about the focus on Latin America. It made almost no loans to well-being of the people of that country, whether the region in the 1950s. In the 1970s, as the Cold they live there or somewhere else? But of course War shifted to Africa, the Bank steered its course the structure of international organizations is such accordingly. This, of course, was valid only until 3 the end of the Cold War, but I think that it certainly in doing what it wants to do? What are the forces affected the DNA of the institution. from which it seeks autonomy? And I have always The other part of the context that has shaped felt that this is not well understood: a key trait of the Bank is the nature of the competition that it has the Bank that has shaped its autonomy has been faced. This began with the International Bank for its financial design. Indeed, for any organization, Reconstruction and Development—IBRD. The R was financial autonomy is the key to functional auton- dropped almost immediately, as soon as competition omy. That was one reason why the Bank, in the from the Marshall Plan drove the Bank out of the early decades, worked very hard to prove itself as a business of reconstruction in war-ravaged Europe. bank, and there were numerous occasions when the In the 1950s the biggest potential competitor was Bank’s management balanced the influence of the the U.S. Ex-Im Bank, and the Bank’s management White House and the Treasury with counterpressure lobbied hard to try and shut it down. In the same from Wall Street. decade the Bank also lobbied hard against the But the United States had less leverage in the creation of IDA (the International Development day-to-day running of the Bank than is commonly Association). But once it became clear that such understood, and even less in later years. The influ- a fund might be lodged in the United Nations, the ence was more strategic: shared understandings Bank turned around and brought IDA under its on country and sectoral priorities and no-go areas, umbrella. The Bank did not take competition from on the scale and timing of capital increases, and regional development banks seriously until the of course on the selection of the Bank’s president 1990s, by which time several of them had grown and often its senior management as well. By itself to a comparable size in their region. the United States could not vote down loans or Throughout the Bank’s history its relationship the annual budget, which has by and large been a with foreign aid has been mixed. As a coordinator consensus affair. of and secretariat to the DAC (the Development Surprisingly, except for one incident that I’m Assistance Committee of the Organisation for aware of, the Board of Executive Directors has not Economic Co-operation and Development), the used the annual approval of the budget to pressure Bank has welcomed the complementarity of foreign the Bank in any significant way. That exception was aid to its own role. But the relationship has been in 1986, when Barber Conable had just joined as contentious as well, with the Bank believing that the new president—and it was meant as a signal the foreign aid driven by foreign policy concerns that led to the major reorganization of 1987, which crowded out the discipline that the Bank sought to was a traumatic experience for the Bank. impose on its borrowers. And of course the biggest The critical pressure point on IBRD has been competition in the 1970s and around the 2000s at the time of capital increases. In each capital was financial markets. One can’t understand the increase major shareholders have sought to shape Bank’s nonperformance in Latin America in the or reshape the Bank’s policies. But because capital 1970s unless one realizes how easily the region’s increases occur so rarely (just four times in the case countries could access global finance from private of IBRD: in 1959, 1979, 1988, and 2010), major banks, desperate to recycle their huge surpluses shareholders have looked to other mechanisms to of petrodollars. And I’m absolutely sure that in the pressure the Bank. next phase of the history of the World Bank we’ll Two additional points relating to the Bank’s be looking at the competition from China. capital are worth noting. First, the importance of the paid-in portion of the Bank’s capital in its equity The Search for Autonomy declined over time, and annual transfers from net A third theme that emerges from our history is the income became the principal source of increases in agency of the Bank. How autonomous is the Bank the Bank’s equity. And second, the comfort afforded 4 to capital markets by the callable-capital portion of Well, in 1980 the PLO applied for observer sta- the Bank’s capital waned over time with the realiza- tus at the World Bank–International Monetary Fund tion that if it were ever called all bets would be off. meetings. The Bank had rapidly expanded lending Instead, borrowers’ scrupulous record in servicing under McNamara in the 1970s. But in the aftermath their debts became more important. These trends, of the 1979 (second) oil shock it was being shut however, were not reflected in concomitant changes out of global capital markets. In the early decades in the Bank’s shareholding. the Bank, under its Articles of Agreement, needed a What fundamentally changed the Bank’s search country’s approval to borrow in its capital markets, for autonomy, as well as what it sought to do with it and at this time the Bank’s borrowing program was and how it sought to achieve it, was the creation of facing constraints. IDA was once again being argued IDA. While IDA allowed the Bank to expand both the on Capitol Hill. McNamara, who was never very scope and the scale of its lending, it also—if one popular on the Hill, desperately needed to get IDA simply scrambles the letters—made the Bank in through as well as a much-needed capital increase. some respects like AID (the U.S. Agency for Interna- The last thing he wanted was for the PLO to attend tional Development), politicized and bureaucratized. the annual meetings in Washington, which would The pressures on the Bank from major shareholders have sent members of Congress into apoplexy. grew over time, and the window through which those Under the rules of the Bank at that time, the pressures arrived was the replenishment of IDA. Board of Governors had to approve any entity’s If larger nonborrowing shareholders have used request for observer status. Let us just say that capital increases and replenishments to advance the voting process was handled creatively, and their agendas, smaller nonborrowing shareholders the decision not to invite the PLO went through have given the Bank “trust funds� to lubricate their with the narrowest of margins. This led to strong own. While trust funds undoubtedly have some reactions among the PLO’s supporters. Later, amid beneficial effects, they do subvert the governance the uproar, a committee chaired by Robert Muldoon, of the institution, since they mean that the budget then New Zealand’s prime minister, was appointed approved by the Bank’s Board does not fully reflect to review the electoral process, which had clearly the institution’s operational priorities. It is interesting been shaped to get the desired outcome. that the Bank has always been careful about telling With the PLO denied permission, McNamara developing country members about the dangers had dodged a bullet in Congress, but he faced of off-budget financing and its implications. Trust another problem. The only countries that then had funds in some sense are really no different than the money to support the Bank’s growing borrowing off-budget financing. program were Middle Eastern countries, especially Saudi Arabia. The Bank was negotiating a large The Role of Contingency borrowing from the Saudi Arabian Monetary Agency, A fourth theme that emerges in the Bank’s history and the Saudis were furious at the way the Bank, is the role of contingency. The social sciences are as they saw it, had (mis)handled the PLO observer not very comfortable with contingency because vote. Now one interesting thing—and I’m sure many science is science and one should be able to gen- of you are aware of this—is that when important eralize. But whether in the histories of individuals countries become upset at the Bank, one way that or organizations, contingency plays a far bigger the Bank has tried to placate them is to give them role than we think. And I will tell you a story that a senior management appointment. illustrates this. I could make a case to you that the Indeed, this incident had several consequenc- reason I’m standing here is the PLO (the Palestine es. Around this time the Bank’s chief economist, Liberation Organization). Why would you think that Hollis Chenery, was stepping down, creating an the PLO has anything to do with it? opening. The search committee that was formed 5 recommended Michael Bruno, the governor of the Institutions and Organizations Bank of Israel and an Israeli citizen. At that point A fifth theme that emerges is the distinction in time this choice was not going to go down well. between institutions and organizations. The role So Bruno was passed over (he would become chief of institutions in development has received much economist of the Bank a decade later and the PLO attention in the past two decades. One can think would be invited as an observer in 1994, following of the Bank (along with the International Monetary the signing of the Oslo Accord between Israel and Fund and the United Nations) as part of the postwar the PLO), although there were some other factors as institutional architecture of global governance. But well. Anne Krueger became chief economist instead, if one closely examines the internal workings of the and her staunch pro-market views had significant Bank—that is, the Bank as an organization rather effects on the Bank’s intellectual role. Important for than in its institutional guise—one gets the sense my purposes—and the reason that I am standing that institutions might be the skeleton but that here—is that Ibrahim Shihata (who was from Egypt) organizations provide the flesh and blood. While was appointed as the Bank’s general counsel, the numerous institutions have been set up, few have first from a developing country. developed the organizational capabilities and com- Shihata was one of the most influential gener- petencies that make them actually function over the al counsels of the Bank and the architect of the long term. (One can have an independent central Multilateral Investment Guarantee Agency. But he bank with all the formal features that economists also played a key role in protecting the writing of love. But if one puts a bunch of monkeys in charge our official Bank history. Under the terms of the of an independent central bank, that independence contract that was signed when we began to write the will be moot.) history, we had full access to all Bank documents It is this singular feature of the history of the and correspondence. But the Bank retained the right Bank as an organization—how it grows over time, to ask the authors to excise any direct quotation its much greater diversity in terms of nationality or that might adversely affect relations with a member gender or the country of location of staff. But as the country. My coauthors and I felt that we wanted to Bank grows, its history is also a story of how the very tell the history by using as much as possible what success of earlier years propels it into becoming the Bank’s staff and management had produced— a much larger organization, and as that happens the countless memos and reports. In other words, the barnacles of bureaucracy begin to encrust the by using the Bank’s own words rather than simply institution with procedural fealty. The Bank began putting our interpretation on them. to OD on ODs (Operational Directives). (Having to So we decided to force the issue not by having read these was by far the most painful part of writing a few quotations but by having thousands of them, the history.) While multiple bureaucratic layers and because if the Bank decided to kill direct quotations, complex systems and procedures are inevitable for it would have to kill the entire official history. Shi- large organizations, they do have an adverse impact hata was sympathetic to the idea, and despite the on creativity and particularly on the willingness to pressure he strongly backed us and ensured that take risks. Taking swipes at bad projects is easy; we were not asked to cut any quotation or change knowing the costs of not undertaking good projects any interpretation. And so the role of contingency, because of greater risk aversion is much harder. the PLO, and the Bank’s history are interlinked. Now one could always argue that with any contingency, Thinking about Performance and as with all histories, we never know what the coun- Accountability terfactuals would have been. And that, of course, This leads me to my sixth historical thread: how always makes for interesting discussion. should we think about the Bank’s performance and accountability? 6 After I wrote my first draft chapter, my senior think carefully about who bears the cost of those coauthors each took me out for lunch. I was much failures? younger than they were, and my first draft was very An important indicator of the Bank’s perfor- critical of the Bank: this has failed, that hasn’t mance—but one that cannot be picked up through worked, this was oversold, and so on. Richard more quantitative analysis of the Bank—is its role Webb returned my draft with the pages swamped in killing off bad projects. Only if one looks carefully with red ink. He said that I should consider taking into Bank documents does this unheralded contri- out every adjective and adverb—their abundance bution of the Bank become apparent, since almost signaled that I was being intellectually lazy. The by definition a project that is nixed does not show adjective and adverb, he argued, must come into up in official performance indicators. An issue much your readers’ minds from the strength of evidence debated today might help illustrate this point: the and the logic of the argument rather than by being Bank’s role in combating corruption. force-fed to them. Some have argued that the Bank did not pay . Lewis, who had worked My other coauthor, John P attention to this key issue in the early decades. One on development for nearly four decades, like a good explanation may be that it did not do so because American used a sports analogy. He said, suppose corruption wasn’t that big a deal then. A second someone from Mars came down and was taken explanation might lie in the changing perception of to a baseball game. And someone said, look, this the sacrosanct nature of sovereignty and the will- guy is a tremendous hitter; his batting average is ingness of the international system to question its .350. The man from Mars would say, my God, a 65 limits. A third might be that even when the issue’s percent failure rate! And Lewis said, look, only if you salience was becoming apparent, the Bank took an know how hard the game is would you appreciate ostrich-like approach and simply tried to ignore it. that a batting average of .350 is actually pretty The historical record is more complex. To take darn good. If development were easy, why would an example: In the early 1950s a senior manager one need the Bank? of the Bank visited Cuba and met with Batista, the One of the things, of course, about the Bank then president. At a managing committee meeting is that it succeeds best in countries that need it he reported back, saying that since “Batista is a the least: the Chinas, Japans, and Koreas. And it corrupt bastard� the Bank should not give him a fails most, of course, in the countries that need it cent. That was it. There was no thick report with the most—but where others fare scarcely better. multiple annexes and chest-thumping. A bean-counting approach to performance Indeed, in the early years specific lending deci- outcomes can have its own perverse effects. This sions drew considerably on staff with deep sectoral happened in the 1990s, when we were writing the experience. Thus the documentation making the history, and made the Bank much more risk averse case for the first loan to a developing country—to than it had been and in some ways less intellec- Chile for electric power—was just a few pages. tually honest about the development enterprise. Decades later the documentation for Bank-financed It failed to defend the position that development electric power projects would be far thicker. Yet there necessarily entails risks and trade-offs and hence is no evidence that the later projects performed failures are inevitable. How does one know whether better than the first. One could argue, of course, doing 10 projects painstakingly, with all the bells that one is comparing apples with oranges. But and whistles that lead to “success,� is better for this example also tells a little about the changing the overall development enterprise than doing 20 human capital composition in the Bank. People with projects with a 30 percent failure rate? Is it more deep sectoral experience gradually got pushed out, fruitful to think less about failures per se and to especially by economists after the creation of the Young Professionals Program. 7 To return to our discussion on corruption, one The Iron Law of Unintended of the most striking transcripts is of a conversation Consequences of McNamara with Indonesian president Suharto in The last theme that emerges through the Bank’s the late 1970s. The technocrats in Indonesia (the history is the “iron law of unintended consequenc- so-called Berkeley mafia) had become worried about es.� At the time we were writing the history, the the mounting levels of corruption. Recognizing their “Washington Consensus� was much in vogue. own limited influence on the president, they tacitly Since then many have sharply criticized it—indeed, asked the Bank to quietly try and warn Suharto. The a whole industry has grown up around trying to only person with the stature to deliver this message slay the “neoliberal monster� that the Washington was McNamara, who flew to Jakarta. The transcript Consensus supposedly gave birth to. of the conversation is fascinating as McNamara The Washington Consensus—with its emphasis appeals to the nationalism in Suharto and warns on global integration, rolling back the state, and of the dangers of the “cancer of corruption� to the privileging the role of markets and the private sec- Indonesian nation. One of the major differences over tor—came toward the end of the Latin American the decades is that while controversial messages debt crisis and the beginning of the collapse of in earlier years were more likely to be delivered in the Soviet Union. It reflected an “end of history� private, since the 1990s they have been given more moment, with the West at the zenith of its power. publicly, reflecting in part the greater transparency The creation of the World Trade Organization with in public institutions. an agenda reflecting the West’s preoccupations, the multiple financial crises afflicting developing The Question of Comparative countries in the 1990s (the Mexican, Asian, and Advantage Russian financial crises)—all seemed to reaffirm This leads me to my seventh thread, a question that the West’s dominance and the advancement of its has been raised periodically in the Bank’s history: hegemonic agenda about economic development what is the Bank’s comparative advantage? Where through multilateral institutions that it controls and does it lie (countries, sectors, issues), and should influences the most (the Bretton Woods institutions the Bank try (or has it tried) to develop a more and the newly created World Trade Organization). And dynamic comparative advantage? The question is of course the Bank was very much a part of this. not just about what it should do (which countries or Fast-forward to a decade and a half after the sectors) but the modalities of engagement. Provide 1997 Asian financial crisis, as “the rise of the rest� money or advice—or a combination of the two, and the relative decline of the West have become and if so, in what proportions? Deliver important the new conventional wisdom. Could it be that the messages in private or in public? We live in an age Washington Consensus was the best thing that with far greater pressures to be more public and to happened to developing countries at a meta-level, disclose information much more overtly. But has reshaping the locus of global economic power in that come at the cost of candidness, leading to ways that the forces most gung ho about pushing anodyne fluff? How close to the client should the it on developing countries never imagined? Bank be? After all, there is a slippery slope between I’ll end with two thoughts. Be careful about embeddedness and capture. And with “stakeholder� any teleological interpretation of history—or of terminology proliferating, who is the client? development. And be careful about what you ask for—sometimes you might get it. And sometimes you have to be careful about whom you ask to write your history. 8 Session Chair William H. Becker Professor of History and Chair of the Department of History, George Washington University William H. Becker is a professor of history and chair of the department of history at the George Washington University. His research and teaching interests are the history of business, business and public policy, the history of the international economy, and the history of large-scale organizations (such as the World Bank, the Export-Import Bank of the United States, NASA, and the Rockefeller Foundation). He is the author or coauthor of six books and was also the general editor of the Encyclopedia of American Business History and Biography. His most recent publication is Eisenhower and the Cold War Economy (Johns Hopkins University Press, 2011). From Bank to Development Agency: Implications for the World Bank’s Mission, Governance, and Policy Session 1 • Kathryn C. Lavelle—American Politics, the Presidency of the World Bank, and Development Policy • Michele Alacevich—Not a Knowledge Bank: Economic Research at the World Bank in the Early 1950s • Alain de Janvry and Jean-Jacques Dethier—The World Bank and Governance: The Bank’s Efforts to Help Build State Capacity American Politics, the Presidency of the World Bank, and Development Policy Kathryn C. Lavelle Ellen and Dixon Long Professor of World Affairs, Case Western Reserve University kcl6@case.edu What does the selection of the World Bank’s president by the United States mean for the relationship between the organization and its largest shareholder? Several recent studies in a variety of social science Robert McNamara, and James Wolfensohn. I pro- disciplines have pointed to the connection between pose that use of the historical narrative provides domestic American politics and the World Bank, a good method to investigate this topic—and a connection that seems to be particularly strong particularly the use of archival materials, because given the relationships between Bank leadership they allow the researcher to examine different and the American political class. Yet few works points of view from different documentary sources. explore the nuances of these politics as they are The four case studies ask what view of devel- situated among the branches of U.S. government opment policy emerged in the Bank during each in which visions of development have emerged Bank president’s historical period and how it was over time. informed by actors in the U.S. presidential admin- Taking the view that policy is far from consis- istration and major congressional figures active tent across the U.S. government, I argue that on Bank policy. The primary evidence comes from the political game is far from over even after the the oral histories conducted by each of the four president makes a direct decision in either the men with the World Bank Group Archives and their U.S. government or the international organization. archival correspondence files. Supplementing this Decisions are often ignored or reversed within the information are other primary sources and histories American policy process. World Bank presidents of the men, their work, and their contributions to do not seek the same goals as American presi- the institution and development policy. dential administrations once they move out of the What insight emerges from a comparison of domestic sphere and into the international one. these four cases? American presidents have no Through the prism of the selection and networks doubt influenced the trajectory of the Bank and of four Bank presidents, this paper evaluates the thus global notions of development. Yet the circum- influence of U.S. politics on development policy stances accompanying weighted voting, and thus thinking and practice in the Bank during the tenure the Bank’s U.S. executive director controlling the of those presidents: Eugene Meyer, Eugene Black, largest bloc of votes, have resulted in outcomes 12 From Bank to Development Agency: Implications for the World Bank’s Mission, Governance, and Policy not easily categorized outside their historical context. The early clash between Meyer and U.S. Executive Director Emilio Collado that contributed to Meyer’s early resignation as Bank president, combined with the desire of the U.S. foreign policy establishment to tap New York capital markets, resulted in a weaker board than the Bank’s Articles of Agreement might suggest. Nonetheless, the Bank’s transformation from a bank to a development agency can be associated with the desire of two of the presidents to seek a high degree of independence from the U.S. government. McNamara and Wolfensohn, the two presidents with the most extensive political networks before their appointment, used these connections to increase the Bank’s institutional Records of the Presidents of the World Bank are some of the independence as a development agency. most heavily used records in the Archives. Lavelle’s paper examines four presidents; this illustration is one item she In these later examples partisan politics play a used in her research. Joseph Bowman on behalf of Henry role in U.S.-Bank relations, but one that could be Fowler, Secretary of Treasury, to Robert McNamara, April interpreted as creating more “space� between the 28, 1968, enclosing “Congressional Opposition to the Inter- government and the international organization. This national Development Association and the Inter-American Development Bank 1959-1969�; General Correspondence; has been the case particularly when a Bank presi- WB IBRD/IDA 03-04, Office of the President, Records of dent is appointed by a presidential administration Robert McNamara; 309676B, World Bank Group Archives from one political party and that administration is then followed by one from the other party—resulting hegemonic power within it through the selection in a new U.S. executive director appointed by a of its president by the United States. different party, who reports to a Treasury official from that party. Thus U.S. partisan politics do Kathryn C. Lavelle’s paper is available as Policy Research not necessarily tie the Bank more closely to the Working Paper 6377 (World Bank, Washington, DC, 2013). 13 Not a Knowledge Bank: Economic Research at the World Bank in the Early 1950s Michele Alacevich Associate Director for Research Activities, Heyman Center for the Humanities, Columbia University ma2944@columbia.edu Today economists are the largest and most powerful professional group at the World Bank. But in the early 1950s they were a marginalized minority Development economics emerged as a discipline Economic Department, whose studies often provid- in the aftermath of World War II. Decolonization ed essential knowledge on the economic conditions had given birth to many newly independent coun- of developing countries and informed the Bank’s tries, virtually all very poor; meanwhile, the onset development policies. The Economic Department of the Cold War generated a competition for in those early years, like its successor today, was influence in developing countries, which turned an important actor in the decision-making process their development into an international priority. at the Bank. Yet while the Bank was very active in The birth of development economics dovetailed development policies worldwide during its first 20 with the reorientation of the International Bank for years of life, it was remarkably silent in the field Reconstruction and Development—today known of development economics. as the World Bank—from supporting European This apparent paradox can be explained by reconstruction to funding development policies observing the early parable of the Bank’s Eco- worldwide. Not surprisingly, the Bank as an insti- nomic Department: after a lively and stimulating tution and the intellectuals who pioneered the beginning—or perhaps because of its lively and new discipline often crossed paths, and it is fair stimulating beginning—the Economic Depart- to say that the Bank and development economics ment was marginalized and then eliminated. In are part of the same story. the Bank’s first 15 years of life the institution’s Indeed, one would think that the Bank was a main competence shifted toward engineering natural incubator for development economics: it and, conversely, the importance of economists quickly became the largest international organi- diminished. This ultimately led to the elimination zation dedicated to fostering development in the of economic research from the Bank’s activities. developing world. In addition, the Bank had a lively Economic research at the Bank was slowly revived 14 From Bank to Development Agency: Implications for the World Bank’s Mission, Governance, and Policy only in the late 1960s, and more convincingly in the early 1970s. The early activity of the Economic Department marks a particularly important phase of the early institution-building process at the Bank: the shaping of a distinct mind-set toward policy issues that set the Bank’s Economic Department apart from other departments and the Bank’s senior management, and the progressive irreconcilableness between economists and top management due to different visions for the Bank and its role. Today the World Bank is without doubt a pre- dominantly economic institution, and economists are its largest and most powerful professional group. In the early 1950s, however, economists were a marginalized minority, and as history shows, different professional groups interpreted the Bank’s agenda and priorities in different ways. The recent change in leadership at the Bank signals that the institution is changing again. This does not mean that the Bank’s economists are at risk of again becoming an endangered species, but it is a good time for the Bank to reflect on the Records of the Bank’s work in countries around the world benefits of embracing disciplinary diversity within are the heart of the Bank’s archives. Alacevich used the the institution. headquarter’s records of the Bank’s early work in Colombia. Letter, Lauchlin Currie to Robert L. Garner, October 27, 1949; Colombia, General Survey Mission (CURRIE), 1949-1952; WB IBRD/IDA 01 Country Operational Files, 1946-1998; 819729F; World Bank Group Archives 15 The World Bank and Governance: The Bank’s Efforts to Help Build State Capacity Alain de Janvry Jean-Jacques Dethier Professor, Department of Agricul- Research Manager, Development tural and Resource Economics Economics, World Bank and Goldman School of Public jdethier@worldbank.org Policy, University of California, Berkeley alain@berkeley.edu Why doesn’t the World Bank focus its efforts on helping poor countries build state capacity? Part of the reason may be political The World Bank’s effectiveness is based not economically sensible (and mindful of sequencing just on proposing investment projects and policy issues) and sociopolitically feasible. reforms but also on assisting developing country The thinking at the Bank about the role of governments in designing and implementing these the state in developing countries has evolved projects and reforms. Reviewing research and proj- over time. To simplify the history of this process, ect documents from throughout the Bank’s history, we distinguish four phases: From its creation in we find that the Bank recognizes the importance the 1940s until the early 1960s the Bank held of the state for its effectiveness and has recently fairly standard conservative views about what made efforts to improve the governance capacity of governments should and should not do. During the developing countries. Yet the Bank’s performance McNamara years the Bank envisaged a proactive in this area has been weak—with high costs for its state. During the 1980s, with more conservative effectiveness. What explains this relative failure? bankers as presidents, this changed—government Outlining some conceptual underpinnings for failures were seen as characteristic of developing the view that an effective state is essential for countries and the motto was “getting prices right.� development, this paper underscores the need Since the 1990s state intervention has gradually for a wide range of government actions to foster recovered its legitimacy—though this global assess- inclusive growth. Developing country governments ment must be nuanced—and the emphasis has are unlikely to successfully absorb large amounts been on “creating a favorable business climate,� of aid if their capacity is not significantly increased. with a healthy dose of skepticism toward industrial We argue that donors should focus on building policy interventions and even the regulation of capacity in such key areas as revenue mobilization, major economic sectors. public spending, macroeconomic stability, basic Through a historical narrative of the Bank’s infrastructure, financial systems, and basic legal changing approach to country assistance, we show and regulatory structures. Efforts should con- that the Bank has taken governance issues increas- centrate on a limited reform agenda that is both ingly seriously. It has embedded governance-related components in projects and programs—but with 16 From Bank to Development Agency: Implications for the World Bank’s Mission, Governance, and Policy insufficient support to enhance the capacity of governments. There is thus a disconnect between the Bank’s rhetoric and advocacy around effective government and actual results. We propose an interpretative thesis on why the Bank has performed poorly in building state capacity, focusing on the two main reasons that have been advanced. The first is lack of knowledge on how to proceed. If this were absolutely true, it would mean that the Bank would be doomed to failure no matter what it did. Economists have limited wisdom about transforming the state into a development instrument—and this calls for more research and experimentation. Yet enough is known to achieve at least some progress in building capacity and improving the quality of governance. The second reason is reluctance by Bank lead- ership to promote a proactive state, and here our interpretation is political. It involves unwillingness to promote state support to avoid stakeholder divi- For its first forty years, the Bank maintained a central file for sions, delegation of decision making and budget records that related to topics other than work in a country. authority to country offices, and a lag in increasing This item, from the central file on “Development,� shows the Bank’s internal debate over the role of the Bank’s resident Bank support to the state in response to growing representatives in countries and what kind of advisory and demand from clients. Support to governments is technical services they should perform. Memorandum, O. a divisive issue among Bank shareholders—par- J. McDiarmid to Joseph Rucinski, November 14, 1960; Development – General V; WB IBRD/IDA 02 Central Files ticularly between the United States on the one 1946-1986; 183995B; World Bank Group Archives hand and European and Asian countries on the other. It is therefore an issue that is ignored or left president and his managing directors unwilling or unresolved for internal political reasons, with the unable to exercise sufficient authority on the matter. 17 Session Chair Pamela Cox Senior Vice President for Change Management, World Bank Group As the World Bank Group’s senior vice president for change management, Pamela Cox is responsible for leading the Group’s reform efforts, for coordinating and sequencing all change initiatives, and for overall internal and external commu- nications around the change agenda. Until December 2012 Ms. Cox was regional vice president for East Asia and Pacific, leading the World Bank’s strategy in the region. She oversaw a portfolio of more than US$30 billion in loans, grants, credits, and trust funds, coordinating and super- vising the activities of more than 1,000 staff. From January 2005 to December 2011 Ms. Cox served as regional vice president for Latin America and the Caribbean, guiding a strategic shift to reposition the Bank as a key development partner among diverse clients seeking a variety of knowledge and financial services. Earlier in her career Ms. Cox was a Bank economist working on agricultural and environmental issues in Africa, South Asia, and Latin America. From 2000 to 2004 she was director of strategy and operations in the Office of the Vice President for Africa. From 1996 to 2000 she served as country director for South Africa, Botswa- na, Lesotho, Namibia, and Swaziland. Ms. Cox, a U.S. citizen, holds a doctorate in development economics and policy and a master’s degree in law and diplomacy and development economics from the Fletcher School at Tufts University in Boston, Massachusetts, and a bachelor’s degree in international studies and international economics from Reed College in Portland, Oregon. Constructive World Bank–Client Partnerships: Three Case Studies Session 2 • Rahul Mukherji—The Role of the World Bank Group Archives in Research: Finding the Tipping Point in Economic Ideas in India • Giovanni Zanalda—A Constructive Partnership: The World Bank and the Republic of Korea Early in the Country’s Economic Takeoff • W. J. Dorman—Urban Development in Cairo, 1976–93: The Perils of “Everyday State Building� in the Arab Republic of Egypt The Role of the World Bank Group Archives in Research: Finding the Tipping Point in Economic Ideas in India Rahul Mukherji Associate Professor, South Asian Studies Program, National University of Singapore sasrm@nus.edu.sg Archival evidence helped establish the importance of homegrown ideas in engendering persistence and change in Indian economic institutions The World Bank Group Archives played a pivotal role over� to what appeared to be radical change at in my research on economic thinking and change in the time of a balance of payments crisis in 1991. India. The research has produced two substantial To make the case for this model of economic publications: Globalization and Deregulation: Ideas, change, it was important for me to establish what Interests and Economic Change in India (New Delhi: the dominant ideas of the day were at the time Oxford University Press, forthcoming); and “Ideas, of India’s two most severe balance of payments Interests, and the Tipping Point: Economic Change crises, in 1966 and 1991. I argued that in 1966, in India,� Review of International Political Economy when ideas within the government favored import 20, 2 (2013): 363–89. substitution, India did not deviate from that model The book and paper argue that it is important to despite pressure from the World Bank and the locate the role of economic ideas within the policy United States. In 1991, however, ideas that had community both in judging how India would respond evolved since 1975 suggested that private sec- to foreign pressure at the time of a balance of tor participation and integration with the global payments crisis and in understanding institutional economy had to replace India’s state-led autarkic change in the country in 1991. Change in economic industrialization. The balance of payments crisis institutions embracing or opposing industrial dereg- of 1991 constituted a tipping point: the executive ulation and integration with the global economy and the technocracy took advantage of the crisis, ultimately depended on the dominant ideas held and pressure from the International Monetary within the government—ideas about what economic Fund, to change the course of India’s economic principles would work best in promoting India’s history—because of a sincere belief in the need economic growth. I have argued that ideational for a shift in the policy paradigm. change in India followed a tipping point model, in The World Bank Group Archives led the way in which slow-moving endogenous changes “tipped declassifying the Bell Mission Report of 1965. This 20 Constructive World Bank–Client Partnerships: Three Case Studies 14-volume report, the outcome of a Bank mission to India headed by Bernard Bell, outlined conditions facing the Indian economy and steps to be taken to alleviate those conditions. It also laid out the conditions that were offered to India in return for funding. But this 1965 report remained a confi- dential document until 2010. Had it not been for initiatives taken by the World Bank Group Archives and the positive role played by the World Bank’s Delhi office, this substantial documentary evidence on India’s economic history would have remained hidden from the scholarly world. In addition, the archivist Bertha Wilson helped locate pertinent material in the oral history archives of the Bank. Together, the Bell Mission Report and the oral history archives helped me establish that the government of India had taken a position at significant variance with that of the World Bank in 1966. And once the government had taken that position, it could not be coerced into changing it. This critical piece of evidence helped establish the important role of homegrown ideas in engen- The Bank has had an oral history program since 1961. dering persistence and change in the institutions Publicly available oral histories are located in the “Archives� governing the Indian economy. section of the Bank’s website. Mukherji used four of them in his research for the paper, including this one with J. Burke Knapp. Oral history interview, J. Burke Knapp, October 6 and 29, 1981, WB IBRD/IDA 44-02 Oral histories, 1981-1989 project; http://siteresources.worldbank.org /EXTARCHIVES/Resources/Burke_Knapp_Oral_History _Transcript_1981_44_02.pdf 21 A Constructive Partnership: The World Bank and the Republic of Korea Early in the Country’s Economic Takeoff Giovanni Zanalda Assistant Research Professor of Social Sciences, Economics, and History, Duke University gz19@duke.edu The World Bank played a crucial part in supporting the local development of know-how, administrative skills, and understanding of international markets The post-1960 economic growth of the Republic There is general agreement that openness of Korea is considered one of the most successful played a crucial part in the success of the Korean examples of economic development in a relatively economy, as well as that of other East Asian econ- short period. It took Korea slightly more than a omies, over the last quarter of the 20th century. decade (1966–77) to double its income per cap- But authors have been debating the causal links, ita. More importantly, this growth spurt was not with some arguing that openness was the initial limited to the initial takeoff stage of the 1960s driver of growth and others that it was the second and 1970s but has continued, with occasional step during the economic takeoff period. Those in downturns, to the present. The Korean economy the second group focus more on the high level of embarked on a catch-up dynamic that by the end domestic investment and the structural reforms of the 1990s brought its income per capita close that occurred throughout the 1960s and early to levels in mature economies such as the United 1970s, arguing that it was these factors that later States and Japan and on par with levels in several enabled Korea to succeed as an open economy. Western European nations. They claim that openness worked because of the A vast literature documents how import- initial high level of investment in the domestic substitution and export-led policies as well as economy and the capacity to adapt imported tech- education, social factors, and domestic and foreign nology—and that the inflow of capital mattered only institutions enabled the transformation of Korea once the economy had already begun its ascent. from a low-income economy in the early 1960s Drawing on material from the World Bank’s into a high-income one by the mid-1990s. Korea’s archives, this paper complements the existing membership in the Organisation for Economic literature by throwing some new light on policies, Co-operation and Development after 1996 and in debates, and lesser-known figures at the center the G-20, the presidency of which Korea held in of Korea’s development takeoff. It illustrates the 2010, points to its international standing among evolution of the relationship between Korea and advanced economies. the World Bank throughout the 1960s and 1970s 22 Constructive World Bank–Client Partnerships: Three Case Studies with respect to the country’s development policy and strategies and brings to the forefront the special role of agents and institutions involved in the decision-making process. The paper focuses in particular on the analysis of material and general correspondence related to the World Bank’s take on and support for Korea’s First and Second Five- Year Economic Development Plans (1962–66 and 1967–71), the preparation for the first meetings of consultative groups for Korea, and World Bank missions to the country. On the basis of preliminary findings, the paper shows how Korea, despite widespread external skepticism about its potential for growth and the geopolitical concerns characterizing the early 1960s, managed to increasingly attract foreign capital and technical support throughout the decade. It emphasizes the crucial part played by the World Bank in supporting the local devel- opment of know-how, administrative skills, and understanding of international markets as well as in promoting debates about development policies. The paper also suggests that the World World Bank officials correspond regularly with heads of Bank is a unique repository of knowledge about state, and their correspondence is included in the country development practices and policies, of which the files. Zanalda used this letter from Korean president Park Chung Hee, which was sent in both Korean and English. archives constitute an essential pillar. Letter, May 3, 1968, President Park Chung Hee to Robert McNamara, Korea General, General Correspondence 01; WB IBRD/IDA 01 Country Operational Files, 1946-1998; 182859B; World Bank Group Archives 23 Urban Development in Cairo, 1976–93: The Perils of “Everyday State Building� in the Arab Republic of Egypt W. J. Dorman Honorary Fellow, School of Social and Political Sciences, University of Edinburgh wj.dorman@ed.ac.uk Three development projects in Cairo illustrate the challenges of building in sustainability through local institutions capable of urban governance Beginning in the mid-1970s, the World Bank 1990s and focused on traffic management in Cairo, and other development agencies, such as the was declared by the completion report to be only U.S. Agency for International Development (AID), “marginally satisfactory,� with a “negligible� impact undertook a series of frequently unsuccessful on institution building and “uncertain� sustain- urban development projects in Cairo. While hardly ability. The much larger-scale AID project, which exceptional, the failed projects provide a unique included construction of an owner-built housing window on the Egyptian state’s “neglectful rule� development, was denounced by a 1989 Forbes of its capital. magazine article as “one of the biggest fiascoes Drawing on research in the World Bank’s ever in the history of [AID].� archives and other sources of information, this These interventions frequently targeted infor- paper examines three such projects—the Bank’s mal neighborhoods established without planning Urban I and II Projects and an AID project—as cases permission, lacking adequate infrastructure, and of “everyday state building.� In Cairo development generally neglected by state agencies, which lacked agencies sought to foster an administratively the resources to intervene in them. Development competent Egyptian state capable of engaging agencies attempted to increase state capacity to with ordinary Cairenes to improve shelter, ser- manage and service the city through the creation vices, and livelihoods. The failure of such efforts of client agencies that would implement projects, illustrates how the reproduction of Egypt’s durably recover costs from beneficiaries, and use the authoritarian political order, still in place since the recovered costs in subsequent projects. 1950s, depends on state-society disengagement. Such efforts can be understood as a kind of The Bank’s Urban I Project, which provided “everyday state building� in which development infrastructure and services to one Cairo neigh- agencies move beyond mere service provision borhood, was judged in a critical audit to be “less and seek to build in sustainability through local than satisfactory� with respect to its cost-recovery, institutions capable of urban governance. While institution-building, and sustainability objectives. less dramatic than the accounts of external The Urban II Project, which ran through the early intervention and imposition that now dominate 24 Constructive World Bank–Client Partnerships: Three Case Studies the literature on state building, these projects addressed equally fundamental issues of state capacity—for example, the mobilization of societal resources for development objectives. But most such efforts at negotiated state build- ing were ultimately unsuccessful. While Egyptian state agencies were eager to receive economic assistance, they balked at the institutional reforms and demands for state-society engagement built into the projects. Such measures may have been framed and understood by development agencies in technical terms, but they constituted a direct chal- lenge to the reproduction of the post-1952 order, which was based at least in part on clientelism and exclusion. So while all three of the projects predate development agencies’ preoccupation with democratization, civil society, and even par- ticipation, they nonetheless entailed a political challenge to the durable authoritarianism of the Sadat and Mubarak governments. The failure of the projects also demonstrates the limited capacity of development agencies to Letter, E. T. Barnes to S. Sandstrom, October 17, 1979; use aid as leverage for politically sensitive reforms. Egypt, Loan Urban Development II, Greater Cairo Urban In the case of the AID project, the strategic con- Development Project; WB IBRD/IDA 01 Country Operational siderations that had led the U.S. government to Files, 1946-1998; 66041B; World Bank Group Archives provide Egypt with substantial economic assistance undercut demands for substantive reform. And all three cases show why political factors must be acknowledged in development interventions. 25 Session Chair Vijayendra Rao Lead Economist, Development Research Group, World Bank Vijayendra Rao, a lead economist in the World Bank’s Development Research Group, integrates his training in economics with theories and methods from anthro- pology, sociology, and political science to study the social, cultural, and political context of extreme poverty in developing countries. Dr. Rao has published in lead- ing journals on subjects that include the rise in dowries in India, the social and eco- nomic context of domestic violence, the economics of public celebrations, sex work in Calcutta, and how to integrate economic and social theory to develop more effec- tive public policy. He coedited Culture and Public Action and History, Historians and Development Policy and coauthored World Development Report 2006: Equity and Development. Jointly with Ghazala Mansuri, he recently completed the World Bank Policy Research Report Localizing Development: Does Participation Work? Dr. Rao obtained a BA (economics, statistics, sociology) from St. Xavier’s College– Bombay (now Mumbai) and a PhD (economics) from the University of Pennsylvania and was a postdoctoral fellow at the Economics Research Center and an associate of the Committee on Southern Asian Studies at the University of Chicago. He taught at the University of Michigan and Williams College before joining the World Bank’s Research Department in 1999. He serves on the editorial boards of several leading journals, is a member of the Successful Societies Program at the Canadian Institute for Advanced Research (CIFAR), and advises research institutes and nongovern- mental organizations in India, the United Kingdom, and the United States. Dialogues of Development: Past Contestations, Present Policy Session 3 • Daniel Immerwahr—Before Social Capital: The Forgotten History of Community Development in the Cold War Era • Michael Woolcock—History, Historians, and Development Debates: Using the World Bank’s Archives to Address Five Key Issues • Trudy Huskamp Peterson—Archival Research as Unfinished Business Before Social Capital: The Forgotten History of Community Development in the Cold War Era Daniel Immerwahr Assistant Professor, Department of History, Northwestern University daniel.immerwahr@gmail.com The international community development movement of the 1950s merits our attention today because its basic strategies have returned In recent decades we have become aware of the Community development programs in a number of blindness, arrogance, and recklessness that have countries (the United States had posted advisers accompanied attempts by industrial nations to to programs in 47 countries by 1956) regularly develop the global South. Too often, as we have commanded heavy investments from the United seen, aid and development have been little more States, host country governments, internation- than top-down attempts to impose abstract notions al bodies such as the United Nations and the of “modernity� on poorer nations with no acknowl- Southeast Asia Treaty Organization (SEATO), and edgment of the importance of local variation or of philanthropic bodies such as the Ford Foundation cultural traditions. and CARE. This paper argues, however, that from the very Community development certainly did not beginning of the U.S. engagement with overseas achieve all that it sought to. But it reshaped poli- development, many of the largest and most tics and development in a number of Third World influential U.S. government aid programs were countries—including Colombia, India, Iran, Pakistan, grassroots, localist, and antitechnocratic in their the Philippines, and Vietnam—not only spawning stated orientation. The aid officials presiding over thousands of small-scale aid projects but also such projects, often experts on agriculture or rural leading in some key cases to the democratization society, entered the field of foreign relations with of local governments. a set of preoccupations that differed from those The international community development of modernization theory. As a rule, they privileged movement of the 1950s merits our attention small-scale works, local knowledge, democratic today because its basic strategies have returned. participation, and communal solidarity at the level Under the labels participatory development , of the village. community-based development, and community- In collaboration with Third World policy makers, driven development, new programs have reanimated these aid officials designed a political project— the basic approach pioneered in the midcentury community development—that came to hold decades and have come to dominate our thinking sway throughout the global South in the 1950s. about how to do development. But what is 28 Dialogues of Development: Past Contestations, Present Policy remarkable about the rapid rise of community approaches to development over the past 20 years is how little acknowledgment there has been of prior experiments with the practice. Our inability to remember what was once a major policy initiative that shaped the course of dozens of nations is all the more alarming because, by and large, community development projects during the Cold War failed. What development experts found, in nation after nation, was that attempts to enroll poor and rural people in development campaigns provided openings for local elites, speaking in the name of “the village� or “the neighborhood,� to capture state resources and channel them toward projects that either enriched them personally or at least did nothing to threaten their local bases of power. This skewing of participatory projects toward village headmen and the like proved corrosive, diminishing both the willingness of people to partic- ipate in development projects and the effectiveness of those projects. Strikingly, scholars have noted During the 1950s, as the community development projects similar problems with the World Bank’s community were developing, the United States was also shipping surplus agricultural commodities abroad. This 1959 paper, written projects today. Now is the time for an assessment by Bank economist Dragoslav Avramovic, analyzes the of community and participatory strategies that impact of the surplus disposal program on economic devel- takes account of their long history, one that asks opment. Memorandum, Dragoslav Avramovic to Davidson about both their advantages and their limits. Sommers, May 14, 1959, enclosing “The U.S. Agricultural Surplus Disposal Program and Economic Development�; Development – General V; WB IBRD/IDA 02 Central Files 1946-1986; 183995B; World Bank Group Archives 29 History, Historians, and Development Debates: Using the World Bank’s Archives to Address Five Key Issues Michael Woolcock Lead Social Development Specialist, Development Research Group, World Bank mwoolcock@worldbank.org In development circles, everyone agrees that history matters. But historians could make a much greater contribution to development policy debates History, whether understood as the past or the right. But they are also both of great contempo- discipline, is a topic on which there is a strong rary significance and potentially amenable to the consensus in development circles: just as on types of analyses that historians of international the broader category of context, everyone agrees agencies can offer. They are topics that have that it matters. At least in principle. In practice, been and remain at the heart of the development it is rare to encounter a country poverty assess- enterprise, yet the relative attention afforded them ment, or any other major country-level report by a has changed over time, as has indeed their very multilateral or bilateral development agency, that meaning to World Bank staff and clients alike. engages seriously with how a country’s present Careful historical and archival inquiry not only opportunities, challenges, constraints, and achieve- can document when and how these changes ments emerged from (and continue to be shaped occurred but also can spell out their enduring by) particular constellations of factors and events consequences: from prosaic considerations relat- in its past. ing to the bases for determining what works (and This paper concurs with the notion that his- thus enhancing development effectiveness) to the tory matters, but extends the logic to argue that broader intellectual frameworks shaping what is therefore historians must matter, and matter in thinkable, sayable, prioritized, and implemented particular ways for certain key issues. It seeks to at any given moment. explain the paradoxical disjuncture between the On agriculture, archival research could be consensus and the neglect of history, considers instrumental in documenting when and how its how historians can contribute positively to devel- status began to decline among development pro- opment policy debates, and offers five substantive fessionals, what the consequences have been for issues, or domains of inquiry, that should be at the resources (staff time, projects) allocated to the forefront of these debates. it, and what the sources of variation are among These five issues—agricultural productivity, and within countries (that is, why some countries state capability, equitable taxation, rule of law, or states, more than others, have sustained their and social inclusion—are important in their own commitments to agriculture). On state capability, 30 Dialogues of Development: Past Contestations, Present Policy archival research could help identify specific coun- tries, sectors, and moments in which implemen- tation dynamics were taken seriously and track the consequences of this for both how effective projects have been and how a given project’s performance was explained to others. On equitable taxation, archival research could help us discern whether, when, how, and through whom durable political settlements have been reached on the desirability and possibility of under- taking a cornerstone (if inherently contentious) activity of the modern democratic state. On the rule of law, it would be instructive to learn how justifications for its promotion have changed over time and how persistent “nonaccomplishment� The Bank’s archives hold thousands of photographs and in moving from agreement on its importance to sound and video recordings. This is a photograph of Robert actually bringing it about has been explained or McNamara making one of the most famous speeches in rationalized. Bank history: his address to the Bank’s Board of Governors Finally, on social inclusion, it would be highly meeting in Nairobi, Kenya, in which he outlined an agenda for combating rural poverty. The audio recording of the speech beneficial for archival historians to discern from is available in the “Archives� section of the Bank’s website: the written accounts (and oral testimony from http://web.worldbank.org/WBSITE/EXTERNAL/EXTABOUTUS/ retired Bank staff) how both the Bank itself and its EXTARCHIVES/0,,contentMDK:23269658~pagePK:36726 ~piPK:437378~theSitePK:29506,00.html client counterparts have grappled with contending notions of what it means—for a country, for a policy dialogue, for a project—to be socially inclusive (to incorporate, for example, the specific concerns of minority populations). 31 Archival Research as Unfinished Business Trudy Huskamp Peterson Chair, Human Rights Working Group, International Council on Archives trudy@trudypeterson.com Research is always unfinished. But it is only through the use of archives that we begin to understand what truly has transpired among us Research in archives as unfinished business: every and health care organizations, big architectural researcher knows the feeling. When we think of firms—should become more available if they research on the history of development—a vast take seriously the Guiding Principles on Business topic with no discernible boundaries—the research and Human Rights that were endorsed by the required seems limitless. An enormous number United Nations Human Rights Council in 2011. of archives hold significant research material for Business archives are balanced by the archives the study of development. of labor unions and syndicates. Also useful are The logical place to star t research on records of international sports bodies, faith-based development topics is with the archives of the organizations, educational institutions, and NGOs. agencies directly concerned with development: Indeed, nearly all types of archives have potential the national agencies, such as the Canadian for use in studying development. International Development Agency, and certain Two caveats are important, however. First, international nongovernmental organizations some records will have a higher kilo/PhD ranking (NGOs), such as Action Against Hunger. Records than others. (A kilo/PhD is a ratio showing how of national governments offer much potential many kilograms of records a researcher must read for research on development, not only the in order to write a PhD dissertation; its modern records of their development agency or foreign counterpart is a kilobyte/PhD.) Second, only a ministry but also those of agencies that served tiny fraction of the extant records are available as development models for other countries. electronically, and relying only on sources found Archives of intergovernmental bodies, such as online is a sure way to miss important material. the development banks, are central sources for What about access to all these archives? research on development. Records of corporations— To an archivist, access means the availability of multinational commercial enterprises, medical archives for consultation as a result of both legal 32 Dialogues of Development: Past Contestations, Present Policy authorization and the existence of finding aids. Since the end of the Cold War the international archival community has developed standards for finding aids that help researchers better under- stand the contents and contexts of the records in archives. Then, in August 2012, the International Council on Archives adopted a best-practice standard on the legal authorization for access to archives: the Principles of Access to Archives. The principles, 10 in number with accompa- nying explanatory text, address access issues in both public and private archives. An introduction discusses the purpose and scope of the principles and the shared responsibilities for implementing The Bank’s archives hold personal papers donated by former Bank staff members or their heirs. Gloria Davis was the first them (http://www.ica.org/13619/toolkits-guides anthropologist hired by the World Bank, and she brought -manuals-and-guidelines/principles-of-access-to with her extensive experience working in Indonesia. Davis -archives.html). was part of virtually every Bank review of the Indonesia transmigration project; this map from her papers is from The business of archival research is the pro- the Transmigration I Project involving the areas of Baturaja cess by which we begin to understand the mani- and Way Abung. Map, “Sket Peta Kab. Lampung Utara,� fold ways in which multiple operators shaped the ca. 1980; Indonesia transmigration program subject file; development of the world we live in. As the very WB IBRD/IDA 84-05, Personal papers of Gloria Davis; World Bank Group Archives first sentence of the Principles says, “Archives are preserved for use by present and future gen- erations.� Research is always unfinished, but it is only through the use of archives that we begin to understand what truly has transpired among us. 33 Session Chair James Boughton Historian, International Monetary Fund (Retired) James Boughton was historian of the International Monetary Fund (IMF) from 1992 to 2012. In 2001–10 he also served as assistant director in the Strategy, Policy, and Review Department at the IMF. From 1981 until he was named historian, he held var- ious positions in the IMF Research Department. Before joining the IMF staff, he was a professor of economics at Indiana University and had served as an economist at the Organisation for Economic Co-operation and Development in Paris. Dr. Bough- ton holds a PhD in economics from Duke University. He has written two volumes of IMF history: Silent Revolution: The International Monetary Fund 1979–1989 and Tear- ing Down Walls: The International Monetary Fund 1990–1999. His publications also include a textbook on money and banking, a book on the U.S. federal funds market, several books that he edited or coedited, and articles in professional journals on international finance, monetary theory and policy, international policy coordination, and the history of economic thought. The Role of Archives in International Organizations Session 4 • Elisa Liberatori Prati—The World Bank’s Archives: 60 Years of Development Knowledge on the “Science of Delivery� • Pamela Tripp-Melby—The International Monetary Fund’s Archives for Economic Research • Bridget Sisk—Archives of Development in the United Nations Secretariat: Murky Past, Unclear Future The World Bank’s Archives: 60 Years of Development Knowledge on the “Science of Delivery� Elisa Liberatori Prati Chief Archivist, World Bank Group eliberatoriprati@worldbankgroup.org The World Bank’s archives offer a wealth of case studies and unpublished primary sources to analyze patterns of development http://www.worldbank.org/archives If history matters, archives can help. And the World and Reports� web page. Today the site provides Bank’s archives offer a wealth of case studies and access to more than 130,000 documents, many unpublished primary sources to help researchers of them in multiple languages, with the aim of understand patterns of development. The archives better sharing the institution’s knowledge base. contain 193,000 linear feet of development The “Documents and Reports� web page is one information related to World Bank Group member of the most frequently accessed on the Bank’s countries dating from 1946 to the present—corre- site, averaging more than 100,000 unique users spondence, project files, country files, economic a month. reports, sector studies, policy files, oral history To increase the accessibility of Bank records interviews, and films, videos, and photographs. even more, the World Bank Group Archives is Stacked, the boxes would reach seven times the developing an “e-archives� project. This effort is height of Mount Everest—and the holdings con- aimed at providing people—no matter where they tinue to grow. Descriptions of 55 of the 78 fonds are—with easy access to public records from the (groups of records from a single office or, in a few Bank’s archives; disseminating records online as cases, from a single individual) are available at a way to share knowledge and information and http://www.worldbank.org/archives. enhance transparency and accountability; and In 2010 the World Bank, under its new Access presenting records in a way that clearly commu- to Information Policy, launched an effort to make nicates their context and original order. more information available to the public than ever We welcome researchers to come and use the before. Thousands of historical documents were records from the archives. Our understanding of released from the archives and made available development will benefit enormously from your on the Bank’s website, through the “Documents work. 36 The Role of Archives in International Organizations The International Monetary Fund’s Archives for Economic Research Pamela Tripp-Melby Chief, Information Services Division, International Monetary Fund (Retired) The International Monetary Fund’s archives http://www.imf.org/external/np/arc/eng provide access to historical policies, decisions, /archive.htm and research for both internal and external researchers With a mandate for global economic and financial Researchers worldwide can now access a stability, the International Monetary Fund (IMF) searchable website with descriptions of archive has many roles, all of which rely on accurate infor- holdings and links to Executive Board minutes mation. To carry out their work, IMF economists and documents. Nearly 200,000 documents are use information from both primary and secondary available online. The archives are accessed hun- sources. The IMF’s archives are an important dreds of times a year, by IMF staff and by external resource, providing authoritative, reliable informa- researchers—from academics and corporate tion on historical policies, decisions, and research. economists to nongovernmental watchdogs and The IMF contributes to the global information national and international civil servants. pool by sharing its authoritative data and analyses. What do researchers who use the IMF’s archives As part of its commitment to transparency, the study? Internal researchers typically look at prece- IMF opened its historical materials to the public dents in the IMF’s policies and operations; external in 1996. Now, most Executive Board documents researchers often study past events that shape our are open after three years, board minutes and economic world today. There are many areas ripe decisions after five years, and other documentary for research in the IMF’s archives. And as more (departmental) material after 20 years. Archival documents are opened, their descriptions also will material goes through established processes to be searchable through the online archives catalog. be prepared for public access. A routine declas- sification process makes the large majority of restricted documents public. 37 The Role of Archives in International Organizations Archives of Development in the United Nations Secretariat: Murky Past, Unclear Future Bridget Sisk Chief, Archives and Records Management Section, United Nations Headquarters sisk@un.org A continuing focus is the digital preservation imperative—planning for the long-term accessibility and usability of authentic digital information http://archives.un.org/ARMS The Archives and Records Management Section Department of Economic and Social Affairs and (ARMS) of the United Nations has three main roles: its predecessors—primarily technical assistance managing records in UN offices, preserving and project files. Other development-related collections providing access to records of continuing value are the archives of the United Nations Children’s as archives, and providing advice and guidance Fund, United Nations Development Programme, in these areas. and United Nations Population Fund. The influence The UN archives have a headquarters focus, that some of the most important economists at the centering on the records of the secretaries-general United Nations had on development thinking was and their immediate office and those of peace- traced by a 2005 exhibition from the UN archives, keeping missions. The archives contain some accompanied by an exhibit catalogue published as 23,500 linear feet of paper records as well as part of Reflections on United Nations Development thousands of photographs, historical maps, reels Ideas (Geneva: United Nations, 2007). of microfilm, and drawings and blueprints of UN A continuing focus is the digital preservation facilities. There are also electronic archives. UN imperative—planning for the long-term accessibility archives and records are available for use by both and usability of authentic digital information. By academic researchers and the general public. 2015 the UN Secretariat is to be paperless. ARMS Records generally are accessible 20 years after is participating in Secretariat-wide efforts to develop being created; those that are strictly confidential digital preservation capability—to protect against require declassification. the risk of being unable to operate efficiently At the core of the development-related archives and effectively because the digital information is in ARMS are the records of the United Nations inaccessible or unusable. 38 Session Chair Célestin Monga Senior Adviser, Development Economics, World Bank Célestin Monga, a Cameroonian national, is a senior adviser at the World Bank, where he has held positions in both operations and the research department, including as a lead economist in the Europe and Central Asia Region and manager of the Policy Review team in the Development Economics Vice Presidency. He has also served on the board of directors of the Sloan School of Management’s Fellows Program at the Massachusetts Institute of Technology (MIT) and taught economics at Boston University and the University of Bordeaux. Prior to joining the World Bank, he was a department head and manager in the Banque Nationale de Paris group. He was the economics editor of the five-volume New Encyclopedia of Africa (Charles Scribners & Sons, 2007). His books have been translated into several languages and are widely used as teaching tools by academic institutions around the world. He holds degrees from MIT, Harvard, and the universities of Paris 1 Panthéon-Sorbonne, Bordeaux, and Pau. Exploring Archives on the Role of Development Practitioners: Africa S ession 5 • Teresa Tomas Rangil—United Nations Economic and Technical Assistance during the Congo Crisis, 1960–64 • Stephanie Decker—Translating Theory into Practice: The World Bank’s Economic Advisers in Ghana, 1960–85 • Gareth Austin—History, Archives, and Development Policy in Africa • Keith Breckenridge—From Parliamentary Accountability to Records Management: The Decline of Archival Authority in 20th-Century South Africa United Nations Economic and Technical Assistance during the Congo Crisis, 1960–64 Teresa Tomás Rangil Junior Research Fellow, Jesus College, University of Oxford tomasrangil@gmail.com Archival sources and oral history on technical assistance programs in the newly independent Congo reveal a large gap between design and execution The accession to independence of the Republic Fund undertook tasks that included liquidating of the Congo (today, the Democratic Republic of the formerly Belgian-controlled Banque Centrale Congo) on June 30, 1960, entailed the transfer of du Congo Belge et du Ruanda-Urundi and drafting the country’s financial and economic institutions the statutes for a new Congolese national bank, from Belgian to Congolese rule. To facilitate the revising the regulation of the exchange rate for the coordination of this transfer, the United Nations Congolese franc and of import-export transactions provided economic, financial, and technical assis- through the establishment of a foreign exchange tance to the Congolese authorities with the help office and an import licensing office, and assisting of the International Monetary Fund. The task was in drafting and negotiating a balanced budget. not easy: the country was undergoing serious These tasks were informed by the theoretical difficulties, with a decline in production output, debates of the 1960s within the development a widening trade gap and falling exchange rate, community—debates relating to fiscal federalism, exploding government deficits, and rising unemploy- currency unification, and monetary and budgetary ment and inflation rates. The problems were soon stability. complicated by the sudden massive departure of This paper contrasts the theoretical analyses Belgian officials and technicians; the secession and policy advice given by experts with the dif- of the provinces of Katanga, Kasai, and Équateur; ficulties of the actual implementation of these the collapse of most means of transportation and recommendations “on the ground.� Using archival communication; and ethnic and tribal warfare. sources and oral history, I reconstruct the life of From 1960 to 1964, in the midst of these policy officials and their circles as well as the difficult circumstances, international experts from material living conditions of the UN development the United Nations and the International Monetary workers in the Congo, their interactions with local 42 Exploring Archives on the Role of Development Practitioners: Africa authorities and the Congolese population, and the way in which these circumstances influenced their work. The paper begins by retracing the design of the civilian operations mission at the UN headquarters in New York and Léopoldville (today, Kinshasa) by the so-called Congo circle led by Dag Hammarskjöld and then U Thant, the members of the Monetary Council, and the Commission pour le redressement économique du Congo. The analysis focuses on the ideas that guided the transfer of the economic and financial institutional arrangements from the colonial ruler to the new government. The paper then follows the experiences from 1962 to 1964 of the technical assistance team charged with implementing policies “in the field.� As soon became evident, there was a huge gap between the design of the technical assistance programs and their execution. The paper analyzes the relevance of this gap for the subsequent devel- opment of a more professional economic expertise in the United Nations. The paper concludes with Like the United Nations, the Bank was deeply concerned a methodological reflection on the use of oral about the changes in the Congo, and the Bank and the histories to understand complex development United Nations shared information. This memo from the and relief operations, contrasting it with the use United Nations financial adviser in the Congo to the United Nations special adviser for civilian affairs in the Congo was of printed archival sources. shared with the Bank. Victor Umbricht to Sir Alexander MacFarquhar, March 27, 1961; Congo – Fact Finding Study by I.B.R.D., Material received from the U.N.; WB IBRD/IDA 01 Country Operational Files, 1946-1998; 183285B; World Bank Group Archives 43 Translating Theory into Practice: The World Bank’s Economic Advisers in Ghana, 1960–85 Stephanie Decker Senior Lecturer in International Business, Aston Business School s.decker@aston.ac.uk The World Bank’s earlier experience in Ghana showed a tendency to prioritize theoretical knowledge over contextual, practical know-how The World Bank’s relationship with Ghana had been upheaval, the country became one of the first politically difficult since the inception of the Volta exponents of a successful Structural Adjustment River Project in 1957. Initially advisers were indi- Program in Africa. Yet behind this dramatic turn- viduals directly appointed by political leaders, but around the work of the resident economic advisers in the early 1970s the World Bank reinvented itself was crucial, as they mediated World Bank policy as a development agency and began to provide within the local context of African politics. economic advice on a large scale. Throughout the This paper illustrates the difficulty of trans- 1970s military regimes controlled the Ghanaian lating economic theories and political intentions economy, which suffered from overvalued exchange into acceptable programs that can work for local rates, widespread corruption, and smuggling. recipients, an aspect of the work of development At the time the World Bank, under Robert practitioners not often considered. It furthermore McNamara, took a laissez-faire approach. This argues that episodes like this one show the spe- changed during the 1980s, which became known cific ways in which organizations view their own as the era of Structural Adjustment. While Ghana knowledge base, what kind of knowledge they seek underwent intense economic crisis and political to transfer, and how. 44 Exploring Archives on the Role of Development Practitioners: Africa Surprisingly, the World Bank appeared to repli- cate some of the limitations seen in the individual advisers of earlier decades—especially the failure to adequately translate theory into practice— despite its superior resources. This is important because it shows a limited concept of knowledge, specifically the tendency to prioritize theoretical knowledge over contextual, practical know-how. As this problem persisted over time, it also showed a failure of organizational memory and social learn- ing. The paper argues that this lack of awareness by the World Bank of its past actions and limitations contributed not only to the failure to identify the problem within organizational practices, but also to the substantial criticism the Bank faced with respect to how Structural Adjustment Programs were implemented in poor countries. Beginning in 1972, separate filing centers were maintained for the records of World Bank regional operations. This item used by Decker is from the records of the Africa Regional Office. J. R. Peberdy to Nicolas A. Gibbs, January 10, 1983; Ghana, LEAP General; West Africa, General Country Files, 1971-1983; WB IBRD/IDA 05 Records of the Africa Regional Office; 191629B; World Bank Group Archives 45 History, Archives, and Development Policy in Africa Gareth Austin Professor of African and Comparative Economic History, Graduate Institute of International and Development Studies, Geneva gareth.austin@graduateinstitute.ch A historical approach takes time seriously—seeking to disentangle continuities and changes and analyze events in their temporally specific contexts This paper discusses how the study of African the physical constraints, notably thin and easily history (economic and otherwise) and an aware- eroded layers of soil nutrients, continue to impose ness of African historiography (written from various costs and policy dilemmas about the necessary disciplinary backgrounds) may help us think about transition to intensive agriculture. development policy in the context of Sub-Saha- African “history lessons� for development policy ran Africa. In illustrating the uses of a historical include the significance of changes of context for approach, I mean one that takes time seriously— debates about the economic efficiency of particular seeking to disentangle continuities and changes institutions, for example, in land tenure; the impor- and analyze events in their temporally specific tance of politics—as distinct from institutions—for contexts. development outcomes; and the need to counter Economic development in Sub-Saharan Africa overgeneralizations about the cultural contexts of has been a very long-term, cumulative, and path- entrepreneurship. Western “myths of origin� are dependent struggle, in an originally land-abundant a misleading guide to current development; more but not resource-rich environment, to mitigate the nuanced historical perspectives are required. multiple constraints (especially by successive, A historical approach highlights the sequence selective adoptions of imported crops). This in which changes occurred, which matters when development path has been characterized by, the changes tend to be conflated in retrospect, among other things, a preference for land-extensive thereby confusing the determinants involved. Since techniques in agriculture and, until well into the the end of the Cold War, many governments and 20th century, the use of various forms of coercion international organizations have hailed the com- to reduce the price of labor. In recent decades much plementarity of market economies and multiparty of the region has moved toward land scarcity and democracy. It is salutary to recall, however, that labor abundance. A cheaper and better-educated in Africa the shift toward the former (Structural labor force raises the possibility of some form Adjustment) distinctly preceded the latter. In Ghana of labor-intensive manufacturing. But some of and Nigeria, for example, economic liberalization 46 Exploring Archives on the Role of Development Practitioners: Africa received democratic legitimation, but only after it was a fait accompli. Another example in the paper concerns the frequent assumption that African leaders are purely self-interested and often incompetent. The historian’s attention to the constraints under which decisions were made, to the perceptions and contexts of the time, is conducive to taking African leaders seriously, rather than seeing them as, at best, mere individualist maximizers responding to incentive structures over which they have little control. There is still no systematic general survey The Bank recognizes the need to strengthen archival pro- of postindependence archives in Africa. But my grams in Africa. As part of Uganda’s Bank-funded Public own limited observations in archives in Nigeria, Service Performance Enhancement Project, a new records The Gambia, and (more extensively) Ghana are and archives center will be built. World Bank. 2006. Ugan- da—Public Service Performance Enhancement Project: somewhat pessimistic. The culture of filing and resettlement plan. s.l. ; s.n. http://documents.worldbank preserving records within the offices that generated .org/curated/en/2006/10/7158670/uganda-public them has not been consistently maintained since -service-performanc-enhancement-project-resettlement-plan independence. Where kept, records often have not been regularly transferred to the archives. on the perceptions that informed them, the inter- Comparing colonial and postcolonial records in the ests and ideals that the individuals and groups Ghana national archives, I am struck by the much involved sought to mobilize, and to what effect. lower density of the latter and the fact that a much There is a tendency among some economists higher proportion of the postcolonial materials are to equate causal determination with statistical copies of published documents and a much lower tests of causality. But when it comes to decision proportion are correspondence files. making, reliance on such tests leads to circular Correspondence files are generally the most reasoning: the assumption that outcomes must promising window on how decisions were made: have been those intended. 47 From Parliamentary Accountability to Records Management: The Decline of Archival Authority in 20th-Century South Africa Keith Breckenridge Historian, Wits Institute for Social and Economic Research, University of the Witwatersrand keith@breckenridge.org.za The public archives and official record keeping have fallen into disrepair in South Africa. Is restoring parliamentary oversight the solution? The public archives and the work of official record to outsource the digitization of all state records keeping have fallen into notorious disrepair in to one of the large international information tech- contemporary South Africa. Shortages of skills, nology corporations. That this has not happened of funds not already earmarked for salaries, of can be traced in significant part to the ignominious competent and tenacious managers, and, per- account that South African scholars and archivists haps most importantly, of trust have battered have offered of archival work—particularly digital the provincial and national archive services over archives—over the past decade. the past decade. In addition, the public activities In short, many South African scholars have of the National Department of Arts and Culture adopted what can usefully be described as the suggest that the leaders of the African National Chicago view—following the work of Bernard Congress (ANC) much prefer the mute testimony Cohn, Nick Dirks, Arjun Appadurai, and Dipesh of the monuments and artifacts of a moribund Chakrabarty—that the official archive is an instru- nationalism to the labyrinthine, and sometimes ment of imperial and colonial control. And this racially derogatory, testimony of the country’s view has strongly influenced national policy. It is archival record. important to acknowledge that there is real power There is a noticeable disinterest in the new to the Chicago argument. But as I show in this tools of digital government that might be applied to paper, the claim is a significant simplification of official records that stands in contrast to the ANC the primary purpose of the archival record over government’s otherwise enthusiastic embrace of the past two centuries, and one that has had computerized administrative solutions. It would be especially damaging effects on public arguments entirely within the general pattern of governance about the political work of accountability in the over the past decade—as in the provision of welfare official record. or the building of roads—for the archive service 48 Exploring Archives on the Role of Development Practitioners: Africa The South African colonial archives, like British public records in general, were heavily shaped by the requirements of presenting official records to Parliament in London. Two imperial problems— the government of India and the abolition of the slave trade—were central to the development of the system of regularly published papers by the parliamentary printer, Luke Hansard and sons, in the century after 1774. In this paper I examine Edmund Burke’s prosecution of Warren Hastings for corruption in the government of the affairs of the East India Company and Dirks’s recent effort to present it as an apology for empire. I show that the requirement of parliamentary account- ability, initiated by Burke and deployed against key imperial representatives in South Africa such as Theophilus Shepstone and Alfred Milner, was the only meaningful restraint on an otherwise despotic bureaucracy. This remains the case today. Restoring parlia- mentary oversight of the official archives—as an act of sovereignty, not heritage—would fix much of Archives in institutions such as the World Bank can supple- what is currently broken in official record keeping ment archives in states where the archives are incomplete. in South Africa. This “mission diary� of a World Bank mission in May 1957 to examine the “creditworthiness� of South Africa includes reports of discussions with a dozen government officials, including future prime minister H. F. Verwoerd. Mission diary, May 11, 1957; South Africa, Mission Diary; WB IBRD/IDA 01 Country Operational Files, 1946-1998; 171918B; World Bank Group Archives 49 Session Chair Gianni Toniolo Research Professor of Economics and History, Duke University, and Professor of Economic History, Libera Universita delle Scienze Sociali (Rome) Gianni Toniolo is a research professor of economics and history at Duke University and a professor of economic history at the Libera Universita delle Scienze Sociali (Rome). He is a research fellow at the Centre for Economic Policy Research (London), a member of the European Academy, and a coeditor of Rivista di Storia Economica. Previously he was a professor of economics at the universities of Roma Tor Vergata and Venice; held visiting professorships at the universities of Connecticut, California (Berkeley), and Hitotsubashi (Tokyo); and was a visiting fellow at St. Antony’s College and All Souls College, Oxford. His research interests focus on European economic growth in the 19th and 20th centuries and on the history of money, finance, and central banking. His books in English include The Oxford Handbook of the Italian Economy since Unification (Oxford University Press, 2013), The World Economy between the Wars (with C. H. Feinstein and P. Temin; Oxford University Press, 2008), The Global Economy in the 1990s: A Long-Run Perspective (with Paul Rhode; Cambridge University Press, 2006), Central Bank Cooperation at the Bank for International Settlements (Cambridge University Press, 2005), Economic Growth in Europe since 1945 (with N. Crafts; Cambridge University Press, 1996), and An Economic History of Liberal Italy (Routledge, 1990). The United Kingdom, the United States, and the World Bank’s Development Policy Session 6 • Simon Szreter—The Archival History of Britain and Its Dialogue with Development Policy during the World Bank Era, circa 1945 to the Present • Alexander Field—What the Developing World Can Learn from the Economic History of the United States—and Vice Versa The Archival History of Britain and Its Dialogue with Development Policy during the World Bank Era, circa 1945 to the Present Simon Szreter Professor of History and Public Policy, University of Cambridge srss@cam.ac.uk Findings about the course of British demographic history have turned upside down our earlier postwar models of economic growth British historical development has in many ways growth and partly reflects its widespread influence been used as a paradigm case for models of eco- across the globe as the leading trading and mari- nomic development that have been highly influential time power throughout much of the modern period in the international policy world throughout the since 1700. From a practical and professional postwar era—an era during which the World Bank historians’ point of view, however, it undoubtedly has been the major global player in and user of also reflects the extraordinary richness of surviving this applied historical knowledge. From Rostovian documentation about economic, social, and demo- takeoff and incremental capital-output ratio (ICOR) graphic affairs throughout the past millennium in a models of growth so popular in the 1950s and country that has never been conquered or occupied 1960s and the demographic and epidemiological throughout that long period during which written transition models that are still influential today, documentation of all the affairs of governance, through to the Washington Consensus neoliberal law, and the economy has existed. paradigm of the 1990s and the current focus on An era of documentary government began the importance of rule of law and getting institu- immediately following that moment of final con- tions right, readings of history—in particular a quest in 1066, in that the conqueror in question, dialogue with British history—have often been a William of Normandy, initiated the Domesday sur- highly influential factor. vey, rightly recognized as a foundational document The unusual degree of influence of this one of not only the visible state, in Jonathan Scott’s country’s history on our thinking about economic sense, but also of the archival state. Michael development of course partly reflects appreciation Clanchy’s superb classic study, From Memory of its importance as the first national economy to to Written Record: England 1066–1307 (London: achieve self-sustaining and industrializing economic Edward Arnold, 1979), has laid out for us how 52 The United Kingdom, the United States, and the World Bank’s Development Policy Britain became, over the next quarter millennium, an increasingly literate and archived society. This process entered a new level of detail and cover- age of the population under the Tudor Crown in the 16th century with the innovation of universal parish registration of all baptisms, marriages, and burials, so that the entire populace was now in existence in the archive. It was that archived population register that in the second half of the 20th century enabled demographic historians working at the Cambridge Group for the History of Population to produce a range of important, entirely new findings about the course of British demographic history from about 1538 onward. These findings have turned upside down not only demographic transition theory but also our earlier postwar models of economic growth. And they have provided the crucial context The United Kingdom has been a central force in Bank for the contemporary policy focus on institutions to operations ever since Bretton Woods. One important early become both plausible and necessary. The impor- issue involving the U.K. was how the International Devel- tance of archivally derived historical knowledge opment Association would handle loans to “dependent to inform development policy is nowhere more territories.� In this letter an official of the Commonwealth Relations Office explains to a member of Parliament how clearly demonstrated than in the case of British aid to territories will be handled; unsatisfied, the MP sent economic history, its influence, and the capacity the letter to the Bank, asking for more information. Letter, to radically reinterpret its meaning that has been William C. Powell to Harold Graves, enclosing request for information from Francis Noel-Baker and a photostat of his shown during the past 50 years. letter from the Commonwealth Relations Office, March 23, 1964; IDA – Policy and Procedure – Dependent Territories – United Kingdom; WB IBRD/IDA 02 Central Files 1946-1986; 184072B; World Bank Group Archives 53 What the Developing World Can Learn from the Economic History of the United States—and Vice Versa Alexander J. Field Michel and Mary Orradre Professor of Economics, Santa Clara University afield@scu.edu The United States has an enviable record of growth. But how much does the history of the developing world stand as a cautionary note? It is widely understood that the differences in labor history, Richard Sylla, had this to say: “Most productivity and per capita output levels throughout informed observers today would agree that the the world are far larger than can reasonably be United States has just about the best financial accounted for by the standard factors appealed to system in the world. Its problems are newswor- in a Solow growth model—in particular, the ratio thy mostly because they arose in the context of of capital to labor or access to production technol- a well-functioning financial order, not one that is ogies. During the 1990s a so-called Washington disorderly� (“Reversing Financial Reversals: Gov- Consensus developed that the main explanation ernment and the Financial System since 1789,� for these differences, and for why the entire world in Government and the American Economy: A New wasn’t rich, was differences in institutions—not History [Chicago: University of Chicago Press, differences in culture or geographic endowments 2007], 115). The crisis that ensued shortly after but differences in the political systems and legal the publication of his essay had as its epicenter rules governing societies and the historical pro- the U.S. financial system, was associated with a cesses that had given rise to them. This view seizing up of most credit markets, and could easily receives strong reinforcement in Daron Acemoglu have plunged the world economy into a depression and James Robinson’s Why Nations Fail: The Origins as serious as the one that marked the 1930s. Even of Power, Prosperity, and Poverty (New York: Crown, with unprecedented fiscal and monetary interven- 2012), where the authors criticize the focus on tions, the fallout from these events continues to geography or the disease environment that they reverberate. Sylla’s comment is reflective of the associate with such writers as Jared Diamond potential dangers of a U.S.-centric triumphalism or Jeffrey Sachs as well as various assertions in thinking about development policy. about culture. There are other concerns. Over the past three In 2007, on the eve of the worst U.S. financial decades the United States has experienced a sub- crisis, one of our leading students of financial stantial increase in wealth and income inequality, 54 The United Kingdom, the United States, and the World Bank’s Development Policy and most of the gains in life expectancy have been among the better-off. The influence of wealthy elites on political outcomes has been reinforced by Supreme Court decisions such as Citizens United, which removed restrictions on independent expenditures in political campaigns by corporations, associations, or labor unions. How much of the triumphalist message of the Washington Consensus stands, even after the travails and crises of the past decade and recent economic and political trends? The United States has an enviable record of economic growth and development, particularly in the second and third quarters of the 20th century. What underlay that record is worth reexamining. But how much does the history of the developing world stand as a cautionary note? It is here that the historical materials collected in the World Bank’s archives can be useful. Particularly useful are those documenting the interplay of political centralization and inclusiveness and the extent to which this has influenced the environment and incentives for The impact of the U.S. economy on the world financial system has been a concern for the Bank from its inception. In this effort, accumulation, and innovation—and their letter from the beginning of the Cold War era, U.S. banker concomitant, sustained economic growth. R. C. Leffingwell tells Bank President John J. McCloy that the U.S. must use its intelligence to avoid a great depression. All the records of the McCloy presidency have been scanned and are available in the “Archives� section of the Bank’s website. http://siteresources.worldbank.org/EXTARCHIVES /Resources/wbg-archives-1506591.pdf 55 Session Chair Hassane Cissé Deputy General Counsel, Knowledge and Research, Legal Vice Presidency, World Bank Hassane Cissé, a national of Senegal, joined the World Bank in 1997 after working for many years as a lawyer at the International Monetary Fund. He has been deputy general counsel, knowledge and research, of the Bank since 2009. In this capacity he provides intellectual leadership on strategic legal issues facing the institution and leads the Bank’s knowledge agenda on law, justice, and development. He is the editor in chief of the World Bank’s Law, Justice, and Development Series and the author of several papers on aspects of international economic law. He coedited the World Bank Legal Review in 2012 and 2013. Before taking his current position, Mr. Cissé served for many years as chief counsel for operations policy at the World Bank, contributing to the modernization and sim- plification of the Bank’s legal and policy framework. He also served as legal adviser on governance and anticorruption, leading the exercise that resulted in the Bank’s adoption in 2006 of an expanded policy framework for sanctions. He was appoint- ed in 2007 to serve as a member of the World Bank’s newly established Sanctions Board. Mr. Cissé obtained his LLB from Dakar University in Senegal. He also holds an LLM from Harvard Law School, graduate law degrees from the universities of Paris I Panthéon-Sorbonne and Paris II Panthéon-Assas, and a graduate degree in history from Paris I University. Mr. Cissé is a member of the World Economic Forum Global Agenda Council on the Rule of Law. Sailing Back to the Future: History and Policy Making at the World Bank Session 7 • Frank Fariello—History and Policy Making at the World Bank: The Evolving Approach to Governance Issues • Alessandra Iorio—The International Development Association and Debt Relief • Vikram Raghavan and Aristedis Panou—The World Bank’s Mediation of Disputes History and Policy Making at the World Bank: The Evolving Approach to Governance Issues Frank Fariello Lead Counsel, Operations Policy, Legal Vice Presidency, World Bank ffariello@worldbank.org Archival research has played a key role in guiding the evolving legal thinking on the World Bank’s approach to governance issues The World Bank’s Articles of Agreement are its guidance note on multistakeholder engagement foundational documents, operating as a kind of under the Bank’s governance and anticorruption constitutional law guiding its policies and oper- strategy, and the 2012 legal note on engagement ations. The Executive Directors are the ultimate in the criminal justice sector by Anne-Marie Leroy. interpreters of the articles. But they have come to The 1990 Shihata legal memorandum provided rely on the Bank’s general counsel to advise them the seminal legal thinking on the Bank’s governance on the proper interpretation, and their endorsement and anticorruption work. This document relied on of, or concurrence with, the views of the general archival materials to understand the legislative counsel signals their acceptance that such views, history surrounding the relevant passages in the expressed in legal opinions, legal notes, or legal articles, including the statements of Lord Keynes memoranda, are a distinct source of the Bank’s and other drafters of the articles, the proceedings jurisprudence. of the Bretton Woods conference, and the congres- Among the most crucial provisions of the arti- sional hearings relating to the U.S. ratification of cles for Bank policies are those setting out the the articles. The memorandum also reflects “data purposes of the Bank and those prohibiting the mining� of Bank records undertaken to understand Bank from interfering in the political affairs of its how these passages have been interpreted and members, the so-called political prohibition. These applied. Through analysis of this archival research, provisions, which delimit the scope of the Bank’s the 1990 memorandum achieved two intellectual work, have been a focus of a series of legal opin- breakthroughs: It placed many governance and ions of the Bank’s general counsels since 1990, anticorruption issues within the Bank’s purposes including Ibrahim Shihata’s 1990 legal memoran- and mandate, something that had been a subject dum on governance, his 1995 legal opinion on the of some doubt. And it reframed the issue of what political prohibition, the 2004 legal note by Ko-Yung is political and what is economic, a key distinction Tung and 2005 legal note by Roberto Dañino on in the articles that defines the border separating the Bank’s activities in anti–money laundering and the impermissible from the permissible. combating the financing of terrorism, the 2009 58 Sailing Back to the Future: History and Policy Making at the World Bank The result was a purposive interpretation of the articles that helped create an enabling environment at the Bank for its governance and anticorruption activities that remains the basic framework for those activities today. At the same time, the 1990 memorandum set important boundaries that are still valid, excluding work with political parties and political reforms. In one important area, however, the legal think- ing has evolved significantly since Shihata’s day: engagement with the criminal justice sector. This evolution culminated in Leroy’s 2012 legal note. Law and order had been one of the areas that Shihata had excluded from the Bank’s mandate in 1990. But the 2012 note, employing the same research techniques as Shihata had, came to a different conclusion in light of the Bank’s experience in governance over the intervening 22 years and World Bank Vice President and General Counsel Ibrahim the evolving understanding of the development Shihata explains the details of his memo entitled “Issues of governance in the borrowing members: the extent of rationale for work in the criminal justice sector. their relevance under the Bank’s Articles of Agreement,� Once again, the archives played a critical role which is, Fariello explains, the seminal legal thinking in in documenting the Bank’s experience and trac- the Bank on governance and anticorruption issues. World ing its evolving legal thinking. Shihata’s original Bank. 1991. The IBRD seminar of Executive Directors was held on 11th April, 1991. Washington D.C. - The Worldbank. analysis was as critical in 2012 as it had been in http://documents.worldbank.org/curated/en/1991 1990. But a close reading of the historical record /04/15274569/ibrd-seminar-executive-directors-held-11th allowed us to refine the original legal test in a way -april-1991 that reconciled the articles’ requirements with the Bank’s actual practice, as well as its evolving legal has been a purposive interpretation that creates thinking, over the years. The result, once again, an enabling environment for the Bank’s work. 59 The International Development Association and Debt Relief Alessandra Iorio Chief Counsel, Concessional Finance, Legal Vice Presidency, World Bank aiorio@worldbank.org Could the International Development Association provide debt relief? Analysis of the question included looking at archival records of the early thinking about the issue In the 1990s, facing increasing pressure from civil Could IDA provide partial debt relief? The society, the World Bank considered whether it was analysis involved looking at the provisions of IDA’s able to provide debt relief to its poorest clients. articles and analyzing the ordinary meaning and The starting point for lawyers is always to look at intended meaning of the language used. For the what the rules say—and in this case that meant intended meaning, we went to the World Bank’s looking at what the Articles of Agreement of the archives and looked at the detailed memoranda International Development Association (IDA) allow. of the meetings of the Financial Policy Committee IDA’s articles set the following parameters: IDA of the International Bank for Reconstruction and can make loans. It can also make grants in certain Development (IBRD), which had been tasked with circumstances. And it may agree to a relaxation or drafting IDA’s articles in the late 1950s. other modification in the terms of its financing. So Looking at the history, we found that the Cana- the question really turned on whether debt relief dian representative at these meetings had asked can be viewed as a relaxation or other modification whether the language in the articles on relaxation of terms. The question came up in two phases. or other modification would cover forgiveness of In the 1990s a campaign called Jubilee 2000 debt. The Bank’s then general counsel replied that sought cancellation of all world debt by the year while the interpretation of the language could be 2000. Notable supporters included Bono and Bob stretched to forgiving debt, this would not be a Geldof. In the late 1990s the Heavily Indebted Poor normal interpretation. The Dutch representative Countries (HIPC) Initiative was enhanced, with a thought that this section might open the way to proposal to forgive a portion of debt service for switch from loans to grants. There was no recorded heavily indebted countries as it fell due. response to this statement. 60 Sailing Back to the Future: History and Policy Making at the World Bank So the drafters of the articles had clearly thought about the issue but left it open. The articles also provide that if there is a question of interpretation of any of the provisions of the articles, the Executive Directors can be asked to formally interpret the articles. This was the path that was pursued, and the Executive Directors found that partial debt relief was permissible under the articles. At the G-8 summit in Gleneagles in 2005, the G-8 agreed to forgive the balance of the HIPC debt under what is known as the Multilateral Debt Relief Initiative (MDRI). This debt forgiveness would result in IDA writing off about US$37 billion from its balance sheet. There were concerns expressed by other shareholders about a much weakened IDA. We knew the history at that point. We’d also created some of our own history in 2000 by allowing partial debt relief. After a highly charged political process, the Executive Directors were again asked to formally interpret the articles, to allow 100 percent debt relief for the HIPC countries— World Bank Presidents Black’s speech at the 1959 Annual Meetings in the 1959 Summary Proceedings which they did. As part of the MDRI package, the shows him grappling with the formation of IDA. World G-8 and other IDA donors committed to provide Bank. 1959. 1959 annual meetings of the Boards of dollar-for-dollar compensation to IDA for the MDRI Governors : summary proceedings. Washington D.C. - The over the next 40 years. Worldbank. http://documents.worldbank.org/curated /en/1959/10/12609881/1959-annual-meetings-boards -governors-summary-proceedings 61 The World Bank’s Mediation of Disputes Vikram Raghavan Aristedis Panou Lead Counsel, Legal Vice Associate Counsel, Legal Vice Presidency, World Bank Presidency, World Bank vraghavan@worldbank.org apanou@worldbank.org The World Bank’s noteworthy mediation efforts relating to the Indus River dispute are richly reflected in the institution’s archives The Indus Basin Besides financing international development, the dispute reached a World Bank has mediated international disputes crisis in early 1953. among member countries. Its involvement in three These handwritten such disputes is particularly significant. Early in its notes, taken by Hector Prud’hom- history the Bank attempted, albeit unsuccessfully, me during a meet- to bridge differences between Iran and the United ing between Bank Kingdom over the nationalization of the Anglo-Iranian President Eugene Oil Company. Subsequently the Bank grappled Black and India’s B. K. Nehru, give with the economic dimensions of the Suez Crisis, the flavor of the involving Egypt and some Western countries. tension; they were But possibly the most noteworthy example filed “since they are more detailed than of the Bank’s mediation efforts relates to the the memo to Mr. Indus River dispute between India and Pakistan. Sommers.� Hector Prud’homme notes of Eugene Black The subcontinent’s partition in 1947 left the two meetings with B. K. Nehru, March 9, 10, and 27, 1953; countries at loggerheads over their sharing of General Negotiations 1953 (III), India-Pakistan I.B.D. [Indus Basin Dispute]; WB IBRD/IDA 01, Country Operational Files, the Indus River’s waters. For more than a decade 1946-1998, World Bank Group Archives the Bank’s engineers, lawyers, and economists worked closely with their Indian and Pakistani counterparts to resolve the matter. It took the The Bank’s archives include vast and extensive personal involvement of Eugene Black, the Bank’s files on all three disputes. The Indus collection is then president, to reach a solution acceptable to particularly important. It is filled with interesting both sides. That solution was embodied in the engineering reports, a large number of maps, Indus Waters Treaty, signed in 1960. As part of technical memos, and legal notes. Both India and the deal, the Bank committed substantial aid for Pakistan have consulted the collection in technical the construction of storage dams and irrigation discussions and arbitral proceedings with each facilities along the river. other over the treaty’s provisions. 62 Closing Remarks Tony Addison Chief Economist and Deputy Director, World Institute for Development Economics Research Tony Addison is chief economist and deputy director of the United Nations University’s World Institute for Development Economics Research (UNU-WIDER) in Helsinki, Finland. He was previously a professor of development studies at the University of Manchester; executive director of the Brooks World Poverty Institute at the University of Manchester (2006–09); associate director of the Chronic Poverty Research Centre; and deputy director of UNU-WIDER. His books include From Conflict to Recovery in Africa (Oxford University Press), Making Peace Work: The Challenges of Economic and Social Reconstruction (Palgrave Macmillan), and Poverty Dynamics: A Cross-Disciplinary Perspective (Oxford University Press). He was a lead author of The Chronic Poverty Report 2008–09: Escaping Poverty Traps. “It is vital for the Bank to have a sense of its history, invest in its own historians, and encourage its operational staff to really engage. But the Bank also needs external historians and others who are independent—because there is a need for high-quality historical analysis. Whether good or bad, it is dangerous to have the practitioner write the history of what happened.� 63 The World Bank Group Archives—Services and Information for the Public Our Collections Contain • Lending project files • Oral history transcripts • Country files • Films • Economic reports • Videos • Sector studies • Photographs • Policy files Services and Information Chronology Web Archives Our chronology provides a comprehensive timeline Since 1997 World Bank external websites containing of key events in World Bank Group history. Its job is information of historical and research value have to highlight important changes in the institutions’ been captured in the Web Archives for long-term history. The chronology from 1944 to 2005 is avail- preservation and open public access. To search able on our website for downloading or printing at online archives, visit http://www.worldbank.org http://www.worldbank.org/archives. /webarchives. 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