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Economics and Researxh Department Priorities for 2010-2012

Economics and Research Department
Priorities for 2010-2012
[PDF: 992 kb | 16 pages]

Economics and Research Department - ERD

As ADB’s principal research arm, the Economics and Research Department (ERD) helps fulfill ADB's vision of an Asia and Pacific free of poverty by
  1. analyzing and researching on key development issues;
  2. supporting operations by helping formulate country partnership strategies and evaluate project impacts; and
  3. participating in global and regional knowledge networks, and disseminating findings.

ERD’s research programs meet four key criteria:

  1. relevance to ADB’s policy advice and lending operations;
  2. analytical and empirical rigor;
  3. innovative application of cutting-edge methodology; and
  4. impact on development by incorporating research findings in project design and implementation within ADB and in the policies of developing member countries (DMCs).

Under the leadership of Chief Economist, Dr. Jong-Wha Lee, and with the work of staff in its four divisions, ERD contributes to the Bank of scientific knowledge and evidence-based policymaking, with focus on developing Asia.

Research and Analysis of Key Development Issues
ERD, in 2010–2012, strengthens and expands its research agenda to support Strategy 2020’s vision of an Asia free of poverty.

ERD research focuses on

• Inclusive growth

Poverty, inequality, structural transformation, education and health, employment and training, migration and remittances, gender, development of small and medium-size enterprises, and social protection are some of the issues we tackle.

•

Examining Inclusive Growth and Public Policy—We examine the relationship between educational systems, economic policies, and the adoption of technology crucial to driving economic growth; the social protection systems needed in an increasingly globalized workplace; and the governance structures and institutions essential for sustainable and inclusive growth in our project, Inclusive Growth and Public Policy in Asia and the Pacific.
•

Diagnosing Critical Constraints to Growth—We expand our work in development diagnostics through our project, Diagnosing Critical Constraints to Growth and Structural Transformation in Selected DMCs. This initiative identifies critical constraints to inclusive growth and the development and formulation of policy actions—expanded to include regions, subregions, economic sectors, and thematic issues such as agricultural productivity and food security, urban poverty and slums, housing for all, structural transformation, and efficiency of financial intermediation.
•

Monitoring Poverty—We train and advise national statistics offices to help them develop their analytical capacity and generate appropriate indicators under our project Developing a Cost Effective Data Collection Strategy for Evidence-Based Policy Making. ERD will also improve ADB staff access to household survey data and execute analytical studies that use survey data to strengthen understanding of how economic and other shocks, and policy changes and interventions, affect poverty and labor market outcomes.
•

Statistical Capacity Building—We build DMCs' capacity to develop statistical systems in DMCs where the systems are weak. This would be based on existing initiatives on statistical capacity building with national statistics offices in the Asian and Pacific Region and in collaboration with ADB regional departments. Statistical capacity building activities will also facilitate the monitoring of and evidence-based research on development issues, with a particular focus on poverty.
•

Coordinating the International Comparison Program—In 2011, ERD will coordinate the International Comparison Program (ICP) in Asia and the Pacific. ICP aims to improve statistical capacity in collecting price data for a basket of goods and services; producing internationally comparable price levels and economic aggregates in real terms; and estimating purchasing power parity of Asia’s principal economies.
• Environmentally Sustainable Economic Growth

To help inform DMCs of their options in adapting to adverse climate change impacts and begin their transition toward a climate-resilient and low-carbon economy, ERD steps up its research on the economics of climate change and public policy and continue analytical work on cost-benefit analysis of projects and associated methodologies.

• Economics of Climate Change and Low-Carbon Growth—Climate change is likely to hit the poorest countries in the region—with low capacity for adaptation—soonest and hardest. Priorities in 2010–2012 include
  1. enhancing ERD’s capacity for economic modeling of climate change to help assess economy-wide climate change impacts, evaluate policy instruments such as carbon and energy taxes and emissions trading schemes, and analyze implications of climate change and policies for international trade, competitiveness, income distribution, and poverty;
  2. analyzing the costs and benefits of mitigation and adaptation options in selected DMCs; and
  3. undertaking or joining regional reviews of the economics of climate change, in collaboration with ADB regional departments and other development partners, as was done for Southeast Asia in 2009.
• Regional integration

Regional integration work focuses on crisis response and structural adaptation. Research on short- and medium-term economic prospects for the region will remain organized around the Asian Development Outlook, and enhanced by the new global economic monitoring team.

• Achieving More Balanced Growth—We will continue to help DMCs rebalance growth, reduce reliance on exports, and shift the engine of growth to more domestic and regional sources. Under the project Sustaining Asia’s Growth and Investment in a Changing World, ERD will look at how Asia can reduce its reliance on extra-regional demand and diversify its sources of growth.
• Pursuing Fiscal and Debt Sustainability—Under Debt Sustainability in Asia and the Pacific, we assess the sustainability of public debt in the region over a 5- to 10-year period. We examine debt sustainability assessment as implemented by the International Monetary Fund and stochastic forecasting mechanisms applied to public debt, apply both to a sample of Asian countries, and compare the outcomes. The project is expected to shed light on debt patterns likely to prevail in Asia, and the findings will guide ADB regional departments in evaluating IMF debt sustainability assessment country results.
• Commodities, Energy, and Global Economic Monitoring—We will establish a global economic team to monitor commodity prices to better understand the underpinnings of financial and commodity market movements and the consequences of volatility. The global economic team will identify commodities particularly important to global markets and DMCs, such as food and energy, and analyze the interactions between financial and commodity markets, on one hand, and inflation, monetary and fiscal policies, and balance of payments, on the other. The impact of external shocks—such as natural disasters—on the availability of credit and the prices of commodities will be emphasized.

ERD Publications
Asian Development Outlook

 Key Indicators for Asia and the Pacific

 The Asian Development Review ADB Economics Working Paper Series
Asian Development Outlook

 Key Indicators for Asia and the Pacific Asian Development Review

 ADB Economics Working Paper Series
The Statistical Database System (SDBS)
Essential social, economic, and financial indicators relating to DMCs are available in this database.
Operational Support
To better support ADB operations, ERD helps prepare country partnership strategies (CPS), pilots country diagnostic studies, and reviews economic analyses and case studies highlighting good practices.

ERD also assists in impact evaluation. ERD, together with regional departments, will select and execute rigorous studies involving ADB projects in infrastructure, education, health, microfinance, agriculture, and private-sector development through a regional technical assistance on impact evaluation.

Cooperation and Dissemination
• External Cooperation

We partner with academic institutions and research organizations in gathering and disseminating information. ERD invites visiting fellows and prominent speakers to conduct research jointly with staff and give lectures at ADB headquarters to provide up-to-date information in the latest developments in research methodology and economic findings.
• Internal Cooperation

We cooperate and collaborate at all levels—among ERD’s divisions, between ERD and other knowledge departments, and between ERD and regional departments and resident missions—for mutual benefits and institutional efficiency. Internal cooperation is an essential element of ERD’s work, enabling the free exchange of ideas and experiences, and fulfilling the enormous needs for information and analysis in ADB’s work in fighting poverty.

• Knowledge Dissemination

Senior ERD staff have spearheaded outreach programs that contribute significantly to ADB visibility online, in print, and on television, in partnership with ADB’s Department of External Relations. The economics website consistently remains among the most-accessed directories on ADB.org, while the statistics site demonstrates consistently high user interest.
Departmental Organization
ERD has four divisions. The department has 27 professional staff and 32 national officers and administrative staff as of January 2010.

• Office of the Chief Economist (EROD)

Plans and coordinates the department's work programs and undertakes research. EROD collaborates with other departments in ADB's knowledge management. The division releases regular publications containing results of research and analytical work conducted by ADB staff, consultants, resource persons, and external authors.
• Development Indicators and Policy Research Division (ERDI)

Researches on policies and critical development issues to improve economic efficiency and poverty reduction; helps build DMCs' statistical capacity; improves and helps DMCs implement data systems of international standards; and participates in international initiatives related to statistical work such as the International Comparison Program. ERDI maintains SDBS and publishes the Key Indicators for Asia and the Pacific.

• Economic Analysis and Operations Support Division (EREA)

Advises on sound application of appraisal methods for the lending and non-lending services that ADB provides to its DMCs. EREA undertakes methodology research, distills good practices of economic analysis of projects and programs, and conducts training programs for ADB staff and DMCs. The division is also the focal point for the department's work on diagnosis of critical constraints to inclusive growth and research on the economics of climate change.

• Macroeconomic and Finance Research Division (ERMF)

Engages in short- and medium-term economic monitoring and forecasting. ERMF researches on macroeconomic issues and policy, money and financial markets, and international finance. The division publishes the Asian Development Outlook (ADO) and the ADO Update.