Inclusive growth?

Look at idea of inclusive growth as developed by World Bank and others Suggest that it offers nothing new and is primarily a rather seductive term which effectively means more of the same

Inclusive growth and Vision 2020

Strategy 2020 (published in 2008) is ADBs long term strategic framework Three major components:
environmentally sustainable growth regional integration inclusive growth

Yet what is IG?

IG and ADB
inclusive growth will have two mutually reinforcing strategic focuses. First, high, sustainable growth will create and expand economic opportunities. Second, broader access to these opportunities will ensure that members of society can participate in and benefit from growth. It must improve the poors access to markets and basic productive assets by putting in place sound policies and institutions. investments will provide the opportunity for all to improve their standards of living, thereby contributing to economic growth, poverty reduction, and the mitigation of extreme inequalities.

What does IG mean for ADB

Vagueness of the definition: most centrally, is it about process or outcomes Survey of ADB publications (Klassen) three rather different definitions or approaches:
Declining inequality Pro-poor investments in social opportunities Equal opportunities and equal access

The origins of IG
Indian 11th Five year Plan (2006?) The target is not just faster growth but also inclusive growth, that is, a growth process which yields broad-based benefits and ensures equality of opportunity for all.

World Bank contributions

2006 World Development Report Equity and Development 2008 The Growth Report (subtitled, Strategies for sustained growth and inclusive development 2009 What is Inclusive Growth

2006 Equity and Development

The WBs attempt to introduce the concept of equity into the development debate A lot of rather dubious philosophy; even worse sociology
By equity we mean that individuals should have equal opportunities to pursue a life of their choosing and be spared from extreme deprivation in outcomes.

Lack of equal opportunities arises form market failures and from those with power and wealth favouring their own. Nothing wrong with unequal outcomes as long as it doesnt affect opportunities Indeed, as long as opportunities equal, different outcomes are a good thing

The Growth Report

Not just WB but other agencies (e.g. DFID) Same line as 2006 Equity and Development but in a way a bit further. Equity of opportunity not just an ethical issue but a practical issue:
Inequality of opportunity can be toxic Such injustices undermine social peace and spark political unrest. They will ultimately derail the economys growth strategy.

Yes a worry about equity of outcomes. But this is secondary:

[People] understand that markets do not produce equal outcomes. They will tolerate this inequality provided that governments take steps to contain it

And this is where social protection comes in. So basically what this is all about is managing social unrest:

What is inclusive growth?

By 2009, clear that some uncertainty as to what IG was in WB: a note on its meaning. Inclusive growth defined in terms of the pace of growth and the creation of productive employment. What is important is not relative but absolute poverty (thus the gap between rich and poor could become wider in contests of inclusive growth). Through creating productive employment absolute levels of poverty are reduced.
For growth to be inclusive, productivity must be improved and new employment opportunities created.

What is important about IG is the creation of equal opportunities: the level playing field. Says almost nothing about poverty; says nothing about morality.

Is there anything new?

Probably not. Its basically the WC and the PWC rephrased. Key to growth is through expansion of market economy Poverty will be eliminated through spread of productive employment In the end driven by fear of political instability: the toxic nature of unequal opportunities rather than any moral imperative. But how is this inequality to be eliminated? The lack of any political or sociological analysis: nave dreamland that somehow investments in education/infrastructure and better regulatory systems will somehow drive this change And for ADB which recognises in latest Asian Development Outlook the dangers of increasing inequality, suggest that IG at least as far as WB formulation is concerned offers little.