Financial Times; WB 'uses doubtful evidence to push policies'

Financial Times
Dec 21, 2006
by Eoin Callan in Washington

The World Bank's use of questionable evidence to "proselytise" on behalf of its development policies has been sharply criticised by the first big external audit of the bank's use of research.
A copy of the audit obtained by the FT found the bank often used research on globalisation "without taking a balanced view of the evidence" and ignored unfavourable research.

The scathing critique is likely to heighten debate over the way in which the benefits of globalisation have been spread.
The panel praised bank researchers' "extremely visible work on globalisation, on aid effectiveness, and on growth and poverty".
But auditors also had "substantial criticisms of the way that this research was used to proselytise on behalf of bank policy, often without taking view of the evidence, and without expressing appropriate scepticism".
The documents conclude: "Internal research that was favourable to bank positions was given great prominence, and unfavourable research ignored."
The probe examined World Bank research from 1998 to 2005 and was led by outside economists including Ken Rogoff, a former director at the International Monetary Fund, and Angus Deaton, a professor at Princeton.
The panel argued that the bank "has not done enough to compile comprehensive data on trade costs", arguing that information on "how industries, regions, firms, and households respond to changes in trade barriers" was fundamental to analysis of trade reform.
François Bourguignon, World Bank chief economist, said the critique was "deep and thoughtful, and draws insights from among the best research expertise available".
Mr Bourguignon indicated there were areas where he "broadly agreed with the report's recommendations and observations on bank research" as well as areas where he had reservations.
The report has been submitted to Paul Wolfowitz, bank president, and is likely to be used to make the case for increased spending on economic research. Mr Bourguignon said it was particularly valuable in the "current environment of contracting research budgets".
The report will be seized on by critics of the bank, but is unlikely to undermine significantly the World Bank's annual global economic outlook, which found grounds for optimism about the future for globalisation.
The bank predicts not only that will the global economy do well in the next two years, but that globalisation between now and 2030 will proceed apace.
Copyright The Financial Times Limited 2006

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