Researchers find a bias in World Bank reports

NEW DELHI: A little publicised World Bank report released in December 2006 has found serious shortcomings in the studies published by the organisation. The study was conducted by a panel of 24 researchers led by Professors Abhijit Banerjee (MIT), Angus Deaton (Princeton University), Nora Lustig (UNDP) and Ken Rogoff (Harvard University).

The evaluators have analysed some high-profile researches conducted by the Bank over the past decade. Of Dollar and Burnside's paper, "Aid, policies and growth," which the Bank has cited repeatedly to argue for increased support for countries with 'good policies', they say, "We think that the Bank was unwise to place so much weight on one paper whose evidence is so unconvincing." The implications for the Bank, according to the evaluators, are alarming. 

"Once the evidence is chosen selectively without supporting argument, and empirical scepticism selectively suspended, the credibility and utility of the Bank's research is threatened," they opine. On Dollar and Kraay's research providing support to the Bank's arguments that trade liberalising countries show greater poverty reduction, they say, "Much of this line of research appears to have such deep flaws that, at present, the results cannot be regarded as remotely reliable."

The evaluators have also found that in addition to misplaced advocacy, the Bank's trade work has "insufficiently addressed the effects of trade on poverty", and has been dominated by arcane computable general equilibrium models. Dissenting research conducted within the Bank, such as that by Branko Milanovic, has been routinely "ignored".

Researches on pensions and insurance have also come in for heavy criticism. "The analytical errors referred to are those that would be well understood by a first-year graduate student in economics," the researchers say. On the Bank's work on poverty mapping, they recommend "that this work be put on hold until the statistical problems are resolved."

They also say that the Bank's work on pensions "produced a great deal that was useful, but balance was lost in favour of advocacy. Some technically-flawed projects have run for years, and have been incorporated into country work without appropriate certification  and review."

There is much selection of evidence, with obscure, sometimes unpublished, studies with the "right" message given prominence over better and often better-known studies that come to the "wrong" conclusion, the evaluators say. Conditions under which research is done:  The report quotes from a 1997 paper - "The World Bank as Intellectual Actor" - by Nicholas Stern (before he became the Vice President for Research at WB) and Francisco Ferreira about the difficulties of doing research in the World Bank.

"Researchers are not free to follow intellectual inspiration. They are under constraints of designated priorities and of an apparent need to be immediately useful to operations. Further there is the strong hierarchy and an atmosphere much more deferential than would be found in universities. Among researchers there is considerable concern with what superiors will think of conclusions reached, to the occasional detriment of whether an analysis is sound," says the paper.

Stern says, "The superiors themselves are sometimes under pressure from the Bank Presidency and elsewhere not to say things that go directly against the broad policy line that the Bank is espousing."