On 18th March, 2010 Lahore University of Management Sciences (LUMS) hosted the first inception conference of the IGC chapter in Pakistan. The second inception conference (hosted by the State Bank of Pakistan) was held in Karachi on 20th March 2010. These were preceded by a small seminar to acquaint the ‘Friends of Pakistan’ group with the developments post-September 2009.
This has resulted in the following goals of the IGC Pakistan chapter:
Objectives: The foremost objective is to introduce evidence-based policy making for inclusive growth. This would lead to a policy design which has broad ownership for traction and sustainability and also makes use of evidence-based assumptions (as opposed to stylised or popular giveaways as a basis for making policy). A policy-relevant research agenda would addresses both short term issues as well as deep structural problems embedded in the local context. This policy-relevant research has to come out of a three way interaction between stakeholders (private sector, media, politicians), policy makers and researchers. This would be a departure from the current structure of a weak interaction between stakeholder and policy makers and little or interaction between stakeholders and researchers on the one hand and researchers and policy makers on the other. Our objective is to make stakeholders become active participants in asking the right research questions and ensuring that evidence can be garnered on specific issues that are policy-relevant. This will contribute to strengthening accountability of policy makers and will promote long term commitment to reform thereby strengthening the democratic process.
Thematic Areas: Following are the proposed thematic areas for the IGC Pakistan initiative:
(i) Macroeconomic Policy and Public Finance. Pakistan’s fiscal situation is fragile and the core factors leading to that fragility need to be understood and responded to. But we need to go beyond the macro framework and look at agents and organisations that can become drivers of growth:
(a) Farm Capabilities and Agriculture. We can start at the micro-level question of why productivity in this region is so low and build up from there.
(b) Firm Capabilities and Competitiveness. The organisation and growth potential of firms is a dimension of structural change that needs to be better understood for formulating growth enhancing policies.
(c) Household Behavior and Investment in Health and Human Capital, as fundamental drivers of inclusive growth, need to be analysed and policy/institutional hurdles removed.
(d) Cities as Engines of Growth. Thriving and declining cities are particularly important dimensions of growth sustainability. Research will show the link between organisation of cities and national growth.
There are two important cross-cutting themes of political economy and governance, and property rights and market structure:
(ii) Political Economy and Governance.
(iii) Property Rights and Market Structure. We need to look at the behavior of political and administrative agents that create incentives that are constraining at the level of the firm, the farm and the household. In agriculture, there is a big issue of whether commodity prices reflect market price movements or whether they are outcomes of oligopolistic behavior. There is a need to go beyond anecdotal evidence and research will focus on the structure of agricultural markets. Pakistan is also undergoing massive change in property rights. There is a major decline in tenancy, and tenants are now completely de-linked from the farm. This needs to be reflected in an inclusive growth policy framework.
Research Outputs: Research outputs will be structured in two ways: (1) rapid response policy notes, and (2) applied research. The policy notes will be opportunistic, demand-driven, and agenda-setting. They will facilitate and service what we want to engage with on the policy table. As for the applied research output, this has two components. One is descriptive and context-based and the other is evaluative. The objective of these research outputs is to shape policy reform thinking and also provide reasonable evidence-based and context-specific assumptions on which sound interventions can be designed.
Collaboration and Modes of Engagement: Leading international researchers will be paired with local academic researchers. There will also be researcher partnerships with key stakeholders, especially in the area of evaluative research. These partnerships have to be made at the earliest stage, at the level of intervention design. Inputs will be sought on the modalities of collaboration and engagement. Stakeholder workshops will be conducted to build groups around thematic areas.