By Quentin Wodon

To arrive Millennium improvement ambitions (MDGs) nations (or states or provinces inside of nations) have innovations: expanding those inputs used to 'produce' the results measured by way of the MDGs, or expanding the potency with which inputs are used. This research appears to be like at even if advancements in potency may convey profits in outcomes.

Two chapters use global panel info to investigate nation point potency in enhancing schooling, wellbeing and fitness and GDP (and thereby poverty) symptoms. different chapters use province and country point facts to research within-country potency in Argentina and Mexico for making improvements to schooling and future health results. jointly, the 4 chapters recommend that aside from expanding inputs, it is crucial to enhance potency with a purpose to succeed in the MDGs. whereas this end is not often fantastic, the research is helping to quantify how a lot growth might be completed via larger potency, and to some degree, how potency itself might be more advantageous.

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We are grateful to Guillermo Cruces for providing the data used in the efficiency analysis. 33 34 WORLD BANK WORKING PAPER TABLE 4-1: DEMOGRAPHIC AND ECONOMIC INDICATORS Latin America & Caribbean Population: Total, 2001 (in millions) Population: Avg. annual growth % 1990–2001 Population: Urban (% of Total) Life expectancy, 2000 (years) PPP GNI pc ($) 2001 GDP pc: Avg. 3 Source: World Bank 2001. countries. Another reason for the selection of Argentina was to understand the role for long-term goals, like the MDGs, when a country is undergoing a profound crisis.

The inputs used are physical capital, human capital (years of schooling) and number of workers. To enable the production frontier to vary by region, we include dummy variables for Asia (DASIA), Latin America and the Caribbean (DLAC), Middle East and North Africa (DMENA) and North America and Europe (DNAW), with Africa as the omitted region. The production frontier estimated for time period T is: ln Y it = α + ln X it β + γ 1 D ASIA + γ 3 DLAC + γ 4 D MENA + γ 4 DNAW + (v it − u i ) i = 1, K , N (1) Four separate production frontiers are estimated for 1980–84, 1985–89, 1990–94 and 1995–98.

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