I had to deliver this last week a 10 minute informative presentation on this topic, for my “States and Markets” class. I’m sharing some thoughts with you here and would be really curious to see what non-economists/ non-policy students think about the proposed solutions. Since I am surrounded by such folks, though, views from the community are also welcome 
The figures
- there’s great news: the proportion of people living in extreme economic poverty, i.e. on less than $1.25/ day (at 2005 prices, adjusted for purchasing power parity) had dropped worldwide from 52% in 1981 to 26% in 2005
- the bad news: there are great regional disparities – China and East Asia in general, which used to be the poorest in the 80s (80% of the population affected by extreme poverty) have reduced their percentage of poor drastically (18% in 2005); however, sub-Saharan African has kept its poverty rate unchanged in the last 40 years, at about 50% of its population. Moreover, because of population increase, in absolute numbers the number of the poor has doubled (from 200 million in 1981 to 380 million in 2005) Continue reading ‘Ending Poverty. What Approach Works Best.’
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I am writing this post in English, as I am pretty sure the trend I will discuss is valid for any emerging market, including for other Central-European countries.
As we were driving downtown yesterday morning, I accidentally overheard on the radio this idiotic jingle that was promoting bank loans for BCR – Erste Bank. Something along the lines: “Honey, let’s buy this 15 inch computer screen?” “But why? When we can get a bigger loan and buy a 20 inch one” “Tananana… BCR… We think alike: incredible rates for an incredible loan”. And the same ridiculous dialogue then promoted a 150 litres fridge (bought through a loan) instead of a 70 litre one Seconds later, a very nice young lady that was distributing flyers in the middle of the traditional morning traffic jam in Bucharest came to our car with a leaflet from Unicredit Tiriac Bank (proud new entry in ORICUM’s online mentoring program). We thus found out about Duet, a new product launched by Unicredit – a combination between a regular deposit and an investment scheme administered by an investment fund. Half of the flyer was explaining how an investment fund works and what risks it involves. No big words, no glossy slogans. Needless to say the latter’s a rare commodity in Romanian banking marketing. Continue reading ‘The fine trap of Balkans banking’