Preface

Over the years, the Development Policy and Analysis Division of the Department of Economic and Social Affairs of the United Nations (UNDESA) has coordinated a number of comparative studies in the context of a number of projects aiming to strengthen the policy analysis capacity in developing countries.1 Part of the work related to these projects involved the adaptation of a model-based toolkit to serve the policy needs in each country. The toolkit allows the assessment of the macroeconomic policy implications of development strategies oriented at the achievement of the internationally agreed Millennium Development Goals (MDGs). The MDGs comprise a set of basic human development objectives related to poverty reduction, universal primary education, maternal and child health, communicable disease control and access to water and basic sanitation. While much progress has been made on these fronts, large shortfalls remain in many countries, requiring major policy efforts. Those efforts are not restricted to the social policy arena, but involve the entire economy. Most poverty reduction efforts run through production, employment, wages and prices. Expansion of social services in education, health and basic sanitation require additional spending efforts that may strain public and private budgets. Adjustments in taxes and public and private credit demand to finance those spending needs, in turn, will have repercussions throughout the economy. Better education and health outcomes are expected to yield, over time, positive spinoffs on productivity and incomes. For these reasons, the capacity development projects have deployed economy-wide modelling tools to aid policymakers in assessing this complex set of interactions and the macroeconomic feasibility of achieving the MDGs in their specific country context.

Related Subject(s): Economic and Social Development