research, as well as making data on development accessible to the public. Bank research also produced quantitative forecasting and planning models (such as general equilibrium models). In the 1980s, Anne Krueger initiated a shift toward more operationally relevant research, away from formal models. There was also a focus on multi-country comparative studies. In the 1990s, there was an increasing trend toward empirical research and reliance on survey data, starting with household surveys. This was part of a growing trend in research in development economics that, as stated by Debraj Ray (2008), “has been almost entirely empirical. A veritable explosion in computing power, the expansion of institutional datasets and their increased availability in electronic form, and the growing ease of collecting one's own data have bred a new generation of development economists. Their empirical sensibilities are of a high order; they are extremely sensitive to issues of endogeneity, omitted variables, measurement error and biases induced by selection. They are constantly on the search for good instruments or natural experiments, and, when these are hard to find, they are adept at creating experiments of their own.” Researchers have greatly contributed, through cross-disciplinary approaches, sound analysis and empirical measurement, in moving the development agenda forward.

# **2 An Evolving Vision of the Development Process**

The choice of strategy for research regarding developing countries has to rely on some vision of what economic development is, and what the basic mechanisms of the development process are.<sup>3</sup> This vision changed over time, as developing countries adopted various policies and their results—successes or disappointments—were recorded.

# 2.1 Growth and Poverty Reduction

In the 1950s and 1960s, development was viewed, in practice, as a process of accumulating physical or human capital, with the goal of increasing national income.<sup>.</sup> A break occurred in the mid-1960s under the intellectual influence of Singer, Seers and others. The idea of development became more identified with processes of social change and poverty reduction. At the World Bank, this change in focus came mainly after President McNamara’s 1973 speech at the annual meetings in Nairobi, which emphasized poverty eradication as the true goal of development.<sup>4</sup> During the long macroeconomic crisis that started at the end of the 1970s, poverty considerations were set aside. The neoliberal perspective that dominated the 1980s considered that growth was all that really mattered for welfare outcomes, and that poverty and inequality would take care of themselves. Proponents of that view downplayed distribution and poverty, and insisted on re-establishing market mechanisms to promote economic growth. Funding for research on poverty and income distribution peaked in 1975, then declined considerably, reaching almost zero between 1980 and 1985.

> 3  See World Bank 1984.   This section summarizing changes in the Bank’s vision of the development process borrows from Wolfensohn and Bourguignon 2004 to which I made a substantive contribution.

> 4 For an account of the history of the development concept, see Arndt 1987.

4