Why is Macroeconomics Neglected in Equity and Inclusion Strategies for Sustainable Development? An Exploration of Four Systemic Barriers

ABSTRACT

The literatures on Macroeconomics and Human development and capabilities have been described as constituting “two different worlds” that never intersect despite the importance of macroeconomics for human development (Nayyar [2012]. “Macroeconomics and Human Development.” Journal of Human Development and Capabilities 13 (1): 7–30.). This paper explores the barriers that keep the two worlds apart in policy making. It considers the case of national strategies for one is implementing UN Agenda 2030 (better known as the SDGs) with a commitment to equity and inclusion; the majority of which rely on social protection and neglect macroeconomic policies. This paper proposes four systemic barriers in the policy making processes: institutional silos and gaps, informational deficits, ideology, and interests. We highlight how these barriers play out in mutually reinforcing ways to construct resilient barriers: narrowly defined mandates of central banks and other economic agencies are reinforced by ideological commitments and the influence of vested interests to neglect inclusion, equity and sustainable development as policy objectives, and in policy research agendas. This in turn creates a vicious circle of information deficits with respect to policy alternatives. The paper discusses how these barriers play out differently in different policy making contexts for different stakeholders.

KEYWORDS:

• Inequality
• SDGs
• fiscal policies
• monetary policies
• interests
• ideology

Disclosure Statement

No potential conflict of interest was reported by the author(s).

Notes

1 See UN Chief Executives report on LNOB for interpretation the pledge as equity and inclusion (UN CEB 2017).

2 Interviewees included: staff of UN agencies; academics with history of advising UN development agencies, national governments and the IMF; researcher with experience as former or present staff of a national central bank.

3 The importance of macroeconomic policies for both growth and LNOB are also explicitly included in the SDG framework, particularly as “means of implementation”, and reflected in Goals including 1, 10 and 17.

Additional information

Notes on contributors

Sakiko Fukuda-Parr

Sakiko Fukuda-Parr is Professor of International Affairs at The New School. She was Director and Lead Author of Human Development Reports 1995–2004, and founding editor of the Journal of Human Development and Capabilities. Her current research focuses on the political economy of knowledge including in global health, politics of indicators, and global development agendas.

Kate Donald

Kate Donald is a researcher and advocate working on economic policy, global governance and human rights, based in Washington D.C. She currently works at Oxfam International, and previously has held positions at the Center for American Progress and the Center for Economic and Social Rights.