Given the recent surge in inflation and the resulting sharp monetary tightening, this note asks whether bank profits are exposed to inflation. While most banks tend to match income and expense exposures, 5 and 8 percent of banks in Advanced Economies (AE) and Emerging Market and Developing...

Industrial policies (IPs) are increasingly implemented, necessitating a reassessment of their benefits and costs. This study examines their economic and geopolitical drivers and their impact on targeted sectors. While IPs yield moderate and uneven economic gains, they are more effective when...

Generative artificial intelligence (gen AI) holds immense potential to boost productivity growth and advance public service delivery, but it also raises profound concerns about massive labor disruptions and rising inequality. This note discusses how fiscal policies can be employed to steer the...

Artificial Intelligence (AI) has the potential to reshape the global economy, especially in the realm of labor markets. Advanced economies will experience the benefits and pitfalls of AI sooner than emerging market and developing economies, largely due to their employment structure focused on...

The transition to a sustainable and green economy requires workers to move out of carbon-intensive jobs and workers to move into green jobs. The pace and effectiveness of the transition hinge not only on climate policies but also on the skills and adaptability of workers. Evidence suggests that...

Innovation in low-carbon technologies (LCTs), which is essential in the fight against climate change, has slowed in recent years. This Staff Discussion Note shows that a global climate policy strategy can bolster innovation in, and deployment of, LCTs. Countries that expand their climate policy...

In the aftermath of the COVID-19 pandemic, emerging market and developing economies are grappling with economic scarring, social tension, and reduced policy space. Policy actions are already urgently needed to boost growth in the near term and support the ongoing green transition. At the same...

Digital divide across countries and within countries continues to persist and even increased when the quality of internet connection is considered. The note shows that many governments have not been able to harness the full potential of digitalization. Governments could play important role to...

Tax capacity-the policy, institutional, and technical capabilities to collect tax revenue-is part of a deeper process of state building that is essential for achieving the sustainable development goals. This Staff Discussion Note shows that developing countries have made some progress in revenue...

Many emerging market and developing economies face a difficult trade-off between economic support and fiscal sustainability. Market-oriented structural reforms ease this trade-off by promoting economic growth and strengthening public finances. The empirical analysis in this note, based on 62...