The welfare of the poor turns in large measure not only on technocratic development “policies”, but the effective delivery of key public services, core elements of which require thousands of face-to-face discretionary transactions (“practices”) by service providers. The importance of (often idiosyncratic) “practices ” was largely ignored in the 1960s and 70s, however, as planners in developing countries sought to rapidly emulate the service delivery mechanisms of the developed countries, namely standardized (top-down) “programs” managed by a centralized civil service bureaucracy. Although this approach could claim some notable successes in poor countries, it soon became readily apparent that it had failed early and often in virtually all sectors. Three common civil service reforms in the 1980s also yielded disappointing results, so in the 1990s scholars and practitioners began to tout more radical “participatory ” (or bottom-up) proposals for improving service delivery. These new proposals have generated a series of unusual alliances and antagonisms in contemporary development debates. We attempt to unravel these debates by distinguishing between the original solution and eight current proposals for improving service delivery, on the basis of a principal-agent model of incentives that explores how these various proposals change flows of resources, information, decision-making, delivery mechanisms, and accountability. We briefly assess the arguments made by proponents and detractors of each approach, and suggest some of the implications of this framework for education, research, and those charged with improving service delivery.

Economists and reform minded policymakers in Latin America are asking themselves, and are being asked, hard questions these days. The broad consensus is that two decades of reform have had too little to show for it. Sporadic and sputtering economic growth and stagnant real wages (especially for the unskilled) is not what was expected. This paper puts the Latin American experience in the global context and examines the processes that brought the region to this point. We look at the trends in policy advice on economic growth and how they were formed, and we address the question of what economists can do now to help the region move in restoring economic growth. The Best and the Brightest Imagine that you are an American and that it is 1962. You only know what you could have known in 1962. You are called on by an energetic young president to design a program to promote economic growth in Latin America. Perhaps you are a professional economist or perhaps simply an informed, savvy observer of the international and economic arenas. 1 What are the big economic facts of your lifetime that shape your views? When you were in your thirties, you would have experienced the Great Depression. You would therefore know for a fact that a capitalist economy is unstable: stock markets can and do crash, unregulated banks fail, and unemployment can soar to very high levels and stay there. Whether or not

and Lant Pritchett for discussions on the general topic and related empirical work, and to Michael Young and Alfred Young for research assistance. p0112vrr.doc 1 1.

support. The authors are grateful for constructive comments and suggestions from Lant Pritchett, Sebastian Edwards, and Simon Johnson (as lead discussants) and other participants at the NBER Africa Project

The authors would like to thank Lant Pritchett for constructive comments. Elena Ketteni provided excellent research assistance. The paper was initiated while the last two authors were visiting the University of Cyprus. y

The paper should not be cited without the permission of the authors. We appreciate the comments of Lant Pritchett and Ian Bannon on an earlier version of the paper, but neither is implicated in any errors in the report. We also acknowledge the assistance of Barbara Diallo-

(Article begins on next page) The Harvard community has made this article openly available. Please share how this access benefits you. Your story matters. Citation Clemens, Michael, Claudio Montenegro, and Lant Pritchett. 2009.The place premium: wage differences for identical workers across the US

(Article begins on next page) The Harvard community has made this article openly available. Please share how this access benefits you. Your story matters. Citation Clemens, Michael, Claudio Montenegro, and Lant Pritchett. 2009.The place premium: wage differences for identical workers across the US

Lant Pritchett, Mike Richards, Mark Rosenzweig, and numerous seminar participants for helpful comments. Special thanks are due to Victor Bottini, Richard Gnagey, Susan Wong, and especially to Scott Guggenheim for their support and assistance throughout the project. The field work and engineering

*I am grateful for comments from participants in the Global Development Network meeting in Cairo and in several World Bank seminars. I am also grateful for comments by Sara Calvo, Stephen O’Connell, Jorge Garcia Garcia, Lant Pritchett, Dani Rodrik, and Sergio Schmukler, and an anonymous referee. I