The World Bank's Early Reflections on Development: The Housing Issue

University of Milan - Bicocca, Economics Department Working Paper No. 91/2005

14 Pages Posted: 25 Oct 2005

See all articles by Michele Alacevich

Michele Alacevich

University of Bologna - Dipartimento di Scienze Politiche e Sociali; Institute for New Economic Thinking (INET)

Date Written: October 2005

Abstract

Until the late 1960s, the World Bank presented itself as an institution devoted to sound and directly productive project loans. Yet, during its very early years, some discussions developed inside the Bank regarding the possibility of issuing different types of loans, namely loans which - albeit sound - were aimed at tackling social issues (social loans), or not directly project-related needs for foreign currencies (impact loans).

This paper analyzes the housing issue as a good case in point. The analysis reveals that the Bank was unwilling to lend for housing programs not because these were not sound - in fact, they were - but because they appeared to be too social-biased and not directly linked to productive investment projects, such as dams, power stations, and railroads.

This early decision had a significant impact on the subsequent development of the Bank's view of policy making. In fact, it was not until the late 1960s that the Bank began to take social issues into consideration, rather late as opposed to other multilateral institutions.

Keywords: World Bank, Housing, International Labor Organization, Development Economics

JEL Classification: B29, B31, O19

Suggested Citation

Alacevich, Michele, The World Bank's Early Reflections on Development: The Housing Issue (October 2005). University of Milan - Bicocca, Economics Department Working Paper No. 91/2005. Available at SSRN: https://ssrn.com/abstract=825465 or http://dx.doi.org/10.2139/ssrn.825465

Michele Alacevich (Contact Author)

University of Bologna - Dipartimento di Scienze Politiche e Sociali ( email )

Strada Maggiore 45
Bologna, 40129
Italy

Institute for New Economic Thinking (INET) ( email )

300 Park Avenue South, 5th Floor
New York, NY 10010
United States

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