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MESSAGES
© The World Bank
Dr Jim Yong Kim, President of the World Bank, at the launch of Sudhir Anand’s The Cost of Inaction, 19 December 2012
because the costs of inaction tend to be
large. The negative consequences of inaction
in relation to children are experienced over
a long period of time – their entire lifespan.
Obversely, the benefits of investment in
children are reaped over a long time horizon.
Investments in children’s early development,
nutrition, health, and education will therefore
generate large aggregate benefits – as
demonstrated in the Rwanda and Angola case
studies.
There is another reason why the costs
of inaction in relation to children can be
particularly large. The damage caused by
not undertaking certain actions on behalf
of children may be irreversible. Thus if a
child suffers from severe malnutrition, he
or she can become stunted – a condition
that is difficult to reverse. If damage is done
to neural networks, it is almost impossible
to undo. Finally, the death of a child
through inaction is the ultimate irreversible
consequence.
The case studies in the book focus mainly
on children affected by poverty and HIV/
AIDS. But the COI approach is quite general
and can be applied to other areas. Failure
to act on climate change, for instance, will
lead to enormous costs because the period
of time (in this case, generations) over
which the consequences are experienced is
very long, and many of the consequences
are irreversible – or reversible only at great
cost.
In summary, the COI approach provides a
framework to support the evaluation of the
negative consequences of inaction. Difficult
decisions have to be made by policymakers,
and there is no mechanical formula that can
generate decisions. Many value judgments
must be taken into consideration in the
areas of human and economic development.
People’s values often differ, and there
needs to be room for debate. The COI
approach seeks to promote such discussion,
not to avoid it. n
‘Economists tend to speak
as if –or at least build
models that embody the
idea –most things in life
are flexible, adjustable
and reversible. But much
of life is not like that and
this observation is crucial
for policy. That is why the
concept of the cost of
inaction is so important
and why this thoughtful
and scholarly book is so
valuable’
Professor Lord Stern of
Brentford,
Honorary Fellow
© The World Bank
ST CATHERINE’S COLLEGE 2012/51