Office of the Chief Economist -- Office of the Vice President, Development Policy (VPD) and the Development Policy Staff

The Development Policy Vice Presidency was established in the 1972 Bank reorganization. Before that time, the Bank President had an Economic Adviser on his immediate staff. Irving Friedman, who was appointed by President George D. Woods in October 1964, was the first to hold this position. Friedman supervised the Economics Department and the Director of Special Economic Studies in 1965, but prior to his departure from the position in 1970 he supervised four units: Economics Department, Economic Program Department, Computing Activities Department, and Development Research Center.

Hollis B. Chenery succeeded Friedman as Economic Adviser to the President in October 1970. Chenery initiated a comprehensive review of the Bank's research program. In the January 1971 Bank reorganization, the Economics staff was divided into three units all reporting to Chenery: the Economics Department; the Economic Program Department; and the Development Research Center. On April 13, 1971, Economic Research in the Bank, the report of the survey conducted by consultant economist Bela Belassa at Chenery's request, was issued. Belassa's report suggested that individual research projects be appraised in terms of their relative cost and benefits and that employment, planning, trade policy, and other new areas of inquiry be subjects of research proposals from the Development Research Center and the Economics Department with active participation of operational departments in the selection and review of the proposals and in the evaluation of completed research. The report concluded that responsibility for setting research priorities, approving the overall research program, and establishing a review process for research should be carried out by an Economic Research Committee chaired by the Economic Adviser to the President. In keeping with Belassa's review recommendations, a Bank-wide Research Committee was established.

When he announced the creation of the Development Policy Vice Presidency (VPD) in 1972, President Robert McNamara saidthat the new vice presidency would increase the Bank's policy formulation capability. Hollis Chenery was named VPD and continued to serve as the President's Economic Adviser. VPD was charged with increasing the Bank's knowledge of the development process and analyzing policies to assure the efficient attainment of development objectives. The Development Policy Staff had wide ranging responsibilities: coordinating policy work in the Bank; preparing papers on development policy and selected sector policy issues; reviewing Country Program Papers; managing the Bank's research program; conducting research on selected sectoral and inter-sectoral problems; operating the debt reporting system; providing country creditworthiness analyses; and providing specialists to support the country and sector economic work of the Regional offices. VPD was assisted by a Research Adviser who was responsible for managing the external research program and a technology adviser responsible for scientific and technology matters in the Bank. In addition, Chenery was assisted by Senior Adviser, Development Policy Ernest Stern. Stern's title changed to Director, Development Policy in 1974, but he continued to report directly to Chenery. Stern left VPD in 1975, but the position of Director, Development Policy continued until the Development Policy Staff evolved into the Economics and Research Staff (ERS).

A Bank-wide Research Committee was established and held its first meeting on April 28, 1971. VPD chaired the committee and the Senior Adviser, Development Policy was Deputy Chairman. The Research Committee was charged with providing advice to Chenery on the scope and content of the research program, recommending the overall level of the External Research Budget (ERB), a separate budget for the Bank's research program that was introduced in 1972, and monitoring and evaluating research. The research activities reviewed by the Research Committee and financed from the ERB all involved outside contracts. Only projects which required external resources (consultants and computer time) were considered eligible for funding from ERB. The identification number (RPO) number was assigned by the Research Committee for approved projects. A P was placed after the RPO number to indicate a proposal for ERB funding for research preparation or a project requiring a small grant. An A was placed after the RPO number to indicate projects involving the application of research methodologies or techniques developed under other Bank research projects to new contexts or new areas.

In 1977, VPD became chair of the committee and director of the staff that prepared The World Development Report. The Development Policy Vice Presidency was succeeded by the Economics and Research Vice Presidency (VPERS) in February 1982 and Hollis B. Chenery became VPERS.