Albania

A Deep Dive on the Albania Investment Corporation

The Growth Lab has been engaged in an applied research project with the country of Albania since 2013. In this time, we have conducted research on numerous, diverse workstreams related to stimulating economic growth in the country.

During this research engagement, our team worked with policymakers on the creation of the Albania Investment Corporation (AIC), an entity within the Albanian government responsible for engaging with both the public...

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Building Capability to Design and Implement Growth Reforms: The Case Study of Albania

The Growth Lab has been engaged in an applied research project with the country of Albania since 2013. In this time, we have conducted research on numerous, diverse workstreams related to stimulating economic growth in the country. During this research engagement, our team worked directly with policymakers to help build their capabilities so they can better design and implement policy reforms.

In this podcast episode, Growth Lab researchers Jessie Lu and Ermal...

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Iterations of a Growth Diagnostic: The Case Study of Albania

The Growth Lab has been engaged in an applied research project with the country of Albania since 2013. In this time, we have conducted research on numerous, diverse workstreams related to stimulating economic growth in the country.

During this research engagement, our team conducted Growth Diagnostic analyses to understand and test potential binding constraints to economic growth in Albania. After the initial Growth Diagnostic study in 2013,...

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A Snapshot of the Growth Lab's Research Engagement in Albania

The Growth Lab has been engaged in an applied research project with the country of Albania since 2013. In this time, we have conducted research on numerous, diverse workstreams related to stimulating economic growth in the country.

In this podcast episode, we kick off a larger outreach campaign, which showcases our engagement in Albania, by gathering members of our research team to discuss their work. Hosted by research assistant Jessie Lu, this podcast features Ermal Frasheri, Tim O’Brien, Shreyas Gadgin Matha, Spencer Bateman, Ricardo Villasmil, and Daniela Muhaj,...

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Public Policy in Action: What Did Working in Albania Teach Us about Economic Growth?

Since 2013, the Center for International Development has been collaborating with the Government of Albania to identify binding constraints to economic growth and create policy solutions to solve them. CID’s Growth Lab and Building State Capability programs have used the tools of growth diagnostics and problem driven iterative adaptation (PDIA) to help drive economic growth in the country. CID Researchers Ermal Frasheri and Tim McNaught have seen firsthand how theory informs public policy and how insights from public policymaking, in turn, enrich our theoretical frameworks. In this Growth Lab... Read more about Public Policy in Action: What Did Working in Albania Teach Us about Economic Growth?
Santos, M., et al., 2020. Albania's Industry Targeting Dashboard. The Growth Lab's VizHub. Publisher's VersionAbstract
This industry targeting tool is custom-made for Albania. Users can choose any of 272 industries (based on NACE Rev. 2 industry codes) from the above drop-down list and explore the industry’s match with Albania’s current productive capabilities and comparative advantages and disadvantages. The tool is designed for use by government and non-government entities that seek to attract foreign direct investment (FDI) to Albania to accelerate economic development. Harvard Growth Lab research in Albania shows that the long-term pace of economic growth will be determined by the pace at which the country can absorb new economic activities and productive capabilities from abroad. Detailed information on the methodology and data sources used in this tool can be found here. This tool can be used in combination with the Growth Lab’s Atlas of Economic Complexity to explore patterns in global trade in very high detail.
O'Brien, T. & Lu, J., 2020. Can Albania’s Economic Turnaround Survive COVID-19? A Growth Diagnostic Update. The Growth Lab's VizHub. Publisher's VersionAbstract
The Growth Lab, which works with countries to identify obstacles to growth and propose targeted policy solutions, has been conducting applied research in Albania since 2013. This brief analysis takes stock of Albania’s economic growth prior to the COVID-19 crisis and what the strengths and weaknesses of the pre-COVID economy imply for recovery and the possibility of accelerating long-term and inclusive growth in the years to come. Albania is a place where much has been achieved to expand opportunity and well-being as growth has gradually accelerated since 2013-14, but where much remains to be done to continue this acceleration once the immediate crisis of COVID-19 has passed.

The Diaspora Brain Trust: A Study of Albanian Talent Around the World

Prepared by Daniela Muhaj

The Growth Lab Albania team is working on better understanding the causes and consequences of youth and high skilled migration post 2000s. There is a perception that the loss in knowhow has been exacerbated in the past decade especially for selected professions or skill segments in high demand by more advanced economies. This study aims to understand the magnitude of the...

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Gadgin Matha, S., Goldstein, P. & Lu, J., 2020. Air Transportation and Regional Economic Development: A Case Study for the New Airport in South Albania.Abstract

Considering the case of the proposed airport in Vlora, South Albania, this report analyzes the channels through which a new greenfield airport can contribute to regional economic development. In December 2019, the Government of Albania opened a call for offers to build a new airport in the south of the country. While there is evidence indicating that the airport could be commercially viable, this does not provide a grounded perspective on the channels by which the airport could boost the regional economy. To evaluate how the new airport would interact with existing and potential economic activities, this report evaluates three of the most important channels of impact by which the airport could serve as a promoter: (1) economic activities directly related to or promoted by airports, (2) the airport’s potential contribution to the region’s booming tourism sector and (3) the potential for the country’s development of air freight as a tool for export promotion. In each of these three cases, the report identifies complementary public goods or policies that could maximize the airport’s impact in the region.

The operation of the airport itself could stimulate a series of economic activities directly related to air traffic services. Airports have the ability to mold the economic structure of the places immediately around them, acting both as a consumer and as a supplier of air transport services. Not only activities related to transportation and logistics thrive around airports, but also a variety of manufacturing, trade and construction industries. Nevertheless, the agglomeration benefits of a successful aerotropolis are not guaranteed by the construction of an airport. For South Albania’s new airport to actualize its potential returns, integrated planning of the airport site will be required, with focus on real estate planification and provision of complementary infrastructure.

Establishing an airport in Vlora has the potential to spur regional development in South Albania through facilitating the growth of the tourism sector and its related activities. Albania’s tourism industry has seen strong growth in the last two decades, but still lags behind its potential. Albania only has a strong penetration in the tourism market of its neighboring markets, and the high seasonality of the tourism season further limits the sector’s growth. The establishment of an airport in South Albania would ease some of the tourism industry constraints tied to transportation into the country and region. Given the high reliance of the tourism industry on its many complementary inputs, more than one area of concern may have to be addressed for the impact of the new airport to be maximized. Facilitating transportation access around the South Albania region and specifically to tourist sites; preparing natural and cultural heritage sites for tourism use and expanding tourism infrastructure to accommodate potential growth are some of the interventions analyzed.

Airfreight infrastructure could in theory provide opportunities to improve the competitiveness of Albanian exports but developing a successful air cargo cluster is no simple task. An airport can facilitate an alternative mode of transport for specific types of goods and hence promote a country’s exports. In Albania’s case, not only existing textile and agriculture products could be competitively exported through air freight, but also air freight itself could improve Albania’s position to diversify into “nearby” industries, identified by the theory of Economic Complexity. Nevertheless, an effective air freight strategy does not and cannot uniquely depend on the simple availability of a nearby airport. Air cargo operations require both traffic volume that Albania may not be able to provide, as well as complementary cargo-specific infrastructure. Although the potential for air freight in South Albania could be high, it is by no means a safe bet nor does it imply with certainty significant impact in the immediate future.

Stuart Russell

Stuart Russell

Former Program Assistant
Stuart Russell formerly provided research and administrative assistance to the Growth Lab program. Originally from Ellicott City, Maryland, Stuart graduated... Read more about Stuart Russell

AIC: A Summer in Albania Working for Investment Capabilities Development

By Damian Galinsky

According to CID’s growth diagnostic findings on Albania, the country has the need to diversify and increase the complexity of the economic base.

As a Harvard Kennedy School student, I spent last summer as a CID intern working on the initial asset analysis and project selection for the Albanian Investment Corporation (AIC). The main objective of AIC is improving growth in Albania through the generation of the capability to identify, prepare, and develop vital projects for Albania.

My analysis was carried out by working...

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Learning Policy in Practice: Insights from the Growth Lab Summer Interns in Albania

Prepared by Daniela Muhaj and Jessie Lu

Town square in Albania with a statue

Three Master in Public Administration in International Development (MPA/ID) students spent this past summer in Albania as Growth Lab interns, working with local counterparts to develop and implement programs on the ground and making the leap from the classroom to learning policy in practice. Recently, we hosted our interns – Damian Galinsky, Uriel Kejsefman, and Shivani Mishra – in a panel discussion to talk about the work they conducted and its role in the broader Growth Lab Albania strategy. They spoke to their experiences living and working in Albania as well as to lessons learned when trying to translate academic and theoretical insights into policy actions. Key highlights from this conversation are summarized below.... Read more about Learning Policy in Practice: Insights from the Growth Lab Summer Interns in Albania

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