nep-ara New Economics Papers
on Arab World
Issue of 2009‒12‒05
two papers chosen by
Quentin Wodon
World Bank

  1. Textile manufacturing in eight developing countries:How far does the business environment explain firms' productive inefficiency? By Tidiane KINDA; Patrick PLANE; Mohamed CHAFFAI
  2. Do Working Men Rebel? Insurgency and Unemployment in Iraq and the Philippines By Eli Berman; Joseph Felter; Jacob N. Shapiro

  1. By: Tidiane KINDA (Fonds Monétaire International); Patrick PLANE (Centre d'Etudes et de Recherches sur le Développement International); Mohamed CHAFFAI (Université Sfax)
    Abstract: Production frontiers and inefficiency determinants are estimated by using stochastic models. Textile manufacturing is considered for a sample of eight developing countries encompassing about one thousand firms. We find that the most influential individual inefficiency determinants relate to in-house organization. Both access to financing and infrastructural services (e.g. power supply, modern information technologies…) also matter. Information about determinants is then regrouped into three broad categories (e.g. managerial organization, economic environment, institutions) by using principal component analyses. Results do not reject the hypothesis that managerial know-how and the quality of institutions are the most important determinants. The impact of the external economic environment is of less importance although statistically significant. Sector-based simulations are then proposed in order to assess productivity gains which would occur if firms had the opportunity to evolve in most favorable environments within the sample. Domestic and international production contexts are considered, respectively. When referring to domestic benchmarks, the contribution of in-house organization prevails as the main source of gains for the eight countries. The role of institutions proves dominant for Egypt and India when focusing on international simulations.
    Keywords: Technical efficiency, external economic environment, firms, institutions, one step stochastic frontier method, organizational know-how, productivity, textile
    Date: 2009
  2. By: Eli Berman; Joseph Felter; Jacob N. Shapiro
    Abstract: Most aid spending by governments seeking to rebuild social and political order is based on an opportunity-cost theory of distracting potential recruits. The logic is that gainfully employed young men are less likely to participate in political violence, implying a positive correlation between unemployment and violence in places with active insurgencies. We test that prediction on insurgencies in Iraq and the Philippines, using survey data on unemployment and two newly- available measures of insurgency: (1) attacks against government and allied forces; and (2) violence that kills civilians. Contrary to the opportunity-cost theory, we find a robust negative correlation between unemployment and attacks against government and allied forces and no significant relationship between unemployment and the rate of insurgent attacks that kill civilians.
    JEL: F51 F52 H4 H56 J6 O12 O53
    Date: 2009–11

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