nep-ara New Economics Papers
on Arab World
Issue of 2010‒08‒28
nine papers chosen by
Quentin Wodon
World Bank

  1. The Gendered Aspects of MSEs in MENA: Evidence from Egypt and Turkey By Fatma El-Hamidi; Cem Baslevent
  2. Islamic Finance and the Theory of Capital Structure By Nagano, Mamoru
  3. The changing pattern of international trade and capital flows of the GCC countries By Marga Peeters
  4. Industrial Upgrading and Export Diversification: A Comparative Analysis of Economic Policies in Turkey and Malaysia By Bilge Erten
  5. Oil Exports and the Iranian Economy By Hadi Salehi Esfahani; Kamiar Mohaddes; M. Hashem Pesaran
  6. Exchange Rate Volatility and Employment Growth in Developing Countries: Evidence from Turkey By Demir, Firat
  7. Poverty reduction and growth interactions: what can be learned from the Syrian experience ? By Anda Mariana David; Mohamed Ali Marouani
  8. The Macroeconomic Effects of Fiscal Policy Shocks in Algeria: An Empirical Study (in Arabic) By Abderrahim Chibi; Mohamed Benbouziane; Sidi Mohamed Chekouri
  9. L’impact des Congés Fiscaux sur le Coût d’usage du Capital dans les Pays Arabes: Cas du Maroc By Brahim Elmorchid

  1. By: Fatma El-Hamidi (University of Pittsburgh); Cem Baslevent
    Abstract: This study attempts to shed light on the gendered aspect of MSEs (i.e. how the sectors of activities, income, growth, etc. differ by the gender of the entrepreneur) and tests some of the main claims of the rather modest available literature by means of an econometric analysis. The empirical work utilizes nationally representative MSE surveys conducted for Turkey and Egypt in 2001 and 2003 respectively (for brevity, we hereafter use “E&T” to refer to “Egypt and Turkey”). The working sample has 4136 and 4238 permanent establishments located in the urban areas of Egypt and Turkey, respectively. By identifying the sectors and types of activities females are more likely to thrive in, this study calls attention to those sectors where direct intervention by the government will be more effective, and provide some guidance for making proposals to further reduce the extent of gender-differences and practices in MSEs.
    Date: 2010–08
  2. By: Nagano, Mamoru
    Abstract: This paper empirically investigates firms using Islamic finance in Malaysia and Middle East countries. The comparative analysis of Islamic finance and non-Islamic finance users resulted in three major implications. First, Islamic bond issuers preferentially choose the Islamic bond issuance prior to bank borrowing and other external financing tools. Second, Islamic bond issuance is not related to the issuer’s internal funds, while Islamic bank borrowing is significantly influenced by the magnitude of a firm’s internal funds. These results suggest that Islamic bond issuers do not always choose to issue bonds based on information cost, but Islamic bank borrowers always do. Third, the Islamic bond issuance contributes to an increase in the issuer’s stock returns and total factor productivity. This empirical result suggests that Islamic bond issuance is preferred because of this unique benefit which standard external financing does not have.
    Keywords: Capital Structure; Bond Issuance; Islamic Finance
    JEL: G3
    Date: 2010–01–02
  3. By: Marga Peeters
    Abstract: Summary for non-specialistsThanks to policies that are geared towards opening up borders, the GCC countries have imparted a significant stimulus to the world economy, to a much greater extent than other oil exporting countries in similar conditions. The development of the gross capital flows in view of the recent global crisis and their composition are the main focus of this study. Aspects of globalization, trade and financial integration, such as the dependence on oil, regional integration, foreign direct investment and cross-border assets and loans are addressed.
    Keywords: Saudi Arabia United Arab Emirates Bahrain Kuwait Oman Qatar Angola Algeria Ecuador Iran Iraq Libya Nigeria Venezuela European Union
    JEL: F15 F21 F34 F4
    Date: 2010–06
  4. By: Bilge Erten
    Abstract: This paper considers the prospects of manufactured exports of Turkey and Malaysia given the rising standards of global competition. While Malaysia has the advantage of having an export-oriented MNC-led industry in high-technology manufactures, Turkey has a weaker, stagnant export structure when it comes to increasing its technology content. Its low-technology textile and food manufacturing industries face difficulties in competing against Asian producers which have access to much lower real wage levels. In more sophisticated parts of manufacturing, Turkish firms find it difficult to compete against high-technology European firms. The divergent trends in net barter and income terms of trade is a reflection of these structural differences. A periodical comparison of actual economic policies’ impact on industrial and trade outcomes is followed by an econometric analysis of trade liberalization on trade performance and balance of payments. Conclusions are drawn from the implications of these qualitative and quantitative assessments. [Working Paper No. 266]
    Keywords: Industrial Upgrading, Export Diversification, Turkey, Malasia
    Date: 2010
  5. By: Hadi Salehi Esfahani (Department of Economics, University of Illinois); Kamiar Mohaddes; M. Hashem Pesaran
    Abstract: This paper develops a long run growth model for a major oil exporting economy and derives conditions under which oil revenues are likely to have a lasting impact. This approach contrasts with the standard literature on the "Dutch disease" and the "resource curse", which primarily focus on short run implications of a temporary resource discovery. Under certain regularity conditions and assuming a Cobb Douglas production function, it is shown that (log) oil exports enter the long run output equation with a coefficient equal to the share of capital. The long run theory is tested using a new quarterly data set on the Iranian economy over the period 1979Q1-2006Q4. Building an error correction specification in real output, real money balances, inflation, real exchange rate, oil exports, and foreign real output, the paper finds clear evidence for two long run relations: an output equation as predicted by the theory and a standard real money demand equation with inflation acting as a proxy for the (missing) market interest rate. Real output in the long run is shaped by oil exports through their impact on capital accumulation, and the foreign output as the main channel of technological transfer. The results also show a significant negative long run association between inflation and real GDP, which is suggestive of economic inefficiencies. Once the effects of oil exports are taken into account, the estimates support output growth convergence between Iran and the rest of the world. We also .find that the Iranian economy adjusts quite quickly to the shocks in foreign output and oil exports, which could be partly due to the relatively underdeveloped nature of Iran’s .financial markets.
    Date: 2010–07
  6. By: Demir, Firat
    Abstract: Employing a unique panel of 691 private firms that accounted for 26% of total value-added in manufacturing in Turkey, the paper explores the impacts of exchange rate volatility on employment growth during the period of 1983 - 2005. The empirical analysis using a variety of specifications, estimation techniques, and robustness tests suggests that exchange rate volatility has a statistically and economically significant employment growth reducing effect on manufacturing firms. Using point estimates, the results suggest that for an average firm a one standard deviation increase in real exchange rate volatility reduces employment growth in the range of 1.4 - 2.1 percentage points.
    Keywords: Exchange Rate Volatility; Employment Growth; Manufacturing Firms; South Eastern Europe; Turkey
    JEL: E24 L6 F31
    Date: 2010
  7. By: Anda Mariana David (Université Paris-Dauphine, UMR DIAL); Mohamed Ali Marouani (UMR « Développement et Société »,IEDES / Université Paris1-Panthéon-Sorbonne, DIAL and ERF)
    Abstract: (english) The aim of this paper is to realize an in-depth analysis of the growth and poverty interactions in Syria, which undertook a series of economic reforms in the past decade to reduce the intervention of the Government in the economy. One of the main tools of the pro-poor growth literature used is the index developed by Bibi (2010), which takes into account at the same time the evolution of the welfare variable and its distribution. The results show that during the 1996-2004 period growth was not equitable at both national and regional levels. When the objective of halving poverty in 2015 is used as a benchmark, growth is pro-poor neither at the national level nor in the majority of the regions. Moreover, the main other characteristic of the Syrian growth and poverty performance is the widening of the gap between urban and rural areas. This could be mainly due to a pattern of growth where oil played an increasing role and agriculture a decreasing one. Agricultural and land policy reforms could have had a negative impact on poverty in some rural regions, such as the North-Eastern rural region, despite their positive effect on agricultural productivity. _________________________________ (français) L’objectif de cet article réaliser une analyse approfondie des interactions entre croissance et pauvreté en Syrie, pays ayant mis en place une série de réformes économiques dans la décennie passée pour réduire l'intervention de l'État dans l'économie. Un des principaux outils d’analyse de la croissance pro-pauvres auxquels on fait appel est l’indicateur développé par Bibi (2010), qui prend en compte à la fois l’évolution de l’agrégat de bien-être et sa distribution. Nos résultats montrent que la croissance en Syrie n’a pas été équitable au cours de la période 1996-2004. Lorsque l’on utilise comme référence le taux de croissance qui permettrait de réduire de moitié la pauvreté en 2015, la croissance n’apparaît pro-pauvre ni au niveau national, ni dans la majorité des régions. Par ailleurs, l’accroissement de l’écart de croissance entre les zones urbaines et rurales est l’une des caractéristiques majeures observées entre 1996 et 2004. Cela pourrait être principalement dû à un modèle de croissance où le pétrole a joué un rôle croissant et l’agriculture un rôle déclinant. De plus, les réformes foncières et agricoles ont pu avoir un impact négatif sur la pauvreté dans certaines régions rurales, telles que celle du Nord-est, en dépit de leurs effets positifs sur la productivité agricole.
    Keywords: Poverty, inequality, pro-poor growth, Syria and MENA, Pauvreté, inégalité, croissance pro-pauvres, Syrie et Moyen-Orient.
    JEL: D63 I32 O40
    Date: 2010–07
  8. By: Abderrahim Chibi (Abou-Bakr Belqayed University, Algeria); Mohamed Benbouziane; Sidi Mohamed Chekouri
    Abstract: This paper focuses on the macroeconomic effects of fiscal policy shocks in Algeria using a Structural Vector Autoregression (SVAR) approach. We use annual data covering 1965-2007 period, the results of the study were as follows: A positive structural shock in the government expenditure will have a positive impact on the real GDP in the short term with very small multiplier, but in the medium and long term have a negative effect on real GDP; lead to important “crowding-out” effects, by impacting negatively on private investment; and have a persistent and positive effect on the price level, consumption and the average cost of financing. A positive structural shock in public revenue would have a positive impact on the size of government spending, the same effect by this shock to real GDP with very small multiplier; have a persistent and negative effect on the price level and the average cost of financing in the medium and long term. For the response of the components of real GDP, there is a positive influence on both the consumption and private investment. These results show that the expansion fiscal policies in Algeria have non-Keynesian effects result of generate crowding-out” effects, and this specification engender the relative ability to influence economic variables as we explicated in Variance decomposition, and therefore there is relative to the effectiveness of such policies in achieving the desired economic goals.
    Date: 2010–08
  9. By: Brahim Elmorchid (Groupe de Recherche Economique et Financière (GREF), Université Cadi Ayyad, Marrakech, Morocco)
    Abstract: Destinés à soutenir l’activité économique, les congés fiscaux ont souvent fait l’objet de débats controversés. Sont-ils efficaces ? Dans cette contribution, nous nous proposons de revisiter cette question à la lumière de l’étude du cas marocain. L’objectif de ce papier est double : modéliser le coût d’usage du capital tenant compte des congés fiscaux et estimer sa valeur au Maroc pour la période allant de 1961 à 2008. Deux scénarios de calcul ont été retenus : le scénario de Droit commun (absence d’exonérations et autres aides à caractère fiscal) et le scénario des lois spécifiques à l’investissement, instituant des congés fiscaux. Au regard des résultats obtenus, il semble qu’en dépit de l’importance des mesures visant son allégement, le coût d’usage du capital au Maroc reste globalement élevé. En 2008, nous l’avons estimé à 21.64% pour un investissement marginal en matériel et outillage et 10.58% pour un investissement marginal en bâtiment. Ensuite, les résultats obtenus par secteur d’activité ou par zone géographique font apparaître une relative neutralité des congés fiscaux vis-à-vis du coût d’usage du capital. S’il n’est pas accompagné de la pratique des amortissements différés, le recours aux congés fiscaux est en général douteux. Les avantages explicites, sous forme d’exonérations fiscales temporaires, sont souvent contrebalancés par des pertes implicites, en particulier la non déductibilité des charges d’amortissements et des charges d’intérêts en périodes d’exonération. Ce résultat explique, entre autres, l’échec des politiques incitatives basées sur la hiérarchisation des avantages fiscaux en fonction des critères sectoriels et géographiques.
    Date: 2010–07

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