nep-ara New Economics Papers
on Arab World
Issue of 2011‒02‒12
five papers chosen by
Quentin Wodon
World Bank

  1. Wage Inequality and Returns to Education in Turkey: A Quantile Regression Analysis By Aysit Tansel; Fatma Bircan
  2. Import Demand Behavior of Arab Countries: Recent Trends and Influence of Geopolitical Events By Nader Habibi
  3. Assessing the Responsiveness of Private Investment to Economic Reforms: The Case of MENA Countries By Ahmet Faruk Aysan; G. Pang; Marie-Ange Veganzones
  4. Modelling and Forecasting Turkish Residential Electricity Demand By Zafer Dilaver; Lester C Hunt
  5. Total Factor Productivity of Tunisia's manufacturing sectors: measurement, determinants and convergence towards OECD countries By Mohamed Chaffai; Patrick Plane

  1. By: Aysit Tansel (Middle East Technical University); Fatma Bircan (Karaelmas University)
    Abstract: This paper investigates the male wage inequality and its evolution over the 1994- 2002 period in Turkey by estimating Mincerian wage equations using OLS and quantile regression techniques. Male wage inequality is high in Turkey. While it declined at the lower end of the wage distribution it increased at the top end of wage distribution. Education contributed to higher wage inequality through both within and between dimensions. The within-groups inequality increased and between-groups inequality decreased over the study period. The latter factor may have dominated the former contributing to the observed decline in the male wage inequality over the 1994-2002. Further results are provided for the wage effects of experience, public sector employment, geographic location, firm size, industry of employment and their contribution to wage inequality. Recent increases in FDI inflows, openness to trade and global technological developments are discussed as contributing factors to the recent rising within-groups wage inequality.
    Keywords: wage inequality, returns to education, quantile regression, Turkey
    JEL: J31 J23 J24 I21
    Date: 2011
  2. By: Nader Habibi (Department of Economics, Brandeis University)
    Abstract: In light of the growing significance of the Arab import market for the global community this study focuses on how the market shares of leading exporters in the Arab world have evolved over the past two decades. In first part of the analysis I looked at the trends of these market shares over time and in comparison to other developing regions. I investigated the market shares of the United States, China, Japan and the aggregate market share of four largest European economies (France, Germany, Italy and the United Kingdom). Since GCC constitutes the largest and most important sub-regional import market inside the Arab world, the study focuses on GCC with more detail. The trend analysis revealed that during 1988-2007 the United States, Japan and European countries have lost market share in Arab markets. China’s market share, which was very small at the beginning of this period, enjoyed a substantial growth over these two decades. The market shares of European countries and the United States were relatively stable before 2000 and most of this market loss was realized during 2000-2007. For Japan on the other hand the market loss was most substantial during the first half of 1990s followed by another noticeable loss during 2005-2007. China’s market share grew at a slow pace up until 2000, followed by faster growth during 2001-2007. In the second part of this analysis I used statistical regression models to investigate the impact of important geopolitical events on relative market shares of the same exporters that were studied in the first section. In light of the complex diplomatic and security relations between the United States and Arab countries it might be the case that Arab imports from the US are sensitive to the ups and downs of the US-Arab relations. To investigate this theory I focused on four important geopolitical events: Gulf War I (1991), Second Palestinian Intifada (2000-2001), The September 11 terror attack (2001) and the US invasion of Iraq (2003-2004). In my statistical model the dependent variables are the market shares of the leading exporters to each Arab country or bloc of countries. The statistical results suggest that the Gulf War I and the US invasion of Iraq have both been associated with changes in US market share in Arab imports. We observe a positive association between Gulf War I and the US market share in GCC countries and the aggregate imports of Arab countries in 1991 and 1992. On the other hand we observe a negative association between the invasion of Iraq and the US market share in aggregate imports of the Arab world. Among GCC countries this negative association is only significant for the US market share in Saudi Arabia. Furthermore, the analysis shows a strong and positive growth in market shares of Asia and Europe during 2003 and 2004 which are associated with the US invasion of Iraq. The results for the second intifada/September 11 event are mixed. This period is associated with an increase in US market share in Bahrain and a negative market share in Saudi Arabia and the UAE. No significant association is detected in other GCC countries or in the aggregate imports of GCC as a group. Nevertheless we observe a negative association between this pair of events and the US market share in the aggregate imports of Arab countries.
    Date: 2010–10
  3. By: Ahmet Faruk Aysan (CERDI - Centre d'études et de recherches sur le developpement international - CNRS : UMR6587 - Université d'Auvergne - Clermont-Ferrand I); G. Pang (CERDI - Centre d'études et de recherches sur le developpement international - CNRS : UMR6587 - Université d'Auvergne - Clermont-Ferrand I); Marie-Ange Veganzones (CERDI - Centre d'études et de recherches sur le developpement international - CNRS : UMR6587 - Université d'Auvergne - Clermont-Ferrand I)
    Abstract: During the 1980s and the 1990s, private investment in the Middle East and North Africa (MENA) has on average shown a decreasing or stagnant trend. This contrasts with the situation of the Asian economies, where private investment has always been more dynamic. In this paper, it is empirically shown for a panel of 39 developing economies--among which four MENA countries-- that in addition to the traditional determinants of investment--such as the growth anticipations and the real interest rate--government policies explain MENA's low investment rate. Insufficient structural reforms--which have most of the time led to poor financial development and deficient trade openness¬¬--have been a crucial factor for the deficit in private capital formation. The economic uncertainties of the region have represented another factor of the firm's decisions not to invest. These uncertainties have consisted of the external debt burden and various measures of volatility.
    Keywords: cerdi
    Date: 2011–02–03
  4. By: Zafer Dilaver (Surrey Energy Economics Centre (SEEC), Department of Economics, University of Surrey); Lester C Hunt (Surrey Energy Economics Centre (SEEC), Department of Economics, University of Surrey)
    Abstract: This research investigates the relationship between Turkish residential electricity consumption, household total final consumption expenditure and residential electricity prices by applying the structural time series model to annual data over the period 1960 to 2008. Household total final consumption expenditure, real energy prices and an underlying energy demand trend are found to be important drivers of residential electricity demand with the estimated short run and the long run total final consumption expenditure elasticities being 0.38 and 1.57 respectively and the estimated short run and long run price elasticities being -0.09 and -0.38 respectively. Moreover, the estimated underlying energy demand trend, (which, as far as is known, has not been investigated before for the Turkish residential sector) should be of some benefit to Turkish decision makers in terms of energy planning. It provides information about the impact of the implementation of past policies, the influence of technical progress, the changes in consumer behaviour and the effects of energy market structure. Furthermore, based on the estimated equation, and different forecast assumptions, it is predicted that Turkish residential electricity consumption will be somewhere between 48 and 80 TWh by 2020 compared to 40 TWh in 2008.
    Keywords: Turkish Residential Electricity Demand, Structural Time Series Model (STSM), Future Scenarios, Energy Demand Modelling and Forecasting.
    JEL: C22 Q41
    Date: 2010–11
  5. By: Mohamed Chaffai (CERDI - Centre d'études et de recherches sur le developpement international - CNRS : UMR6587 - Université d'Auvergne - Clermont-Ferrand I); Patrick Plane (CERDI - Centre d'études et de recherches sur le developpement international - CNRS : UMR6587 - Université d'Auvergne - Clermont-Ferrand I)
    Abstract: The purpose of this paper is twofold. First, sector-based Total Factor Productivity (TFP) is calculated for six Tunisian manufacturing sectors over the period 1983-2002. Economic determinants of the productive performance are also investigated. In doing so, we take care of the direction of the causality by using a panel data Granger type-test. The recent literature in international economics has placed a particular emphasis on the relation between TFP and variables reflecting the potential impact of both trade and financial openness. Sector-based TFPs proved to be sensitive to some of these variables, highlighting a causality that does not reject the stimulating impact of exports and foreign direct investments. Second, the paper implements some panel data unit root tests to investigate the statistical hypothesis of TFP catching up of Tunisia with OECD members. In benchmarking each of the six Tunisian sectors by those of the most developed countries, panel data unit root tests do not reject the hypothesis of an overall catching- up for five of them.
    Keywords: cerdi
    Date: 2011–02–03

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