nep-ara New Economics Papers
on Arab World
Issue of 2012‒07‒29
nine papers chosen by
Quentin Wodon
World Bank

  1. The Locational Determinants of Turkish Outward FDI in Eurasian Countries By Nuri Yavan
  2. Factors of Social Capital in Rural Settlements: Case of Hilvan By Tuba Inal Cekic
  3. The Historical Roots of Entrepreneurship in South-Central Anatolia in Turkey By Oguz Ozbek
  4. Creative capacity for sustainable development: A comparative analysis of European and Turkish rural regions By Aliye Ahu Gulumser; Tuzin Baycan-Levent; Peter Nijkamp
  6. Food security in African and Arab countries: a review of the topic and some suggestions for building composite indicators with Principal Components Analysis By Ernest Reig
  7. Soft skills or hard cash ? the impact of training and wage subsidy programs on female youth employment in Jordan By Groh, Matthew; Krishnan, Nandini; McKenzie, David; Vishwanath, Tara
  8. On-the-Job Learning and Earnings: Comparative Evidence from Morocco and Senegal By Nordman, Christophe Jalil; Wolff, François-Charles
  9. Business and Technology Incubators and their Role in the Nordic Countries in Comparison to the GCC countries: An Analysis of Current Affairs By Thomas Hedner; Hanadi Almubaraki; Michael Busler; Adli Abouzeedan

  1. By: Nuri Yavan
    Abstract: A large body of empirical literature exists on location specific factors of developed countries multinational firms. Indeed, most of previous studies focus on the flows of outward foreign direct investment (FDI) from developed economies. Nevertheless, still there exists a knowledge gap in the literature on the location choice of multinational firms from developing economies. Therefore, it is essential to investigate the role of firms from emerging economies like Turkey in this process. In this context, this paper seeks to examine the location determinants of Turkish outward FDI in Eurasian Countries. We empirically examine the important factors for the location decisions of Turkish outward FDI, considering both Central and Eastern Europe Countries (CEEC) and Independent State of Commonwealth (CIS) at very different stages of economic development. Thus, the paper investigates the determinants of Turkish outward FDI using location factors of CEEC and CIS countries. Based on various types of regression models, we test our hypotheses employing official Turkish outward FDI data collected between 1993 and 2006. Our empirical results indicates that several location factors of the host country such as cultural distance, natural resources, market size, privatization and wage are the significant determinants in the case of Turkish outward FDI. We also find important differences between CEE and CIS countries regarding location determinants. While some location factors are important for Turkish outward FDI in CEE countries, some of these have no impact on Turkish OFDI in CIS countries. As a result, this paper offers some theoretical and empirical contributions as well as managerial implications. Key Words: Outward foreign direct investment, Turkish outward FDI, Location choice, Economic geography, Multinational firm, CEE and CIS countries.
    Date: 2011–09
  2. By: Tuba Inal Cekic
    Abstract: The concept of social capital, comprising social networks, norms of reciprocity and trust, has been gaining wide interest among researchers and policy makers. So it became a common concept to use social capital as a way to both describe and understand economical, political and social wellbeing of community. While the importance of social capital is highlighted in regional and rural development strategies, Turkey has gone into a fundamental restructuring process in rural and regional development policies in terms of European Union (EU) membership process. Social capital factors in rural settlements within the context of rural development in Rural area of Hilvan, has been put forth as the main theme of this paper. The paper aims to provide an overview of the concept of social capital for rural development and discusses social capital in terms of participation, trust, openness to diversity, and social-institutional networks. Potential items to measure these elements were developed in an empirical study conducted in rural area of Hilvan. Statistical analysis has been used to define factors of social capital and relation between factors and other independent variables like characteristics of rural settlements, socio-cultural structure of rural households and agricultural property and production types.
    Date: 2011–09
  3. By: Oguz Ozbek
    Abstract: The economic development in one region or locale can be associated with and explained by socio-cultural and socio-spatial factors. This premise is well-supported by an institutional and historical analysis. The increasing number of works on social embeddedness and formation of entrepreneurial culture highlight again a well-known phrase of institutional economics: history matters. Economic growth in one region can be closely associated with broad historical processes and initial advantages. The Turkish case offers a suitable context for this institutional analysis outlined above. The initial advantages that are most evident in the irreversible development trajectories of the commercial centres like Istanbul and Izmir are also expressive in the emerging regional and sub-regional growth centres like Anatolian Tigers. Anatolian Tigers refer a number of new growth centres that put up a good and consistent performance in manufacturing industry since the 1980s. Two Anatolian Tigers, Konya (well-known) and Karaman (less-known) locating in South-Central Anatolia constitute the geographical scope of this paper. The sub-region of Konya-Karaman is not only delineated by normative criteria but also defined historically and geographically. This makes the area a historical region of established commercial culture. Konya is an important regional centre of commercial, industrial, agricultural and service activities in Turkey especially with its nationally strategic industrial establishments and grain production. Since the 1980s, Konya has experienced an important development in the manufacturing industry. Karaman that is an important industrial and commercial centre of Central Anatolia at both provincial and urban levels is commonly not known or termed as an Anatolian Tiger but it displays a number of historical peculiarities (administrative, socio-economic and geographic) are crucial to comprehend the historical roots of recent commercial and industrial development of Tigers and other redeveloping centres in Anatolia. In the re-emergence of Konya and Karaman as regional growth centres, locational, social and political factors contributed positively to the perpetual socio-economic development in Anatolian Seljuk, Karamanogullari, Ottoman and Republican periods. In conclusion, from the perspective of institutional economics, this paper examines the role of historical-geographical factors in the formation of an entrepreneurial culture in the sub-region of Konya and Karaman.
    Date: 2011–09
  4. By: Aliye Ahu Gulumser; Tuzin Baycan-Levent; Peter Nijkamp
    Abstract: Creative capacity in the field of regional sciences means the capability of any region to generate knowledge and thus to achieve innovation and the diffusion of the output of the innovative activity while obtaining the viability and sustainability of this process. Although creative capacity studies mainly focus on urban regions, the late rural studies and empirical evidences showed that rural region has a great potential capacity in terms of its five components viz. knowledge; innovation; entrepreneurship; creativity; and networks. But, these opportunities have shown by a rural specific approach rather than an urban approach. On this basis, by taking into consideration these discussions in the literature, we assume that the rural creative capacity can be evaluated by the recent changes in rural regions that show the capability of rural regions to exploit its knowledge as an output. On this purpose, in this study, we aim to evaluate which component is relatively important to identify the level of rural creative capacity. Therefore, the study focuses on 60 villages from Europe and 17 villages from Turkey by deploying the data obtained from the in-depth questionnaires. This study is a first attempt at settlement level with an optimistic approach to measure the opportunities lying at the heart of rural regions. The results of the study showed that creativity in terms of traditions is the most important component in both cases while European villages have more opportunities and do not have the latent rural problems while Turkish villages are still suffering from the well-known rural problems that their capacity exists but it is very limited.
    Date: 2011–09
  5. By: Ebru Seckin
    Abstract: The firms prefer the lean production in the competitive environment, discard the stages and processes that do not create value by aiming at diversity in commodity and service provision. Accordingly, the relationships between the suppliers and customers become prominent and the firms that abandon the big firm emerge as new actors in the market. Information and communication technology brings about flexibility and creates new opportunities in location choice. Thus, the enterprises have become complicated, distant from the center and network based. As the central tasks within a firm stay in the developed regions, the peripheral tasks are moved to underdeveloped regions. As a result of the core-periphery distinction in service sector, call center sector has become prominent. When the issue is considered in terms of regional development, the call centers, which are now out of the firm, are located in the underdeveloped regions. While the literature about call center sector discussion considers call centers as an opportunity for the economic development of the underdeveloped regions, making use of the labor force of the periphery at the call centers seems to be the greatest constrains. The aim of this study is to evaluate whether the call centers are long term investments for underdeveloped regions, in terms of its contribution to the development of the local labor force capacity. The goal is to compare the opinions of the labor force about the jobs at the call center related to the characteristics of the labor force. In this respect, the methodology consists of a survey study with the employees of two call center firms. The employees answered 20 questions about their willingness to continue their job at the call center and capacity development by utilizing 5 Likert scale. The results will be obtained by means of ANOVA test that is conducted in order to determine whether there is a difference in the answers provided according to the level of education, type of the firm, term of employment and gender.
    Date: 2011–09
  6. By: Ernest Reig (University of Valencia)
    Abstract: This paper is concerned with the issue of food security, placing special emphasis on the current situation of Arab and African countries. The main conceptual aspects of food security are briefly reviewed, pointing to the shift from a former focus on food energy availability to a more comprehensive appraisal of this phenomenon in recent times. The most likely causes of recent rises in food prices are also described. Food security issues are analysed in connection with rural poverty issues and with the failure to achieve successful agricultural development in some developing countries, which sometimes have to overcome strong restrictions concerning the availability of land and water resources for food production. The paper points to the convenience of using multivariate statistical tools to summarise a wealth of food security-related indicators, and a practical example of the use of Principal Components Analysis (PCA) for data concerning 52 African and Middle East countries is provided, with a dataset originally comprising 13 variables. The PCA methodology is described in a non-mathematical fashion, also showing the basic steps in its application to this case. Two basic composite indicators, or ‘principal components’ are selected, one in connection with ‘human development’ and the other with ‘being at risk of hunger’, and countries in the sample are ranked according to their situation with regards to these dimensions.
    Keywords: food security, agricultural development, Arab countries, Principal Components Analysis
    Date: 2012–07
  7. By: Groh, Matthew; Krishnan, Nandini; McKenzie, David; Vishwanath, Tara
    Abstract: Throughout the Middle East, unemployment rates of educated youth have been persistently high and female labor force participation, low. This paper studies the impact of a randomized experiment in Jordan designed to assist female community college graduates find employment. One randomly chosen group of graduates was given a voucher that would pay an employer a subsidy equivalent to the minimum wage for up to 6 months if they hired the graduate; a second group was invited to attend 45 hours of employability skills training designed to provide them with the soft skills employers say graduates often lack; a third group was offered both interventions; and the fourth group forms the control group. The analysis finds that the job voucher led to a 40 percentage point increase in employment in the short-run, but that most of this employment is not formal, and that the average effect is much smaller and no longer statistically significant 4 months after the voucher period has ended. The voucher does appear to have persistent impacts outside the capital, where it almost doubles the employment rate of graduates, but this appears likely to largely reflect displacement effects. Soft-skills training has no average impact on employment, although again there is a weakly significant impact outside the capital. The authors elicit the expectations of academics and development professionals to demonstrate that these findings are novel and unexpected. The results suggest that wage subsidies can help increase employment in the short term, but are not a panacea for the problems of high urban female youth unemployment.
    Keywords: Tertiary Education,Labor Markets,Labor Policies,Primary Education,Access to Finance
    Date: 2012–07–01
  8. By: Nordman, Christophe Jalil (IRD, DIAL, Paris); Wolff, François-Charles (University of Nantes)
    Abstract: In this paper, we consider a model of on-the-job learning where workers learn informally by watching and imitating colleagues. We estimate the rate of knowledge diffusion inside the firm using two matched worker-firm data sets from Morocco and Senegal. We rely on non-linear least squares to estimate the structural parameters of the informal learning model and account for firm heterogeneity using firm factors derived from a principal component analysis. We find that the rate of knowledge diffusion is around 7 percent in Morocco and Senegal, but part of the learning-by-watching returns stems from firm heterogeneity. Informal training significantly affects the shape of returns to tenure in these two countries. Finally, we estimate an extended model with both learning-by-watching and learning-by-doing and find significant benefits from imitating colleagues in Morocco.
    Keywords: earnings functions, informal training, learning-by-watching, learning-by-doing, returns to tenure, Morocco, Senegal
    JEL: J24 J31 O12
    Date: 2012–07
  9. By: Thomas Hedner; Hanadi Almubaraki; Michael Busler; Adli Abouzeedan
    Abstract: Business and Technology incubators are seen as important actors for the development of dynamic start-up companies in national economies. The way such incubators function and the impact they have on regional development may vary from one region to another. In this paper we survey and discuss the roles played by business and technology incubators in two different regions of the world, namely the Nordic region with countries like Sweden, Norway and Finland and the Gulf Cooperation Council (GCC) countries, such as Kuwait, Bahrain, Qatar, UAE and Saudi Arabia. The business and technology incubators were assessed in terms of perspective (Logics and Function; Strategy and Planning; Policies and Practices; Role and Impact; Output and Outcome) as well as stage of development (Inception, Implementation, Consolidation and Renewal; Etzkowitz and Klofsten 2005). The paper analyzes the role of business incubators from functional and longitudinal perspectives. In the two regions, we have also analyzed the strength and impact of actors and institutions involved in the development of incubator systems, such as academic, business and governmental institutions. Keywords: Incubators, Business Incubators, venture creation, Nordic countries, GCC countries.
    Date: 2011–09

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