nep-ara New Economics Papers
on MENA - Middle East and North Africa
Issue of 2016‒09‒18
five papers chosen by
Paul Makdissi
Université d’Ottawa

  1. The Empirical Content of Season-of-Birth Effects: An Investigation with Turkish Data By Torun, Huzeyfe; Tumen, Semih
  2. The Economic Impact of Conflicts and the Refugee Crisis in the Middle East and North Africa By Bjoern Rother; Gaelle Pierre; Davide Lombardo; Risto Herrala; Priscilla Toffano; Erik Roos; Allan G Auclair; Karina Manasseh
  3. An Investigation into the Dynamics of EU Agricultural Imports from Mediterranean Partner Countries By Mili, Samir
  4. Deputy Crown Prince Mohammed Bin Salman?s Three-Pronged Approach to Counter-Terrorism By Report: Salman Al Ansari; Dr. Majid Rafizadeh
  5. Modeling Business Cycle Fluctuations through Markov Switching VAR:An Application to Iran By Moradi, Alireza

  1. By: Torun, Huzeyfe (Central Bank of Turkey); Tumen, Semih (Central Bank of Turkey)
    Abstract: Although the season of birth variable is often used as an instrumental variable to estimate the rate of returns to schooling in the labor economics literature, there is an emerging consensus that the season of birth is systematically associated with later outcomes in life such as the educational and labor market success; thus, it is highly likely non-random. Using a large micro-level data set from Turkey, we argue that the degree of this non-randomness can be even larger in a developing-country context. Specifically, we show that around 20 percent of all individuals in Turkey have January as their month of birth due to a combination of geographical, seasonal, institutional, and idiosyncratic factors that lead to misreporting. We further document that being January-born strongly predicts worse socio-economic outcomes in later life. We show that this can be a serious problem in evaluating policies that define eligibility based on the month of birth – such as compulsory schooling and compulsory military service laws that set the eligibility birth date cutoff as the January 1st. We confirm the validity of this concern based on a series of regression discontinuity design exercises. We conclude that, in a developing-country context, additional caution should be exercised when using the season-of-birth variable as a statistical tool.
    Keywords: season-of-birth effects, IV, education, earnings, family background, misreporting
    JEL: C26 I26 J13
    Date: 2016–09
  2. By: Bjoern Rother; Gaelle Pierre; Davide Lombardo; Risto Herrala; Priscilla Toffano; Erik Roos; Allan G Auclair; Karina Manasseh
    Abstract: In recent decades, the Middle East and North Africa region (MENA) has experienced more frequent and severe conflicts than in any other region of the world, exacting a devastating human toll. The region now faces unprecedented challenges, including the emergence of violent non-state actors, significant destruction, and a refugee crisis bigger than any since World War II. This paper raises awareness of the economic costs of conflicts on the countries directly involved and on their neighbors. It argues that appropriate macroeconomic policies can help mitigate the impact of conflicts in the short term, and that fostering higher and more inclusive growth can help address some of the root causes of conflicts over the long term. The paper also highlights the crucial role of external partners, including the IMF, in helping MENA countries tackle these challenges.
    Date: 2016–09–16
  3. By: Mili, Samir
    Abstract: This contribution explores the buyer side of the value chains for the main agricultural products sourced from the Mediterranean Partner Countries (MPCs) in North Africa and Middle East into the EU, taking Spain as study case of these European import flows. Using the Global Value Chain (GVC) approach, it provides new survey-based evidence for better understanding and profiling the opportunities and constraints for these trade flows, and therefore deriving implications to improve the efficiency of the target value chains both in origin and in destination. Primary information has been gathered using two complementary methods. First, a buyer survey has been conducted through structured questionnaires directed to major Spanish importing and trading companies of orange, strawberry, tomato and olive oil sourced from Morocco, Tunisia, Egypt and Turkey. Subsequently, survey results have been supplemented by in depth, semi-structured interviews to a representative group of knowledgeable experts from the academic, public administration and business sectors. Results show differences depending on the product and the country studied. The approach used has been efficient in fulfilling the research objectives. It complements conventional quantitative inquiries where available evidence reveals serious difficulties to conduct thorough empirical analysis of the functioning of this trade with quantitative models. It is shown that the suggested approach is an alternative avenue to overcome these difficulties.
    Keywords: Euro-Mediterranean Partnership, agricultural trade, Global Value Chain, buyer survey, Agribusiness, International Relations/Trade,
    Date: 2016–05
  4. By: Report: Salman Al Ansari; Dr. Majid Rafizadeh
    Abstract: Deputy Crown Prince and Defense Minister, Prince Mohammed bin Salman, who according to the New York Times "has moved quickly to revolutionize his country?s economy in ways that offer tantalizing hints at even broader reforms", is now establishing and spearheading a new comprehensive, locally and internationally coordinated counter-terrorism strategy. President Obama hosted Mohammed bin Salman in June, 2016 and discussed U.S.-Gulf Cooperation Council (GCC) as well as expressed appreciation for Saudi Arabia's efforts in combatting ISIS and contributing to the campaign against ISIS. While the strategy is centered around conventional methods of countering terrorism, such as monitoring, tracking down and eliminating terrorist threats, it will do so by focusing on eradicating any terrorist cyber-presence, combatting extremist ideologies, and establishing a coalition of countries. the Deputy Crown Prince pushed for three main directions towards the strategy that focus on tackling terrorism through multiple fronts that include (but are not limited to) digital, ideological and military fronts. Three centers have been established that take on each respective front.
    Date: 2016–09
  5. By: Moradi, Alireza
    Abstract: IN this paper, the Iranian Business Cycle characteristics were investigated via uni-variate and multivariate Markov-switching specifications. By using Hamilton (1989) and Krolzig (1997) (MS-VAR) models, we examined the stochastic properties of the cyclical pattern of the quarterly Iranian real GDP between 1988:Q2 - 2008:Q3. The empirical analysis consists of mainly three parts. First, two kinds of alternative specifications were tried and we were adopted best specification with respect to various diagnostic statistics. Then, selected models were tested against their linear benchmarks. LR test results imply strong evidence in favor of the nonlinear regime switching behavior. Furthermore, the multivariate specification with various macro aggregates and changing variance parameter outperformed the other MS models with reference to one-step ahead forecasting performance. With this specification, we can detect the three recessionary periods experienced by the Iranian economy between 1988:Q2 and 2008:Q3. Finally, based on inference from this model a chronology of business cycle turning points was determined.
    Keywords: Markov Switching Models, Business Cycles, MSVAR, Iran.
    JEL: C32 E32
    Date: 2016–09–09

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