|
on MENA - Middle East and North Africa |
| By: | Ragui Assaad; Caroline Krafft (St. Catherine University) |
| Abstract: | In this paper, we present a comparison of several dimensions of higher education processes linked to educational quality across different types of higher education institutions in three MENA countries: Egypt, Jordan and Tunisia. While an important comparison is across public and private institutions, we also distinguish across selective and non-selective institutions and by field of study. To keep the comparison tractable, we restrict our analysis to two broad fields of study, namely information technology and business/commercial studies. The rationale for selecting these fields is that they are the ones where private sector institutions are likely to be more prevalent in all three countries, allowing for meaningful comparisons by sector of ownership. The analysis is based on three similar surveys of higher education graduates from these two fields conducted by ERF with local partners in all three countries over the course of 2012 to 2015. |
| Date: | 2016–06–12 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1069&r=ara |
| By: | Racha Ramadan (Cairo University); Vladimir Hlasny; Vito Intini |
| Abstract: | Economic inequality across socio-demographic groups in the Arab region is high and growing. This paper evaluates the differentials in household expenditures across rural/urban areas, female/male-headed households, non-educated/educated-headed households and nonemployed/employed-headed households, in ten Household Income and Expenditure surveys from four Arab countries: Egypt (2008, 2010 and 2012), Jordan (2006 and 2010), Palestine (2007, 2010 and 2011) and Tunisia (2005 and 2010). Unconditional quantile regressions are used to analyze the differentials across the population distribution and to decompose them by source. Results show that Egypt and Tunisia – countries that have faced political instability during the early 2010s – exhibit relatively high expenditure gaps across rural/urban and non-educated/educated groups. Expenditure gaps in Jordan and Palestine – countries that have largely avoided instability – and those across non-employed/employed and female/male headed households are more moderate. Overall, education and the return to it, geographic location and household composition play an important role in bringing about, as well as reducing, economic inequality across social groups. These findings have important implications for development policy in the Arab region and possibly for our understanding of the socio-political climate leading up to the Arab Spring. |
| Date: | 2016–06 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1016&r=ara |
| By: | Driouchi, Ahmed; Harkat, Tahar |
| Abstract: | Abstract This paper examines the causality between social, technological, and political variables with macroeconomic variables in 19 Arab countries: Algeria, Bahrain, Egypt, Iraq, Jordan, Kuwait, Lebanon, Libya, Mauritania, Morocco, Oman, Qatar, Saudi Arabia, Sudan, Syria, Tunisia, United Arab Emirates, Palestine, and Yemen. It uses the Granger causality test to determine causal relationships using data between years 1962 and 2015. Empirical findings reveal unique causality profile for each of the Arab countries. Results also suggest the most important variables in the determination of the economic growth in Arab economies, separately. Variables related to the demography of the new generation, ICTs and use of social media appear to be playing important causal roles, in the sense of Granger tests. This implies that economic, future social and political decisions need to account for these findings and that policies need to be geared towards for further inclusion of the aspirations and expectations of the youth. |
| Keywords: | Keywords: Granger Causality, Arab Countries, Macroeconomic Variables, Social Variables, Technological Variables, Political Variables.; Granger Causality, Arab Countries, Macroeconomic Variables, Social Variables, Technological Variables, Political Variables. Granger Causality, Arab Countries, Macroeconomic Variables, Social Variables, Technological Variables, Political Variables |
| JEL: | I25 J62 |
| Date: | 2017–03–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:77218&r=ara |
| By: | Caroline Krafft (St. Catherine University); Halimat Alawode |
| Abstract: | Problems with inequality have been at the forefront of recent events in the Middle East and North Africa region. Yet by conventional measures such as wages and consumption, inequality is not particularly high. In this paper we explore an alternative dimension of inequality, specifically inequality of opportunity in higher education. We assess the determinants of attaining higher education in Egypt, Jordan, and Tunisia and quantify the extent and drivers of inequality of opportunity. We find that inequality is similarly high in Egypt and Tunisia, but moderate in Jordan. In all three countries family socio-economic characteristics are the primary driver of inequality. Family characteristics affect attainment even after accounting for test scores, which are themselves influenced by socio-economic status. Particularly in Egypt and Tunisia, where higher education is free of charge, public spending on higher education is ultimately regressive. Thus, a theoretically meritocratic and equitable system perpetuates inequality. |
| Date: | 2016–10–20 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1056&r=ara |
| By: | Ahmed Shoukry Rashad; Mesbah Fathy Sharaf (Department of Economics, Faculty of Arts, University of Alberta, Edmonton, Canada) |
| Abstract: | Medical care during pregnancy is crucial for protecting women from health risks during and after pregnancy, and has been consistently linked to better child health outcomes. Improving maternal health is one of the Millennium Development Goals (MDGs). This paper examines the socio-economic inequalities in maternity care utilization in Egypt, Jordan, and Yemen after the Arab Spring, using the most recent rounds of the National Demographic and Health Survey. Concentration curves and concentration indices are used to examine the demographic and socio-economic correlates of maternity care utilization, and to assess the situation under the political instability that followed the Arab Spring. In addition, we investigate the underlying factors that generate the socio-economic inequalities in maternity care utilization by decomposing the concentration index into its determinants. The analysis yields that the degree of the socio-economic inequalities in maternity care utilization varies largely within the Arab world. The level of inequality is severe in Yemen, moderate in Egypt, and minor in Jordan. Results of the decomposition analysis show that socio-economic disparities in maternity care utilization are mainly due to the lack of economic resources and its correlates among the poor. The political instability in the region did not hinder Egypt and Jordan from improving the maternal health indicators at the national level. Increasing women education, especially among the poor, and poverty reduction measures focusing on rural communities could help narrow the inequalities in maternity care and hence improves population health outcomes. |
| Date: | 2016–06 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1011&r=ara |
| By: | Yosr Abid (Technical and Practical Assistance to Development, Tunisia); Cathal O'Donoghue; Denisa Sologon |
| Abstract: | The present paper intends to identify the main driving factors of the distribution of welfare in Tunisia and Egypt. We present a regression-based method to compare the labor market and demographic characteristics in both countries, as well as their impact on the distribution of consumption expenditures. For this, we develop a welfare generation model to generate estimates for the contribution of different demographics and labor characteristics for each country to welfare. This allows us to capture differences in both returns in employment and demographic characteristics. In this paper, we present the welfare generation model and its estimation results. These suggest that the most relevant factors in explaining the distribution of welfare are similar in Tunisia and Egypt. Some specific characteristics, such as education and regional characteristics, have a different impact in each country. |
| Date: | 2016–06 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1009&r=ara |
| By: | Mongi Boughzala (University of Tunis El Manar, FSEGT); Samir Ghazouani; Abdelwahab Ben Hafaiedh |
| Abstract: | This paper is about the institutional and regulatory system governing higher education in Tunisia; its focus is on autonomy and accountability and it also compares the performance of public higher education graduates to the private sector’s. The main idea guiding this paper is that better educational outcomes depend, among other things, on the institutional arrangements and the incentives structure they generate. The paper analyzes the current incentive system underlying the functioning of the university system in Tunisia. In spite of the reforms attempted to improve the quality of the education system this system remains very disconnected from the demand side of the labor market. Management and academic staff have little incentive to adapt their training and research programs to the market needs. This is to a large extent because they enjoy little autonomy and are hardly accountable. The paper also relies on data drawn from the recent Tunisia Higher Education Graduates’ Survey (THEGS 2015) initiated by ERF which builds on similar studies previously undertaken by ERF in Egypt and Jordan. This data is used to compare the outcome of the public universities with the private institutions with a focus on the employment performance of their graduates. Private universities behave differently, and some try to innovate in terms of pedagogy and to be closer to the potential employers’ demands. However, they remain small and attract less than 8 percent of the total student body. They are all profit driven and tend to have few if any permanent academic staff; instead, they rely mostly on temporary teachers. Nevertheless, based on the THEGS 2015 data, they manage to perform quite well compared to their public counterparts. |
| Date: | 2016–07 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1031&r=ara |
| By: | Izak Atiyas (Sabanci University); Ozan Bakis; Esra Ceviker Gurakar |
| Abstract: | It has widely been asserted that an important dimension of social dynamics that eventually carried the Justice and Development Party (Adalet ve Kalkinma Partisi, AKP) to political power is the emergence of a “devout bourgeoisie” especially in the new growth centers of Anatolia. In this paper, we use firm level data over the last three decades to trace the economic and especially productivity dynamics in the manufacturing industries of new growth centers in Anatolia (“Anatolian Tigers”) in comparison to the traditional growth centers (the “West”). We observe that what happened in the 1990s in the Tigers was a significant change in the size distribution of employment with the emergence of a significant number of medium sized enterprises. In the 2000s there was a visible convergence between the labor productivity of highly productive firms in the Tigers and the West, whereas divergence occurred at the lower end of the productivity distribution. We then examine the evolution of members of religious business associations among the largest 1000 manufacturing firms in Turkey. We observe that the number of such firms increased substantially especially after mid-1990s. These firms are concentrated in relatively more labor-intensive industries, and have lower productivity than firms associated with business associations that represent the traditional industrial elite and are quite export oriented. We discuss the possible role of political connections and conclude they possibly had a more diminished role in the emergence of devout businesses in manufacturing compared to rent-thick activities such as public procurement, construction or regulated industries. |
| Date: | 2016–11–23 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1064&r=ara |
| By: | Driouchi, Ahmed; Harkat, Tahar |
| Abstract: | Abstract: This is to provide empirical evidence on the likely roles of knowledge, social networks and Information Technologies (IT) besides governance in shaping the characteristics of the current generation of youth in comparison with the oldest ones. The framework of intergenerational mobility provides promising grounds for the empirical analysis. Series of hypotheses require empirical testing under the above framework. The data are mainly time series from international organizations such as the World Bank, the International Labor Organizations and United Nations. In addition, results from previous studies assessing educational mobility and income are used. Several statistical methods provide the grounds for the testing of the retained hypotheses. The attained results show that the effects of annual demographic growth is not established clearly for all Arab countries as most economies have had immobility in demographic population growth over the period 1960-2015 but the total population of youth in the current generation is higher than the population that prevailed for the older generation. The overall openness of the Arab economies besides their democratization measured by series of indices appear to have been stable over the period 1996-2015. Other results are related to social mobility in income, education attainment and to the unemployment trends. They all show with the progress in ICTs and the increasing reliability on social media, that the current generation has more features that are different from those of the oldest generation. |
| Keywords: | Keywords: Young generations, Arab World, Economic, Social and Political Changes |
| JEL: | I25 J62 |
| Date: | 2017–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:77216&r=ara |
| By: | Cem Baslevent (Istanbul Bilgi University and ERF) |
| Abstract: | The main purpose of this project is to carry out descriptive analyses to determine the extent to which social transfers and pension payments have an impact on income inequality and the incidence of poverty in Turkey. Our survey data allows us to carry out this research by identifying the amounts of various types of income received by households. Furthermore, the availability of the amounts of labor income and pension payments at the individual level allows us to distinguish between the incomes of male and female household members, which makes it possible to examine some gendered dimensions of the research question. Thus, the examination of the distributional impact of pension and social assistance programs in Turkey promises to be an interesting exercise that will provide valuable insights for not only for social scientists, but also for politicians and policy makers. Pension payments received by female household members reflect a strong attachment to the labor market in the past. Thus, our findings might also point to the importance of the continued economic activity of women in terms of social justice. Also, by quantifying the contribution of social transfers to inequality, we might produce concrete empirical evidence of whether social policies of the government have had an impact on political outcomes. |
| Date: | 2016–06 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1013&r=ara |
| By: | Mehmet S. Tosun (University of Nevada, Reno, ERF, IZA and OIPA) |
| Abstract: | In this study, I examine the links between demographic change and fiscal policy in MENA countries, focusing specifically on the economic impacts coming from the conflict between social security and education, which are two of the most government programs in any country. The paper is unique as it incorporates a political economy model of education given expected increases in social security spending in the background. Labor movements and growth results are expected to depend significantly on the return to education. A sensitivity analysis on the parameter that shows the return to education spending reveals that MENA countries would suffer significantly from a lower return to education. This scenario highlights the importance of returns to education for the growth results in the MENA region. It is also important to note that the MENA region could potentially experience significant positive economic growth if it can maintain a high return to education and also attract more capital, despite a rising fiscal burden coming from the social security system. |
| Date: | 2016–07 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1023&r=ara |
| By: | Rania S. Miniesy (The British University in Egypt); Eman Elish |
| Abstract: | The objectives of this paper are twofold; to investigate the host country determinants of Chinese Outward Foreign Direct Investment (OFDI) in general and to examine, given these determinants, if Chinese OFDI in MENA is different (less) than elsewhere. We obtained data for the top forty Chinese OFDI recipients worldwide and that included seven MENA countries from 2003-2012. Using a pooled ordinary least squares estimation technique on the lagged explanatory variables and the lagged dependent variable flows and stocks alternatively with robust standard errors, we found the following: Chinese OFDI is market seeking, resource seeking, and efficiency seeking and that it is not deterred by poor governance but on the contrary is attracted to it. Chinese OFDI follows its exports and relocates probably to evade barriers to trade in third markets. The seven MENA countries seemingly receive significantly less Chinese OFDI flows compared to other countries because they are less open, have lower labor productivity and do not import as much on average from China as other non-MENA countries. However, careful inspection shows that UAE is creating this bias; in other words, UAE is the reason Chinese OFDI to the MENA_7 is significantly less than in other countries. This maybe because exporting to UAE rather than licensing or FDI seems like the best scenario, or UAE is already satiated with FDI from other countries, or China is waiting for the right time to enter such an FDI-competitive market like that of UAE. |
| Date: | 2016–07 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1024&r=ara |
| By: | Fatma El-Hamidi (University of Pittsburgh) |
| Abstract: | The purpose of this study is to quantify the effects of the current energy reform policy on household expenditures along gender and regional lines. Gender analysis helps to identify constraints such as transportation poverty faced by women to access economic opportunities like education and/or employment. Regional analysis is crucial as well. An energy reform policy on butane gas cylinders, for example, may have a greater effect on rural households compared to urban households since the majority of urban residents rely on natural gas as the main source of energy for electricity and heating water. Results of the study are summarized as follows: 1- the government is taking serious efforts to gradually remove energy subsidies. 2- The poor will pay a higher price than the rest of the population. 3- a comprehensive policy to ease the burden on the poor is to consider a spatially targeted plan in which public investment are weighted significantly in favor of Upper Egypt and rural areas at large. In particular, structural investments in education, health and employment must precede welfare compensatory policies. |
| Date: | 2016–10–20 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1055&r=ara |
| By: | Binnur Balkan; Seyit M|min Cilasun; Belgi Turan (Atilim University) |
| Abstract: | This paper investigates the impact of the employment subsidy program implemented in 2008 by Turkish government to generate new employment opportunities for women and young men. More precisely, using a nationally representative individual level data, we analyze the impact of the program on social protection of women by checking the transitions in the labor market states. Using difference-in-differences (DID) estimation technique; we assess the effectiveness of the policy by analyzing the switches from informal employment to formal employment, from unemployment to formal employment and from out of the labor force to formal employment. Our results indicate that the reform did not effectively increase the employment probabilities of women compared to men who are not eligible to benefit from the program but formality of women in the labor market increased significantly suggesting an expansion in the social security coverage women in Turkey. |
| Date: | 2016–06 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1022&r=ara |
| By: | Kahia, Montassar |
| Abstract: | Given the growing international competition and globalization being characterized by the massive reduction of institutional barriers, opening new markets for consumer goods, the birth of many trade agreements and the establishment of the World Trade Organization, it is imperative for companies wishing to grow, the possibility to internationalize. Consequently, one of the first modes of internationalization of a firm is export. Indeed, the success of export can be measured by various factors that depend on company's goal against the use of export strategy. Such factors are grouped into two categories namely: external and internal factors to the company. This paper will focus on exploring and analyzing the key factors that affect the export intensity of Tunisian companies. Thus, our study was conducted at the micro-economic level. Indeed, as the available data, we will try to find out the factors of export activity for a sample of Tunisian companies and this through a Logit model with random effects applied to panel data from 1997 to 2003. Indeed, the main factors that positively affect the probability of exporting in Tunisia are: Capital intensity; the company age and size. Furthermore, among the main factors that negatively affect the probability of exporting, we state labor cost. |
| Keywords: | Export intensity; Logit model; Panel data; Tunisian companies |
| JEL: | C01 C13 C19 C5 F1 F13 F6 O1 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:77278&r=ara |
| By: | Esra Çeviker Gürakar (Okan University); Tuba Bircan Ildiri |
| Abstract: | Using a unique dataset of 17,937 high value public work construction procurements made between 2004 and 2011, this paper provides systematic evidence on favoritism in public procurement in Turkey. While the yearly total of high value construction procurements has tripled in eight years, the share of procurements that are made through less competitive procurement methods increased due to various legal amendments that increased the use of less competitive procurement methods and hence state discretion in public procurement contract award processes. We find that the politically connected firms enjoyed high levels of government discretion and higher contract prices in public procurements compared to the nonconnected other firms. The probability of a politically connected firm winning a procurement contract increases, among other things, when less competitive award procedures are used. Procurements that are conducted through less competitive methods, cost more towards public. The use of public procurement for rent creation and distribution was extensive particularly for projects that cost more than TL 10 million, and the TOKI projects. |
| Date: | 2016–10–16 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1053&r=ara |
| By: | Doaa El-Diftar; Eleri Jones; Mohamed Moustafa Soliman |
| Abstract: | Disclosure and transparency are crucial elements in the improvement of overall corporate governance. Disclosure is a very important mean of communication between management and outside investors. This study investigates how institutional blockholders impact levels of voluntary disclosure released in annual reports of some of the most active companies in the Egyptian Stock Exchange. The results generated by the study did support a significant positive impact of institutional blockholders on voluntary disclosure and transparency. It also found that this impact is due to two types of institutional blockholders’ ownership: low institutional ownership defined as those owning from five to twenty percent and controlling institutions defined as those owning more than fifty percent of a company’s shares. This indicates that concentrated ownership can be viewed as a monitoring mechanism in an emerging market like Egypt. According to the author’s knowledge, this study is the first to explore the impact of different categories of blockholders; categorized by the size of their block; on levels of voluntary disclosure in Egypt. |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1039&r=ara |
| By: | Souhaïb Chamseddine Zardi (Central Bank of Tunisia) |
| Abstract: | The aim of this paper is to evaluate the relative performance of different forecasts of inflation methods for the case of Tunisia. For that, we use a large number of econometric models to forecast short-run inflation. Specifically, we use univariate models as Random Walk, SARIMA, a Time Varying Parameter model and a suite of multivariate autoregressive models as Bayesian VAR and Dynamic Factor models. The forecasting results suggest that models which incorporate more economic information outperform the benchmark random walk for the first two quarters ahead. Furthermore, we combine our forecasts by means and the results reveal that the combination of forecasts leads to a reduction in forecast errors compared to individual models. |
| Keywords: | Short-run forecasting, Dynamic Factor Models, Forecast combination |
| Date: | 2017–03 |
| URL: | http://d.repec.org/n?u=RePEc:gii:giihei:heidwp07-2017&r=ara |
| By: | Burcay Erus (Bogaziçi University) |
| Abstract: | In 2002 Turkey started to implement reforms in health care aiming to ease access and increase efficiency. Reforms increased insurance coverage and resulted in higher number of outpatient and inpatient treatments at both public and private hospitals. To reign in consequent increase in health expenditures, a series of co-payments were instituted. Along with that primary care services were reformed through a family-medicine system that provided free access. The aim was to channel patients to primary care and hence cut on costs of secondary care. This work aims to measure the impact of these two measures, introduction of co-payments at secondary care and ease of access to free primary care, on out-of-pocket expenditures and access/use of healthcare services. We find that while contributory payments resulted in higher OOP health expenditures, especially for lower income households, the impact was small and did not hinder access to healthcare services. Indeed, possibly due to easier access to primary care, inability to see a doctor became less prevalent. Adverse effect of the contributory payments have been limited and have largely been countered by the provision of a easily available primary care system. |
| Date: | 2016–06–12 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1070&r=ara |
| By: | Ebaidalla Mahjoub Ebaidalla (University of Khartoum) |
| Abstract: | Egypt, Sudan and Ethiopia possess potential natural and human resources, which can entail successful trade integration between the three countries. This paper investigates the performance of trilateral trade between Egypt, Sudan and Ethiopia. The study also analyzes the prospects and challenges for trade expansion between these countries. The study used the gravity model beside diversification and product complementarity indices to identify the pattern and structure of trade between the three countries. The analysis revealed that Egypt is the most diversified economy, which can lead trade in the region. Moreover, the paper indicated that there are some challenges facing the implementation of any trade arrangements between these countries, including: export concentration, poor infrastructure and political instability. Finally, the paper concludes with some recommendations to facilitate free trade between the three countries. |
| Date: | 2016–10–25 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1057&r=ara |
| By: | Aysit Tansel (Middle East Technical University); Deniz Karaoglan |
| Abstract: | This study provides causal effect of education on health behaviors in Turkey which is a middle income developing country. Health Survey of the Turkish Statistical Institute for the years 2008, 2010 and 2012 are used. The health behaviors considered are smoking, alcohol consumption, fruit and vegetable consumption, exercising and one health outcome namely, the body mass index (BMI). We examine the causal effect of education on these health behaviors and the BMI Instrumental variable approach is used in order to address the endogeneity of education to health behaviors. Educational expansion of the early 1960s is used as the source of exogenous variation in years of schooling. Our main findings are as follows. Education does not significantly affect the probability of smoking or exercising. The higher the education level the higher the probability of alcohol consumption and the probability of fruit and vegetable consumption. Higher levels of education lead to higher BMI levels. This study provides a baseline for further research on the various aspects of health behaviors in Turkey. |
| Date: | 2016–07 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1030&r=ara |
| By: | Jenik Radon (Columbia University); Sarah Logan |
| Abstract: | This paper applies a practitioner’s analytical perspective to assessing the contractual arrangements governing oil and natural gas development in oil-producing countries in the Middle East and North African, drawing on international experience for a comparative approach. It also looks at factors influencing the efficiency and competitiveness of national oil companies in these countries, key aspects of the relationship between international oil companies and these governments, and management issues vis-à-vis governments and their national oil companies, such as competitive neutrality. It finds that the type of contractual arrangement used influences the extent to which the needs and interests of host countries are advanced, and that applying political constraints and non-commercial mandates to national oil companies diminish their competitiveness. Finally, it finds that national oil companies that diversify the nature and geographical scope of their activities have a stronger likelihood of remaining relevant in today’s changing oil and gas industry. |
| Date: | 2016–12–13 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1072&r=ara |
| By: | Mohamed Zaky; Sarah El khishin (British University in Egypt) |
| Abstract: | The paper contributes to discussions on budgetary institutions and fiscal governance in Egypt. It explores the interrelationships between budgetary institutions, political factors and fiscal performance. We investigate the intricacies between the structure and quality of budget institutions and fiscal performance and the key weaknesses in budgetary institutions in Egypt. We also analyze to what extent these weaknesses aggravated adverse effects of political fragmentation on fiscal performance in Egypt. Finally, we highlight the major challenges in the institutional-political-fiscal paradigm in Egypt. Added to the known medium-term reforms in budgetary institutions, the paper recommends three urgent reforms in these institutions. The first procedure is applying a top-down approach during budget vote to be on two separate stages. In the first stage of budget vote, the parliament votes on the fiscal aggregates, while in the second stage the parliament votes on the allocation of resources to different sectors. The second procedure that should be urgently adopted is applying balanced budget rules or at least reactivating the golden rule to control the current budget deficit. The third procedure is related to off-budget expenses. Fiscal relations between budget and economic authorities should be transparent and documented explicitly in the budget to reflect the real annual values of public expenditure and the budget deficit. In this regard, however, since budget preparation and implementation are based on a fully cash accounting base, documenting the total values of transfers that accrued to economic authorities appears to be a crucial procedure. |
| Date: | 2016–07 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1027&r=ara |
| By: | Jamal Ibrahim Haider (Center for International Development at Harvard University) |
| Abstract: | Do export sanctions cause export deflection? Data on Iranian non-oil exporters between January 2006 and June 2011 shows that two-thirds of these exports were deflected to non-sanctioning countries after sanctions were imposed in 2008, and that at this time aggregate exports actually increased. Exporting firms reduced prices and increased quantities when exporting to a new destination, however, and suffered welfare losses as a result. |
| JEL: | F13 F14 F15 F21 F5 F6 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:cid:wpfacu:80&r=ara |
| By: | Rim Berahab |
| Abstract: | An analysis of trade relations between Morocco and sub-Saharan Africa indicates a growing volume of trade, reflecting a continuation of stimulated trade relations. A similar trend is observed in foreign direct investment (FDI), which has continued to grow in recent years, reflecting Morocco's determination to become a major player in the development of the African continent. This Policy Brief first presents trends in inter-regional trade between Morocco and sub-Saharan Africa, focusing on several indicators. Then it analyzes the evolution of the complementarity of Morocco’s exports with imports by its main sub-Saharan partners. Finally, it depicts Morocco's foreign direct investment in sub-Saharan Africa, focusing on the main recipients and the structure of Moroccan FDI. |
| Keywords: | Trade, Morocco, Sub-Saharan Africa, Complementarity, index, exports, imports, free trade agreement, Foreign Direct Investment, concentration, index |
| Date: | 2017–02 |
| URL: | http://d.repec.org/n?u=RePEc:ocp:ppaper:pb1704&r=ara |
| By: | Ishac Diwan; Jamal Ibrahim Haidar (Harvard University) |
| Abstract: | Using firm-level census data, we determine how politically-connected firms (PCFs) reduce job creation in Lebanon. After observing that large firms account for the bulk of net job creation, we find that PCFs are larger and create more jobs, but are also less productive, than non-PCFs in their sectors. On a net basis, at the sector-level, each additional PCF reduces jobs created by 7.2% and jobs created by non-PCFs by 11.3%. These findings support the notion that politically-connected firms are used for clientelistic purposes in Lebanon, exchanging privileges for jobs that benefit their patrons’ supporters. |
| Date: | 2016–10–17 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1054&r=ara |
| By: | Eleftherios Giovanis (University of Verona); Oznur Ozdamar |
| Abstract: | This study explores the determinants and characteristics of the out-of-pocket to capacity to pay and catastrophic health expenditures in Turkey using a detailed micro-level survey, the Household Budget Survey during the period 2002-2011. The results show that those who have public health insurance are less likely to face out-of-pocket to capacity to pay and catastrophic health expenditures, than those with private or without health insurance. In addition, the study explores the expansion of the health reform of 2003, where in 2008 the Green Card (Yesil Kart) holders are entitled, without fee, to the same services as those with public health insurance such as Emekli Sandigi, BAG-KUR, SSK. The analysis employs a differences-in-differences approach using a pseudo-panel based on propensity score matching. The results support that the difference of pocket health expenditures between the public health insurers and green card holders has been reduced. Furthermore, those who are located in rural areas are compared with those residing in urban areas, as the health reform in 2008 included expansion and improvement on the emergency services and infrastructure in rural areas. |
| Date: | 2016–10–25 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1058&r=ara |
| By: | Abdessalem Abassi; Lota Dabio Tamini |
| Abstract: | The objective of this paper is to analyze trade potential versus actual realized trade among North African trading partners. Following the literature on production economics, we built a stochastic frontier gravity model. The underlying assumption is that all deviation from trade potential is not due to white noise but could also be due to inefficiencies. Time-variant country-specific trade efficiency estimates are obtained and analyzed. Our results indicate that Mauritania as a country of destination and of origin is where the trading relationship is the least efficient. Conversely, Tunisia, followed by Morocco, faces the fewest ÒbehindÓ and ÒbeyondÓ the border effects. Our analysis of market integration and trade efficiency at the disaggregated level indicates that trade efficiency scores exhibit high variability between the categories of products. Moreover, North African market integration is worst when considering the goods from the category ÒTextiles; Footwear & HeadgearÓ. Our estimates indicate that trade efficiency for agricultural products is relatively low indicating the existence of significant ÒbehindÓ and ÒbeyondÓ border inefficiencies. Our estimates also point at the presence of poor and counterproductive regulatory environment and underline the importance of improving domestic policies to encourage entrepreneurial development and business facilities. Our findings confirm the need for the North African countries to improve their trade logistics at the national level to enhance trade efficiency and to implement trade facilitation reform programs. |
| Keywords: | Trade integration; Industrial products; Agricultural products; Stochastic frontier analysis; Gravity model; North Africa. |
| JEL: | F14 F15 O10 |
| Date: | 2016 |
| URL: | http://d.repec.org/n?u=RePEc:lvl:creacr:2016-4&r=ara |
| By: | Oznur Ozdamar (Adnan Menderes University); Eleftherios Giovanis |
| Abstract: | Survivors' benefits are cash payments made by government to family members when a worker dies. His or her spouse and unmarried children are entitled to receive these cash benefits. The payments are intended to help ease the financial strain caused by the loss of the worker's income. Survivors can receive benefits if the deceased partner was employed and contributed to Social Security long enough to be considered insured. Although these benefits aim to help single-head households who are in financial difficulties due to the loss of an additional household income, the remaining parents have generally serious challenges to do work both at labor market and home such as childrearing and house chores. Widows across the world therefore share two common experiences: a loss of social status and reduced economic circumstances. Prior research suggests that widowhood is much more common experience among women than men. Moreover, it is more likely to cause financial difficulties for women than for men, and financial strain reducing well-being of women. Using Cross-Sectional Income and Living Conditions Survey of Turkey (2006-2012), the first aim of this paper is to empirically analyze the effect of survivors’ benefits on poverty indicators of widowed-mother households and secondly to investigate whether survivors’ benefits promote health status of women and children in these families. |
| Date: | 2016–06 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1018&r=ara |
| By: | Ali Enami; Nora Lustig (Tulane University); Alireza Taqdiri |
| Abstract: | This paper evaluates the role of fiscal system in Iran in reducing poverty and inequality. We employ the marginal contribution approach in which the effect of each component of the system is evaluated by comparing the current system to the counter factual of removing that component from the system. Using the CEQ framework, we show that the fiscal system as a whole reduces inequality and poverty significantly by about 16% and 63% respectively. We find that the main driver of this effect is the Targeted Subsidy Program (implemented in 2010) that eliminated the energy subsidies and substituted them with a nominal cash transfer to every Iranian. We show that the effect of this program on reducing inequality and poverty is about 10% and 64% respectively. The main reduction in poverty comes from the rural areas where this program reduces the poverty headcount index from 37% to 17% comparing to the 5% reduction in the urban areas. Given the success of this program in reaching the bottom deciles of the income distribution and reducing inequality and poverty, we recommend that the current plans of Iranian government in eliminating the subsidy of the top deciles is combined with the allocation of some of the freed funds to the bottom deciles. |
| Date: | 2016–06 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1020&r=ara |
| By: | Adeel Malik (Oxford Centre for Islamic Studies and Department of International Development, University of Oxford) |
| Abstract: | Revisiting macroeconomic policies and outcomes of Arab resource-rich economies (RREs), this paper synthesizes the political economy considerations that underpin policy choices. The paper argues that, in the context of Arab RREs, fiscal and financial sector policies play a particularly important role in absorbing natural resource rents. Fiscal policy is highly pro-cyclical and rooted in the underlying political settlement, which is based on extensive distributional commitments. Financial systems are deep but are known for restricted financial access to vast areas of economy. Given the excessive dependence on hydrocarbon rents and the prevalence of fixed exchange rate regimes, the external constraint remains more binding. Even where monetary policy has greater room to operate, existing policy frameworks are not geared towards domestic targets, such as inflation and unemployment, and are largely determined outside the purview of macroeconomic policy. I argue that the political objective function is essential for understanding these macroeconomic arrangements. With weak productive constituencies and few institutional constraints, macroeconomic policy involves limited feedback from the private sector and upholds the interest of the sovereign. In this milieu, institutional constraints on fiscal policy are more important than central bank independence. The paper also discusses the stability implications of current macroeconomic arrangements, arguing that stability in Arab RREs is almost entirely predicated on the uninterrupted flow of oil rents rather than resilient institutional structures. |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1034&r=ara |
| By: | Nora Aboushady; Chahir Zaki (Cairo University) |
| Abstract: | The objective of this paper is to explore the nexus between exports performance and components of the investment climate. This paper contribution is twofold: first, the paper fills the gap in the available literature by combining both the literature on productivity and investment climate and that on exports and productivity. Second, we use firm-level data to examine the differential impact of investment climate on both the intensive and the extensive margins using the World Bank enterprise survey for Egypt. Our results suggest that in fact, politics do matter for two reasons. First, the most important constraint affecting firms’ exports is political instability despite investment reforms. Second, the ability of state owned firms to become exporters, despite their limited competitiveness once they enter the exports market. Finally, tax policy and competition from the informal sector are the most important impediments that hinder both the increase in the number of exporters and the quantity of exports. Imported inputs do also matter for both of the two margins. |
| Date: | 2016–12–13 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1071&r=ara |
| By: | Inma Martínez-Zarzoso; Leila Baghdadi; Hendrik Wiard Kruse (University of Goettingen) |
| Abstract: | The main aim of this paper is to investigate the effects of Tunisian trade policy on household welfare. We use the recently released household survey data in combination with estimated tariff pass-through elasticities and wage elasticities obtained from Mincerian equations. Changes in tariffs affect both local prices and wages and those changes are transmitted into changes in household expenditure. Using the methodology proposed by Porto (2006), the main results show that the changes in household welfare are positive and have a greater effect for the lower quantiles of the expenditure distribution. This result is largely explained by the fact that the decrease in consumer goods prices benefits poor more than rich households, while labor income effects are close to zero. |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1033&r=ara |
| By: | Ishac Diwan (Harvard University); Marc Schiffbauer |
| Abstract: | In Egypt, the bulk of bank loans during 2003-2010 went to politically connected firms. At the same time, the banking sector was liberalized increasingly operated around competitive and profit-maximizing principles. A key puzzle that the paper tries to answer is why private banks may lend in preferential ways to politically connected firms (PCFs) in such an environment. Using a rich corporate dataset, we find that politically connected firms did not have higher profitability compared to non-politically connected firms. This suggests that PCFs were perceived to have lower risk. Indeed, we find evidence that this was the case, and that lower risk reflected higher access to bailout guarantees (implicit or explicit), as happened in earlier periods, and/or higher perceived growth opportunities. |
| Date: | 2016–12–13 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1073&r=ara |
| By: | Sahar Tohamy Hassanin (Emory University) |
| Abstract: | This paper examines the role that administrative court review in Egypt plays in supporting the integrity of public-private business relations. The paper uses court rulings related to Government Tenders and Bids Law during administrative contract implementation to assess whether 1- government authorities are more likely to receive a favorable ruling, 2- whether award-to-claim ratios are higher in government-initiated cases, and 3- whether average judicial dispute settlement time differs between contractor versus administrative authority claims. I use rulings data on some 470 cases from East Laws Network to construct variables for dispute characteristics and outcomes. Analysis shows that government authorities have higher odds of a favorable award of the main disputed value or in composite claims, compared to contractors. Plaintiff identity does not affect award odds for compensation or interest claims while plaintiffs’ inclusion of an interest or compensation claim increases the odds of main value award ratios. For the fraction of claim value awarded, administrative authorities receive a larger fraction of the claim and the difference is larger the wider the composite claim measure is. Similar to odds of award ratios, the expected award to claim value increases with inclusion of interest or compensation claims when filing, but relating award to a measure that includes a specified compensation claim reduces the expected award to claim fraction. For judicial dispute settlement time, results show that contractor-plaintiff cases take less time to resolve in court relative to administration-initiated cases. Economy-wide variables, institutional administrative court restructuring and a variety of dispute characteristics affect dispute resolution time, where their effect on dispute outcomes is generally negligible. The overall analysis suggests that plaintiffs are partially successful in applying law principles when claiming interest and compensation to improve dispute outcomes. Bias in favor of administrative authorities remains, however, suggesting that it is likely the outcome of the combined discretionary room for administrative authorities in the Government Tenders and Bids Law and discretionary room that courts have in Civil Law principles governing compensation and interest awards. Both increase administrative authorities’ chances and size of a positive award, but do not indicate a certain outcome that dissuades contractors completely from resorting to court in case of dispute. |
| Date: | 2016–11–22 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1062&r=ara |
| By: | Ozlem Albayrak; Thomas Masterson |
| Abstract: | This paper presents the quality analysis of the statistical matching conducted for a research study on household consumption behavior, household indebtedness, and inequality for Turkey. The match has been done for four years (2005, 2008, 2009, and 2012) of Household Budget Surveys (HBS) and the Survey for Income and Living Conditions (SILC). The aim of the statistical matching is to transfer household expenditure data from the HBS to the SILC to create synthetic data sets that have information on household consumption expenditures as well as household income and indebtedness. We are following the methodology of constrained statistical matching, using estimated propensity scores developed in Kum and Masterson (2010) to produce the synthetic data sets that we need. The analysis shows that the match is of high quality. |
| Keywords: | Statistical Matching; Consumer Economics: Empirical Analysis; Personal Income, Wealth, and Their Distribution; Turkey |
| JEL: | C14 D12 D31 |
| Date: | 2017–02 |
| URL: | http://d.repec.org/n?u=RePEc:lev:wrkpap:wp_885&r=ara |
| By: | Hany Abdel-Latif (School of Management, Swansea University); Tapas Mishra |
| Abstract: | This paper empirically explores how fiscal policy represented by acceleration in government spending exerts asymmetric effects on economic growth in the context of a developing country, Egypt in particular. By allowing the theoretical plausibility of asymmetric effects of fiscal policy on economic activity, our research suggests that nothing can guarantee linearity between the growth impact of increasing and decreasing government expenditures. Using a non-linear ARDL model on Egypt data at both aggregated and disaggregated levels- for the period 1980-2013, this paper provides new evidence of a non-linear relationship between government spending and economic growth. |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1035&r=ara |
| By: | Jad Chaaban (American University of Beirut) |
| Abstract: | This paper explores the extent to which local commercial banks in Lebanon are linked to the country’s political class, and how this impacts their efficiency and sovereign risk exposure. By compiling detailed ownership and political affiliation data on the major 20 commercial banks in 2014, the paper shows that as much as 18 out of the 20 banks have major shareholders linked to political elites, and 43% of assets in the sector could be attributed to political control. “Crony capital” within the banking sector is also shown to impact the quality of banks’ loans, and their exposure to public debt. |
| Date: | 2016–10–26 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1059&r=ara |
| By: | Steffen Hertog (London School of Economics) |
| Abstract: | This paper argues that capitalism in Arab low- to mid-income countries is organized in a distinct and recognizable pattern. The key stylized facts are: a stretched, over-committed and interventionist state; deep insider-outsider divides in private sectors and labor markets resulting from lopsided state intervention; and low levels of cooperation and trust between state, business and workers. These features produce an equilibrium of low skills and low productivity that hampers private-driven growth in the region. Some fundamental parts of this story apply to underdeveloped economies in general, notably low government capacity and a segmentation of business and labor into formal and informal markets. Others, however, are regionally specific, including the relative importance and historical ambition of the state in the economy and, closely related, the relative size of the insider coalitions created through government employment and subsidies. Unusually rigid insider-outsider divisions are cemented by a particularly pronounced weakness of universal social security and safety mechanisms. As a result of uneven government intervention and market segmentation, trust and cooperation between state, business and labor are even lower than elsewhere, both on the individual and the organizational levels. Arab cronyism needs to be understood as a key feature of this larger complex of deep state intervention and rigid insider-outsider boundaries. The paper helps explain why cronyism has been so hard to eradicate, but also points to potential structural reforms that could contribute to reducing its incidence. |
| Date: | 2016–06–12 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1068&r=ara |
| By: | Mohammed Said Saadi (L’Institut Supérieur de Commerce et d’Administration des Entreprises) |
| Abstract: | The purpose of this paper is to shed some light on Moroccan cronyism by studying its manifestation and impact in the manufacturing sector. More specifically, it attempts to find out whether the lopsided and cronyistic business-government relations have a positive or negative influence on competition and economic growth. The paper shows that political connectedness has always been part and parcel of a large patronage network that has helped the political power, the makhzen, to strengthen its control on Moroccan society and to prevent any countervailing power from taking root, especially in the economic sphere. |
| Date: | 2016–11–23 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1063&r=ara |
| By: | Amirah El-Haddad (Deutsches Institut für Entwicklungspolitik/ German Development Institute) |
| Abstract: | Abstract: Structural transformation in Egypt has been modest. Industry is growing at a slower rate than services. Within industry, the non-manufacturing sectors of mining, construction and utilities have grown faster than manufacturing. The moderate growth of manufacturing itself is sustained by that of the resource based chemicals and petroleum sector, the latter dominated by petroleum refineries. There has been no development in more sophisticated sectors such as machinery and equipment or electronics. Exports follow the same structure. High technology exports are almost absent at just 1% of total merchandise exports. These data demonstrate the failure of the Egyptian governments’ active industrial policy to achieve structural transformation. With the aid of some comparative perspective, to avoid further government failure this paper presents short (selective) and long term (neutral) policy recommendations. With respect to the former, incentives should be strictly performance-based, they should be dynamic with policies not set to contradict each other’s’ goals such as local content requirements. Whilst encouraging local production, such requirements reinforce inefficiency and reduce innovation and upgrading incentives. It is further recommended that incentives need be finite, pre-announced and enforced along with constant independent monitoring and evaluation. Improving incentives is conditional on a number of long term neutral or horizontal policies that raise the competitiveness of the entire economy and guard against capture. These policies include introducing profound governance and institutional reform to slash red-tape, remove the command and control economy, and clearly establish the rule of law with commercial dispute resolution and fair and expeditious contract enforcement. Second, improve the economy’s competitive environment and accentuate equality of opportunity between all market players rather than favoring some firms to others, and protecting market insiders at the expense of potential entrants. A non-equal level playing field has negative implications on Egyptian consumers’ welfare. This policy area also calls for clarifying the role of the Army in the economy within a framework which respects Egyptian competition law and equality of opportunity amongst all players. Next is the recommendation to focus on primary, secondary and vocational education as well as encouraging human resource innovation and improving the infrastructure not just in industrial and free zones which only partially deal with the problem. Labor markets require further easing of labor market regulations to reduce rigidities. Additionally, conditional transfers to subsidize private “not” public employment, not just to avoid politicization of government employment but to also offset the reduction in employment in construction sectors following introduction of the proposed wealth tax. These are the sectors crowding out industrial production keeping the labor force captive in low productivity sectors. Managing these schemes should not be limited to the government but can be fully run by civil society. These efforts should be coupled with flexible exchange rate policies to ensure availability of foreign exchange to producers, avoid reduced competitiveness and to limit the flow of resources into non-traded sectors. The combined effect of these recommendations will be to enhance productivity and technological content; in turn raising real wages, thus boosting effective demand and market size for more sophisticated high value products; finally realizing economies of scale for such products. All this will support growth with structural transformation, the eventual goal of Egyptian industrial policy. |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1038&r=ara |
| By: | Razin, Assaf |
| Abstract: | The paper reviews the role of globalization forces behind Israel's transformation from low tech to high tech economy |
| JEL: | F01 F36 |
| Date: | 2017–02 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11882&r=ara |
| By: | Sandra Polónia Rios; Pedro da Motta Veiga; Eduardo Augusto Guimarães |
| Abstract: | Despite the sustained growth in the bilateral trade observed at the beginning of the Century, Moroccan – Brazilian economic relations are still going through what could be called the ‘shallow’ phase of relations between two middle-income countries. |
| Keywords: | Brazil, Morocco, Latin America, South, Economy, cooperation, Trade, Industry, Bilateral, FDI, Exports, Imports, Services, Infrastructure, Finance |
| Date: | 2017–02 |
| URL: | http://d.repec.org/n?u=RePEc:ocp:rpaper:pp-1702&r=ara |
| By: | Razin, Assaf |
| Abstract: | The exodus of Soviet Jews to Israel in the 1990s was a unique event. The extraordinary experience of Israel, which has received three quarter million migrants from the Former Soviet Union, amounting to 17 percent of its population, within a short time, is also relevant for the current debate about migration and globalization. The immigration wave was distinctive for its large high skilled cohort, and its quick integration into the domestic labor market. Immigration also changed the entire economic landscape: it raised productivity, underpinning technological prowess, and had significant impact on income inequality and the level of redistribution in Israel's welfare state. |
| JEL: | F22 F6 H00 J1 |
| Date: | 2017–02 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:11877&r=ara |
| By: | Besma Jellali (Faculté Sciences Economiques de Tunis) |
| Abstract: | L’objectif de ce travail est d’estimer le processus d’appariement mettant en relation le nombre d’embauches en fonction d’un stock donné de postes vacants et de chômeurs, à partir des données tunisiennes régionales relatives à sept régions sur la période 2004-2012. On utilise une approche de frontière stochastique sur données de panel pour tenir compte d’une manière explicite des effets individuels et temporels sur l’efficience d’appariement. Les résultats suggèrent qu’il y’a des différences notables au niveau l’efficacité d’appariement entre les régions. Celles- ci contribuent de manière significative aux nombre de placements réalisés. Plus les régions sont efficaces plus l’appariement aura lieu. Les caractéristiques individuelles des chômeurs ainsi d’autres variables environnementales jouent un rôle crucial dans la détermination de l’inefficacité d’appariement. En particulier, les demandeurs d’emploi hautement qualifiés améliorent l’efficacité technique de la fonction d’appariement. |
| Date: | 2016–08 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1036&r=ara |