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on Central and Western Asia |
| By: | Rajeev, Meenakshi; Ranade, Ranjeet; Deb, Sarmistha |
| Abstract: | In the face of many debt-ridden farmers committing suicide, the agricultural credit delivery system assumes a significant role in the agrarian economy of India. This paper looks at the credit delivery system in rural India on the basis of a field survey carried out in the State of West Bengal. Given the reality that access to formal sector credit is not smooth for the marginal farmers, the emergence of a trader class as a major source of credit for working capital (without demanding any collateral), appears to be beneficial for these poor farmers. Surprisingly, the repayment rates of the comparatively poorer farmers are found to be better than that of the financially better-off farmers. The paper constructs a game theoretic model to show how in the face of asymmetric information, necessity to build trust has led to this behaviour. |
| Keywords: | Key Words: Borrower; lender; trader; strategy |
| JEL: | Q14 |
| Date: | 2006–11–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:768&r=cwa |
| By: | Singh, Lakhwinder |
| Abstract: | Sustained industrial growth has been widely acknowledged as an engine of economic transformation. Less developed countries, however, remained predominantly agrarian due to lack of dynamism in the industrial economy and the low level of industrialization. Economic policy reform programme was initiated since July 1991 to generate essential dynamism in the industrial sector for successful transformation of the agrarian economy of India. In this paper an attempt is made to examine the industrial growth experience of Punjab economy during the period 1980-81 to 2001-2002, that is a decade before and a decade after the initiation of economic reforms. The empirical evidence clearly show a downturn in industrial growth in the post-reform period compared to that of the pre-reform period. Factors that have contributed to the deceleration of industrial growth in Punjab were lower investment-GSDP ratio, lower plan expenditure and lower quality of human capital and infrastructure. Identified factors that have led to the deceleration of industrial growth in Punjab were making the state scarce in economic activities and lack of private corporate investment in Punjab both of domestic and foreign. Alternative strategy has been suggested which not only has the capacity to arrest the process of deceleration of industrial growth in the state but also has a capacity to transform agrarian economy to industrialized one along with raising the level of rural income and welfare. |
| Keywords: | Indian Punjab; rural industrialisation strategy; deceleration of growth; Economic reforms public policy |
| JEL: | O18 O14 O1 |
| Date: | 2006–11–13 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:799&r=cwa |
| By: | Chaudhuri, Shubham; Ravallion, Martin |
| Abstract: | The paper examines the ways in which recent economic growth has been uneven in China and India and what this has meant for inequality and poverty. Drawing on analyses based on existing household survey data and aggregate data from official sources, the authors show that growth has indeed been uneven-geographically, sectorally, and at the household level-and that this has meant uneven progress against poverty, less poverty reduction than might have been achieved had growth been more balanced, and an increase in income inequality. The paper then examines why growth was uneven and why this should be of concern. The discussion is structured around the idea that there are both " good " and " bad " inequalities-drivers and dimensions of inequality and uneven growth that are good or bad in terms of what they imply for both equity and long-term growth and development. The authors argue that the development paths of both China and India have been influenced by, and have generated, both types of inequalities and that while good inequalities-most notably those that reflect the role of economic incentives-have been critical to the growth experience thus far, there is a risk that bad inequalities-those that prevent individuals from connecting to markets and limit investment and accumulation of human capital and physical capital-may undermine the sustainability of growth in the coming years. The authors argue that policies are needed that preserve the good inequalities-continued incentives for innovation and investment-but reduce the scope for bad ones, notably through investments in human capital and rural infrastructure that help the poor connect to markets. |
| Keywords: | Rural Poverty Reduction,Pro-Poor Growth and Inequality,Inequality,Population Policies |
| Date: | 2006–11–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:4069&r=cwa |
| By: | Gerald Makepeace (Cardiff Business School and IZA Bonn); Sarmistha Pal (Brunel University) |
| Abstract: | Given the intrinsically sequential nature of child birth, timing of a child’s birth has consequences not only for itself, but also for its older and younger siblings. The paper argues that prior and posterior spacing between consecutive siblings are thus important measures of intensity of sibling competition for limited parental resources. While the available estimates of child mortality tend to ignore the endogeneity of sibling composition, we use a correlated recursive model of prior and posterior spacing and child mortality to correct it. There is evidence that uncorrected estimates underestimate the effects of prior and posterior spacing on child mortality. |
| Keywords: | sibling rivalry, birth spacing, endogeneity bias |
| JEL: | D13 I12 O15 |
| Date: | 2006–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2390&r=cwa |
| By: | Garima Vasishtha; Taimur Baig; Manmohan S. Kumar; Edda Zoli |
| Abstract: | This paper examines two main aspects of the interaction between fiscal and monetary policy in emerging market economies. First, it explores the interest rate-inflation relationship in economies with different levels of external and domestic public debt using panel- and crosssection data. The results show that interest rate-inflation elasticity weakens with debt/GDP and external debt/GDP. Second, it utilizes high-frequency data from Brazil, Turkey, and Poland to examine how market-determined variables react to economic news. The results suggest that when vulnerabilities are high, budget news has the most significant impact on country spreads and interest rates, and the impact of monetary policy is weakened. |
| Keywords: | Public debt , fiscal policy , monetary policy , Emerging markets , Public debt , Fiscal policy , Monetary policy , |
| Date: | 2006–08–14 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:06/184&r=cwa |
| By: | Alexander Spermann (ZEW Mannheim, University of Freiburg and IZA Bonn) |
| Abstract: | This paper advocates the cautious and constitutional evolution of existing basic income schemes ("unemployment benefit II") and Targeted Negative Income Tax (TNIT = "Einstiegsgeld") into a means-tested combi-wage model for the future long-term unemployed (gradualism strategy). The paper argues that, with regard to existing unemployment benefit II claimants, stronger financial incentives should be offered on a time restricted basis by largely disregarding (up to the relative poverty line) earnings from "mini", "midi" and part-time jobs – with the aim of providing current unemployment II claimants with a powerful incentive to work at least 15 hours a week and thus to relinquish their unemployed status. Bearing in mind the uncertain employment impact and the related fiscal risks, the paper advises against additional financial incentives by reducing support levels from one day to the next (cold turkey strategy). |
| Keywords: | labor market reform, employee subsidy, workfare, long-term unemployment |
| JEL: | I38 J22 |
| Date: | 2006–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2398&r=cwa |
| By: | Mohammad Niaz Asadullah (SKOPE, Department of Economics, University of Oxford) |
| Abstract: | This paper documents the regional divide in educational facilities between East Pakistan (now Bangladesh) and West Pakistan between 1947 and 1971. During this period, the total number of primary schools in East Pakistan declined, leading to overcrowding of existing schools and classrooms. On the other hand, despite being endowed with fewer schools, West Pakistan surpassed East Pakistan in the total number of primary schools, and in teacher–student ratios. This evident educational disparity, we argue, cannot be attributed to regional differences in school age population, school types, the quality and unit cost of schooling. Rather, this problem is examined in terms of the hypothesis of ‘discrimination’ as an alternate explanation. |
| JEL: | I20 N35 N95 |
| Date: | 2006–11–17 |
| URL: | http://d.repec.org/n?u=RePEc:nuf:esohwp:_063&r=cwa |