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on Central and Western Asia |
| By: | Lei, Yu-Hsiang; Michaels, Guy |
| Abstract: | We use new data to examine the effects of giant oilfield discoveries around the world since 1946. On average, these discoveries increase per capita oil production and oil exports by up to 50 percent. But these giant oilfield discoveries also have a dark side: they increase the incidence of internal armed conflict by about 5-8 percentage points. This increased incidence of conflict due to giant oilfield discoveries is especially high for countries that had already experienced armed conflicts or coups in the decade prior to discovery. |
| Keywords: | Armed Conflict; Civil War; Natural Resources; Petroleum; Resource Curse |
| JEL: | O13 Q33 Q34 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:8620&r=cwa |
| By: | Luciana Juvenal; Ivan Petrella |
| Abstract: | The run-up in oil prices after 2004 coincided with a growing flow of investment to commodity markets and an increased price comovement between different commodities. We analyze whether speculation in the oil market played a key role in driving this salient empirical pattern. We identify oil shocks from a large dataset using a factor-augmented autoregressive (FAVAR) model. We analyze the role of speculation in comparison to supply and demand forces as drivers of oil prices. The main results are as follows: (i) While global demand shocks account for the largest share of oil price fluctuations, financial speculative demand shocks are the second most important driver. (ii) The comovement between oil prices and the price of other commodities is explained by global demand and financial speculative demand shocks. (iii) The increase in oil prices in the last decade is mainly explained by the strength of global demand. However, financial speculation played a significant role in the oil price increase between 2004 and 2008, and its subsequent collapse. Our results support the view that the financialization process of commodity markets explains part of the recent increase in oil prices. |
| Keywords: | Petroleum products - Prices ; Vector autoregression ; Speculation |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedlwp:2011-027&r=cwa |
| By: | Vincenzo Bove (Department of Government, University of Essex); Petros G. Sekeris (Center for Research in the Economics of Development, University of Namur) |
| Abstract: | Our paper explores the economic conditions that lead third parties to intervene in ongoing internal wars. We develop a formal model that ties together some of the main forces driving the decision to interfere in a civil war, including the economic benefits accruing from the intervention and the potential costs associated with such choice. We predict that third party interventions are most likely in civil conflicts where the country at war harbors a profitable industry as a consequence of its high levels of peace-time production and state strength, while the opposition forces’ strength reduces the likelihood of intervention. We also present novel empirical results on the role of valuable goods, i.e. oil, in prompting third party military intervention in contexts of high state stability, by using a dataset on intrastate conflicts on the period 1960-1999. |
| Keywords: | Intrastate Conflict; Third party intervention |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:nam:wpaper:1115&r=cwa |
| By: | Michael D. Makowsky (Department of Economics, Towson University); Jared Rubin (Department of Economics, Chapman University) |
| Abstract: | Recent uprisings in the Arab world consist of individuals revealing vastly different preferences than were expressed prior to the uprisings. This paper sheds light on the general mechanisms underlying large-scale social and institutional change. We employ an agent-based model to test the impact of authority centralization and social network technology on preference revelation and falsification, social protest, and institutional change. We find that the amount of social and institutional change is decreasing with authority centralization in simulations with low network range but is increasing with authority centralization in simulations with greater network range. The relationship between institutional change and social shocks is not linear, but rather is characterized by sharp discontinuities. The threshold at which a shock can “tip” a system towards institutional change is decreasing with the geographic reach of citizen social networks. Farther reaching social networks reduce the robustness and resilience of central authorities to change. This helps explain why highly centralized regimes frequently attempt to restrict information flows via the media and Internet. More generally, our results highlight the role that information and communication technology can play in triggering cascades of preference revelation and revolutionary activity in varying institutional regimes. |
| Keywords: | preference falsification, revolution, protest, network technology, agent-based model. |
| JEL: | C63 Z13 D83 D85 D71 H11 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:tow:wpaper:2011-05&r=cwa |
| By: | Immervoll, Herwig (World Bank); Llena-Nozal, Ana (OECD) |
| Abstract: | The fallout from the global economic downturn of 2008-09 is a continuing source of stress on families and a constraint on government policies. How can social policies contribute to a quick and equitable recovery from the crisis and how can they best respond to the difficulties that households continue to face? What role can and should social policy budgets play in improving the budget outlook of countries facing unsustainable government debt? And how should governments prioritise different areas of social spending when faced with heightened demand for support but, often, much reduced fiscal space? This paper addresses these questions in light of countries' experiences during the most recent and earlier economic downturns. |
| Keywords: | economic crisis, social policy, redistribution, unemployment, government spending |
| JEL: | I38 J08 H20 H60 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izapps:pp32&r=cwa |
| By: | Immervoll, Herwig (World Bank); Richardson, Linda (OECD) |
| Abstract: | We use a range of data sources to assess if, and to what extent, government redistribution policies have slowed or accelerated the trend towards greater income disparities in the past 20-25 years. In most countries, inequality among "non-elderly" households has widened during most phases of the economic cycle and any episodes of narrowing income differentials have usually not lasted long enough to close the gap between high and low incomes that had opened up previously. With progressive redistribution systems in place, greater inequality automatically leads to more redistribution, even if no policy action is taken. We find that, in the context of rising market-income inequality, tax-benefit systems have indeed become more redistributive since the 1980s but that this did not stop income inequality from rising: market-income inequality grew by twice as much as redistribution. Between the mid-1990s and the mid-2000s, the redistributive strength of tax-benefit systems then weakened in many countries. While growing market-income disparities were the main driver of inequality trends between the mid-1980s and mid-1990s, reduced redistribution was often the main reason why inequality rose in the ten years that followed. Benefits had a much stronger impact on inequality than social contributions or taxes, despite the much bigger aggregate size of direct taxes. As a result, redistribution policies were often less successful at counteracting growing income gaps in the upper parts of the income distribution. |
| Keywords: | income inequality, redistribution, working age, OECD |
| JEL: | D31 H22 H55 C81 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6030&r=cwa |
| By: | Franziska Gassmann; UNICEF Innocenti Research Centre |
| Abstract: | This paper provides an overview of the social and economic vulnerabilities of households with children in the five Central Asian countries, and assesses the ability of national social protection systems to address these, with the main focus on the role of non-contributory cash transfers financed from general government revenues. The paper concludes that the existing social cash transfer systems are not effective in addressing the needs of poor and vulnerable children and families in Central Asia. Limited coverage together with limited funding reduces the potential poverty reduction impact of the programmes. |
| Keywords: | economic crisis; poverty reduction; social assistance; social protection; |
| JEL: | H0 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:ucf:inwopa:inwopa639&r=cwa |
| By: | Margherita Fort; Nichole Schneeweis; Rudolf Winter-Ebmer |
| Abstract: | We study the relationship between education and fertility, exploiting compulsory schooling reforms in Europe as source of exogenous variation in education. Using data from 8 European countries, we assess the causal effect of education on the number of biological kids and the incidence of childlessness. We find that more education causes a substantial decrease in childlessness and an increase in the average number of children per woman. Our findings are robust to a number of falsification checks and we can provide complementary empirical evidence on the mechanisms leading to these surprising results. |
| Keywords: | Instrumental Variables, Education, Fertility |
| JEL: | I2 J13 |
| Date: | 2011–07 |
| URL: | http://d.repec.org/n?u=RePEc:jku:econwp:2011_05&r=cwa |
| By: | Kässi, Otto |
| Abstract: | I decompose the variance of earnings of Finnish male and female workers to its permanent and transitory components and study their evolution between the years 1998 and 2007. I find that the increasing earnings inequality of men and women is driven by both transitory and permanent components of earnings. In addition, I find considerable differences in earnings dynamics between men and women that have been largely neglected in previous studies of earnings dynamics. The inequality among men is dominated by the permanent component. Conversely, permanent and transitory components are of comparable magnitudes to women. As a corollary, men face more stable income paths but with larger permanent earnings differences. Women, on the other hand, face more instable earnings profiles but have smaller permanent differences in earnings. The correlation between initial earnings inequality and the growth in earnings inequality is found to be positive for both sexes, implying a divergence of earnings profiles towards end of the working career. In addition, earnings instability has risen for both sexes. |
| Keywords: | Earnings distribution; earnings dynamics; permanent inequality; transitory inequality; variance decomposition |
| JEL: | J62 J31 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:34301&r=cwa |
| By: | Margherita Fort; Nichole Schneeweis; Rudolf Winter-Ebmer |
| Abstract: | We study the relationship between education and fertility, exploiting compulsory schooling reforms in Europe as source of exogenous variation in education. Using data from 8 European countries, we assess the causal effect of education on the number of biological kids and the incidence of childlessness. We find that more education causes a substantial decrease in childlessness and an increase in the average number of children per woman. Our findings are robust to a number of falsification checks and we can provide complementary empirical evidence on the mechanisms leading to these surprising results. |
| Keywords: | Instrumental Variables, Education, Fertility |
| JEL: | I2 J13 |
| Date: | 2011–07 |
| URL: | http://d.repec.org/n?u=RePEc:jku:nrnwps:2011_11&r=cwa |
| By: | Thushyanthan Baskaran (Gothenburg Centre of Globalization and Development, Department of Economics, University of Gothenburg, Sweden); Zohal Hessami (Department of Economics, University of Konstanz, Germany) |
| Abstract: | This paper studies the effect of globalization on public expenditures allocated to different stages of education. First, we derive theoretically that globalization’s influence on education expenditures depends on the type of government. For benevolent governments, the model suggests that expenditures for higher education will increase and expenditures for basic education will decline with deepening economic integration. For Leviathan governments, on the other hand, the effects of globalization on public education spending cannot be unambiguously predicted. In the second part of the paper, we empirically analyze globalization’s influence on primary, secondary, and tertiary education expenditures with panel data covering 104 countries over the 1992 - 2006 period. The results indicate that globalization has led in both industrialized and developing countries to more spending for secondary and tertiary and to less spending for primary education. |
| Keywords: | Globalization, economic integration, public education, education expenditures |
| JEL: | F15 H42 H52 |
| Date: | 2011–10–24 |
| URL: | http://d.repec.org/n?u=RePEc:knz:dpteco:1142&r=cwa |
| By: | Peter Robert (TÁRKI); Annamária Gáti (TÁRKI-TUDOK) |
| Abstract: | The paper intends to increase the information and knowledge on graduates’ labour market entry and early career under post-communism. The specific purpose of the analysis is to examine gender differences with respect to two particular research questions: the length of time graduates need to enter the labour force and find a first job; the odds for becoming unemployed during the first five years spent in labour force. Data from the recent HEGESCO project (www.hegesco.org) are employed in the paper. The data collection has occurred in 2008 / 2009 and refers to those diploma holders who completed their studies five years earlier in 2002 / 2003. The project involved five nations: Hungary, Lithuania, Poland, Slovenia and Turkey. The present study deals with three former communist countries: Hungary (N=1533), Poland (N=1200) and Slovenia (N=2923). The paper provides background information on these three countries in terms of their institutional features related to the school system and the labour market. Both descriptive (bivariate) and causal (multivariate) techniques are applied in the study. The Kaplan-Meier survival analysis is used to examine gender differences in labour market entry in the three countries. For investigating the determinants of possible unemployment experience (did it occur or not), the logistic regression method is applied. In addition to gender variation, data offer a large variety of predictors and control variables informing about various characteristics of the study program (field of study, BA/MA, full-time / part-time, first degree gained) as well as about the respondent’s involvement during studies (voluntary / student organization activity, internship, work experience). It is also possible to control for social origin (parental education). Results reveal that gender difference for the length of time to find a first job is significantly present only in Slovenia. For unemployment, at observed level women are definitely disadvantaged and experienced unemployment in all three countries more frequently as compared to men. On the ground of the multivariate analysis, however, the female disadvantage to have a significantly bigger chance to become unemployed in comparison to males turns out to be present only in Poland. As taking into account the large variation in the compositional effects, the paper elaborates on how these features bring advantages or disadvantages for males and females to avoid unemployment. On this ground it is impossible to conclude about a better or worse situation regarding the rank order of the three countries. |
| Date: | 2011–09 |
| URL: | http://d.repec.org/n?u=RePEc:laa:wpaper:34&r=cwa |
| By: | Park, Yung Chul (Asian Development Bank Institute); Song, Chi-Young (Asian Development Bank Institute) |
| Abstract: | The purpose of this paper is to reexamine the exchange rate policy of the Republic of Korea, and its role in promoting financial and monetary cooperation in East Asia in the wake of the 2008 global financial crisis. The Republic of Korea would not actively participate in any discussion of establishing a regional monetary and exchange rate arrangement as it is expected to maintain a weakly managed floating regime. The People’s Republic of China (PRC) has been fostering the yuan as an international currency, which will lay the groundwork for forming a yuan area among the PRC; the Association of Southeast Asian Nations (ASEAN); Hong Kong, the PRC; and Taipei,China. Japan has shown less interest in assuming a greater role in East Asia’s economic integration due to deflation, a strong yen, slow growth, and political instability. Japan would not eschew free floating. These recent developments demand a new modality of monetary cooperation among the Republic of Korea, Japan, and the PRC. Otherwise, ASEAN+3 will lose its rationale for steering regional economic integration in East Asia. |
| Keywords: | exchange rate policy; republic of korea; financial monetary cooperation; east asia; global financial crisis; regional economic integration |
| JEL: | F30 F40 |
| Date: | 2011–10–23 |
| URL: | http://d.repec.org/n?u=RePEc:ris:adbiwp:0314&r=cwa |
| By: | Di Bartolomeo Giovanni; Stefano Papa |
| Abstract: | This paper attempts to measure conditional and unconditional other-regarding preferences in two versions of an investment game: a canonical one and a cheap-talk variant where some pre-play is also allowed (i.e., non-binding unilateral messages). We find that counter-factual measures, as the well-known triadic design (Cox, 2004 [G&EB]) may systematically fail in distinguishing between conditional and unconditional other-regarding preferences due to the existence of frame effects. Specifically, by using indirect methods, we document conditional other-regarding preferences that are systematically neglected by the triadic approach. By inspecting result from the cheap-talk variant of the game, we also find that messages have no effect on average, but they affect the participants’ behavior leading to a polarization of their choices. |
| Keywords: | Conditional and unconditional other-regarding preferences, trust, reciprocity, investment game, frame effect, polarization effect, cheap talk |
| JEL: | C91 D83 |
| Date: | 2011–10 |
| URL: | http://d.repec.org/n?u=RePEc:ter:wpaper:0082&r=cwa |
| By: | Berlin, Martin (Swedish Institute for Social Research, Stockholm University); Kaunitz, Niklas (Dept. of Economics) |
| Abstract: | This paper uses the Swedish Level of Living Survey to study how satisfaction with living conditions and daily life covary with economic resources, in the cross-section and in a decade-long panel. We find that self-reported lack of economic margins is a powerful determinant of satisfaction, its magnitude being comparable even to that of marriage or cohabitation. In contrast, although income is positively associated with satisfaction, the relationship is less robust than for economic margins, and the estimated gradients vary substantially depending on the choice of satisfaction measure, income measure and model specification. |
| Keywords: | - |
| Date: | 2011–10–18 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:sofiwp:2011_012&r=cwa |
| By: | Emilia Del Bono; Andrea Weber; Rudolf Winter-Ebmer |
| Abstract: | We study the effect of job displacement on fertility in a sample of white collar women in Austria. Using instrumental variables methods we show that unemploy- ment incidence as such has no negative effect on fertility decisions, but the very fact of being displaced from a career-oriented job has; fertility rates for women affected by a plant closure are signiffcantly below those of a control group, even after six years. |
| Keywords: | fertility, unemployment, plant closings, human capital |
| JEL: | J13 J64 J65 J24 |
| Date: | 2011–04 |
| URL: | http://d.repec.org/n?u=RePEc:jku:nrnwps:2011_02&r=cwa |
| By: | Chris Robinson (University of Western Ontario) |
| Abstract: | Measures of occupation distance based on underlying skill portfolios are constructed and used to contrast involuntary and total mobility. One component of total occupational mobility is voluntary mobility, including moves to higher job offers using the same skills, as well as promotions that may reflect augmented skills. These are not sources of specific human capital loss. By contrast, the involuntary mobility component due to plant closure involves a higher incidence of loss of specific capital. The evidence indicates that a decreasing fraction of occupation switches involve significant skill portfolio switches: the mean distance in involuntary occupational mobility declines significantly over time. Wage losses following displacement are strongly related to distance. This is reflected in a marked downward shift in the skill portfolio for involuntary occupation switchers. By contrast, the direction of the skill portfolio change in total mobility shows a neutral or modest upward pattern, suggesting limited specific human capital loss from voluntary occupational mobility. |
| JEL: | J24 J31 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:uwo:hcuwoc:20115&r=cwa |
| By: | Friesenbichler, Klaus |
| Abstract: | This paper analyzes firm growth patterns in South Asia, using establishment level data from an Interim Enterprise Survey. The survey was conducted by the World Bank in 2009 and 2010 and covers seven countries in the region. The first finding suggests that size in the base year gains importance for employment growth and firm age is statistically insignificant for growth. This contradicts the thought that young and small firms are the bearers of growth. Second, establishments in larger localities expanded faster, confirming the observation of urban centers as growth poles. Third, establishments in areas of severe conflict performed worse than establishments in other areas. Interestingly, the distribution of growth rates shows that both firm growth and fast-growing firms exist in conflict regions. |
| Keywords: | Microfinance,Achieving Shared Growth,Labor Markets,Small Scale Enterprise,Economic Growth |
| Date: | 2011–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5856&r=cwa |