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on Central and Western Asia |
| By: | Claudio Morana (Università di Milano Bicocca, CeRP-Collegio Carlo Alberto, Italy, Fondazione Eni Enrico Mattei, Italy and International Centre for Economic Research, ICER) |
| Abstract: | In this paper the oil price-macroeconomy relationship is investigated from a global perspective, by means of a large scale macro-financial-econometric model. In addition to real activity, fiscal and monetary policy responses and labor and financial markets are considered as well. We find that oil market shocks would have contributed to slowing down economic growth since the first Persian Gulf War episode. Among oil market shocks, supply side disturbances were the largest contributor to macro-financial fluctuations, accounting for up to 12% of real activity variance. The latter shocks would have exercised recessionary effects during the first and second Persian Gulf War and 2008 oil price episodes; preferences, speculative and volatility shocks would have also contributed to exacerbate the recessionary episodes. As long as oil supply will keep expanding at a lower pace than required by demand conditions, a recessionary bias, determined by higher and more uncertain real oil prices, may then be expected to persist also in the near future. |
| Keywords: | Oil Price, Oil Price-Macroeconomy Relationship, Macro-finance Interface, International Business Cycle, Factor Vector Autoregressive Models |
| JEL: | C22 E32 G12 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2012.28&r=cwa |
| By: | Yu-Hsiang Lei; Guy Michaels |
| 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: | Natural Resources, Resource Curse, Petroleum, Armed Conflict, Civil War |
| JEL: | Q34 Q33 O13 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:oxcrwp:067&r=cwa |
| By: | Severin Borenstein; Ryan Kellogg |
| Abstract: | Beginning in early 2011, crude oil production in the U.S. Midwest and Canada surpassed the pipeline capacity to transport it to the Gulf Coast where it could access the world oil market. As a result, the U.S. “benchmark” crude oil price in Cushing, Oklahoma, declined substantially relative to internationally traded oil. In this paper, we study how this development affected prices for refined products, focusing on the markets for motor gasoline and diesel. We find that the relative decrease in Midwest crude oil prices did not pass through to wholesale gasoline and diesel prices. This result is consistent with evidence that the marginal gallon of fuel in the Midwest is still imported from coastal locations. Our findings imply that investments in new pipeline infrastructure between the Midwest and the Gulf Coast, such as the southern segment of the controversial Keystone XL pipeline, will not raise gasoline prices in the Midwest. |
| JEL: | L71 L95 Q41 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18127&r=cwa |
| By: | Kong, Minji; Han, Doo Bong; Nayga, Rodolfo M., Jr. |
| Abstract: | This study analyzes the interrelationship and volatility between grain and oil prices. Specifically, the objective of this study is to investigate the volatility transmission mechanism of grain prices with oil prices, under the assumption that an increase in crude oil prices not only affects corn and soybean prices but also other grain commodity prices such as wheat and rice. The results presented in this paper suggest several conclusions. First, there is a short-run relationship between the grain market and oil prices, which implies that recent co-movements of oil and grain prices are just a temporary phenomenon. Second, grain prices, except for rice, are affected by oil prices to some degree. Finally, the volatilities of oil prices influence the volatilities of corn and soybean prices, and vice versa. |
| Keywords: | Grain prices, volatility, Volatility Transmission, VAR, GARCH, Resource /Energy Economics and Policy, |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aaea12:124377&r=cwa |
| By: | Christian Ebeke; Luc Désiré Omgba; Rachid Laajaj |
| Abstract: | Evidence has shown that the allocation of talented people affects the long-term growth. It has been found that a large population of engineers tends to foster innovation and growth more rapidly than population of lawyers and other activities with access to the public rent. Yet little is known about what determines the allocation of talents. This paper uses a sample of 69 developing countries to address this question. It shows that the oil rent tends to orient talents towards productive activities in well-governed countries, and towards rentseeking activities in poorly governed countries. These results are robust to different specifications, datasets on governance quality and estimation methods. The paper sheds light on the sources and mechanisms of the resource curse through its effect on human resources and rent-seeking activities. |
| Keywords: | Rent-seeking; occupational choice; oil rents. |
| JEL: | D72 J24 Q32 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:drm:wpaper:2012-26&r=cwa |
| By: | Ludovico Alcorta (United Nations Industrial Development Organization); Morgan Bazilian (United Nations Industrial Development Organization); Giuseppe De Simone (United Nations Industrial Development Organization); Ascha Pedersen (United Nations Industrial Development Organization) |
| Abstract: | Energy efficiency is a foundation of any good energy policy. The economic, security, and environmental benefits of energy efficiency have been recognized for decades. We explore energy efficiency policy insights derived from survey work in developing countries in 119 projects across nine manufacturing sub-sectors. The methodology utilises financial return calculations to highlight gaps and opportunities for meeting the potential of energy efficiency projects in the manufacturing sector. We find a generally very high level of internal rates of return at a project level - with payback periods ranging from 0.9 to 2.9 years; but note that these metrics do not always appropriately influence corporate decision-making for a number of well-understood reasons. |
| Keywords: | Energy Efficiency, Energy Investment, Energy And Development, Industrial Development |
| JEL: | O14 Q41 E22 C58 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2012.35&r=cwa |
| By: | Moser, Christoph; Rose, Andrew K |
| Abstract: | The Doha multilateral round of trade negotiations sponsored by the WTO has been dragging on for over a decade, with no end in sight. In this short paper we assess empirically what determines the duration of trade negotiations, focusing on the span between the start of trade talks and their conclusion. We use data from 88 regional trade agreements between 1988 and 2009, and a semi-parametric Cox proportional hazards model. Four factors are robust determinants of the length of RTA negotiations. Negotiations are more protracted when there are more countries at the negotiation table, and when the countries are not from the same region. Negotiations between more open and richer countries are also finished more quickly. |
| Keywords: | Cox; data; duration; empirical; GATT; income; regional; survival; WTO |
| JEL: | F13 F51 F53 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:8993&r=cwa |
| By: | Anderson, Kym; Strutt, Anna |
| Abstract: | Rapid trade-led economic growth in emerging Asia has been shifting the global economic and industrial centres of gravity away from the north Atlantic, raising the importance of Asia in world trade but also altering the commodity composition of trade by Asia and other regions. What began with Japan in the 1950s and Korea and Taiwan from the late 1960s has spread to the much more populous ASEAN region, China and India. This paper examines how that growth and associated structural changes are altering agricultural markets in particular and thereby food security. It does so retrospectively and by projecting a model of the world economy which compares alternative growth strategies, trade policy scenarios and savings behaviors to 2030. Projected impacts on sectoral shares of GDP, ‘openness’ to trade and the composition and direction of trade are drawn out, followed by effects of the boom in non-farm sectors on agricultural self-sufficiency and real food consumption per capita in Asia and elsewhere. The paper concludes by drawing implications for policies that can address more efficiently Asia’s concerns about food security and rural-urban income disparity than the trade policy measures used by earlier-industrializing Northeast Asia. |
| Keywords: | Global economy-wide model projections, Asian economic growth and structural change, South-South trade, booming sector economics, food security, International Relations/Trade, Marketing, D58, F13, F15, F17, Q17, |
| Date: | 2012–02 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare12:124192&r=cwa |
| By: | Daniel Berkowitz; Mark Hoekstra; Koen Schoors |
| Abstract: | This paper examines the effect of banking on economic growth in modern Russia. To overcome simultaneity and selection, we exploit regional banking variation induced by the creation of “specialized banks” (spetsbanks) in the last years of the Soviet Union (1988-1991). Consistent with the qualitative work of Joel Hellman [1993] and Juliet Johnson [2000], we show that these reforms generated an ideal natural experiment in that the concentration of spetsbanks is jointly uncorrelated with 15 predictors of future growth, including pre-banking income, education, anti-market sentiment, institutional quality, and government interference in the economy. Results indicate that while the presence of one additional spetsbank per million inhabitants increased total within-state lending to private firms and individuals by 14 to 26 percent in the early 2000s, it had no effect on investment or per capita income. In contrast, we find that spetsbanks increased employment. Additional results indicate that spetsbanks increased growth in regions in which they were less connected to government and were generally more similar to non-spetsbanks, as well as in regions that were better at protecting property rights. Our results thus indicate that bank origins, political connections, and property rights are important determinants of effective finance. |
| JEL: | O16 O43 P3 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18139&r=cwa |
| By: | Akarca, Ali T. (University of Illinois at Chicago); Tansel, Aysit (Middle East Technical University) |
| Abstract: | Antalya and Muğla provinces located in southwestern Turkey have emerged as the new magnets for internal migration in the country. Characteristics of immigration from other provinces to these two are described, and analyzed in the context of the gravity model. The factors that affect the migration to Antalya and Muğla seem to be the same and their effects on the flows to each destination differ only slightly. Better job opportunities, especially in the hotel and restaurant services sector, appear as the main attraction fueling this migration. Surprisingly, the pleasant climates of the two provinces do not seem to matter. |
| Keywords: | Turkey, gravity model, internal migration, Antalya, Muğla |
| JEL: | J61 R23 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp6627&r=cwa |
| By: | Andrew E. Clark |
| Abstract: | The role of money in producing sustained subjective well-being seems to be seriously compromised by social comparisons and habituation. But does that necessarily mean that we would be better off doing something else instead? This paper suggests that the phenomena of comparison and habituation are actually found in a considerable variety of economic and social activities, rendering conclusions regarding well-being policy less straightforward. |
| Keywords: | Comparison, habituation, income, unemployment, marriage, divorce, health, religion, policy |
| JEL: | D01 D31 H00 I31 J12 J28 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp452&r=cwa |