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on Development |
| By: | Ali Abdel Gadir Ali |
| URL: | http://d.repec.org/n?u=RePEc:api:apiwps:0602&r=dev |
| By: | Maurice Kugler |
| Abstract: | In this paper we model the effect of migrant remittances on job creation and human capital formation, given migration prospects. Model calibration of deep parameters was performed with data from the AMCO survey on migration and remittances. The simulations based on the model show that remittances can have offsetting effects on equilibrium human capital and labor market out- comes in the country of origin of migrants. First, remittances enhance school- ing opportunities for recipient households, and human capital formation can be augmented. Second, an increase in human capital supply by recipient house- holds induces job creation as labor demand increases in the origin country. If a sufficiently large share of remittance recipients do not migrate, then the net effect is brain gain rather than brain drain ensuing remittances. The job cre- ation spillover in local labor markets increases the rate of return to schooling for nonrecipient households, whose members are less likely to migrate. As a result, there are more incentives to substitute consumption for human capital investment. At the same time, the rise in expected income due to the spillover induces higher desired consumption. If the “substitution effect” outweighs the “income effect”, then remittances will increase overall human capital and re- duce the unemployment rate. The calibration and simulation analyses suggest that he net effect of remittances depends upon the accessibility of education and the degree and labor market frictions in the origin country as well as the immigration policy in the destination country of migrants. |
| Keywords: | Migrant remittances, education, brain gain, job creation |
| JEL: | F22 F36 O11 J69 |
| URL: | http://d.repec.org/n?u=RePEc:bdr:borrec:370&r=dev |
| By: | Flore Gubert (DIAL, IRD, Paris); Anne-Sophie Robilliard (DIAL, IRD, Paris) |
| Abstract: | (english) Most households in rural Madagascar are engaged in agriculture and derive a large share of their income from the production of food or cash crops and from animal husbandry. However, agricultural yields can be extremely volatile due to weather conditions, pests, insects, rodents and other calamities. As a result, households record large fluctuations in their incomes that must be dealt with. Since the usual consumption-smoothing market mechanisms are quite limited in the Malagasy context, households need to rely on nonmarket mechanisms or to adopt multi-faceted strategies to cope with risk. In this paper, we examine the possibility that parents obtain informal income insurance by letting their children work. We test this hypothesis by examining the relationship between household income shocks and human capital investment in children. In particular, we investigate whether children’s propensity to join school and to drop out of school responds to transient shocks. We also investigate issues such as gender and intrahousehold resource allocation. _________________________________ (français) La plupart des ménages ruraux malgaches tirent l’essentiel de leurs revenus de l’agriculture et sont exposés à un fort degré d’incertitude en raison de la fréquence et de l’intensité des aléas frappant les champs de culture ou les troupeaux. En l’absence de marchés du crédit ou de l’assurance, des moyens alternatifs pour éliminer ou atténuer les conséquences défavorables de cette incertitude doivent être trouvés par les ménages. Dans cet article, nous envisageons la possibilité que la mise au travail des enfants constitue un mécanisme de gestion des risques. Afin de tester cette hypothèse, nous examinons les déterminants de la scolarisation en cycle primaire d’un échantillon d’enfants issus de ménages ruraux. Nous examinons notamment le rôle des chocs de revenu subis par les ménages sur les probabilités d’entrée (dans) et de sortie hors de l’école de leurs membres en âge d’être scolarisés, en portant une attention particulière aux questions de genre et d’allocation intra-ménage des ressources. Les résultats indiquent que les chocs transitoires de revenu ont un impact significatif sur la probabilité de sortie de l’école mais pas sur la probabilité d’entrer à l’école. Cela suggère que la déscolarisation des enfants les plus âgés constitue un mécanisme de gestion du risque pour les ménages ruraux. |
| Keywords: | Schooling decisions, Transitory shocks, Risk-coping strategies, Décision de scolarisation, Chocs transitoires, Stratégies de gestion des risques. |
| JEL: | D91 I21 J24 O55 |
| Date: | 2006–06 |
| URL: | http://d.repec.org/n?u=RePEc:dia:wpaper:dt200608&r=dev |
| By: | Martin Valdivia (Grupo de Analisis para el Dessarrollo); Dean Karlan (Economic Growth Center, Yale University) |
| Abstract: | Can one teach entrepreneurship, or is it a fixed personal characteristic? Most academic and policy discussion on microentrepreneurs in developing countries focuses on their access to credit, and assumes their human capital to be fixed. However, a growing number of microfinance organizations are attempting to build the human capital of micro-entrepreneurs in order to improve the livelihood of their clients and help further their mission of poverty alleviation. Using a randomized control trial, we measure the marginal impact of adding business training to a Peruvian village banking program for female microentrepreneurs. Treatment groups received thirty to sixty minute entrepreneurship training sessions during their normal weekly or monthly banking meeting over a period of one to two years. Control groups remained as they were before, meeting at the same frequency but solely for making loan and savings payments. We find that the treatment led to improved business knowledge, practices and revenues. The microfinance institution also had direct benefits through higher repayment and client retention rates. Larger effects found for those that expressed less interest in training in a baseline survey have important implications for implementing similar market-based interventions with a goal of recovering costs. |
| Keywords: | entrepreneurship, microfinance, business training, business skills, adult education |
| JEL: | C93 D12 D13 D21 I21 J24 O12 |
| URL: | http://d.repec.org/n?u=RePEc:egc:wpaper:941&r=dev |
| By: | Santanu Gupta; Raghbendra Jha |
| Abstract: | This paper examines allocation of local public goods over jurisdictions (villages) with individuals with identical tastes and different incomes, in a model with democratic institutions and majority rule. The median voter (in income) in each jurisdiction determines the probability of re-election for the incumbent government. The jurisdiction with the median of these median voters is most favoured. With identical median voters in jurisdictions, and with re-election requiring less than 50mandate, jurisdictions with higher income inequality get favoured. Results from a survey data (from NCAER) on infrastructure provision in 1669 Indian villages confirm this hypothesis. Ethnic fragmentation does not affect public good provision but political fragmentation does. Finally, villages with the median population are the most favoured for public goods allocation. Sparsely populated and too densely populated villages are relatively neglected. |
| Keywords: | median voter, local public good, reservation utility |
| JEL: | H41 H72 |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:pas:papers:2006-07&r=dev |
| By: | Shandre Thangavelu (Singapore Centre for Applied and Policy Economics, Department of Economics, National University of Singapore); Yong Aik Wei (Singapore Centre for Applied and Policy Economics, Department of Economics, National University of Singapore) |
| Abstract: | The paper studies the effects of the changing age and education composition of the labour force on productivity growth in Singapore. The quality change of workers from aging and education is measured through a quality index. Quality change through education is the key driving force for the productive performance of the labour force. On the other hand, the growth in the labour quality of workers by age, and hence, its contribution to labour productivity growth is falling. To moderate the impact of the aging labour force on productivity growth, greater efforts to raise the educational profile of the labour force and to re-train older workers are required. |
| JEL: | J24 O40 |
| URL: | http://d.repec.org/n?u=RePEc:sca:scaewp:0613&r=dev |
| By: | Gupta, Bishnupriya (Department of Economics, University of Warwick) |
| Abstract: | This paper uses firm level data from all the textile producing regions in India to examine the relation between wages, unionization and labour productivity. We find that fewer workers were employed per machine in the unionized mills in Bombay and Ahmedabad, as compared to non-unionized regions implying that low labour productivity was not due to union resistance to increased work intensity. Our findings suggest that while low wages in India encouraged overmanning, higher wages, prompted by unionization, had productivity enhancing effects. We explore alternative explanations for low labour productivity, arising from the managerial and institutional structure of Indian cotton mills. |
| Date: | 2006 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:warwec:753&r=dev |