nep-dev New Economics Papers
on Development
Issue of 2008‒07‒30
thirteen papers chosen by
Jeong-Joon Lee
Towson University

  1. Two-name Land Use Certificates and Gender Inequality: An Empirical Investigation for Vietnam By Le Dang Trung
  2. Foreign Direct Investment in Vietnam: Is There Any Evidence Of Technological Spillover Effects By Anh Ngoc Nguyen; Nguyen Thang; Le Dang Trung; Ngoc Quang Pham; Chuc Dinh Nguyen; Nhat Duc Nguyen
  3. Development and Migration: Lessons from Southern Europe. By Alessandra Venturini; Riccardo Faini
  4. Social Protection and Migration in China: What Can Protect Migrants from Economic Uncertainty? By Song, Lina; Appleton, Simon
  5. Export Dynamics in Colombia: Transactions Level Evidence By Jonathan Eaton; Marcela Eslava; Maurice Kugler; James Tybout
  6. Use of Informal Mobile Telephony in Low income households in Colombia By Luis Fernando Gamboa; Luis Hernando Gutiérrez
  7. Estimates of the Steady State Growth Rates for Selected Asian Countries with an Extended Solow Model By Rao, B. Bhaskara
  8. Institutions, Innovation and Economic Growth By Tebaldi, Edinaldo; Elmslie, Bruce
  9. Remittances and the household’s expenditures on health By Valero-Gil, Jorge
  10. Distorted Agricultural Incentives and Economic Development: Asia’s Experience By Anderson, Kym
  11. Factor Utilization in Indian Manufacturing: A Look at the World Bank Investment Climate Surveys Data By Ana M. Fernandes; Ariel Pakes
  12. Immigration and National Wages: Clarifying the Theory and the Empirics By Gianmarco I.P. Ottaviano; Giovanni Peri
  13. Powerful Women: Does Exposure Reduce Bias? By Lori A. Beaman; Raghabendra Chattopadhyay; Esther Duflo; Rohini Pande; Petia Topalova

  1. By: Le Dang Trung (Centre for Analysis and Forecasting, Vietnam Academy of Social Sciences)
    Abstract: <p>The new 2003 Land Law marks an extraordinary change in the land titling policy in Vietnam. It strongly requires that the names of both the husband and the wife must be stated on the land use right certificate of the land plot that they both own. This regulation not only officially recognizes the property rights of women as land is a crucial asset for every household but it also improves the position of the wife relatively compared to the husband.</p><p>We examine how the intra-couple issues change in association with having two-name land use certificates which are considered as a legally recognized proof of property rights for women. We expect some correlation between the outcome of the two-name land titling policy and the allocation of human resources between the husband and the wife; the income gap between the husband and the wife, the investment in their sons and daughters' education; and 'bad' consumption on smoking and alcohol drinking of the husband which consumes resources without generating utility (in terms of good health).</p><p>We use the data from two waves of Vietnam Household Living Standard Surveys (VHLSS), before and after the two-name land use certificates came into effect to identify the correlation. The investigation is conducted for a wide range of outcomes, namely, the difference of the working time that the husband and the wife allocated to the first and the second time consuming jobs; the difference of the wife and the husband's time doing house work; the difference in individual income of the wife and the husband; the difference in expenses on their sons and their daughters' education; the change in expenses on smoking and alcohol drinking. Though divorce is one of the most interesting outcomes that should be investigated, the household survey data observed only a few cases of new divorce in the two year period and does not ensure enough variations to conduct the analysis. Therefore, we leave the relationship between having two-name land use certificates and divorce unknown. We find that, in association with having two-name land use certificates, the non-Kinh (or nonHoa) wife works for individual income less while the Kinh or Hoa wife seems to work more relatively compared to her husband. The correlation is opposite for the number of hours spent on house work. The difference in house work time of the Kinh wife and her spouse is significant reduced while it turns to increase in the case of non-Kinh couples. This gap also decreases for non-poor couples. Two-name land use certificates seem to be uncorrelated with the income gap between the wife's and the husband's personal income. Interestingly, the two-name land use certificates encourage rural couples to invest in their daughters while observing the opposite for urban couples. Finally, we find no correlation between the ownership of two-name land use certificates and the husband's bad habits(smoking and drinking).</p>
    Keywords: Vietnam, Household, Rights for women, Vietnam Household Living Standard Surveys
    Date: 2008
  2. By: Anh Ngoc Nguyen (Development and Policies Research Center (DEPOCEN), 216 Tran Quang Khai Street, Hanoi, Vietnam); Nguyen Thang (Center for Analysis and Forecasting (CAF), No1 Lieu Giai Street, Hanoi, Vietnam); Le Dang Trung (Center for Analysis and Forecasting (CAF), No1 Lieu Giai Street, Hanoi, Vietnam); Ngoc Quang Pham (Development and Policies Research Center (DEPOCEN), 216 Tran Quang Khai Street, Hanoi, Vietnam); Chuc Dinh Nguyen (Aston Business School, Aston University, UK); Nhat Duc Nguyen (Development and Policies Research Center (DEPOCEN), 216 Tran Quang Khai Street, Hanoi, Vietnam)
    Abstract: In the context of integrating more deeply into the world economy the Vietnamese policy makers have undertaken several measures to attract foreign direct investment to the country, with the culmination of FDI inflows in 2007 reaching over USD 20 billion, an increase of 69% over 2006. The policy has been taken on the ground that the FDI inflows will create employment and bring along the much needed technological advances, which will spill over to domestic firms. In this paper, we use a firm-level panel data constructed from the Census 2000-2005 to investigate not only the horizontal spillovers but also the backward and forward linkages. Adding to the current literature which focused mainly on the spillovers in the manufacturing sector, our paper provide the first estimates of the spillover effects in the service sector (at least in the context of developing countries). We also distinguish between the horizontal output spillovers (which capture demonstration effects and competition effects) and the horizontal employment spillover (which captures the labour mobility effect). The results obtained from our regression models are mixed. Different channels of spillovers are at work for the manufacturing and the service sectors. We find evidence of the positive backward technological spillovers for the manufacturing and positive horizontal spillovers for the service sector.
    Keywords: Foreign Direct Investment, Vietnam, technological spillovers
    Date: 2008–01
  3. By: Alessandra Venturini; Riccardo Faini
    Abstract: Policy-makers in OECD countries appear to be increasingly concerned about growing migration pressure from developing countries. At the same, at least within Europe, they typically complain about the low level of internal labor mobility. In this paper, we try to shed some light on the issues of both internal and external labor mobility. We investigate the link between development and migration and argue, on both theoretical and empirical grounds, that it is likely be non linear. More precisely, we find that, in a relatively poor sending country, an increase in income will have a positive impact on the propensity to migrate, even if we control for the income differential with the receiving country, because the financial constraint of the poorest become less binding. Conversely, if the home country is relatively better off, an increase in income may be associated with a fall in the propensity to migrate even for an unchanged income differential. Econometric estimation for Southern Europe over the period 1962-1988 provides substantial support to this approach. We estimate first the level of income for which the financial constraint is no longer binding, around 950$, and then the level of income for which the propensity to migrate declines, which is around $ 4300 in 1985 prices. We therefore predict a steady decline in the propensity to migrate from Southern European countries. Similarly, our results highlight the possibility that the pressure to migrate from Northern African countries and other developing countries may increase with further growth.
    Keywords: migration, growth
    JEL: O15
    Date: 2008–06
  4. By: Song, Lina (University of Nottingham); Appleton, Simon (University of Nottingham)
    Abstract: Job-related welfare entitlements are common in China. Migrants who do not hold urban registration are, in principle, not entitled to job-related welfare even if they are employees in the State sector. The official explanation is that rural-urban migrants are allocated access to farm land in their rural origins, and hence their welfare rights and security are covered by this entitlement to the use of land. In this paper, we look at whether migrants still benefited from these opportunities. Second, we investigate whether it is the poor, the unentitled and the vulnerable that are excluded from public protection programs. Chinese official social protection programs are, like in most western countries, officially designated as being for poverty alleviation. However would such programs still be targeted in ways that limit their coverage, curtail the range of basic needs provided for and allocate benefits very unequally? Thirdly, we explore whether households with favourable productive characteristics are more likely to get into social protection programs. Here, the ongoing debate concerning equality of opportunity and equality of outcomes has some relevance. Finally, we examine the roles social networks or Guanxi (the Chinese term for social connections) may play in dealing with economic shocks.
    Keywords: migration, social protection, entitlement, China
    JEL: H41 H42 D63
    Date: 2008–07
  5. By: Jonathan Eaton; Marcela Eslava; Maurice Kugler; James Tybout
    Abstract: We examine Colombian export transaction data from customs records in several dimensions. We begin with some basic statistics on the number and frequency of export transactions by a firm, overall and across individual markets. We then decompose the variation in overall exports into the number of transactions and the size of the average transaction, both at the aggregate level and for individual firms to explore gravity equations, where the patterns of exports and numbers of transactions are related to the distance with respect to the destination. The analysis is carried out both at the aggregate and the firm level. Then we explore the relationship between patterns of transactions numbers and shipment modes. Our results show great heterogeneity in the patterns of frequency and number of transactions across firms; the average firm sent about 75 shipments abroad in 2005, while the firm with largest number of transactions that same year dispatched more than 26,000 shipments. Moreover, while close to 35% of firms in the sample report a single export transaction over the period, for most firms with multiple transactions the average span between two transactions is less than a month. Part of this heterogeneity is shown to be related to the distance with respect to the destination market: firms exporting to more distant destinations make less frequent shipments than firms exporting to markets that are closer. This suggests that there are fixed costs per shipment inducing declining marginal cost of higher shipment volume. These patterns imply that, at the aggregate level, transactions numbers are the primary source of variation in exports. The variability in the numbers of transactions also explains an important part of the well-known negative relationship between aggregate exports and distance to a specific destination.
    Date: 2008–07–14
  6. By: Luis Fernando Gamboa; Luis Hernando Gutiérrez
    Abstract: Access to mobile telephony in Colombia exhibits rather interesting features compared to other countries. Colombia witnessed the beginning of a new alternative for communication consisting in the use of informal resale of minutes on the streets and small stores during the first years of this century. In this paper we are interested in analyzing the main factors that determine the utilization of this kind of service. We use a probabilistic model to explain the characteristics of the people that use ‘informal resale’ on the streets and we find that people in the modality of prepayment and people from small cities has a higher probability of using this alternative. It is also found that people in the firm-leader use more often this service. These results seem indicate that price differentials among on-net and off-net and between prepaid and postpaid are the causes of the rise of this economic activity. *** El acceso a la telefonía móvil en Colombia evidencia ciertas particularidades con respecto a otros países. En Colombia surgió una nueva alternativa de comunicación que consistía en la venta de minutos de celular en las calles y en pequeños negocios durante los primeros años de ésta década. En este documento se analizan las principales características de quienes usan esta modalidad de comunicación con base en una encuesta dirigida a usuarios y no usuarios de bajos ingresos. Se usa un modelo probabilístico para explicar las características de las personas que lo usan y se encuentra que las personas que están en la modalidad de contrato prepago y que viven en ciudades pequeñas tienen una mayor probabilidad de usar esta alternativa de comunicación. De otro lado se encuentra que quienes están con el operador dominante tienden a usar este servicio también de una forma más notoria. Estos resultados parecen indicar que los diferenciales de precios entre las llamadas off-net y on-net así como entre prepago y postpago son los que alimentaron el surgimiento de esta actividad.
    Date: 2008–07–09
  7. By: Rao, B. Bhaskara
    Abstract: This paper develops an extended version of the Solow (1956) growth model in which total factor productivity is assumed a function of two important externalities viz., learning by doing and openness to trade. Using this framework we show that these externalities have played an important role to improve the long run growth rats of six Asian countries viz., Singapore, Malaysia, Thailand, Hong Kong, Korea and the Philippines. A few broad policies to improve their long run growth rates are suggested.
    Keywords: Solow Growth Model; Endogenous Growth; Learning by Doing; Trade Openness; Steady State Growth Rate; Newly Developing Asian Countries.
    JEL: O11 C22 O19 C01
    Date: 2008–07–25
  8. By: Tebaldi, Edinaldo; Elmslie, Bruce
    Abstract: This article contributes to the growth literature by developing a formal growth model that provides the basis for studying institutions and technological innovation and examining how human capital and institutional constraints affect the transitional and steady state growth rates of output. The model developed in this article shows that the reason that growth models a-la-Romer (1990) generate endogenous growth is the use of a set of restrictive and unrealistic assumptions regarding the role of institutions in the economy. The baseline model developed in this article shows that the long-run growth of the economy is intrinsically linked to institutions and suggests that an economy with institutions that retard or prevent the utilization of newly invented inputs will experience low levels and low growth rates of output. The model also predicts that countries with institutional barriers that prevent or restrict the adoption of newly invented technologies will allocate a relative small share of human capital in the R&D sector. Moreover, both the baseline and the extended version of the model suggest that sustainable growth in human capital, not an increase in the stock of human capital, generates a growth effect.
    Keywords: Institutions; innovation; human capital; economic growth
    JEL: O43 O3
    Date: 2008–05–13
  9. By: Valero-Gil, Jorge
    Abstract: This paper considers the effect of remittances on the share of health expenditures to total household expenditure. The main purpose of this paper is to investigate whether remittances are especially targeted towards household’s health in Mexico. We use a Tobit model with random effects and find a statistically significant effect of remittances on the proportion of health expenditures for households that do not have access to employment’s medical insurance: Our results suggest that around 10% of changes in remittances are devoted to health expenditure.
    Keywords: Health expenditure; Remittances; Tobit; Health related consumption
    JEL: D12 I12 F24
    Date: 2008–06–24
  10. By: Anderson, Kym
    Abstract: Earnings from farming in many low-income countries have been depressed by a pro-urban bias in own-country policies, as well as by governments of richer countries favoring their farmers with import barriers and subsidies. Both sets of policies reduce national and global economic welfare. The rapid development of many Asian emerging economies has been accompanied by a gradual reduction in their anti-agricultural policies, but many distortions remain and some countries have moved from negative to positive assistance for farmers, following the earlier examples of first Japan and then Korea and Taiwan. Drawing on results from a new multi-country research project, this paper examines the extent of these changes relative to those of other developing countries over the past five decades. It concludes by pointing to prospects for further policy reform in Asia.
    Keywords: agricultural and trade policy reforms; Asian agricultural development; Distorted incentives
    JEL: F13 F14 Q17 Q18
    Date: 2008–07
  11. By: Ana M. Fernandes; Ariel Pakes
    Abstract: We use the World Bank Investment Climate Surveys data to analyze the employment of both labor and capital in Indian manufacturing. We focus on disparities among states in manufacturing employment patterns, and provide reduced form evidence of their relationship to both (i) institutional constraints, and (ii) productivity.
    JEL: L11 L5 O4 O53
    Date: 2008–07
  12. By: Gianmarco I.P. Ottaviano; Giovanni Peri
    Abstract: This paper estimates the effects of immigration on wages of native workers at the national U.S. level. Following Borjas (2003) we focus on national labor markets for workers of different skills and we enrich his methodology and refine previous estimates. We emphasize that a production function framework is needed to combine workers of different skills in order to evaluate the competition as well as cross-skill complementary effects of immigrants on wages. We also emphasize the importance (and estimate the value) of the elasticity of substitution between workers with at most a high school degree and those without one. Since the two groups turn out to be close substitutes, this strongly dilutes the effects of competition between immigrants and workers with no degree. We then estimate the substitutability between natives and immigrants and we find a small but significant degree of imperfect substitution which further decreases the competitive effect of immigrants. Finally, we account for the short run and long run adjustment of capital in response to immigration. Using our estimates and Census data we find that immigration (1990-2006) had small negative effects in the short run on native workers with no high school degree (-0.7%) and on average wages (-0.4%) while it had small positive effects on native workers with no high school degree (+0.3%) and on average native wages (+0.6%) in the long run. These results are perfectly in line with the estimated aggregate elasticities in the labor literature since Katz and Murphy (1992). We also find a wage effect of new immigrants on previous immigrants in the order of negative 6%.
    JEL: F22 J31 J61
    Date: 2008–07
  13. By: Lori A. Beaman; Raghabendra Chattopadhyay; Esther Duflo; Rohini Pande; Petia Topalova
    Abstract: We exploit random assignment of gender quotas across Indian village councils to investigate whether having a female chief councillor affects public opinion towards female leaders. Villagers who have never been required to have a female leader prefer male leaders and perceive hypothetical female leaders as less effective than their male counterparts, when stated performance is identical. Exposure to a female leader does not alter villagers' taste preference for male leaders. However, it weakens stereotypes about gender roles in the public and domestic spheres and eliminates the negative bias in how female leaders' effectiveness is perceived among male villagers. Female villagers exhibit less prior bias, but are also less likely to know about or participate in local politics; as a result, their attitudes are largely unaffected. Consistent with our experimental findings, villagers rate their women leaders as less effective when exposed to them for the first, but not second, time. These changes in attitude are electorally meaningful: after 10 years of the quota policy, women are more likely to stand for and win free seats in villages that have been continuously required to have a female chief councillor.
    JEL: O1
    Date: 2008–07

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