nep-dev New Economics Papers
on Development
Issue of 2009‒01‒24
25 papers chosen by
Jeong-Joon Lee
Towson University

  1. Formal and Informal Sectors in China and India: An Accounting-Based Approach By Codrina Rada
  2. Introducing Demographic Changes in a Model of Economic Growth and Income Distribution By Codrina Rada
  3. Who borrows among the poor? MC use determinants in Guatemala, with particular reference to social ties By Masako Hasegawa
  4. An Empirical Analysis of Income Inequality between a Minority and the Majority in Urban China: The Case of Ningxia Hui Autonomous Region By Li Shi; Ding Sai
  5. Comparative Output and Labour Productivity in Manufacturing for China, Japan, Korea and the United States in Circa 1935 by a Production PPP Approach By Kyoji Fukao; Harry X. Wu; Tangjun Yuan
  6. The Contribution of Social Networks to Income Inequality in Rural China: A Regression-Based Decomposition and Cross-Regional Comparison By Ming Lu; Jianzhi Zhao
  7. Happiness in the Dual Society of Urban China: Hukou Identity, Horizontal Inequality and Heterogeneous By Shiqing Jiang; Ming Lu; Hiroshi Sato
  8. Growth of Villages in China, 1990-2002 By Hiroshi Sato
  9. What Lies behind Rising Earnings Inequality in Urban China? Regression-based Decompositions By Deng Quheng; Li Shi
  10. How Much Does Immigration Boost Innovation? By Hunt, Jennifer; Gauthier-Loiselle, Marjolaine
  11. The Quality-Complementarity Hypothesis: Theory and Evidence from Colombia By Kugler, Maurice; Verhoogen, Eric
  12. India's Approach to Capital Account Liberalization By Prasad, Eswar
  13. The Microeconomic Determinants of Emigration and Return Migration of the Best and Brightest: Evidence from the Pacific By Gibson, John; McKenzie, David
  14. Child Welfare and Old-Age Security in Female Headed Households in Tanzania By Seebens, Holger
  15. When Does Domestic Saving Matter for Economic Growth? By Philippe Aghion; Diego Comin; Peter Howitt; Isabel Tecu
  16. Tax Challenges Facing Developing Countries By Richard Bird
  17. The contribution of domestic, regional, and international factors to Latin America’s business cycle. By Melisso Boschi; Alessandro Girardi
  18. Is aid the capital component making countries efficient? By Veiderpass, Ann; Andersson, Per-Åke
  19. China's new labour contract law: No harm to employment? By Chen, Yu-Fu; Funke, Michael
  20. How vertically specialized is Chinese trade? By Dean, Judith; Fung , K.C.; Wang, Zhi
  21. The fragility of social capital By Angelo Antoci; Fabio Sabatini; Mauro Sodini
  22. Environmental pressures and rural-urban migration: The case of Bangladesh By Herrmann, Michael; Svarin, David
  23. The Determinants of Private Transfers in Rural Vietnam By Eozenou, Patrick
  24. Women Empowerment in India By Nayak, Purusottam; Mahanta, Bidisha
  25. The Long-run Effects of Household Liquidity Constraints and Taxation on Fertility, Education, Saving and Growth By Papagni, Erasmo

  1. By: Codrina Rada
    Abstract: This paper discusses the estimation of a social accounting matrix that distinguishes between formal and informal activities for China and India for 2000 and 1998-99 respectively. Wage shares for the formal/informal employment for China and net domestic product shares for the formal/informal sectors for India are being applied as weights to the input-output tables and flow of funds tables provided by official statistics. While some estimation techniques used in this paper remain vulnerable to criticism, the proposed methodology is a first step towards an integrated approach to account for the dualism of many economies in the developing world. The results are important data input for any policy-driven CGE model for developing countries.
    Keywords: informal sector, social accounting matrix, comparative economic systems, China, India
    JEL: E01 E26 P44
    Date: 2009–02
  2. By: Codrina Rada
    Abstract: Unprecedented demographic changes are set to unfold in most of the industrialized world. They are relevant not only because of the diminishing pool of workers, but also because of the increasing importance of retirees as an economic class. Retirees’ consumption and saving patterns can differ considerably from those of wage earners and capitalists, as retirees tend to consume more services and save less or in fact dissave. From this perspective of changing aggregate consumption and saving patterns I argue that population aging together with existing constraints to growth and the institutional framework in place leads to a reconfiguration of income distribution and therefore to possible changes in the growth rate of the economy. Understanding how future income distribution may look like and the behavior of different economic classes, helps in designing the right policies to accommodate the demographic transition.
    Keywords: population aging, income distribution and growth, Keynesian macroeconomics
    JEL: E12 E24 E60
    Date: 2009–01
  3. By: Masako Hasegawa (Osaka School of International Public Policy (OSIPP),Osaka University)
    Abstract: Who borrows Micro Credit (MC) is the information needed to improve not only MC programs but also policies of poverty alleviation. This paper analyzes the MC use determinants taking social ties into account using data in Guatemalan Living Standard Measurement Study. It shows that the determinants are relatively different between the poor and the non-poor. It also shows that social ties could raise the possibility of MC utilization especially among the poor, which would verify the function of social ties as collateral of creditworthiness. Those excluded from MC may not be the poorest but the socially weakest.
    Keywords: Micro Credit (MC), social ties, information asymmetry, creditworthiness, Guatemala,
    JEL: C25 D14 Q14
    Date: 2009–01
  4. By: Li Shi; Ding Sai
    Abstract: Based on the urban survey data of Ningxia Hui Autonomous Region in 2006, this paper studies the impact of ethnic characteristics on the income determination mechanism in the same economic region. Using the decomposition methods of Blinder and Oaxaca, Fields, and Morduch and Sicular, we analyze income gap between employed Hui and Han as well as income inequality within the two ethnic groups. The main conclusions are, first, that there is almost no income gap between Han and Hui in Ningxia. But different ethnic characteristics have effects on the income determination mechanism. Ethnic factors such as religion and social capital have no obvious effect on the income determination.
    Keywords: Minority, Majority, Income Inequality
    JEL: D33 J15
    Date: 2009–01
  5. By: Kyoji Fukao; Harry X. Wu; Tangjun Yuan
    Abstract: Following the standard methodology for measuring industry-of-origin or production-side PPPs, this study compares the unit values of manufacturing products in China, Japan, Korea and the US to calculate unit value ratios (UVRs) and hence estimates PPPs for individual manufacturing industries using the US as the base country in circa 1935. Based on the products that could be matched between these countries, the estimated manufacturing production PPPs for China, Japan and Korea are only from half to two thirds of the prevailing market exchange rates, suggesting much lower cost of production in manufacturing in these countries than in the US. The estimated PPPs are used to calculate industry-level output and labour productivity in China, Japan and Korea relative to those of the US in circa 1935. The results show that the size of factory manufacturing in Japan was 12 percent of the US level whereas in China it was only one percent and even lower in Korea. In terms of comparative labour productivity, measured as PPP$ per hour worked with the US as the reference, Japanese and Korean manufacturing was 24 and 23 percent of the US level, whereas Chinese manufacturing was only 7 percent of the US level.
    Keywords: Production (industry-of-origin) purchasing power parity (PPP), unit value ratio, comparative output and labour productivity, comparative advantage, economic development
    JEL: L60 O47 P52
    Date: 2008–12
  6. By: Ming Lu; Jianzhi Zhao
    Abstract: This study aims to quantify the contribution of social networks, i.e., guanxi,to income inequality in rural households in China. One purpose is to understand how this influence varies across regions with different levels of marketization and economic development. Employing household survey data in rural China, we find that social networks contribute 12.1%-13.4% to income inequality among households in rural China, ranking fourth after village identifiers, nonfarm employment, and education. We also find that social networks exert a greater impact on income and a greater contribution to income inequality in Eastern China, compared with Middle-Western China where economic development is relatively slower. Our findings challenge the conventional understanding that social capital is the capital of the poor. In other words,the rich get richer in richer regions through social networks.
    Keywords: Social Network, Income Inequality, Marketization, Regression-Based Decomposition
    JEL: O15 Z13 P36
    Date: 2009–01
  7. By: Shiqing Jiang; Ming Lu; Hiroshi Sato
    Abstract: This paper studies the impact of income inequality on the subjective well-being of different social groups in urban China. We classify urban social groups according to their hukou status: rural migrants, gbornh urban residents, and gacquiredh urban residents who once changed their hukou identity from rural to urban. We focus on how the horizontal inequality-income disparity between migrants and urban residents-affects individual happiness. The main results are as follows. First, migrants suffer from unhappiness when the horizontal inequality increases, but urban residents show a much smaller aversion to the horizontal inequality. Second, migrants will not be happier if their relative incomes within their migrant group increase, while urban residents do become happier when their incomes increase within their groupfs income distribution. Third, gacquiredh urban residents have traits of both migrants and gbornh urban residents. They have an aversion to the horizontal inequality like migrants, and they also favor higher relative income among urban residents. Fourth, gbornh urban residents have lower happiness scores when they are old. People who are Communist Party members strongly dislike the horizontal inequality. Our findings suggest that migrants, gacquiredh urban residents, elderly people and Party members from gbornh urban residents are the potential proponents of social integration policies in urban China.
    Keywords: Horizontal inequality, Happiness, Hukou identity, Migration, Social integration
    JEL: I31 O15 R23
    Date: 2009–01
  8. By: Hiroshi Sato
    Abstract: This paper examines the economic and noneconomic determinants of growth disparity among Chinese villages between 1990 and 2002. By estimating a growth equation, first, we confirm a significant positive effect of the initial level of human capital, as well as the initial condition of physical infrastructure. Second, social capital measured by the degree of stable social relations at the village level is also a significant growth-promoting factor. The policy implications of our findings are that public policy promoting social stability in rural areas should be strengthened, as well as increasing financial support for rural education and infrastructure construction, especially in lower income regions.
    Keywords: regional disparity, growth regression, social capital, rural China
    JEL: D31 O18 R11
    Date: 2009–01
  9. By: Deng Quheng; Li Shi
    Abstract: Coupled with advances in enterprise reform and changes in the wage structure, earnings inequality in urban China has been increasing, and this has contributed significantly to rising income inequality. Using urban household survey data from the 1988, 1995 and 2002 waves of the China Household Income Project, in this paper, we decompose earnings inequality in urban China by using the regression-based decomposition methods developed by Fields (1998), Morduch and Sicular (2002) and Shorrocks (1999). The decomposition results indicate that the effects of gender and membership of the Communist Party of China on earnings inequality have changed little. While work experience had a reduced effect on earnings inequality, the effects of education and occupation have increased. The contributions of ownership status and industry to earnings inequality have increased. Regional effects have been the largest recent contributor to earnings inequality.
    Keywords: earnings inequality, regression-based decompositions, urban China
    JEL: D31 J31 O53
    Date: 2009–01
  10. By: Hunt, Jennifer (McGill University); Gauthier-Loiselle, Marjolaine (Princeton University)
    Abstract: We measure the extent to which skilled immigrants increase innovation in the United States by exploring individual patenting behavior as well as state-level determinants of patenting. The 2003 National Survey of College Graduates shows that immigrants patent at double the native rate, and that this is entirely accounted for by their disproportionately holding degrees in science and engineering. These data imply that a one percentage point rise in the share of immigrant college graduates in the population increases patents per capita by 6%. This could be an overestimate of immigration's benefit if immigrant inventors crowd out native inventors, or an underestimate if immigrants have positive spill-overs on inventors. Using a 1940-2000 state panel, we show that immigrants do have positive spill-overs, resulting in an increase in patents per capita of 9-18% in response to a one percentage point increase in immigrant college graduates. We isolate the causal effect by instrumenting the change in the share of skilled immigrants in a state with the state's predicted increase in the share of skilled immigrants. We base the latter on the 1940 distribution across states of immigrants from various source regions and the subsequent national increase in skilled immigrants from these regions.
    Keywords: immigration, innovation
    JEL: J61 D24 O32
    Date: 2009–01
  11. By: Kugler, Maurice (University of Southampton); Verhoogen, Eric (Columbia University)
    Abstract: This paper presents a tractable formalization and an empirical investigation of the quality-complementarity hypothesis, the hypothesis that input quality and plant productivity are complementary in generating output quality. We embed this complementarity in a general-equilibrium trade model with heterogeneous, monopolistically competitive firms, extending Melitz (2003), and show that it generates distinctive implications for two simple, observable within-sector correlations − between output prices and plant size and between input prices and plant size − and for how those correlations vary across sectors. Using uniquely rich and representative data on the unit values of outputs and inputs of Colombian manufacturing plants, we then document three facts: (1) output prices are positively correlated with plant size within industries on average; (2) input prices are positively correlated with plant size within industries on average; and (3) both correlations are more positive in industries with more scope for quality differentiation, as measured by the advertising and R&D intensity of U.S. industries. The predicted and observed correlations between export status and input and output prices are similar to those for plant size. We present additional evidence that market power of either final-good producers or input suppliers does not fully explain the empirical patterns we observe. These findings are consistent with the predictions of our model and difficult to reconcile with alternative models that impose symmetry or homogeneity of either inputs or outputs. We interpret the results as broadly supportive of the quality-complementarity hypothesis.
    Keywords: product quality, heterogeneous firms, international trade, plant size
    JEL: O1 F1 L1
    Date: 2009–01
  12. By: Prasad, Eswar (Cornell University)
    Abstract: In this paper, I analyze India's approach to capital account liberalization through the lens of the new literature on financial globalization. India's authorities have taken a cautious and calibrated path to capital account opening, which has served the economy well in terms of reducing its vulnerability to crises. By now, the capital account has become quite open and reversing this is not a viable option. Moreover, the remaining capital controls are rapidly becoming ineffective, making the debate about capital controls rather moot. Managing de facto financial integration into international capital markets and aligning domestic macroeconomic policies in a manner that maximizes the indirect benefits and reduces the risks is the key challenge now facing India's policymakers on this front.
    Keywords: India, international financial integration, capital flows, capital controls
    JEL: F3 F4 O2
    Date: 2009–01
  13. By: Gibson, John (University of Waikato); McKenzie, David (World Bank)
    Abstract: A unique survey which tracks worldwide the best and brightest academic performers from three Pacific countries is used to assess the extent of emigration and return migration among the very highly skilled, and to analyze, at the microeconomic level, the determinants of these migration choices. Although we estimate that the income gains from migration are very large, not everyone migrates and many return. Within this group of highly skilled individuals the emigration decision is found to be most strongly associated with preference variables such as risk aversion, patience, and choice of subjects in secondary school, and not strongly linked to either liquidity constraints or to the gain in income to be had from migrating. Likewise, the decision to return is strongly linked to family and lifestyle reasons, rather than to the income opportunities in different countries. Overall the data show a relatively limited role for income maximization in distinguishing migration propensities among the very highly skilled, and a need to pay more attention to other components of the utility maximization decision.
    Keywords: brain drain, brain gain, highly skilled migration, return migration, selectivity
    JEL: O15 F22 J61
    Date: 2009–01
  14. By: Seebens, Holger (University of Göttingen)
    Abstract: This paper is concerned with patterns of expenditure and child welfare among female headed (FHH) and male headed households (MHH) in Tanzania as well as with the underlying cause of potentially different patterns. I estimate semiparametric Engel curves to investigate household expenditure patterns while controlling for household characteristics and find that FHH spend significantly more money on the welfare of children and less on consumption of adult goods. In an attempt to explain this observed difference, I further investigate the empirical content of the old-age security hypothesis, which states that persons lacking the financial means to rely on themselves during old-age invest more in children who care for them in later periods. The results lend support to the idea that old-age security might be the driving force behind the observed differences of expenditure allocated towards the welfare of children. FHH having access to alternative means of old-age security, spend significantly less on child welfare. Furthermore, food expenditure levels of FHH and MHH with access to alternative old-age security become the same.
    Keywords: demand, female headed households, child welfare, old age security
    JEL: D12 J12 J13 J14
    Date: 2009–01
  15. By: Philippe Aghion (Harvard University - Department of Economics); Diego Comin (Harvard Business School, Business, Government and the International Economy Unit); Peter Howitt (Brown University - Department of Economics); Isabel Tecu (Brown University - Department of Economics)
    Abstract: Can a country grow faster by saving more? We address this question both theoretically and empirically. In our theoretical model, growth results from innovations that allow local sectors to catch up with frontier technology. In poor countries, catching up requires the cooperation of a foreign investor who is familiar with the frontier technology and a domestic entrepreneur who is familiar with local conditions. In such a country, domestic saving matters for innovation, and therefore growth, because it enables the local entrepreneur to put equity into this cooperative venture, which mitigates an agency problem that would otherwise deter the foreign investor from participating. In rich countries, domestic entrepreneurs are already familiar with frontier technology and therefore do not need to attract foreign investment to innovate, so domestic saving does not matter for growth. A cross-country regression shows that lagged savings is positively associated with productivity growth in poor countries but not in rich countries. The same result is found when the regression is run on data generated by a calibrated version of our theoretical model.
    Keywords: Savings, growth, technology adoption, TFP, FDI
    JEL: E2 O2 O3
    Date: 2009–01
  16. By: Richard Bird (University of Toronto)
    Abstract: Taxes matter. We all know we need them to pay for public services. But most of us complain about them -- exercise our "voice" -- and often try to dodge them -- to "exit" -- when we can. Those who design and implement tax systems, like those who try to escape them, for the most part consider themselves to be eminently ‘practical’ people responding to the world around them as they see it. As John Maynard Keynes (1936, 384-85) once said, however, “practical men, who believe themselves to be quite free from any intellectual influences, are usually the slaves of some defunct economist…..soon or late, it is ideas, not vested interests, which are dangerous for good or evil.” While true to some extent, at least when it comes to taxes this dictum both unduly flatters economists and puts too little weight on interests and other factors. Tax policy everywhere is shaped not only by ideas and vested interests but also by changing economic conditions, administrative constraints and technological possibilities, and, especially, the political institutions within which these factors are at play.
    Keywords: value-added tax, tax system, exit, voices
    Date: 2008–03–01
  17. By: Melisso Boschi (University of Perugia and Centre for Applied Macroeconomic Analysis (CAMA)); Alessandro Girardi (ISAE - Institute for Studies and Economic Analyses and University of Rome Tor Vergata)
    Abstract: This paper quantifies the relative contribution of domestic, regional and international factors to the fluctuation of domestic output in six key Latin American (LA) countries: Argentina, Bolivia, Brazil, Chile, Mexico and Peru. Using quarterly data over the period 1980:1-2003:4, a multivariate, multi-country time series model was estimated to study the economic interdependence among LA countries and, in addition, between each of them and the three world largest industrial economies: the US, the Euro Area and Japan. Falsifying a common suspicion, it is shown that the proportion of LA countries’ domestic output variability explained by industrial countries’ factors is modest. By contrast, domestic and regional factors account for the main share of output variability at all simulation horizons. The implications for the choice of the exchange rate regime are also discussed.
    Keywords: International business cycle, Latin America, exchange rate regimes, Global VAR methodology, VEC models.
    JEL: C32 E32 F31 F41
    Date: 2008–11
  18. By: Veiderpass, Ann (Department of Economics, School of Business, Economics and Law, Göteborg University); Andersson, Per-Åke (Department of Economics, School of Business, Economics and Law, Göteborg University)
    Abstract: Cross country regressions on aid effectiveness have failed to provide substantial evidence on the effects of foreign aid. This study focuses on country performance in a production theory context. By means of the non-parametric DEA method, we study 60 individual low and middle income countries between 1995 and 2000. Is there a systematic correlation between resource intensity and country efficiency? We find indications of a positive relation between capital intensity and country efficiency. We then investigate whether aid is the conclusive part of capital providing this correlation, but when linking country efficiency development to aid, there is no clear pattern to be found.<p>
    Keywords: Aid; efficiency; country comparison; production approach
    JEL: D24 O57
    Date: 2009–01–12
  19. By: Chen, Yu-Fu (BOFIT); Funke, Michael (BOFIT)
    Abstract: In January 2008, China adopted a new labour contract law. This new law represents the most significant reform to the legislation on employment relations in mainland China in more than a decade. The paper provides a theoretical framework on the inter-linkages between labour market regulation, option value and the choice and timing of employment. All in all, the paper demonstrates that the Labour Contract Law in its own right will have only small impacts upon employment in the fast-growing Chinese economy. Rather, induced increasing unit labour costs represent the real issue and may reduce employment.
    Keywords: China; labour contract law; real options; employment
    JEL: C61 D81 D92 J23
    Date: 2009–01–13
  20. By: Dean, Judith (BOFIT); Fung , K.C. (BOFIT); Wang, Zhi (BOFIT)
    Abstract: Two recent phenomena have transformed the nature of world trade: the explosive growth of Chinese trade, and the growth of vertically specialized trade due to international production fragmentation. While vertical specialization may explain much of the growth and unique features of Chinese trade, few papers have quantitatively assessed these two phenomena together. In part, this is because it is difficult to measure just how vertically specialized Chinese trade is. The unique features of China's extensive processing trade cause both the identification of imported intermediate goods, and their allocation across sectors, to depend upon the Chinese trade regime. In this paper, we estimate the vertical specialization of Chinese exports, addressing these two challenges. Using two Chinese benchmark input-output tables, and a detailed Chinese trade dataset which distinguishes processing trade from other forms of trade, we develop a new method of identifying intermediate goods imported into China. Vertical specialization is then estimated using two methods. The first method uses the Hummels, Ishii and Yi (2001) measure, the official benchmark IO tables, and incorporates our identification correction. The second method follows the first, but also incorporates the Koopman, Wang and Wei (2008) method of splitting the benchmark IO tables into separate tables for processing and normal exports, in order to address the allocation problem. Results show strong evidence of an Asian network of intermediate suppliers to China, and the two methods provide a range of estimates for the foreign content of Chinese exports. In 2002 aggregate exports ranges between 25% and 46%, with some individual sectors are as high as 52%-95%. Across destinations, under both methods, the vertical specialization of Chinese exports declines with the level of development of the trading partner.
    Keywords: China; fragmentation; vertical specialization; trade growth
    JEL: F10 F14
    Date: 2009–01–13
  21. By: Angelo Antoci; Fabio Sabatini; Mauro Sodini
    Abstract: This paper addresses two hot topics of the contemporary debate, social capital and economic growth. Our theoretical analysis sheds light on decisive but so far neglected issues: how does social capital accumulate over time? Which is the relationship between social capital, technical progress and economic growth in the long run? The analysis shows that the economy may be attracted by alternative steady states, depending on the initial social capital endowments and cultural exogenous parameters representing the relevance of social interaction and trust in well-being and production. When material consumption and relational goods are substitutable, the choice to devote more and more time to private activities may lead the economy to a “social poverty trap”, where the cooling of human relations causes a progressive destruction of the entire stock of social capital. In this case, the relationship of social capital with technical progress is described by an inverted U-shaped curve. However, the possibility exists for the economy to follow a virtuous trajectory where the stock of social capital endogenously and unboundedly grows. Such result may follow from a range of particular conditions, under which the economy behaves as if there was no substitutability between relational activities and material consumption
    Keywords: Economic growth, Technical progress, Transitional dynamics, Social capital, Social norms
    JEL: A13 O33 O49 Z13
    Date: 2009–01
  22. By: Herrmann, Michael; Svarin, David
    Abstract: Bangladesh, like other least developed countries (LDC), has a large rural population and agricultural labor force. At the turn of the Millennium 75 percent of the LDCs’ population still lived in rural areas and 71 percent of the LDCs’ labor force was involved in agriculture. Yet, even the least developed countries are affected by rapidly accelerating rural-to-urban migration. This decade, 2001-2010, is the first ever in which the urban population grows faster than the rural population in the LDCs. And this change is also associated with a historic employment transition, where the agricultural sector gradually loses importance. Both the population and the employment transition that can be observed for the group of least develops countries, are largely attributable to LDC's in Asia, and in particular Bangladesh. The very large rural-urban migration in Bangladesh, in comparison with other least developed countries, is attributable to relatively strong push factors on the one hand, and strong pull factors on the other. The principle factor that encourages people to leave their homes in the country side is the frequent recurrence of natural disasters, which undermine agricultural development and cause food crisis. By contrast, the principle factor that attracts people to urban centers is the expansion of the non-agricultural sectors, industry and services, which promises jobs and higher household incomes.
    Keywords: Bangladesh; climate change; rural-urban migration; agricultural development; urban planning; dual-dual model; employment; poverty
    JEL: O18 J31 R0 J21 J61 Q54 I32
    Date: 2009–01
  23. By: Eozenou, Patrick
    Abstract: We use the Vietnam Living Standard Survey conducted in 1993 and in 1998 to analyze the determinants of private transfers among rural farmers. Private transfers are widespread and important relative to pre-transfer income levels of recipients in both years. Conducting parametric and semiparametric analysis of single-index models for transfer status, we find that private transfers help smoothing income across the life cycle and across states of nature. Pre-transfer income is positively related to the net donor status and negatively associated with the net recipients status, especially for low levels of income. These results suggest that crowding-out of public redistributive policies targeted to the rural poor might be an issue to take into account in Vietnam.
    Keywords: Private Transfers; Single-Index Model; Probit; Semiparametric Estimation; Vietnam
    JEL: D63 O10 I3 D64
    Date: 2008–09
  24. By: Nayak, Purusottam; Mahanta, Bidisha
    Abstract: The present paper is an attempt to analyze the status of women empowerment in India using various indicators like women’s household decision making power, financial autonomy, freedom of movement, political participation, acceptance of unequal gender role, exposure to media, access to education, experience of domestic violence etc based on data from different sources. The study reveals that women of India are relatively disempowered and they enjoy somewhat lower status than that of men in spite of many efforts undertaken by government. Gender gap exists regarding access to education and employment. Household decision making power and freedom of movement of women vary considerably with their age, education and employment status. It is found that acceptance of unequal gender norms by women are still prevailing in the society. More than half of the women believe wife beating to be justified for one reason or the other. Fewer women have final say on how to spend their earnings. Control over cash earnings increases with age, education and with place of residence. Women’s exposure to media is also less relative to men. Rural women are more prone to domestic violence than that of urban women. A large gender gap exists in political participation too. The study concludes by an observation that access to education and employment are only the enabling factors to empowerment, achievement towards the goal, however, depends largely on the attitude of the people towards gender equality.
    Keywords: Women Empowerment; Gender
    JEL: O15
    Date: 2009–01–06
  25. By: Papagni, Erasmo
    Abstract: This paper investigates economic growth under liquidity constraints by taking into account the choices of fertility, human capital and saving. In a model of four overlapping generations, parents are altruistic towards their offspring and finance their education investment. The government provides education subsidies to young adult parents and levies taxes on income of the adult generation. Sensitivity analysis on borrowing limits and tax parameters highlights effects with opposite sign on the main endogenous variables at steady state. A lift in liquidity constraints decreases savings and capital accumulation and this effect is responsible for the ambiguous sign of comparative statics on the rate of fertility and on human capital investment. From model simulation, we derive an inverted U-shaped curve relating the borrowing limit with fertility, education and growth, meaning that financial reforms in the less developed countries have positive effects on the economy in the long-run, even if they raise fertility and reduce savings. Greater government subsidies to human capital investments and lower income taxes have positive effects on savings and fertility. The same parameters present ambiguous effects on education investments and growth. Numerical simulations show that a) human capital investment has an inverted U-shaped relation with income taxes and education subsidies ; b) economic growth decreases with greater income taxes and increases with higher education subsidies. Jel codes: O40, O16, J13, D91.
    Keywords: Borrowing constraints; taxation; endogenous population; economic growth
    JEL: J13 D91 O16 O40
    Date: 2008–05

This nep-dev issue is ©2009 by Jeong-Joon Lee. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.