nep-dev New Economics Papers
on Development
Issue of 2009‒07‒28
twenty papers chosen by
Jeong-Joon Lee
Towson University

  1. Labour Standards and Migration : do labour conditions matter ? By Rémi Bazillier; Yasser Moullan
  2. Institutions Quality and Growth By Fabien, NGENDAKURIYO
  3. On the Distributional Consequences of Epidemics By Raouf,BOUCEKKINE; Jean-Pierre, LAFFARGUE
  4. On the robustness of brain gain estimates By Michel, BEINE; FrŽdŽric, DOCQUIER; Hillel, RAPOPORT
  5. Brain drain in globalization A general equilibrium analysis from the sending countriesÕ perspective By Luca, MARCHIORI; I-Ling SHEN; FrŽdŽric, DOCQUIER
  6. Democracy and Economic Development By Chittawan Chanagul
  7. How Does Decentralised Minimum-Wage Setting Affect Unemployment and informality? The Case of Indonesia By Margherita Comola; Luiz de Mello
  8. The Effectiveness of Education and Health Spending among Brazilian Municipalities By Luiz de Mello; Mauro Pisu
  9. Aid for trade : matching potential demand and supply By Gamberoni, Elisa; Newfarmer, Richard
  10. Tax compliance perceptions and formalization of small businesses in south Africa By Coolidge, Jacqueline; Ilic, Domagoj
  11. The political economy of Land Reform: A new perspective applied to Latin America By Miguel Rocha de Sousa
  12. The Real Exchange Rate as an Instrument of Development Policy By Arslan Razmi; Martin Rapetti; Peter Skott
  13. Gradients of the Intergenerational Transmission of Health in Developing Countries By Bhalotra, S; Rawlings, S
  14. Impact of the global crisis on the achievement of the MDGs in Latin America By Rob Vos; Marco V. Sánchez
  15. Distributional Implications of Halving Poverty in South Africa By Tregenna, F.
  16. Pro-Poor Growth Using Non-Income Indicators: An Empirical Illustration for Colombia By Adriana Cardozo; Melanie Grosse
  17. Inequality in Human Development: An empirical assessment of thirty-two countries By Michael Grimm; Kenneth Harttgen; Stephan Klasen; Mark Misselhorn; Teresa Munzi; Timothy Smeeding
  18. Aid and Trade - A Donor’s Perspective By Felicitas Nowak-Lehmann D.; Inmaculada Martínez Zarzoso; Stephan Klasen; Dierk Herzer
  19. Pro-Poor Progress in Education in Developing Countries? By Kenneth Hartgen; Stephan Klasen; Mark Misselhorn
  20. Latin America's Decline: A Long Historical View By Sebastian Edwards

  1. By: Rémi Bazillier (LEO - Laboratoire d'économie d'Orleans - CNRS : UMR6221 - Université d'Orléans); Yasser Moullan (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Panthéon-Sorbonne - Paris I)
    Abstract: We study in this paper the interactions between migration rates and the level of labour standards. We use an augmented version of the Grogger and Hanson (2008) model, adding the level of working conditions into the specification. Our hypothesis is that the differential of working conditions may be a complementary determinant of migration. In a first time, we test the influence of labour standards in countries of origin using a database on emigration rates built by Defoort (2006) for the period 1975-1995. For labour standards, we built an original index with a temporal dimension. We find that labour standards in the source countries does not have a significant impact on the probability of moving abroad. In a second time, we use a bilateral migration database built by Marfouk and Docquier (2004) in order to test the influence of labour standards in destination countries. If labour standards in the source countries do not have a significant impact on migration flows, level of labour conditions in destination countries have multiple effects on bilateral migration flows. Social protection or protection of collective relations have a positive impact on migration, while job and employment protection laws have the opposite effect. We also find that high-skilled workers are much more sensitive to social security benefits while low skilled workers are more attracted by a protective job and employment legislation.
    Keywords: Migration, labour standards, brain-drain, labour markets.
    Date: 2009–07
  2. By: Fabien, NGENDAKURIYO (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES))
    Abstract: We analyze the dynamic interaction between civil society organizations and Government in a representative developing economy. Government favors corruption and so fails to build e±cient institutions. On its side, civil society exerts pressure on Government to constrain it to halt corruption. We distinguish between an authoritarian Government and an unrestrictive one: the latter does not repress society's protests while the former implements punishment mechanisms. We demonstrate analytically the existence of a unique stable equilibrium by solving a linear quadratic di¨erential game for three Regimes respectively the optimal control problem, noncooperative and cooperative games. Numerical assessment indicates that civil monitoring always increases as corruption increases, but civil monitoring is low and institutions improve much faster under cooperation. Furthermore, total factor Productivity e¨ects always dominate the detrimental e¨ect of civil monitoring on growth in the ørst regime, under some restrictions in the second and never in the third. In response to a change in the government's aversion to rent variations in the presence of authoritarian government, total factor productivity e¨ects always dominate under both the noncooperative and cooperative scenario.
    Date: 2009–06
  3. By: Raouf,BOUCEKKINE (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES) and Center for Operations Research and Econometrics (CORE)); Jean-Pierre, LAFFARGUE (University Paris I, CES and CEPREMAP)
    Abstract: We develop a tractable general theory for the study of the economic and demographic impact of epidemics, and notably its distributional consequences. To this end, we develop a three-period overlapping generations model where altruistic parents choose optimal health expenditures for their children and themselves. The survival probability of (junior) adults and children depends on such investments. Agents can be skilled or unskilled. The model emphasizes the role of orphans. Orphans are not only penalized in the face of death, they are also penalized in the access to education. Epidemics are modeled as one period exogenous shocks to the survival rates. We specifically study the consequence of a negative shock on adult survival rates in the first period. We prove that while the epidemic has no permanent effect on income distribution, it can perfectly alter it in the short and medium run. In particular, the epidemic may imply a worsening in the short and medium run of both economic performance and income distribution. Two opposite mechanisms are isolated: first, the survival rate of children at the end of the first period decreases relatively more in poor than in wealthy families. This decreases the proportion of junior adults with a low endowment of human capital in period 2. Secondly, the number of orphans in period 1 increases in both families. This decreases the proportion of junior adults with a low endowment of human capital in period 2. Therefore, the proportion of the unskilled will necessarily increase in the medium run if orphans are too penalized in the access to a high level of education.
    Keywords: Epidemics, orphans, income distribution, endogenous survival, medium-term dynamics
    JEL: O1 D9 I1 I2
    Date: 2009–05
  4. By: Michel, BEINE (UNIVERSITY OF LUXEMBURG and CES-Ifo); FrŽdŽric, DOCQUIER (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES) and FNRS); Hillel, RAPOPORT (Department of Economics, BAR-ILAN UNIVERSITY, EQUIPPE (UniversitŽs de Lille))
    Abstract: Recent theoretical studies suggest that migration prospects can raise the expected return to human capital and thus foster education investment at home or, in other words, induce a brain gain. In a recent paper (Beine, Docquier and Rapoport, Economic Journal, 2008) we used the Docquier and Marfouk (2006) data set on emigration rates by education level to examine the impact of brain drain migration on gross (pre-migration) human capital formation in developing countries. We found a positive effect of skilled migration prospects on human capital growth in a cross-section of 127 developing countries, with an elasticity of about 5 percent. In this paper we assess the robustness of our results to the use of alternative brain drain measures, definitions of human capital, and functional forms. We find that the results hold using the Beine et al. (2007) alternative brain drain measures controlling for whether migrants acquired their skills in the home or in the host country. We also regress other indicators of human capital investment on skilled migration rates and find a positive effect on youth literacy while the effect on school enrolment depends on the exact specification chosen.
    Date: 2009–06
  5. By: Luca, MARCHIORI (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES) and UNIVERSITY OF LUXEMBOURG, Faculty of Law, Economics and Finance); I-Ling SHEN (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES), UNIVERSITY OF GENEVA, Department of Econometrics and Institute for the Study of Labor (IZA)); FrŽdŽric, DOCQUIER (UNIVERSITE CATHOLIQUE DE LOUVAIN, Institut de Recherches Economiques et Sociales (IRES), Belgian National Fund of Scientific Research and Institute for the Study of Labor (IZA))
    Abstract: The paper assesses the global effects of brain drain on developing economies and quantifies the relative sizes of various static and dynamic impacts. By constructing a unified generic framework characterized by overlappinggenerations dynamics and calibrated to real data, this study incorporates many direct impacts of brain drain whose interactions, along with other indirect effects, are endogenously and dynamically generated. Our findings suggest that the short-run impact of brain drain on resident human capital is extremely crucial, as it does not only determine the number of skilled workers available to domestic production, but it also affects the sending economyÕs capacity to innovate or to adopt modern technologies. The latter impact plays an important role particularly in a globalized economy where capital investments are made in places with higher production efficiencies ceteris paribus. Hence, in spite of several empirically documented positive feedback effects, those countries with high skilled emigration rates are the most candid victims to brain drain since they are least likely to benefit from the Òbrain gainÓ effect, and thus suffering from declines of their resident human capital.
    Keywords: Brain Drain, Capital Flow, Development, Human Capital, Remittances
    JEL: F22 J24 O15
    Date: 2009–06
  6. By: Chittawan Chanagul
    Abstract: With the goal of freeing the world from poverty, some Western authorities have consistently insisted on promoting democracy in totalitarian states in the past decades. Seeing that democratic political system are stably established more and more in many countries, an opportunity arises to determine the effects of democracy on economic development. Taking advantage of this fact, this paper attempts to explore whether or not democracy contributes largely to prosperity of a nation. The conclusion is that, whereas democracy acts as a catalyst that influences prosperity in many already well-to-do nations, democracy per se is not significantly beneficial to low initial income countries. Another interesting point found in this study is that the Western colonialism tends to be one of the most significant factors in explaining poor economic development in many regions of the world today.
    JEL: O1 O43 O57
    Date: 2009–11
  7. By: Margherita Comola; Luiz de Mello
    Abstract: The Indonesian labour market is characterised by widespread informality. To some extent, these outcomes can be attributed to a sharp increase in the real value of the minimum wage since 2001, when minimum-wage setting was decentralised to the provincial governments. To test this hypothesis, this paper uses survey data on the labour market (Sakernas), household income and expenditure (Susenas) and the industrial sector (Survei Industri) to construct a district-level dataset spanning the period 1996 to 2004. The effects of changes in the minimum wage on unemployment, formal-sector employment and the incidence of informality in urban areas are estimated separately by fixed effects and jointly by a seemingly unrelated regression (SUR) estimator. Our findings show that an increase in the minimum-to-mean wage ratio is associated with a net increase in employment: a rise in informal-sector employment more than compensates for job losses in the formal sector. This Working Paper relates to the 2008 OECD Economic Assessment of Indonesia (<P>Comment la décentralisation de la fixation du salaire minimum affecte le chômage et l’informalité ? L’expérience de l’Indonésie<BR>Le marché du travail indonésien est caractérisé par une importante informalité. Dans une certaine mesure, ces résultats peuvent être attribués à une forte augmentation de la valeur réelle du salaire minimum depuis 2001, quand la fixation du salaire minimum a été décentralisée vers les provinces. Pour tester cette hypothèse, ce document utilise les données des enquêtes sur le marché du travail (Sakernas), sur les revenus et les dépenses des ménages (Susenas) et sur le secteur industriel (Survei Industri) pour construire une base de données au niveau des administrations locales pour la période entre 1996 et 2004. Les effets de l’évolution du salaire minimum sur le chômage, sur l’emploi du secteur formel et sur l’informalité urbaine sont estimés séparément par un modèle à effets fixes et conjointement par SUR. Nos résultats suggèrent qu’une augmentation du ratio salaire minimum/salaire moyen entre 1996 et 2004 est accompagnée d’une nette augmentation de l’emploi : une augmentation de l’emploi du secteur informel a plus que compensé les pertes d’emploi du secteur formel. Ce Document de travail se rapporte à l’Évaluation économique de l’OCDE de l’Indonésie, 2008 (
    Keywords: unemployment, chômage, employment, emploi, Indonesia, salaire minimum, minimum wage, informality, informalité, Indonésie
    JEL: J23 J31 J64
    Date: 2009–07–08
  8. By: Luiz de Mello; Mauro Pisu
    Abstract: This paper uses a large dataset combining census, household survey and budgetary data for nearly 4.000 Brazilian municipalities to estimate the impact of government spending on education and health outcomes. We deal with the multi-dimensional nature of the population’s social status by estimating structural equation models with latent variables using a limited-information two-stage least square (2SLS) estimator. Robustness of the baseline regressions to heterogeneity in the data is assessed on the basis of quantile regressions. The main empirical findings are that government spending is a powerful determinant of education outcomes, but this is not the case for health, and that spending on non-education programmes are also at least as important. In addition, there appears to be scope for gains in economies of scale in the provision of education and health care services, at least for selected segments of the conditional distribution of social outcomes. Finally, there are cross-sectoral effects in service delivery: health (education) outcomes affect the population’s education (health) status. This Working Paper relates to the 2009 OECD Economic Survey of Brazil (<P>L’efficacité des dépenses d’éducation et de santé des administrations municipales brésiliennes<BR>Ce document utilise une grande base de données combinant des informations issues des enquêtes réalisées auprès des ménages et des recensements, ainsi que les budgets de près de 4.000 municipalités brésiliennes pour estimer l’effet des dépenses des administrations publiques en matière d’éducation et de santé. Le caractère multidimensionnel des indicateurs sociaux est pris en compte par un modèle d’équation structurelle avec des variables latentes estimé par le double moindre carré à information limité. Des régressions quantiles ont été estimées pour évaluer la robustesse des résultats de base en tenant compte de l’hétérogénéité des données. Les principaux résultats sont que les dépenses des administrations publiques sont particulièrement déterminantes pour la performance de l’éducation mais pas de la santé et que les dépenses des programmes hors éducation sont aussi importantes. En outre, les résultats en matière de santé ont un impact sur les indicateurs d’éducation, et vice versa. Finalement, il apparaît que des économies d’échelle pourraient être exploitées pour la fourniture des services d’éducation et de santé au moins pour les collectivités situées sur certains segments de la distribution conditionnelle des résultats en matière d’éducation et santé. Ce Document de travail se rapporte à l’Étude économique de l’OCDE du Brésil, 2009 (ésil).
    Keywords: santé, education, health care, éducation, Brazil, Brésil, structural equation modelling, modèle d’équation structurelle, latent variable, variable latente, quantile regression, régression quantile
    JEL: I12 I18 I21 I31
    Date: 2009–07–10
  9. By: Gamberoni, Elisa; Newfarmer, Richard
    Abstract: This paper is designed to help both the beneficiary governments and donors of aid-for-trade identify countries that are under-performing in trade and which are receiving less aid for trade than their global performance might otherwise suggest is necessary. The authors develop ten measures of trade performance and capacity (including trade-related infrastructure, institutions, and incentives) to assess potential demand, and then look at country allocations of aid for trade to see which are receiving below-average amounts in the supply of aid for trade - relative to their potential demand. As they design national development strategies, countries may wish to consider giving greater attention to trade and requesting that donors allocate more aid for trade. As part of the analysis, the paper provides a conceptual framework for selecting indicators of trade performance and its policy determinants that the World Trade Organization and its partners might monitor closely as part of the aid for trade initiative.
    Keywords: Economic Theory&Research,Free Trade,Emerging Markets,Trade Policy,Transport Economics Policy&Planning
    Date: 2009–07–01
  10. By: Coolidge, Jacqueline; Ilic, Domagoj
    Abstract: This paper is based on large-scale surveys of formal and informal small businesses in South Africa, including questions about their experiences and perceptions about tax compliance, tax morale, and related variables. The survey findings suggest that formalization is more likely to take place in urban areas, involving relatively larger firms, and those who already use proper bookkeeping. Informal firms who said they were likely to register for tax in the near future were more likely than other informal firms to report higher satisfaction with government services, and to believe most businesses pay their taxes. The most-cited advantages of being registered for tax included better access to government services, better access to financing, and better opportunities for growth.
    Keywords: Taxation&Subsidies,Debt Markets,Emerging Markets,Tax Law,Fiscal Adjustment
    Date: 2009–07–01
  11. By: Miguel Rocha de Sousa (Department of Economics, University of Évora; NICPRI-UE)
    Abstract: We define in section 1 our notion of land reform, on section 2, the most important social and political movements of land reform in Latin America are presented. On section 3 we use a theoretical model in the context of economic growth with human capital learning-by-doing to evaluate land reforms. Section 4, discusses the results. Section 5 presents some economic efficiency estimates for the “Cédula” project of 2000 in NE Brazil - a market led land bill project, sponsored by the World Bank (WB) and the Ministry of Agricultural Development (MDA). Finally, section 6 concludes, and section 7 presents the references.
    Keywords: Brazil, “Cédula”, human capital, Land Reform, Latin America, Learning by doing, “MST - Movimento dos Sem Terra”.
    JEL: Q15
    Date: 2009
  12. By: Arslan Razmi (University of Massachusetts Amherst); Martin Rapetti (University of Massachusetts Amherst); Peter Skott (University of Massachusetts Amherst)
    Abstract: Growth is endogenous in small open economies with substantial hidden or open unemployment, even under constant returns to scale. Growth promoting policies, however, have implications for the balance of trade, and two instruments are needed in order to achieve targets for both the growth rate and the balance of trade. The real exchange rate can serve as one of those instruments. Distributional conflict imposes constraints on real exchange rate policies, but in LDCs the main exchange-rate related distributional conflict may be over the sectoral distribution of profits, rather than the real wage. This paper develops a model along these lines and presents empirical support for the hypothesis that real exchange rate undervaluations are a useful instrument for the pursuit of accumulation and growth in low income countries. JEL Categories: F43, O11, O41
    Keywords: Real exchange rates, underemployment, capital accumulation, investment, growth.
    Date: 2009–07
  13. By: Bhalotra, S; Rawlings, S
    Abstract: This paper investigates the sensitivity of the intergenerational transmission of health to changes in education, income and public services. It uses individual survey data on 2.24 million children born to 600000 mothers during 1970-2000 in 38 developing countries. These data are merged with macroeconomic data by country and birth cohort to create an unprecedentedly large sample of comparable data that exhibits massive variation in maternal and child health as well as in aggregate economic conditions. Child health is indicated by infant survival. Our measure of maternal health is (relative) height, although we also investigate indicators of the health environment in the mother’s childhood as proxies for her health. This is more general and carries the advantage that these indicators are free of endowment effects. We find a substantial positive intergenerational correlation of health that is stronger at both tails of the distribution of mother’s height, and larger for negative deviations from mean height. We show that improving maternal education, raising income and improving the supply or effectiveness of public services in the child’s birth year limits the degree to which child health is tied to family circumstance. These results are robust to mother fixed effects that control for genetic and other endowments common across siblings. The interaction (gradient) effects are most marked for shorter women, consistent with their being constrained in the investments they are able to make in child health. We also find that income and the infectious disease environment in the mother’s birth year exhibit significant intergenerational spillover. There is some previous evidence that adult stature on the one hand and early childhood conditions on the other predict own life expectancy. Our finding that both mother’s height and conditions in her childhood predicts survival or life expectancy for offspring is an important extension of the evidence.
    Keywords: intergenerational, health, infant mortality, birth weight, height, SES, income, education.
    JEL: O12 I12
    Date: 2009–07
  14. By: Rob Vos; Marco V. Sánchez
    Abstract: Progress towards the MDGs is expected to slow as a consequence of the global economic downturn. This study applies an economy-wide framework to analyze the impact of the crisis on the progress towards the MDGs in six Latin American countries. It finds significant setbacks towards the goals and the cost of achieving these will rise commensurately by about 1.5 to 2.0 per cent of GDP in required additional public spending per year between 2010 and 2015 as compared with a no-crisis scenario. The additional public spending would contribute to economic growth though not sufficiently for full recovery to pre-crisis growth.
    Keywords: computable general equilibrium models, distribution, welfare and poverty, foreign aid, macroeconomic analyses of economic development
    JEL: C68 D3 I3 F35 O11
    Date: 2009–06
  15. By: Tregenna, F.
    Abstract: The South African government has set as a policy objective the halving of poverty by 2014, although the meaning of this goal has not yet been defined. This article frames government’s stated target of halving poverty by 2014 in terms of specific measures of the poverty gap and poverty headcount ratio, using newly released income and expenditure survey data. With the poverty line as defined here, approximately half the South African population falls below the poverty line. Despite this, the aggregate poverty gap is surprisingly only about 3% of GDP. Projections of poverty in 2014 under various growth scenarios indicate that growth alone will be insufficient to halve poverty by that time, and that any worsening of distribution will put the target of halving poverty by 2014 beyond reach. However, projecting the effects of a range of growth and distributional scenarios indicate that halving poverty appears feasible with moderate growth rates and fairly mild pro-poor distributional change. The results are indicative as to the scale of distributional changes necessary to halve poverty under various growth scenarios.
    Keywords: income distribution, poverty, inequality, South Africa
    JEL: D30 D31 I32
    Date: 2009–06–09
  16. By: Adriana Cardozo (University of Göttingen); Melanie Grosse (University of Göttingen)
    Abstract: In this paper, we analyze how the distribution of selected non-income welfare indicators changed between 1997 and 2003 in Colombia. We use multidimensional propoor growth measurement techniques and create indices for assets, health, education, and subjective welfare using two alternative weighing techniques: polychoric principal components and normatively selected weights. Results show that while income and expenditures fluctuated according to economic growth, reflecting the effects of the 1999 economic crisis, non-income indicators had minor changes. While income and expenditures decreased for all income percentiles, and relatively more for the richest, the non-income dimensions stagnated and remained in 2003 as unequally distributed as in 1997.
    Keywords: Pro-Poor Growth; Inequality; Welfare Measurement; Multidimensionality of Poverty; Latin America; Colombia
    JEL: D30 I30 O10 O12
    Date: 2009–07–15
  17. By: Michael Grimm (Institute of Social Studies, Erasmus University Rotterdam, The Hague, The Netherlands); Kenneth Harttgen (Göttingen University, Germany); Stephan Klasen (Göttingen University, Germany); Mark Misselhorn (Göttingen University, Germany); Teresa Munzi (Luxembourg Income Study, Luxembourg); Timothy Smeeding (Luxembourg Income Study, Luxembourg)
    Abstract: One of the most frequent critiques of the HDI is that it does not take into account inequality within countries in its three dimensions. In this paper, we apply a simple approach to compute the three components and the overall HDI for quintiles of the income distribution. This allows comparison of the level in human development of the poor with the level of the non-poor within countries, but also across countries. This is an application of the method presented in Grimm et al. (2008) to a sample of 21 low and middle income countries and 11 industrialized countries. In particular the inclusion of the industrialized countries, which were not included in the previous work, implies to deal with a number of additional challenges, which we outline in this paper. Our results show that inequality in human development within countries is high, both in developed and industrialized countries. In fact, the HDI of the lowest quintiles in industrialized countries is often below the HDI of the richest quintile in many middle income countries. We also find, however, a strong overall negative correlation between the level of human development and inequality in human development.
    Keywords: Human Development; Income Inequality; Differential Mortality; Inequality in Education
    Date: 2009–07–15
  18. By: Felicitas Nowak-Lehmann D. (Georg-August University Göttingen, Germany); Inmaculada Martínez Zarzoso (Georg-August University Göttingen, Germany); Stephan Klasen (Georg-August University Göttingen, Germany); Dierk Herzer (Johann-Wolfgang Goethe University Frankfurt, Germany)
    Abstract: One reason donors provide foreign aid is to support their exports to aid-recipient countries. Time series data for Germany suggests an average return of between US$ 1.04 to US$ 1.50 for each US dollar of aid spent by Germany. Although this is well below previous estimates, the value is robust to different specifications and econometric approaches. Interestingly, we find strong evidence of crowding out between bilateral donors in the sense that bilateral aid from other EU members significantly reduces exports from Germany to the recipients. The evidence suggests that, in the long-run, aid causes exports and not vice versa. We discuss the implications these findings might have for aid volumes and allocation.
    Keywords: trade; foreign aid; donors; time series based panel estimation techniques
    JEL: F10 F35 C23
    Date: 2009–07–15
  19. By: Kenneth Hartgen (University of Göttingen); Stephan Klasen (University of Göttingen); Mark Misselhorn (University of Göttingen)
    Abstract: Spurred by international commitments and expanded funding at the national and international level, attendance in education and associated years of schooling have expanded substantially in developing countries in recent years. But has this expansion in enrolments reduced existing inequalities in educational access and achievements? This paper analyzes differences in improvements in the access to the education system and in educational outcomes across the welfare distribution between and within countries, and also by gender and regions for a sample of 37 developing countries using Demographic and Health Surveys (DHS). For the analysis, the toolbox of pro-poor growth analysis is applied to several educational indicators. We find drastic inequalities in educational attendance across the income distribution. Interestingly, inequalities in attendance declines with rising average attendance, while inequality in completion rates or schooling years increases with rising completion rates or schooling years. We find great heterogeneity in the distribution of progress of education, with very little pro-poor progress in educational achievement indicators. Also, progress appears to be less pro-poor in countries with low initial educational achievement and high overall educational progress. We find no correlation between pro-poor progress and free education policies or initial inequality in education. At the regional level, educational progress was generally more pro-poor in Asia and Latin America, while in Africa the experience is very heterogeneous. While gender inequality has decreased slightly, large differences by region tend to persist over time.
    Keywords: education; human capital; inequality; pro-poor growth
    JEL: I20 I29 I31 I32
    Date: 2009–07–15
  20. By: Sebastian Edwards
    Abstract: In this paper I analyze Latin America's very long term economic performance (since the early 18th century), and I compare it with that of the United States, Australia, New Zealand and the countries of Western Europe. I begin with an analysis of long term data and an attempt at determining when the region's decline really began. The next section deals with the relation between the strength of institutions since colonial rule and the region’s economic performance. Next I move to an analysis of Latin America's long history with instability, crises and debt defaults. I show that currency collapses have been a staple of the region's economic history. In the Section that follows I analyze the long term evolution of social conditions, including poverty and income inequality. This analysis shows that a high degree of income disparity and poverty have a long history in the region. The paper ends with an analysis of the way in which Latin American intellectuals and scholars have seen the increasing economic and income gap with the United States and Canada.
    JEL: F30 F32 N26 O40 O54
    Date: 2009–07

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