nep-dev New Economics Papers
on Development
Issue of 2009‒08‒22
fourteen papers chosen by
Jeong-Joon Lee
Towson University

  1. Globalization, Financial Depth, and Inequality in Sub-Saharan Africa By Hisako KAI; Shigeyuki HAMORI
  2. Does Positional Concern Matter in Poor Societies? Evidence from a Survey Experiment in Rural Ethiopia By Akay, Alpaslan; Martinsson, Peter; Medhin, Haileselassie
  3. Marital Violence and Women's Employment and Property Status: Evidence from North Indian Villages By Bhattacharya, Manasi; Bedi, Arjun S.; Chhachhi, Amrita
  4. The New Mexican-Americans: International Retirement Migration and Development in an Expatriate Community in Mexico By Thomas W. Methvin
  5. Border Trade and Economic Zones on the North-South Economic Corridor: Focusing on the Connecting Points between the Four Countries By Tsuneishi, Takao
  6. Must Improved Labor Standards Hurt Accumulation in the Targeted Sector? Stylized Analysis of a Developing Economy By Arslan Razmi
  7. "Disability and Returns to Education in a Developing Country" By Kamal Lamichhane; Yasuyuki Sawada
  8. Food and cash transfers: evidence from Colombia By Orazio Attanasio; Erich Battistin; Alice Mesnard
  9. Stagnation of a “Miracle”:Botswana’s Governance Record Revisited By Christian von Soest
  10. A Start for Mild Liberalization? Building Civil Society through Co-operative Dynamics in China By Li Zhao
  11. Child Labour and Schooling Responses to Access to Microcredit in Rural Bangladesh By Islam, Asadul; Choe, Chongwoo
  12. Trustworthiness and economic performance By Breuer, Janice Boucher; McDermott, John
  13. Disease, Institutions and Underdevelopment By Hasan, Lubna
  14. Aging, religion, and health By Angus S. Deaton

  1. By: Hisako KAI (Graduate School of International Cooperation Studies Kobe University); Shigeyuki HAMORI (Faculty of Economics Kobe University)
    Abstract: This paper examines the relationship between globalization, financial deepening, and inequality in sub-Saharan Africa between 1980 and 2002. We provide the first detailed econometric analysis in this regard covering the entire sub-Saharan African region; such an analysis has hardly been conducted owing to the lack of relevant data. We find that while globalization deteriorates inequality, its disequalizing effect depends on the level of development of the country. Further, this paper confirms that globalization deteriorates the equalizing effect of financial depth, although the latter helps to reduce inequality. We conclude that in sub-Saharan Africa, as a result of globalization, the rich have become richer and the poor have become poorer.
    Keywords: Globalization, Financial Depth, Inequality, Sub-Saharan Africa
    JEL: F40 O10
    Date: 2009–08
  2. By: Akay, Alpaslan (IZA); Martinsson, Peter (University of Gothenburg); Medhin, Haileselassie (University of Gothenburg)
    Abstract: We investigated attitudes toward positionality among rural farmers in Northern Ethiopia, using a tailored survey experiment. On average, we found positional concerns neither in income per se nor in income from aid projects among the farmers. These results support the claim that positional concerns are positively correlated with absolute level of income of a country.
    Keywords: Ethiopia, positional concern, relative income
    JEL: C90 D63
    Date: 2009–08
  3. By: Bhattacharya, Manasi (affiliation not available); Bedi, Arjun S. (Institute of Social Studies); Chhachhi, Amrita (Institute of Social Studies)
    Abstract: Dominant development policy approaches recommend women's employment on the grounds that it facilitates their empowerment, which in turn is believed to be instrumental in enhancing women's well-being. However, empirical work on the relationship between women's employment status and their well-being as measured by freedom from marital violence yields an ambiguous picture. Motivated by this ambiguity, this paper draws on testimonies of men and women and data gathered from rural Uttar Pradesh, to examine the effect of women's employment and asset status as measured by their participation in paid work and their ownership of property, respectively, on spousal violence. Unlike the existing literature, we treat women's work status and violence as simultaneously determined and find that women's engagement in paid work and ownership of property, are associated with sharp reductions in marital violence.
    Keywords: domestic violence, employment status, property ownership, India
    JEL: J12 J15 J16
    Date: 2009–08
  4. By: Thomas W. Methvin (Princeton University)
    Abstract: If you did a Google search right now on the subject of U.S.-Mexico immigration, you would probably find thousands of resources, documents, and web-pages all dealing with what is often referred to as the immigration problem. The question is generally consistent across many fronts: how to deal with the millions of undocumented Mexican immigrants from Mexico who are seeking a better life in the U.S.? While this kind of immigration between the U.S. and Mexico certainly is important, it is not the only kind of migration between the two countries. While much of what may be deemed dominant migration theory details the migration experiences primarily of so-called labor migrants and South-North migrations between areas of lesser development to more developed regions, important exceptions exist and are notably understudied.
    Date: 2009–05
  5. By: Tsuneishi, Takao
    Abstract: The North-South Economic Corridor (NSEC), the road between Bangkok and Kunming, China, including the Laos route (R3B) and the Myanmar route (R3B), has been developed since 1998 following the GMS program. The region covering Yunnan Province in China, Shan State in Myanmar, Northern Laos and Northern Thailand has historical and ethnic closeness, and is a comparatively poor mountainous, boundary area. In the wake of the development of the NSEC, however, the region has started to show signs of change. Consequently, a review is to be carried out concerning the movement of people and cars, border trade and the situation concerning the progress of border economic zones at the five nodal border points in the four countries, and over three routes: R3A, R3B, and the Mekong River route.
    Keywords: GMS, Economic corridor, Border trade, Border economic zone, Quadrangle economic zone, Golden triangle, R3A, R3B, Mekong River, CBTA, Asia, China, Myanmar, Laos, Thailand, International trade, Regional economic cooperation
    JEL: F15 O53 R11
    Date: 2009–07
  6. By: Arslan Razmi (University of Massachusetts Amherst)
    Abstract: This paper analyzes a stylized small open economy. The analysis clas- sifies the economy into two tradable output-producing sectors: a manu- facturing sector and a (mainly tourism-related) services sector. Assuming sectoral differences based on stylized facts, we explore the impact of higher labor standards in the manufacturing sector on the long-term prospects of the economy using comparative dynamic exercises to analyze changes in output, foreign direct investment, relative prices, sectoral distribution, and accumulation. We find, in particular, that imposing higher standards across the manufacturing sector could, in the long run, shift the structure of the domestic economy in favor of that sector. JEL Categories:
    Date: 2009–08
  7. By: Kamal Lamichhane (Research Center for Advanced Science and Technology (RCAST), The University of Tokyo); Yasuyuki Sawada (Faculty of Economics, University of Tokyo)
    Abstract: In this paper, we estimate wage returns to investment in education for persons with disabilities in Nepal, using information on the timing of being impaired during school-age years as identifying instrumental variables for years of schooling. We employ unique data collected from persons with hearing, physical, and visual impairments as well as nationally representative survey data from the Nepal Living Standard Survey 2003/2004 (NLSS II). After controlling for endogeneity bias arising from schooling decisions as well as sample selection bias due to endogenous labor participation, the estimated rate of returns to education is very high among persons with disabilities, ranging from 19.4 to 33.2%. The coexistence of these high returns to education and limited years of schooling suggest that supply side constraints in education to accommodate persons with disabilities and/or there are credit market imperfections. Policies to eliminate these barriers will mitigate poverty among persons with disabilities, the largest minority group in the world.
    Date: 2009–08
  8. By: Orazio Attanasio (Institute for Fiscal Studies and University College London); Erich Battistin (Institute for Fiscal Studies); Alice Mesnard (Institute for Fiscal Studies)
    Abstract: <p>We study food Engel curves among the poor population targeted by a conditional cash transfer programme in Colombia. After controlling for the endogeneity of total expenditure and for the (unobserved) variability of prices across villages, the best fit is provided by a log-linear specification. Our estimates imply that an increase in total expenditure by 10% would lead to a decrease of 1% in the share of food. However, quasi-experimental estimates of the impact of the programme on total and food consumption show that the share of food increases, suggesting that the programme has more complex impacts than increasing household income. In particular, our results are not inconsistent with the hypothesis that the programme, targeted to women, could increase their bargaining power and induce a more than proportional increase in food consumption.</p>
    Keywords: Demand patterns, food Engel curves, evaluation of welfare programme
    JEL: C52 D12 I38
    Date: 2009–07
  9. By: Christian von Soest (GIGA Institute of African Affairs)
    Abstract: Botswana has been dubbed an “African miracle.” The country has been praised not only for maintaining a multiparty system and high growth rates since independence but also for its good governance record. In contrast to other African countries, the extent of neopatrimonialism, which runs counter to good governance, is said to be low. This article aims to a) precisely assess Botswana’s neopatrimonial profile and b) put forward explanations for the comparatively low level of neopatrimonialism and for the recent “stagnation of a miracle.” The paper finds that there have always been neopatrimonial tendencies in Botswana, though they have been largely overlooked by mainstream analyses. The crucial difference is the limited nature of these tendencies relative to other African countries. This can be attributed to the independence period, characterized by the homogeneity of political, economic, and administrative interests in safeguarding private property rights through a “strong” rational-legal state, that is, by limiting neopatrimonialism. Financed by massive revenues stemming from diamonds, the Southern African Customs Union (SACU), and the Bank of Botswana, the government of the Botswana Democratic Party (BDP) was able to secure its reign through the provision of public goods and limited neopatrimonial exchange relations. However, due to decreasing electoral dominance and elite cohesion, the ruling party is now reverting to some neopatrimonial and authoritarian means in order to safeguard its rule.
    Keywords: neopatrimonialism, corruption, governance, institutions, interests, development, Botswana
    Date: 2009–04
  10. By: Li Zhao (HIVA, Catholic University of Leuven)
    Abstract: This paper aims to understand the society-state relationship in China, by exploring this dynamics with other types of organizations, i.e. civil society organizations with economic objectives. The dynamics of co-operatives can influence and interact with civil society dynamics. In this sense, this paper presents the evolution of civil society in China by identifying the causal mechanisms of co-operatives’ development and the conditions needed for them to develop. This causal mechanisms are set within the context of one historical process evolving with path dependency. Using this theoretical framework, it further presents the empirical observation. The findings of the paper are that economic development shaped the new co-operative movement in China; this process was different from the former revolutionary communalist co-operative movement; like their counterparts from the liberal democratic tradition, new co-operatives participated in the market economy, developed in an evolutionary and peaceful way, had great respect for private property and especially, were self-motivated and voluntary in nature. The co-operative movement in China can thus be considered as a mild liberalization within civil society’s sphere. Furthermore, its spillover effect would be seen as the effect of enhancing the role of civil society as a critical dialogue partner with the state. The originality lies in its systematic analysis examining the conditions that underpin this dynamics, thus filling the academic gaps in the study of society-state relationship in another way different from the popularly-used perspective which examines the voluntary and non-profit nature of civil society organizations and excludes the economic spheres within civil society.
    Keywords: civil society dynamics, new co-operative movement, China, path dependency
    JEL: L31 N45 N55 O19 P13 P26 P32
    Date: 2009–08
  11. By: Islam, Asadul; Choe, Chongwoo
    Abstract: Microcredit has been shown to be effective in reducing poverty in many developing countries. However, less is known about its effect on human capital formation. In this paper, we develop a model examining the relation between microcredit and child labour. We then empirically examine the impact of access to microcredit on children’s education and child labour using a new and large data set from rural Bangladesh. We address the selection bias using the instrumental variable method where the instrument relies on an exogenous variation in treatment intensity among households in different villages. The results show that household participation in a microcredit program may increase child labour and reduce school enrolment. The adverse effects are more pronounced for girls than boys. Younger children are more adversely affected than their older siblings and the children of poorer and less educated households are affected most adversely. Our findings remain robust to different specifications and methods, and when corrected for various sources of selection bias.
    Keywords: Microcredit; child labour; school enrolment; instrumental variable; treatment effect
    JEL: A20 C21 O12
    Date: 2009
  12. By: Breuer, Janice Boucher; McDermott, John
    Abstract: Intrinsically trustworthy agents never cheat. A society's willingness to trust and the quality of its institutions have their origins in the intrinsic trustworthiness of its citizens. Trustworthiness is the basis for maximizing output in economic exchange and in explaining differences in standards of living around the world. We measure intrinsic trustworthiness with a question from the World Values Survey and estimate its effect using a sample of 60 countries. We find that trustworthiness is important for output per capita and that the effect of trust is likely to come from trustworthiness.
    Keywords: trustworthiness; trust; institutions; output per capita
    JEL: O43 Z13
    Date: 2009–03
  13. By: Hasan, Lubna
    Abstract: What explains poverty of Sub Saharan Africa and South Asia? One view holds the disease environment of these regions as the primary culprit. Others see it as a typical symptom of growth retarding institutions. We test validity of these competing assertions for a cross section of countries. Our results indicate that institutions are the prime determinant of economic performance of countries. Disease does not play a significant role in determining outcomes. On the contrary, we find support for the indirect effect of disease via institutions, as asserted by the 'institutions school'. Interestingly, the 'institutions school' contention about geography having no direct effect on income is also not validated. Our results show that being land locked can pose significant disadvantage for a country. Endowment of hydrocarbon, however, is beneficial for economic outcomes.
    Keywords: Economic Performance; Institutions; Disease
    JEL: O43 I10
    Date: 2009–08–19
  14. By: Angus S. Deaton
    Abstract: Durkheim’s famous study of suicide is a precursor of a large contemporary literature that investigates the links between religion and health. The topic is particularly germane for the health of women and of the elderly, who are much more likely to be religious. In this paper, I use data from the Gallup World Poll to study the within and between country relationships between religiosity, age, and gender, as well as the effects of religiosity on a range of health measures and health-related behaviors. The main contribution of the current study comes from the coverage and richness of the data, which allow me to use nationally representative samples to study the correlates of religion within and between more than 140 countries using more than 300,000 observations. It is almost universally true that the elderly and women are more religious, and I find evidence in favor of a genuine aging effect, not simply a cohort effect associated with secularization. As in previous studies, it is not clear why women are so much more religious than men. In most countries, religious people report better health; they say they have more energy, that their health is better, and that they experience less pain. Their social lives and personal behaviors are also healthier; they are more likely to be married, to have supportive friends, they are more likely to report being treated with respect, they have greater confidence in the healthcare and medical system and they are less likely to smoke. But these effects do not all hold in all countries, and they tend to be stronger for men than for women.
    JEL: I10 Z12
    Date: 2009–08

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