|
on Development |
| By: | Marcelo Soto |
| Abstract: | Empirical studies assume that the macro Mincer return on schooling is con- stant across countries. Using a large sample of countries this paper shows that countries with a better quality of education have on average relatively higher macro Mincer coeficients. As rich countries have on average better educational quality, differences in human capital between countries are larger than has been typically assumed in the development accounting literature. Consequently, factor accumulation explains a considerably larger share of income differences across countries than what is usually found. |
| Keywords: | Human capital; income growth; GMM estimation; development accounting. |
| JEL: | O11 O47 C33 |
| Date: | 2009–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:aub:autbar:779.09&r=dev |
| By: | Pamina Koenig |
| Abstract: | This paper analyzes the effect of immigrants' networks on the decision of individual firms to starting exporting to the immigrants' home country. Existing evidence on the trade-creating effect of immigrants show a robust effect, however at the national or regional level. Using French exports at the firm-level to 61 countries, I find that increasing the number of foreign immigrants in the region by 10 % increases the probability that a firm starts exporting to the immigrants' home country by 1.2%. More, the effect of immigrants is enhanced when immigrants are older or more educated. The effect of immigrants also varies among origin countries. |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pse:psecon:2009-31&r=dev |
| By: | Roy Bahl (Andrew Young School of Policy Studies, Georgia State University); Geeta Sethi (The World Bank); Sally Wallace (Andrew Young School of Policy Studies, Georgia State University) |
| Abstract: | This report is about the fiscal performance of rural local governments in the state of West Bengal. Specifically, our goal is to develop a comprehensive fiscal information system for all rural local governments, and to use these data to valuate the intergovernmental finance structure in the state. The work is of significant policy importance, given the need to implement programs to respond to the constitutional amendments mandating fiscal decentralization, and to support central and state government initiatives to use the Panchayat Raj Institutions (PRIs) as an important part of its poverty alleviation strategy. A more immediate need in West Bengal (and other states as well) is to support the work of the State Finance Commissions to better integrate rural local governments into the intergovernmental fiscal framework. To date, there has not been a comprehensive review of rural local government finance in West Bengal. |
| Keywords: | West Bengal, Fiscal Decentralization, Decentralization |
| Date: | 2009–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:ays:ispwps:paper0907&r=dev |
| By: | Timothy Goodspeed; Jorge Martinez-Vazquez (International Studies Program. Andrew Young School of Policy Studies, Georgia State University); Li Zhang |
| Abstract: | Host country government officials in developing and developed countries alike would like to know the impact of their public policies on foreign investment in their countries. Unfortunately, the literature does not provide a single view, and there are likely to be differences between developing and developed countries. This paper examines the impact of three host country government policies on the host’s FDI stock: taxation, good governance, and infrastructure. We focus on whether the impact of these factors on FDI differs depending on the level of development of the host country. The regression results indicate that FDI is sensitive to host country taxation in developed countries, but not in developing countries; FDI is sensitive to host country corruption in developing countries but not developed; and FDI shows sensitivity to host country infrastructure quality in both developed and developing host countries, though FDI appears to be more sensitive in developing host countries. |
| Keywords: | FDI, Developing countries, Developed countries, Foriegn Direct Investment |
| Date: | 2009–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:ays:ispwps:paper0910&r=dev |
| By: | Roy Bahl (Andrew Young School of Policy Studies, Georgia State University); Musharraf Cyan (International Studies Program. Andrew Young School of Policy Studies, Georgia State University) |
| Abstract: | The purpose of this paper is to evaluate the current practice of local government taxation in Pakistan and to point the way toward structural reforms that are both more rational and more in step with Pakistan’s vision for its fiscal decentralization. The analysis here is restricted to sub provincial governments, i.e., districts, TMA’s and union councils but with a decided emphasis on the former two. We do this by examining the current practice, and by drawing on international comparisons and “best practices” as laid out in the theory of fiscal federalism. |
| Keywords: | Local Government Taxation, Pakistan, Fiscal Decentralization |
| Date: | 2009–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:ays:ispwps:paper0909&r=dev |
| By: | Jorge Martinez-Vazquez (International Studies Program. Andrew Young School of Policy Studies, Georgia State University); Kaspar Richter |
| Abstract: | Pakistan’s economic development is once again threatened by macroeconomic imbalances. Broadly speaking, high growth in the 1960s was followed by low growth in the 1970s, and high growth in the 1980s by low growth in the 1990s, as macroeconomic vulnerabilities derailed development. Supported by a favorable global environment, Pakistan returned to a strong development record for much of this decade. Growth accelerated and fiscal and social indicators improved. But as in the past, the gains proved unsustainable, as economic policies adjusted too little and too late to a deterioration in the external environment. The looming crisis is threatening to undo much of the recent development progress. |
| Keywords: | Pakistan, Tax policy, Tax Bases |
| Date: | 2009–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:ays:ispwps:paper0908&r=dev |
| By: | Iliana Olivié |
| Abstract: | This study provides a general analysis of economic relations between Spain, as a donor of official development assistance (ODA), and Ecuador, as a partner and recipient of development aid. It seeks to assess the potential (in)coherence between Spain’s foreign economic activities and the goals of development and poverty reduction that the Spanish government established for its relations with developing countries. Hence, the study's main aim is to determine whether the Spanish government as a whole (and not just Spanish co-operation) is coherent with Ecuador’s development and thus coherent with Spain’s policies on international development co-operation. We therefore analyse the links between the two countries through trade, international remittances, foreign direct investment (FDI) and external debt, from a development point of view. The secondary aim is to offer recommendations to help make Spain’s activities more coherent with development. One main challenge that arises is the lack of an institutional framework for a wider set of relations between the two countries. Although there is an institutional basis for international assistance acitivites, it does not cover other economic activities such as trade or investment projects. As a result, incoherences appear, such as the approval of ODA trade credit lines that are eliminated in debt cancellation agreements a few years later.<BR>Cette étude analyse les relations économiques entre l’Espagne, un bailleur de fonds, et l’Équateur, pays partenaire et récipiendaire de l’aide au développement. On cherche à établir les (in)cohérences potentielles entre les activités économiques extérieures de l’Espagne et les objectifs de développement et réduction de la pauvreté que le même gouvernement a établis pour ses relations avec les pays en développement. Le principal objectif est alors de déterminer si l’ensemble de l’Administration espagnole (et pas seulement l’administration chargée de la coopération au développement) est cohérent avec l’objectif de développement de l’Équateur et, en conséquence, cohérent avec les politiques espagnoles de coopération internationale pour le développement. Concrètement, nous analysons, du point de vue du développement, les liens en matière de commerce, transferts internationaux de migrants, investissements directs étrangers et dette étrangère. Le deuxième but est d’offrir une série de recommandations afin d’assurer la cohérence des activités économiques extérieures de l’Espagne avec son objectif de développement. Un des défis majeurs réside dans l’absence d’un cadre institutionnel intégrant l’ensemble des relations entre les deux pays. Bien qu’il existe une base institutionnelle pour la coopération internationale au développement, celle-ci ne couvre pas certaines dimensions économiques comme le commerce ou les projets d’investissement. Il en résulte l’apparition d’incohérences comme l’ouverture de lignes de crédit AOD qui sont par la suite résiliées lors d’un accord d’annulation de dettes. |
| Keywords: | finance, finance, trade, development, développement, Spain, commerce, Espagne, Ecuador, aid, aide, coherence, cohérence, foreign debt, dette extérieure, Équateur |
| JEL: | F14 F21 F24 F34 F35 O19 O21 |
| Date: | 2009–07–30 |
| URL: | http://d.repec.org/n?u=RePEc:oec:devaaa:280-en&r=dev |
| By: | Sebastián Nieto Parra; Javier Santiso |
| Abstract: | In this paper we test the impact of elections on fiscal policy in Latin American economies in comparison to OECD countries over the period 1990-2006. We find that in Latin American countries, the average primary balance declines by an amount close to 0.7 per cent of GDP during an election year, confirming the hypothesis of fiscal deteriorations during the election cycle. Most of this movement is due to the expenditure component and within this it is current (close to 0.8 per cent of GDP) rather than capital expenditure that is most affected. By contrast, in OECD countries, the observed changes in the primary balance and current expenditures during election years are minimal. Our analysis also suggests that re-elections of incumbent candidates in Latin America have a considerable impact on the expenditure side of the fiscal balance. Finally, by comparing the 2005-2006 electoral cycle with respect to prior electoral cycles, we note a slight improvement of fiscal management around elections in the region. We derive policy implications and recommendations from our findings.<BR>L’objectif de cet article est de tester l’impact des élections sur la politique budgétaire dans les pays d’Amérique Latine par rapport aux pays de l’OCDE pendant la période 1990-2006. Nos résultats montrent qu’en moyenne le solde primaire diminue de près de 0,7 pourcent du PIB pendant l’année électorale, ce qui confirme l’hypothèse d’une détérioration de la discipline budgétaire pendant le cycle électoral en Amérique Latine. Une grande partie de ce mouvement s’explique par une croissance des dépenses publiques qui trouve son origine dans les dépenses courantes (près de 0,8 pourcent du PIB) plus que dans les dépenses en capital. En revanche, dans les pays de l’OCDE, le solde primaire et les dépenses courantes évoluent peu pendant l’année électorale. Notre analyse suggère également que les réélections des candidats en exercice en Amérique Latine ont un impact considérable sur les dépenses budgétaires. Enfin, la comparaison du cycle électoral de 2005-2006 aux cycles passés fait apparaître une amélioration, bien qu’encore réduite, de la discipline budgétaire de la région en période électorale. Nous analysons les implications politiques de ces résultats et proposons des recommandations. |
| Keywords: | elections, élections, Latin America, Amérique latine, incumbent candidates, candidats en exercice, political budget cycle, cycle politique et budgétaire |
| JEL: | D72 E62 H62 P16 |
| Date: | 2009–08–14 |
| URL: | http://d.repec.org/n?u=RePEc:oec:devaaa:281-en&r=dev |
| By: | Emmanuel Frot; Javier Santiso |
| Abstract: | Aid ineffectiveness, fragmentation, and volatility have already been highlighted by scholars and OECD studies. Far fewer studies have been devoted to another problem of capital flows: herding behaviour. Building upon a methodology applied to financial markets, where herding is a common feature, this article attempts to measure herding behaviour in the allocation of foreign aid, proposing different indexes that try to capture the specific features of aid allocation. Of course, herding can also be beneficial. When a country faces an earthquake, a tsunami, or any humanitarian disaster, the rush of donors is a positive factor. Excluding such cases of beneficial herding, we attempt to focus on pure herding behaviour, creating pendulum swing effects comparable to those in financial markets. . Our different indexes all detect donor herding, its exact size depending on the measure adopted. Our preferred index, relying on threeyear disbursements, indicates a significant level of herding, similar to that which is found on financial markets. We also uncover major differences across different types of donors, with no, or very limited, herding among multilateral donors, in contrast to bilateral donors, always subject to herding behaviour. We then follow by investigating the empirical causes of herding. We find that while political transitions away from democracy are accompanied by herding out, transitions towards democracy do not affect herding levels. Finally, we show that observable determinants actually explain little of the herding levels, leaving a large part of herding unexplained.<BR>L’inefficacité, la fragmentation et la volatilité de l’aide au développement ont été souvent soulignées dans les travaux académiques comme dans ceux de l’OCDE. Un autre écueil relatif aux flux de capitaux a été beaucoup moins étudié : les comportements moutonniers. Cet article évalue ce comportement dans l’allocation de l’aide. Il s’inspire d’une méthodologie proche de celle utilisée pour les marchés financiers et propose différents indices qui prennent en compte les caractéristiques de l’allocation de l’aide au développement. Nous avons tenté ici de nous concentrer sur les purs évènements moutonniers, en excluant les comportements mimétiques bénéfiques, liés aux afflux d’aide qui suivent les tremblements de terre, des tsunamis ou autres désastres humanitaires : dans de tels cas, le suivisme des donateurs est bénéfique. Peux-t-on pour autant, à l’exclusion de ces cas, détecter des comportements moutonniers des donateurs, qui amplifieraient les mouvements de balanciers des flux, comparables à ce que l’on rencontre dans les marchés financiers ? Nos différents indices détectent tous la présence de comportements moutonniers au sein des donateurs. La magnitude exacte de ces comportements dépend de l’indice utilisé. Notre mesure préférée, basée sur les déboursements tri-annuels, indique des niveaux de comportement moutonnier similaires à ceux trouvés sur les marchés financiers. Nous mettons aussi en évidence d’importantes différences entre les types de donateurs. Le comportement moutonnier n’existe pas, ou très peu, entre les organisations multilatérales, tandis qu’il est présent entre les donateurs bilatéraux. Nous estimons ensuite empiriquement les causes du comportement moutonnier. Nous établissons que les transitions politiques vers moins de démocratie repoussent les pays donateurs de manière coordonnée. Au contraire, les transitions vers plus de démocratie ne modifient pas simultanément les décisions d’allocation de plusieurs donateurs. Enfin, nous montrons que les variables influençant les comportements moutonniers n’en expliquent qu’une faible partie. Il reste donc que la majeure partie de ces comportements reste inexpliquée. |
| Keywords: | fragmentation, volatility, volatilité, aid, aide, fragmentation, herding, comportement moutonnier |
| JEL: | F34 F35 |
| Date: | 2009–07–15 |
| URL: | http://d.repec.org/n?u=RePEc:oec:devaaa:279-en&r=dev |
| By: | Jason Gagnon; Theodora Xenogiani; Chunbing Xing |
| Abstract: | The rapid and massive increase in rural-to-urban worker flows to the coast of China has drawn recent attention to the welfare of migrants working in urban regions, particularly to their working conditions and pay; serious concern is raised regarding pay discrimination against rural migrants. This paper uses data from a random draw of the 2005 Chinese national census survey to shed more light on the discrimination issue, by making comparisons of earnings and the sector of work between rural migrants on one hand, and urban residents and urban migrants on the other. Contrary to popular belief, we find no earnings discrimination against rural migrants compared to urban residents. However, rural migrants are found to be discriminated in terms of the sector in which they work, with a vast majority working in the informal sector lacking adequate social protection.<BR>L’augmentation rapide et massive des mouvements ruraux-à-urbains d’ouvriers vers la côte de la Chine a appelé à l’attention récente le bien-être des migrants travaillant dans des régions urbaines, en particulier vis-à-vis de leurs conditions de travail et de salaire ; la préoccupation a d’autant plus augmenté concernant la discrimination de salaire contre les migrants ruraux. Ce document emploie des données d’un tirage aléatoire du recensement national chinois de 2005 pour éclaircir la question de la discrimination en faisant des comparaisons de revenus et de secteur de travail entre les migrants ruraux d’une part, et les résidents et migrants urbains de l’autre. Contrairement à la croyance populaire, nous ne trouvons aucune discrimination de revenus entre migrants ruraux et résidents urbains. Cependant, les migrants ruraux s’avèrent être distingués en termes de secteur dans lequel ils travaillent, une grande majorité d’entre eux travaillant dans le secteur informel, caractérisé par un manque d’accès à une protection sociale adéquate. |
| Keywords: | migration, China, Chine, informal employment, migration, emploi informel, discrimination, discrimination |
| JEL: | J24 J71 O15 R23 |
| Date: | 2009–06–30 |
| URL: | http://d.repec.org/n?u=RePEc:oec:devaaa:278-en&r=dev |
| By: | Petreski, Marjan |
| Abstract: | The aim of this paper is to examine the theoretical and empirical arguments for the relationship between the exchange-rate regime and economic growth. As a nominal variable, the exchange rate (regime) might not affect the long-run economic growth. However, there is no unambiguous theoretical evidence what impacts the exchange-rate target exhibits on growth. The channel through which the regime might influence growth is trade, investment and productivity. Theoretical considerations relate the exchange-rate effect on growth to the level of uncertainty imposed by flexible option of the rate. However, while reduced policy uncertainty under a peg promotes an environment which is conductive to production factor growth, trade and hence to output, such targets do not provide an adjustment mechanism in times of shocks, thus stimulating protectionist behaviour, price distortion signals and therefore misallocation of resources in the economy. Consequently, the relationship remains blurred and requires in-depth empirical investigation. The empirical research offers divergent result though. A big part of the studies focuses on the parameter of the exchange-rate dummy, but does not appropriately control for other country-characteristics nor apply appropriate growth framework. Also, the issue of endogeneity is not treated at all or inappropriate instruments are repeatedly used. Very few studies disgracedly pay small attention to the capital controls, an issue closely related to the exchange-rate regime and only one study puts the issue in the context of monetary regimes. Overall, the empirical evidence is condemned because of growth-framework, endogeneity, sample-selection bias and the so-called peso problem. An empirical investigation which will consider all those aspects might reveal clear and robust suggestion of the relationship between exchange-rate regime and growth. |
| Keywords: | Exchange rate regime,economic grow |
| JEL: | E42 F31 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwedp:200931&r=dev |
| By: | Cunningham, Wendy |
| Abstract: | High youth unemployment rates may be a signal of difficult labor market entry for youth or may reflect high churning. The European and United States literature finds the latter conclusion while the Latin American literature suggests the former. This paper uses panel data to examine whether Latin American youth follow OECD patterns or are, indeed, unique. By decomposing transition matrices into propensity to move and rate of separation matrices and estimating duration matrices, the authors find that Latin American youth do follow the OECD trends: their high unemployment reflects high churning while their duration of unemployment is similar to that of non-youth. The paper also finds that young adults (age 19-24) have higher churning rates than youth; most churning occurs between informal wage employment, unemployment, and out-of-the labor force, even for non-poor youth; and unemployment probabilities are similar for men and women when the analysis control for greater churning by young men. The findings suggest that the"first employment"programs that have become popular in the region are not addressing the key constraints to labor market entry for young people and that more attention should be given to job matching, information, and signaling to improve the efficiency of the churning period. |
| Keywords: | Youth and Governance,Labor Markets,Population Policies,Adolescent Health,Labor Policies |
| Date: | 2009–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5022&r=dev |
| By: | Friedman, Jed; Schady, Norbert |
| Abstract: | The human consequences of the current global financial crisis for the developing world are presumed to be severe yet few studies have quantified such impact. The authors estimate the additional number of infant deaths in sub-Saharan Africa likely due to the crisis and discuss possible mitigation strategies. They pool birth-level data as reported in female adult retrospective birth histories from all Demographic and Health Surveys collected in sub-Saharan Africa nations. This results in a data set of 639,000 births to 264,000 women in 30 countries. The authors use regression models with flexible controls for temporal trends to assess an infant’s likelihood of death as a function of fluctuations in national income. They then apply this estimated likelihood to expected growth shortfalls as a result of the crisis. At current growth projections, their estimates suggest there will be 30,000 - 50,000 excess infant deaths in sub-Saharan Africa. Most of these additional deaths are likely to be poorer children (born to women in rural areas and lower education levels) and are overwhelmingly female. If the crisis continues to worsen the number of deaths may grow much larger, especially those to girls. Policies that protect the income of poor households and that maintain critical health services during times of economic contraction should be considered. Interventions targeted at female infants and young girls may be particularly beneficial. |
| Keywords: | Population Policies,Early Child and Children's Health,Adolescent Health,Gender and Health,Health Systems Development&Reform |
| Date: | 2009–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5023&r=dev |
| By: | Fofack, Hippolyte; Ndikumana, Leonce |
| Abstract: | Despite the recent increase in capital flows to Sub-Saharan Africa, the region remains largely marginalized in financial globalization and chronically dependent on official development aid. And with the potential decline in the level of official development assistance in a context of global financial crisis, the need to increase domestic resources mobilization as well as non-debt generating external resources is critical now more than ever before. However, the debate on resource mobilization has overlooked an important untapped source of funds consisting of the massive stocks of private wealth stashed in Western financial centers, a substantial part of which left the region in the form of capital flight. This paper argues that the repatriation of flight capital should take a more prominent place in this debate from a moral standpoint and for clear economic reasons. On the moral side, the argument is that a large proportion of the capital flight legitimately belongs to the Africans and therefore must be restituted to the legitimate claimants. The economic argument is that repatriation of flight capital will propel the sub-continent on a higher sustainable growth path while preserving its financial stability and without mortgaging the welfare of its future generations through external borrowing. The analysis in the paper demonstrates quantitatively that the gains from repatriation are large and dominate the expected benefits from other sources such as debt relief. It is estimated that if only a quarter of the stock of capital flight was repatriated to Sub-Saharan Africa, the region would go from trailing to leading other developing regions in terms of domestic investment, thus initiating a ‘big-push’-led sustainable long-term economic growth. The paper proposes some strategies for inducing capital flight repatriation, but cautions that the success of this program is contingent on strong political will on the part of African and Western governments and effective coordination and cooperation at the global level. |
| Keywords: | Access to Finance,Economic Theory&Research,Investment and Investment Climate,Debt Markets,Emerging Markets |
| Date: | 2009–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5024&r=dev |
| By: | Robalino, David A.; Zylberstajn, Helio |
| Abstract: | This paper solves and estimates a stochastic model of optimal inter-temporal behavior to assess how changes in the design of the unemployment benefits and pension systems in Brazil could affect savings rates, the share of time that individuals spend outside of the formal sector, and retirement decisions. Dynamics depend on five main parameters: preferences regarding consumption and leisure, preferences regarding formal Vs. informal work, attitudes towards risks, the rate of time preference, and the distribution of an exogenous shock that affects movements in and out of the social security system (given individual decisions). The yearly household survey is used to create a pseudo panel by age-cohorts and estimate the joint distribution of model parameters based on a generalized version of the Gibbs sampler. The model does a good job in replicating the distribution of the members of a given cohort across states (in or out of the social security / active or retired). Because the parameters are related to individual preferences or exogenous shocks, the joint distribution is unlikely to change when the social insurance system changes. Thus, the model is used to explore how alternative policy interventions could affect behaviors and through this channel benefit levels and fiscal costs. The results from various simulations provide three main insights: (i) the Brazilian SI system today might generate distortions (lower savings rates and less formal employment) that increase the costs of the system and might generate regressive redistribution; (ii) there are important interactions between the unemployment benefits and pension systems, which calls for joint policy analysis when considering reforms; and (iii) current distortions could be reduced by creating an actuarial link between contributions and benefits and then combining matching contributions and anti-poverty targeted transfers to cover individuals with limited or no savings capacity. |
| Keywords: | ,Labor Markets,Labor Policies,Pensions&Retirement Systems,Emerging Markets |
| Date: | 2009–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5027&r=dev |
| By: | Fofack, Hippolyte |
| Abstract: | In spite of the similarities between Sub-Saharan Africa and the Arab Gulf region (Gulf Cooperation Council states), development policies implemented in these two regions of the world have produced markedly different and even divergent outcomes. While Gulf Cooperation Council states have drawn on hydrocarbon revenues to dramatically transform their economic landscape, Sub-Saharan African countries have exhibited abysmal economic and social outcomes. The remarkable increase in personal income and large current account surpluses in Arab Gulf states is in sharp contrast with widespread poverty and recurrent balance of payments crises in Sub-Saharan Africa. This paper reviews the possible causes of these divergent development paths and discusses the prospects for economic convergence in the new globalization landscape of growing trade ties between the two regions. In particular, it shows that development models underpinned by institutional continuity and intergenerational accountability could enhance long-run growth in Sub-Saharan Africa and income convergence between the two regions. |
| Keywords: | Economic Theory&Research,Emerging Markets,Currencies and Exchange Rates,Debt Markets, |
| Date: | 2009–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5025&r=dev |
| By: | Caner, Mehmet; Koehler-Geib, Fritzi; Vincelette, Gallina Andronova |
| Abstract: | This paper analyzes the drivers and consequences of sudden stops of capital flows. It focuses on the impact of external vulnerability on the depth and length of sudden stop crises. The authors analyze 43 developing and developed countries between 1993 and 2006. They find evidence that external vulnerability not only significantly impacts the probability of a sudden stop crisis, but also prolongs the time it takes for growth to revert to its long-term trend once a sudden stop occurs. Interestingly, external vulnerability does not significantly impact the size of the instantaneous output effect in case of a sudden stop but prompts a cumulative output effect through significantly diminishing the speed of adjustment of output to its trend. This finding implies that countries financing a large part of their absorption externally do not suffer more ferocious output losses in a sudden stop crisis, but take longer to adapt afterward and are hence expected to suffer more protracted crises periods. Compared with previous literature, this paper makes three contributions: (i) it extends the country and time coverage relative to datasets that have previously been used to analyze related topics; (ii) it specifically accounts for time-series autocorrelation; and (iii) it provides an analysis of the adjustment path of economic growth after a sudden stop. |
| Keywords: | Currencies and Exchange Rates,Debt Markets,Achieving Shared Growth,Emerging Markets,Economic Theory&Research |
| Date: | 2009–08–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5021&r=dev |
| By: | Stark, Oded |
| Abstract: | This paper presents a set of reflections on what gives rise to remittances, which constitute a major part of the impact of migration on economic development in the migrantsâ own countries. The collage of reasons presented serves to illustrate that remittance behavior is the outcome of an intricate interplay between the preferences and interests of migrants and their families. |
| Keywords: | Reasons for remitting, Consumer/Household Economics, Institutional and Behavioral Economics, D31, F22, F24, J61, O12, O15, |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:ags:ubzefd:52800&r=dev |
| By: | Cororaton, Caesar B.; Orden, David |
| Keywords: | Distorted incentives, agricultural and trade policy reforms, national agricultural development, Agricultural and Food Policy, International Relations/Trade, F13, F14, Q17, Q18, |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:ags:wbadwp:52789&r=dev |
| By: | Herault, Nicolas; Thurlow, James |
| Keywords: | Distorted incentives, agricultural and trade policy reforms, national agricultural development, Agricultural and Food Policy, International Relations/Trade, F13, F14, Q17, Q18, |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:ags:wbadwp:52792&r=dev |
| By: | Zhai, Fan; Hertel, Thomas |
| Keywords: | Distorted incentives, agricultural and trade policy reforms, national agricultural development, Agricultural and Food Policy, International Relations/Trade, F13, F14, Q17, Q18, |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:ags:wbadwp:52787&r=dev |
| By: | Cicowiez, Martin; Diaz-Bonilla, Carolina; Diaz-Bonilla, Eugenio |
| Keywords: | Distorted incentives, agricultural and trade policy reforms, national agricultural development, Agricultural and Food Policy, International Relations/Trade, F13, F14, Q17, Q18, |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:ags:wbadwp:52793&r=dev |
| By: | de Souza Ferreira Filho, Joaquim Bento; Horridge, Mark |
| Keywords: | Distorted incentives, agricultural and trade policy reforms, national agricultural development, Agricultural and Food Policy, International Relations/Trade, F13, F14, Q17, Q18, |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:ags:wbadwp:52795&r=dev |
| By: | Cororaton, Caesar B.; Corong, Erwin; Cockburn, John |
| Keywords: | Distorted incentives, agricultural and trade policy reforms, national agricultural development, Agricultural and Food Policy, International Relations/Trade, F13, F14, Q17, Q18, |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:ags:wbadwp:52790&r=dev |
| By: | Warr, Peter |
| Keywords: | Distorted incentives, agricultural and trade policy reforms, national agricultural development, Agricultural and Food Policy, International Relations/Trade, F13, F14, Q17, Q18, |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:ags:wbadwp:52791&r=dev |
| By: | Sanchez, Marco V.; Vos, Rob |
| Keywords: | Distorted incentives, agricultural and trade policy reforms, national agricultural development, Agricultural and Food Policy, International Relations/Trade, F13, F14, Q17, Q18, |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:ags:wbadwp:52796&r=dev |
| By: | Arndt, Channing; Thurlow, James |
| Keywords: | Distorted incentives, agricultural and trade policy reforms, national agricultural development, Agricultural and Food Policy, International Relations/Trade, F13, F14, Q17, Q18, |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:ags:wbadwp:52794&r=dev |
| By: | Warr, Peter |
| Keywords: | Distorted incentives, agricultural and trade policy reforms, national agricultural development, Agricultural and Food Policy, International Relations/Trade, F13, F14, Q17, Q18, |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:ags:wbadwp:52788&r=dev |
| By: | Ting Yin (Institute of Social and Economic Research, Osaka University) |
| Abstract: | In this paper, I discuss the actual conditions and the determinants of co-residence between older parents and their children in China, especially the impact of bequest motives on parent-child co-residence, using micro data from the gSurvey of Living Preferences and Satisfaction,h conducted at Osaka University. More specifically, I use three subsamples of older respondents (those who live in urban areas, those who live in rural areas, and the pooled sample of both) to analyze the impact of bequest motives and other factors on the probability of parent-child co-residence. The results are as follows: Bequest motives are strong in China, with more than 60 percent of respondents having a bequest motive, and the parent-child co-residence rate is also high (just under 60 percent). Bequest motives do not have a significant impact on the probability of parent-child co-residence in any of the three samples. However, in urban areas of China, if older parents own their own homes, the probability that they co-reside with their children increases as the value of their home increases. In rural areas of China and in the country as a whole, the coefficient of parental income is positive and significant in some cases, meaning that children are more likely to live with their parents if parental income is higher. All of these results suggest that, in both urban and rural areas of China, the Chinese are selfishly motivated and the life-cycle model applies. |
| Keywords: | Bequest motives; parent-child co-residence; life-cycle hypothesis; altruism model; strategic bequest motive. |
| JEL: | D91 E21 |
| Date: | 2009–08 |
| URL: | http://d.repec.org/n?u=RePEc:osk:wpaper:0926&r=dev |
| By: | Gambetta, Renzo |
| Abstract: | This note reports information on the income inequality in Peru calculated from Income Household surveys from 2003-2008. Using surveys from the ENAHO published by the National Institute of Statistics, we used as index the household income annualized, it was divided by the total members of each household to compute the inequality indicators. We computed the density of income distribution using nonparametric methods (Kernel) then we used bootstrapping techniques to check the statistic significance of the inequality indexes variation using the K-S and the MWM to test the null hypothesis of no changes in income inequality between the periods. We conclude that the changes in the inequality indexes indeed have been reducing but in very minimal level even though the economic activity (real GDP) grew at sustained rates, 7.3% in average. |
| Keywords: | income distribution; non parametric estimation; bootstrapping |
| JEL: | D31 C15 |
| Date: | 2009 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16986&r=dev |
| 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 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:17090&r=dev |
| By: | Li, Xun |
| Abstract: | This paper discusses a new growth mode, a country with a dual economic structure in which each economic sector will receive different government policies such as financial and fiscal policies. Firstly It obtains the economic growth rate and the growth rate of per capita output in the balanced growth path. Secondly it shows how different policy allocations and current industrial structure influence the economic growth. This model also reveals several other factors such as technology progress and population flow which have effect on economic growth. More importantly, two types of "traps" which are often neglected by policymaker are pointed out and given names. They are “Policy Trap” and “Labor-force Flow Trap” which deserve the attentions of policymaker. |
| Keywords: | economic growth Policy Trap Labor-force Flow Trap industrial structure |
| JEL: | O49 |
| Date: | 2009–07–18 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:16990&r=dev |
| By: | Xing, Chunbing |
| Abstract: | As massive rural residents leave their home countryside for better employment, migration has profound effects on income distributions such as rural-urban income gap and inequalities within rural or urban areas. The nature of the effects depend crucially on who are migrating and their migrating patterns. In this paper, we emphasize two facts. First, rural residents are not homogeneous, they self-select to migrate or not. Second, there are significant differences between migrants who successfully transformed their hukou status (permanent migrants) and those did not (temporary migrants). Using three coordinated CHIP data sets in 2002, we find that permanent migrants are positively selected from rural population especially in terms of education. As permanent migration takes more mass from the upper half of rural income density, both rural income level and inequalities decrease, the urban-rural income ratio increases at the same time. On the contrary, the selection effect of temporary migrants is almost negligible. It does not have obvious effect on rural income level and inequalities. |
| Keywords: | migration; self-selection; China |
| JEL: | O15 |
| Date: | 2009–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:17036&r=dev |
| By: | Petra E. Todd (Department of Economics, University of Pennsylvania); Kenneth I. Wolpin (Department of Economics, University of Pennsylvania) |
| Abstract: | This paper discusses the use of discrete choice dynamic programming (DCDP) methods for evaluating policies of particular relevance to developing countries, such as policies to reduce child labor and increase school attendance, to improve school quality, to affect immigration flows, to expand old age pension benefits, or to foster small business investment through microfinance. We describe the DCDP framework and how it relates to static models, illustrate its application with an example related to conditional cash transfer programs, consider numerous empirical applications from the literature of how the DCDP methodology has been used to address substantively important policy issues, and discuss methods for model validation. |
| Keywords: | development economics, policy evaluation, dynamic discrete choice models, schooling, migration |
| JEL: | J22 C21 H31 |
| Date: | 2009–07–24 |
| URL: | http://d.repec.org/n?u=RePEc:pen:papers:09-028&r=dev |