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on Development |
| By: | Estrin, Saul (London School of Economics); Mickiewicz, Tomasz (University College London) |
| Abstract: | We analyze theoretically and empirically the impact of the shadow economy on entrepreneurial entry, utilising 1998-2005 individual-level Global Entrepreneurship Monitor data merged with macro level variables. A simple correlation coefficient suggests a positive linear link between the size of the shadow economy and entrepreneurial entry. However, this masks more complex relationships. With appropriate controls and instrumenting for potential endogeneity where required, the impact of the shadow economy on entry is found to be negative, based on a linear specification. Moreover, there is also evidence of nonlinearity: entrepreneurial entry is least likely when the shadow economy is of medium size. We attribute the negative effects of shadow economy on entry to perceived strong competition faced by new entrants when the shadow economy is widespread. At the individual level, an extensive shadow economy has a more negative impact on respondents who are risk averse. In addition, in the economies where property rights are strong, the negative impact of the shadow economy is weaker. |
| Keywords: | shadow economy, entrepreneurship |
| JEL: | O17 D2 L26 P14 |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5053&r=dev |
| By: | Timothy Besley; Torsten Persson |
| Abstract: | This paper is a report on an on-going project, which asks a number of questions relevant to the study of state capacity. What are the main economic and political determinants of the state’s capacity to raise revenue and support private markets? How do risks of violent conflict affect the incentives to invest in state building? Does it matter whether conflicts are external or internal to the state? When are large states associated with higher income levels and growth rates than small states? What relations should we expect between resource rents, civil wars and economic development? The paper is organized into three main sections: 1. The origins of state capacity, 2. Sate capacity and the genius of taxation, and 3. State capcity and the strategy of conflict. Each of these begins with a specific motivation. A simple model is formulated to analyze the determinants of state capacity in the first section, and modified to address the new issues that arise in subsequent sections. The theoretical results are summarized in a number of propositions. We discuss the implications of the theory, comment on its relation to existing literature, and briefly mention some empiric applications. [Working Paper No. 231] |
| Keywords: | state capacity; development,higher income levels, growth rates, |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2665&r=dev |
| By: | Duncan Thomas; Bondan Sikoki; Cecep Sumantri; Elizabeth Frankenberg; Firman Witoelar; John Strauss; Wayan Suriastini |
| Abstract: | Attrition is the Achilles heel of longitudinal surveys. Drawing on our experience in the Indonesia Family Life Survey, we describe survey design and field strategies that contributed to minimizing attrition over four waves of the survey. The data are used to illustrate the selectivity of respondents who attrit from the survey and, also the selectivity of respondents who move from the place they were interviewed at baseline and are subsequently interviewed in a new location. These results provide insights into the nature of selection that will arise in studies that fail to track and interview movers. Attrition, and types of attrition, are related in complex ways to a broad array of characteristics measured at baseline. Our evidence also suggests attrition may be related to characteristics that are not observed in our baseline. We draw on data from a Survey of Surveyors and describe characteristics of both the interviewers and the interview that predict attrition in later waves. These characteristics point to possible strategies that may reduce levels of attrition and may also reduce the impact of attrition on the interpretation of models estimated with longitudinal data. [Working Paper No. 259] |
| Keywords: | Attrition, longitudinal studies, survey design, Indonesia |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2652&r=dev |
| By: | Arusha Cooray (School of Ecnomoics, University of Wollongong); Niklas Potrafke (Department of Economics, University of Konstanz, Germany) |
| Abstract: | We investigate empirically whether political institutions or culture and religion underlie gender inequality in education. The dataset contains up to 157 countries over the 1991-2006 period. The results indicate that political institutions do not significantly influence education of girls: autocratic regimes do not discriminate against girls in denying educational opportunities and democracies do not discriminate by gender when providing educational opportunities. The primary influences on gender inequality in education are culture and religion. Discrimination against girls is especially pronounced in Muslim dominated countries. |
| Keywords: | Gender discrimination, education, democracy, religion |
| JEL: | O11 O15 O43 O57 P26 P36 Z12 |
| Date: | 2010–07–13 |
| URL: | http://d.repec.org/n?u=RePEc:knz:dpteco:0601&r=dev |
| By: | Stelios Michalopoulos (Tufts University); Alireza Naghavi (University of Bologna and FEEM); Giovanni Prarolo (University of Bologna and FEEM) |
| Abstract: | This research examines the economic origins of Islam and uncovers two empirical regularities. First, Muslim countries, virtual countries and ethnic groups, exhibit highly unequal regional agricultural endowments. Second, Muslim adherence is systematically larger along the pre-Islamic trade routes in the Old World. The theory argues that this particular type of geography (i) determined the economic aspects of the religious doctrine upon which Islam was formed, and (ii) shaped its subsequent economic performance. It suggests that the unequal distribution of land endowments conferred differential gains from trade across regions, fostering predatory behavior from the poorly endowed ones. In such an environment it was mutually beneficial to institute a system of income redistribution. However, a higher propensity to save by the rich would exacerbate wealth inequality rendering redistribution unsustainable, leading to the demise of the Islamic unity. Consequently, income inequality had to remain within limits for Islam to persist. This was instituted via restrictions on physical capital accumulation. Such rules rendered the investments on public goods, through religious endowments, increasingly attractive. As a result, capital accumulation remained low and wealth inequality bounded. Geography and trade shaped the set of economically relevant religious principles of Islam affecting its economic trajectory in the preindustrial world. |
| Keywords: | Religion, Islam, Geography, Physical Capital, Human Capital, Land Inequality, Wealth Inequality, Trade |
| JEL: | O10 O13 O16 O17 O18 F10 Z12 |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2010.75&r=dev |
| By: | Bin Dong (The School of Economics and Finance, Queensland University of Technology); Benno Torgler (The School of Economics and Finance, Queensland University of Technology, CREMA – Center for Research in Economics, Management and the Arts and CESifo) |
| Abstract: | In this study we explore in detail the causes of corruption in China using two different sets of data at the regional level (provinces and cities). We observe that regions with more anti-corruption efforts, histories of British rule, higher openness, more access to media and relatively higher wages of government employees are markedly less corrupt; while social heterogeneity, regulation, abundance of resource and state-owned enterprises substantially breed regional corruption. Moreover, fiscal decentralization is discovered to depress corruption significantly, while administrative decentralization fosters local corruption. We also find that there is currently a positive relationship between corruption and economic development in China that is mainly driven by the transition to a market economy. |
| Keywords: | Corruption, China, Government, Decentralization, Deterrence, Social Heterogeneity |
| JEL: | D73 H11 K42 |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2010.72&r=dev |
| By: | Bin Dong (The School of Economics and Finance, Queensland University of Technology); Benno Torgler (The School of Economics and Finance, Queensland University of Technology, CREMA – Center for Research in Economics, Management and the Arts and CESifo) |
| Abstract: | With complementary Chinese data sets and alternative corruption measures, we explore the consequences of corruption. Adopting a novel approach we provide evidence that corruption can have both, positive and negative effects, on economic development. The overall impact of corruption might be the balance of the two simultaneous effects within a specific institutional environment (“grease the wheels” and “sand the wheels”). Corruption is observed to considerably increase income inequality in China. We also find that corruption strongly reduces tax revenue. Looking at things from an expenditure point of view we observe that corruption significantly decreases government spending on education, R&D and public health in China. We also observe that regional corruption significantly reduces inbound foreign direct investment in Chinese regions, which indicates that the pollution haven hypothesis may not hold in China. This finding sheds a new light on the “China puzzle” that China is the largest developing host of FDI while it is appears to be very corrupt. Finally we observe that corruption substantially aggravates pollution probably through loosening environment regulation, and that it modifies the effects of trade openness and FDI on the stringency of environmental policy in a manner opposite to that observed in literature to date. |
| Keywords: | Corruption, China, Government, Economic Development, Inequality, Environment |
| JEL: | D72 H11 K42 |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2010.73&r=dev |
| By: | Leandro Prados de la Escosura |
| Abstract: | The pessimistic flavour of the Human Development Reports appears to be in contradiction with their own numbers as developing countries fare comparatively better in human development than in per capita GDP terms. This paper attempts to bridge this gap by providing a new, ‘improved’ human development index [IHDI], informed by welfare economics. The IHDI is presented here alongside the UNDP’s HDI for the world and its main regions since the late nineteenth century. Social dimensions in the IHDI are derived, following Kakwani (1993), with a convex achievement function, while a geometric average is employed to combine its dimensions (longevity, knowledge, and income). Thus, the IHDI does not conceal the gap between rich and poor countries and casts a much less optimistic view than the conventional UNDP index, while fits with the UNDP concern for international differences. The paper’s findings highlight main weaknesses in human development dimensions of present-day developing countries. |
| Keywords: | Human development, Life expectancy, Education, Per capita GDP |
| JEL: | O15 I00 N30 O50 |
| Date: | 2010–06 |
| URL: | http://d.repec.org/n?u=RePEc:cte:whrepe:wp10-07&r=dev |
| By: | Jeffrey Carpenter; Tyler Williams |
| Abstract: | Given the substantial amount of resources currently invested in microcredit programs, it is more important than ever to accurately assess the extent to which peer monitoring by borrowers faced with group liability contracts actually reduces moral hazard. We conduct a field experiment with women about to enter a group loan program in Paraguay and then gather administrative data on the members' repayment behavior in the six-month period following the experiment. In addition to the experiment which is designed to measure individual propensities to monitor under incentives similar to group liability, we collect a variety of the other potential correlates of borrowing behavior and repayment. Controlling for other factors, we find a very strong causal relationship between the monitoring propensity of one's loan group and repayment. Our lowest estimate suggests that borrowers in groups with above median monitoring are 36 percent less likely to have a problem repaying their portion of the loan. Besides confirming a number of previous results, we also find some evidence that risk preferences, social preferences, and cognitive skills affect repayment. |
| Keywords: | Loans ; Credit ; Human behavior |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedbwp:10-6&r=dev |
| By: | John Fernald; Brent Neiman |
| Abstract: | We derive aggregate growth-accounting implications for a two-sector economy with heterogeneous capital subsidies and monopoly power. In this economy, measures of total factor productivity (TFP) growth in terms of quantities (the primal) and real factor prices (the dual) can diverge from each other as well as from true technology growth. These distortions potentially give rise to dynamic reallocation effects that imply that change in technology needs to be measured from the bottom up rather than the top down. We show an example, for Singapore, of how incomplete data can be used to obtain estimates of aggregate and sectoral technology growth as well as reallocation effects. We also apply our framework to reconcile divergent TFP estimates in Singapore and to resolve other empirical puzzles regarding Asian development. |
| Keywords: | Industrial productivity ; Productivity ; Technology ; Singapore |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedfwp:2010-18&r=dev |
| By: | Paolo Falco; Andrew Kerr; Neil Rankin; Justin Sandefur; Francis Teal |
| Abstract: | This paper addresses the question as to why we observe such large differentials in earnings in urban African labour markets after controlling for observable human capital. We first use a three year panel across Ghana and Tanzania and find common patterns for both countries assuming that movement between occupations is exogenous. Unobserved individual market ability is by far the most important factor explaining the variance of earnings. Sector differences do matter even with controls for ability and the sectoral gap between private wage employment and civil servants is about 50 per cent, once we control for unobserved time-invariant factors. Wage earners earn the same as the selfemployed in both Ghana and Tanzania. An additional important aspect of formality is enterprise size. At most half of the OLS effect of size on earnings can be explained by unobservable ability. Workers in largest firms are the high earners with wage rates which exceed those of civil servants. We then use an extension of the Ghana panel to five years to assess the extent of possible biases from the assumption of exogenous movement. We find evidence that this is important and that OLS may be understating the extent of both the size effect and the private sector wage (negative) premium. The implications of our results for understanding the nature of formal and informal employment in Africa are discussed. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:10-03&r=dev |
| By: | Pieter Serneels; Jose G. Montalvo; Gunilla Pettersson; Tomas Lievens; Jean Damascene Butera; Aklilu Kidanu |
| Abstract: | Background: Most developing countries face shortages of health workers in rural areas. This has profound consequences for health service delivery, and ultimately for health outcomes. To design policies that rectify these geographic imbalances it is vital to understand what factors determine health workers’ choice to work in rural areas. But empirical analysis of health worker preferences has remained limited due to the lack of data. Methods: Using unique contingent valuation data from a cohort survey of 412 nursing and medical students in Rwanda, this paper examines the determinants of future health workers’ willingness to work in rural areas, as measured by rural reservation wages, using regression analysis. These data are also combined with those from an identical survey in Ethiopia to enable a two-country analysis. Results: Health workers with higher intrinsic motivation - measured as the importance attached to helping the poor - as well as those who have grown up in a rural area, and Adventists who participate in a local bonding scheme are all significantly more willing to work in a rural area. The main Rwanda result for intrinsic motivation is strikingly similar to that obtained for Ethiopia and Rwanda together. Discussion: The results suggest that in addition to economic incentives, intrinsic motivation and rural origin play an important role in health workers’ decisions to work in a rural area, and that faith-based institutions matter. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:10-10&r=dev |
| By: | Justin Sandefur |
| Abstract: | The size of the informal sector is commonly associated with low per capita GDP and a poor business environment. Recent episodes of reform and growth in several African countries appear to contradict this pattern. From the mid 1980’s onward, Ghana underwent dramatic liberalization and achieved steady growth, yet average firm size in the manufacturing sector fell from 19 to just 9 employees between 1987 and 2003. I use a new panel of Ghanaian firms, spanning 17 years immediately post-reform, to model firm dynamics that differ markedly from well-established ‘stylized facts’ in the empirical literature from other regions. In contrast with American and European firms, entry of new firms and selection on observable characteristics, rather than within-firm growth, dominates industrial evolution in Ghana. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:10-05&r=dev |
| By: | Monazza Aslam; Geeta Kingdon |
| Abstract: | This study investigates the relationship between parental schooling on the one hand, and child health outcomes (height and weight) and parental health-seeking behaviour (immunisation status of children), on the other. While establishing a correlational link between parental schooling and child health is relatively straightforward, confirming a causal relationship is more complex. Using unique data from Pakistan, we aim to understand the mechanisms through which parental schooling promotes better child health and health-seeking behaviour. The following ‘pathways’ are investigated: educated parents’ greater household income, exposure to media, literacy, labour market participation, health knowledge and the extent of maternal empowerment within the home. We find that while father's education is positively associated with the 'one-off' immunisation decision, mother's education is more critically associated with longer term health outcomes in OLS equations. Instrumental variable (IV) estimates suggest that father's health knowledge is most positively associated with immunisation decisions while mother's health knowledge and her empowerment within the home are the channels through which her education impacts her child's height and weight respectively. |
| Keywords: | parental schooling, mother's health knowledge, father's health knowledge, media exposure, maternal empowerment, child health, immunisation, Pakistan. |
| JEL: | I1 I2 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:10-16&r=dev |
| By: | Nicholas Nsowah-Nuamah; Francis Teal; Moses Awoonor-Williams |
| Abstract: | Poverty has halved in Ghana over the period from 1991 to 2005. Our objective in this paper is to assess how far this fall was linked to the creation of better paying jobs and the increase in education. We find that earnings rose rapidly in the period from 1998 to 2005, by 64% for men and by 55% for women. While education, particularly at the post secondary level, is associated with far higher earnings there is no evidence that the increase in earnings that occurred over the period from1998 to 2005 is due to increased returns to education or increased levels of education. In contrast there is very strong evidence, for all levels of education, that the probability of having a public sector job approximately halved over the period from 1991 while the probability of having a job in a small firm increased very substantially. In 1991/92 a male worker with secondary education had a 7 per cent probability of being employed in a small firm, by 2005/06 this had increased to 20 per cent which was higher than the probability of being employed by the public sector. Employment in small firms, which is the low paying occupation within the urban sector, increased from 2.7 to 6.7 percent of the population, an increase from 225,000 to 886,000 employees. Jobs in total have been increasing in line with the population but the proportion of relatively low paying ones increased markedly from 1998/99 to 2005/06. The rises in income that occurred over this period were due almost entirely to increases in earnings rates, for given levels of education, across all job types particularly among the unskilled. Why unskilled earnings rates rose so rapidly is unclear. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:10-01&r=dev |
| By: | Alexander Moradi |
| Abstract: | Sub-Sahara African populations are tall relative to the extremely adverse disease environment and their low incomes. Selective mortality, which removes shorter individuals leaving taller individuals in the population, was proposed as an explanation. From heights of surviving and non-surviving children in Gambia, we estimate the size of the survivorship bias and find it to be too small to account for the tall adult heights observed in sub-Saharan Africa. We propose instead a different yet widely ignored explanation: African populations attain a tall adult stature, because they can make up a significant amount of the growth shortfall after age 5. This pattern is in striking contrast to other developing countries. Moreover, mortality rates are relatively low after age 5 adding further doubts about selective mortality. |
| Keywords: | adult height, mortality, sub-Saharan Africa, catch-up growth |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:10-17&r=dev |
| By: | Roxana Gutierrez-Romero |
| Abstract: | This paper analyses the factors that give rise to the existence of the informal economy and how it evolves over time. Using an occupational-choice model the paper shows that at early stages of development, informal and formal markets coexists, but in the long-run the size of the informal economy can decline depending on the initial distribution of wealth. The model shows that the higher the initial wealth inequality the larger the size of the informal economy and the higher the wealth inequality will be in the long run. The paper calibrates the model using numerical simulations. |
| Keywords: | informal economy, occupational choice and inequality |
| JEL: | D31 K4 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:10-07&r=dev |
| By: | Geeta Kingdon |
| Abstract: | Using new and unique panel data, we investigate the role of long-term health and childhood malnutrition in schooling outcomes for children in rural India, many of whom lack basic numeracy and literacy skills. Using data on students’ performance on mathematics and Hindi tests, we examine the role of the endogeneity of health caused by omitted variables bias and measurement error and correct for these problems using a household fixed effects estimator on a sub-sample of siblings observed in the data. We also present several extensions and robustness checks using instrumental variables and alternative estimators. We find evidence of a positive causal effect of long-term health measured as height-for-age z-score (HAZ) on test scores, and the results are consistent across several different specifications. The results imply that improving childhood nutrition will have benefits that extend beyond health into education. |
| Keywords: | Health, Nutrition, Schooling, India |
| JEL: | I12 I21 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:10-14&r=dev |
| By: | Neil Rankin; Justin Sandefur; Francis Teal |
| Abstract: | This paper investigates the role of learning - through formal schooling and time spent in the labor market - in explaining labor market outcomes of urban workers in Ghana and Tanzania. We investigate these issues using a new data set measuring incomes of both formal sector wage workers and the self-employed in the informal sector. In both countries we find significant, convex returns to education and large earnings differentials between sectors when we pool the data and do not control for selection. In Ghana there is a particularly steep age-earnings profile. We investigate how far a Harris-Todaro model of market segmentation or a Roy model of selection can explain the patterns observed in the data. We find highly significant differences across occupations and important effects from selection in both countries. The data is consistent with a pattern by which higher ability individuals queue for the high wage formal sector jobs such that the age earnings profile is convex for the self-employed in Ghana once we control for selection. The returns to education are far higher in the large firm sector than in others and in this sector they are linear not convex. In both countries there is clear evidence of convexity in the returns to education for the self-employed and here the average returns are low. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:10-02&r=dev |
| By: | Christian Helmers; Manasa Patnam |
| Abstract: | This paper identifies the effect of neighborhood peer groups on childhood skill acquisition using observational data. We incorporate spatial peer interaction, defined as a child’s nearest geographical neighbors, into a production function of child cognitive development in Andhra Pradesh, India. Our peer group construction takes the form of directed networks, whose structure allows us to identify peer effects and enables us to disentangle endogenous effects from contextual effects. We exploit variation over time to avoid confounding correlated with social effects. Our results suggest that spatial peer and neighborhood effects are strongly positively associated with a child’s cognitive skill formation. These peer effects hold even when we consider an alternative IV-based identification strategy and different variations to network size. Further, we find that the presence of peer groups helps provide insurance against the negative impact of idiosyncratic shocks to child learning. |
| Keywords: | Children, peer effects, cognitive skills, India |
| JEL: | C21 O15 R23 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:10-13&r=dev |
| By: | Danila Serra; Pieter Serneels; Abigail Barr |
| Abstract: | Economists have traditionally assumed that individual behavior is motivated exclusively by extrinsic incentives. Social psychologists, in contrast, stress that intrinsic motivations are also important. In recent work, economic theorists have started to build psychological factors, like intrinsic motivations, into their models. Besley and Ghatak (2005) propose that individuals are differently motivated in that they have different “missions,” and their self-selection into sectors or organizations with matching missions enhances organizational efficiency. We test Besley and Ghatak’s model using data from a unique cohort study. We generate two proxies for intrinsic motivations: a survey-based measure of the health professionals philanthropic motivations and an experimental measure of their pro-social motivations. We find that both proxies predict health professionals’ decision to work in the non-profit sector. We also find that philanthropic health workers employed in the non-profit sector earn lower wages than their colleagues. |
| JEL: | C93 I11 J24 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:10-04&r=dev |
| By: | Freire, Tiago; Henderson, J. Vernon; Kuncoro, Ari |
| Abstract: | Using survey data on fishermen and fishing villages in Aceh, Indonesia from 2005 and 2007, this paper examines the effect of the December 2004 tsunami and resulting massive aid effort on local public good provision, in particular on public labor inputs, but also public capital choices. Also analyzed are the roles of and changes in local social and political institutions and participation in political and social activities. Such an examination informs not only our understanding of the impacts of aid on villages, but also our understanding of how villages allocate resources to public goods. For public labor inputs, volunteerism is lower in villages with more aid projects, but that is offset if the dominant donor mitigates agency problems by doing its own implementation. Volunteerism is lower in villages with more 'democratic' activity such as elections, although that effect is mitigated in villages with higher levels of social capital pre-tsunami. Evidence suggests volunteerism is lower not because of changes in types of leaders with village elections per se, but rather due to heightened internal divisions associated with elections. Correspondingly for public capital, villages with more democratic activity combined with more aid projects tend to emphasize garnering private aid (e.g., houses) at the expense of public aid (e.g., public buildings). |
| Keywords: | Aid; Volunteer; Public Goods. |
| JEL: | H41 O12 |
| Date: | 2010–06–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:23877&r=dev |
| By: | Ernesto Aguayo-Tellez; Jim Airola; Chinhui Juhn |
| Abstract: | Using household and establishment level data which span the 1990s, we examine the impact of trade liberalization policies on women’s labor market outcomes in Mexico. We find that that women’s relative wage remained stable while employment increased, leading to an increase in women’s wage bill share. Between-industry shifts, consistent with trade-based explanations, account for up to 40 percent of the growth in women’s wage bill share between 1990 and 2000. Comparing across industries, we find tariff cuts and exports are positively related to industry growth and women benefited since some of the fastest growing industries were female-intensive industries. We use establishment level data for the manufacturing sector to examine within-industry shifts in women’s wage bill share. Even controlling for detailed industry and maquiladora status, women’s wage bill share is positively related to exports by foreign firms, suggesting that trade liberalization further encouraged outsourcing and assembly-type activity. Finally, we find suggestive evidence that household bargaining power shifted in favor of women. Expenditures shifted from goods associated with male preference, such as men’s clothing and tobacco and alcohol, to those associated with female preference such as women’s clothing and education. |
| JEL: | J16 J21 J31 O19 O24 O54 |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:16195&r=dev |
| By: | Rachel Glennerster; Edward Miguel; Alexander Rothenberg |
| Abstract: | Scholars have pointed to ethnic and other social divisions as a leading cause of economic underdevelopment, due in part to their adverse effects on public good provision and collective action. We investigate this issue in post-war Sierra Leone, one of the world’s poorest countries. To address concerns over endogenous local ethnic composition, and in an advance over most existing work, we use an instrumental variables strategy relying on historical ethnic diversity data from the 1963 Sierra Leone Census. We find that local ethnic diversity is not associated with worse local public goods provision across a variety of outcomes, regression specifications, and diversity measures, and that these “zeros” are precisely estimated. We investigate the role that two leading mechanisms proposed in the literature – enforcement of collective action by strong local government authorities, and the existence of a common national identity and language – in generating these perhaps surprising findings. |
| JEL: | H41 O12 O55 |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:16196&r=dev |