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on Development |
| By: | Peter E Robertson (UWA Business School, The University of Western Australia); Jessica Y Xu (Australian Government, The Treasury) |
| Abstract: | China’s growth has been rapid but the value of China's international trade has grown even faster. This trade-biased growth is bringing both challenges and opportunities for Asian economies that are highly integrated with Chinese trade networks. Moreover in ASEAN countries such as Indonesia and Malaysia, China’s success has been seen as a threat to its existing trade and manufacturing base. We use an historical simulation analysis to examine the impacts of China’s growth on Asian economies. We find that a decade of China’s growth has raised GDP per capita in the developed Asian economies by around 16%. The effect on the ASEAN-4 economies is not as strong but still large, the GDP of the ASEAN-4 economies increased by approximately 7%. The main source of these gains is found to be lower durable goods import costs which induce accumulation of machinery and equipment capital. |
| Keywords: | Economic Growth, China, Trade Costs |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:uwa:wpaper:10-15&r=dev |
| By: | Grace Gao (UWA Business School, The University of Western Australia) |
| Abstract: | Food occupies a role of particular importance in the consumer’s budget, especially in poor countries. This paper deals with special issues arising from modelling food consumption patterns in 138 countries, where per capita incomes differ by as much as a factor of 100. We explore various forms of the Engel curve, and emphasise the economic behaviour of the income elasticity and the [0, 1] domain of the budget share. Using a new functional form to allow for the substantial variation in prices across countries, we provide estimates of income and price elasticities in each country. Stress testing is also employed by considering the implications of extreme values of income. |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:uwa:wpaper:10-17&r=dev |
| By: | John Cockburn; Ismaël Fofana; Luca Tiberti |
| Abstract: | The current global financial and economic crisis, which exacerbates the impacts of the energy and food crises that immediately preceded it, has spread to the developing countries endangering recent gains in terms of economic growth and poverty reduction. The effects of the crisis are likely to vary substantially between countries and between individuals within the same country. Children are among the most vulnerable population, particularly in a period of crisis. Especially in least developed countries, where social safety nets programs are missing or poorly performing and public fiscal space is extremely limited, households with few economic opportunities are at a higher risk of falling into (monetary) poverty, suffering from hunger, removing children from school and into work, and losing access to health services. This study simulates the impacts of the global economic crisis and alternative policy responses on different dimensions of child welfare in Western and Central Africa (WCA) over the period 2009-2011. It is based on country studies for Burkina Faso, Cameroon, and Ghana, which broadly represent the diversity of economic conditions in WCA countries. In order to capture the complex macro-economic effects of the crisis and the various policy responses – on trade, investment, remittances, aid flows, goods and factor markets – and to then trace their consequences in terms of child welfare – monetary poverty, hunger (caloric poverty), school participation, child labour, and access to health services – a combination of macro- and micro-analysis was adopted. The simulations suggest that the strongest effects are registered in terms of monetary poverty and hunger, although large differences between countries emerge. More moderate impacts are predicted in terms of school participation, child labour, and access to health care, although these are still significant and require urgent policy responses. Specifically, Ghana is the country where children are predicted to suffer the most in terms of monetary poverty and hunger, while Burkina Faso is where the largest deteriorations in schooling, child labour and access to health services are simulated. Among the policy responses examined to counteract the negative effects of the crisis on child well-being, a targeted cash transfer to predicted poor children is by far the most effective program. A comparison between a universal and targeted approach is also presented. |
| Keywords: | Global economic crisis, child poverty, hunger, education, child labour, health, West and Central Africa, Burkina Faso, Cameroun, Ghana, social protection |
| JEL: | D58 H31 I18 I21 I32 |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:lvl:mpiacr:2010-10&r=dev |
| By: | Chen, Yi (University of California, Los Angeles); Lei, Xiaoyan (Peking University); Zhou, Li-An (Peking University) |
| Abstract: | Though the positive income gradient of child health is well documented in developed countries, evidence from developing countries is rare. Few studies attempt to identify a causal link between family income and child health. Utilizing unique longitudinal data from the China Health and Nutrition Survey, we have found a positive, age-enhancing income gradient of child health, measured by height-for-age z scores. The gradient is robust to alternative specifications and a comprehensive set of controls. Using the fact that the rural tax reform implemented since 2000 created an exogenous variation in family income across regions and over time, we explore a causal explanation for the income gradient, and find that it has a very strong independent causal effect on child health. |
| Keywords: | child health, income gradient, rural tax reform |
| JEL: | I10 I12 O15 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5182&r=dev |
| By: | Ren, Weiwei (University of Western Australia); Miller, Paul W. (Curtin University of Technology) |
| Abstract: | This paper examines the gender differential in the payoff to schooling in China. The analyses are conducted separately for rural and urban areas, and are based on a framework provided by the over education/required education/under education literature, and the decomposition developed by Chiswick and Miller (2008). It shows that the payoff to correctly matched education in rural China is much higher for females than for males. Associated with this, the wage penalty where workers are under qualified in their occupation is greater for females than for males. Both of these factors are shown to be linked to the higher payoff to schooling for females than for males. Over educated females, however, are advantaged compared with their male counterparts, though this has little effect on the differential in the payoff to schooling between males and females in rural China. These findings are interpreted using the explanations offered for the gender differential in the payoff to schooling in the growing literature on earnings determination in China. The payoffs to actual years of schooling for males and females in urban China are remarkably similar in this study. |
| Keywords: | China, schooling, earnings, rates of return |
| JEL: | J31 J62 J70 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5179&r=dev |
| By: | Akbulut-Yuksel, Mevlude (Dalhousie University); Turan, Belgi (University of Houston) |
| Abstract: | This paper provides evidence on how adverse health conditions affect the transfer of human capital from one generation to the next. We explore the differential exposure to HIV/AIDS epidemic in sub-Saharan Africa as a substantial health shock to both household and community environment. We utilize the recent rounds of the Demographic and Health Surveys (DHS) for 11 countries in sub-Saharan Africa that provide information on mother’s HIV status and enable us to link mothers and their children. The data also allow us to distinguish between two separate channels that are likely to differentially affect the intergenerational transfers: mother’s HIV status and community HIV prevalence. First, we find that mothers transfer 37% of their human capital to their children in the developing economies in sub-Saharan Africa. Second, our results show that mother's HIV status has large detrimental effect on inheritability of human capital. HIV-infected mothers are 30% less likely to transfer their human capital to their children. Finally, focusing only on non-infected mothers and their children, we find that HIV prevalence in the community also significantly impairs the intergenerational human capital transfers even if mother is HIV negative. The findings of this paper is particularly distressing for these already poor, HIV-torn countries as in the future they will have even lower overall level of human capital due to the epidemic. |
| Keywords: | HIV/AIDS, intergenerational transmission, human capital investment |
| JEL: | O12 I1 I2 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp5166&r=dev |
| By: | Fabio Veras Soares (International Poverty Centre); Elydia Silva (International Poverty Centre) |
| Abstract: | This paper analyses Brazilian, Chilean and Colombian experiences with conditional cash transfer programmes and how they have helped tackle gendered economic and social vulnerabilities. It is argued that Bolsa Família, Chile Solidario and Familias en Acción should be analysed within the broader social protection strategies in which they are meant to be components. Such an approach can help generate thinking on ways to improve the impacts of the programmes in terms of gender equality. A detailed description of the programmes? design and implementation features is provided in order to understand both their rationale and their impacts. We conclude that the programmes do tackle a number of gendered vulnerabilities but also have clear limits with regard to a more decisive role in tackling gender inequities. (...) |
| Keywords: | Conditional Cash Transfer Programmes and Gender Vulnerabilities: Case Studies of Brazil, Chile and Colombia |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:ipc:wpaper:69&r=dev |
| By: | Thankom Arun; Samuel Kobina Annim |
| Abstract: | This paper investigates a relationship between economic governance and the dual objectives of Microfinance Institutions (MFIs): poverty reduction and financial viability. Using an unbalanced panel of 531 MFIs the important role of other institutions such as country-level business registry departments in facilitating targeting of poor clients is illuminated. Comparing the estimates of Hausman-Taylor and Fixed Effects Vector Decomposition allows us to scrutinize and at least partially correct the effects of both time invariant and slow changing endogenous variables. We find that credit information availability and lesser time in securing property enhances the chances of MFIs in achieving their poverty reduction objective. Product diversification leading to economies of scope also enables MFIs to reach poor clients. On the basis of the above, it is imperative for government and development partners to channel their efforts towards provision of an enabling atmosphere that will enhance the achievement of microfinance social objectives. [Discussion Paper No. 5159] |
| Keywords: | microfinance, dual objectives, economic governance, property rights, credit information |
| Date: | 2010 |
| URL: | http://d.repec.org/n?u=RePEc:ess:wpaper:id:2817&r=dev |
| By: | Dillon, Andrew; Bardasi, Elena; Beegle, Kathleen; Serneels, Pieter |
| Abstract: | Child labor statistics are critical for assessing the extent and nature of child labor activities in developing countries. In practice, widespread variation exists in how childlabor is measured. Questionnaire modules vary across countries and within countries over time along several dimensions, including respondent type and the structure of the questionnaire. Little is known about the effect of these differences on child labor statistics. This paper presents the results from a randomized survey experiment in Tanzania focusing on two survey aspects: different questionnaire design to classify children work and proxy response versus self-reporting. Use of a short module compared with a more detailed questionnaire has a statistically significant effect, especially on child labor force participation rates, and, to a lesser extent, on working hours. Proxy reports do not differ significantly from a child’s self-report. Further analysis demonstrates that survey design choices affect the coefficient estimates of some determinants of child labor in a child labor supply equation. The results suggest that low-cost changes to questionnaire design to clarify the concept of work for respondents can improve the data collected. |
| Keywords: | Street Children,Labor Markets,Youth and Governance,Children and Youth,Labor Policies |
| Date: | 2010–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5414&r=dev |
| By: | Clausen, Bianca; Kraay, Aart; Murrell, Peter |
| Abstract: | A potential concern with survey-based data on corruption is that respondents may not be fully candid in their responses to sensitive questions. If reticent respondents are less likely to admit to involvement in corrupt acts, and if the proportion of reticent respondents varies across groups of interest, comparisons of reported corruption across those groups can be misleading. This paper implements a variant on random response techniques that allows for identification of reticent respondents in the World Bank’s Enterprise Survey for Nigeria fielded in 2008 and 2009. The authors find that 13.1 percent of respondents are highly likely to be reticent, and that these reticent respondents admit to sensitive acts at a significantly lower rate than possibly candid respondents when survey questions are worded in a way that implies personal wrongdoing on the part of the respondent. |
| Keywords: | Public Sector Corruption&Anticorruption Measures,E-Business,Social Analysis,Social Accountability,Bankruptcy and Resolution of Financial Distress |
| Date: | 2010–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5415&r=dev |
| By: | Lederman, Daniel; Mengistae, Taye; Xu, Lixin Colin |
| Abstract: | The causes and consequences of foreign direct investment in developing countries remain a subject of debate among researchers and policymakers alike. The authors use international data and a new micro-data set of firms in 13 Southern African developing countries to investigate the benefits and determinants of foreign direct investment in this region. Foreign direct investment appears to have facilitated local development in the region. Foreign firms tend to perform better than domestic firms, tend to be larger, are located in richer and better-governed countries and in countries with more competitive financial intermediaries, and are more likely to export than domestic firms. They also exhibit positive spillover effects to domestic firms. Relying on a standard model to predict the country-level inflows of foreign direct investment per capita, the authors find that Southern African developing countries are attracting the expected level of inflows, at least relative to their income level, human capital, demographic structure, institutions, and economic track record. There are some differences between Southern African developing countries and the rest of the world in foreign direct investment behavior: in Southern African developing countries, the income level is less important and openness more so. The authors use two comparison groups to compare with the region to shed light on why other regions have attracted more foreign direct investment per capita than Southern African developing countries. The factors that explain the region's low inflows of foreign direct investment are economic fundamentals (previous growth rates, average income, phone density, and adult share of the population). |
| Keywords: | Emerging Markets,Economic Theory&Research,Investment and Investment Climate,Debt Markets,Foreign Direct Investment |
| Date: | 2010–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5416&r=dev |
| By: | Philip Brock |
| Date: | 2010–07 |
| URL: | http://d.repec.org/n?u=RePEc:udb:wpaper:uwec-2010-05-r&r=dev |
| By: | Arnelyn Abdon; Marife Bacate; Jesus Felipe; Utsav Kumar |
| Abstract: | We rank 5,107 products and 124 countries according to the Hidalgo and Hausmann (2009) measures of complexity. We find that: (1) the most complex products are in machinery, chemicals, and metals, while the least complex products are raw materials and commodities, wood, textiles, and agricultural products; (2) the most complex economies in the world are Japan, Germany, and Sweden, and the least complex, Cambodia, Papua New Guinea, and Nigeria; (3) the major exporters of the more complex products are the high-income countries, while the major exporters of the less complex products are the low-income countries; and (4) export shares of the more complex products increase with income, while export shares of the less complex products decrease with income. Finally, we relate the measure of product complexity with the concept of Complex Products and Systems, and find a high degree of conformity between them. |
| Keywords: | Capabilities; Development; Economic Complexity; Diversification; Method of Reflections; Product Complexity; Ubiquity |
| JEL: | O10 O14 |
| Date: | 2010–09 |
| URL: | http://d.repec.org/n?u=RePEc:lev:wrkpap:wp_616&r=dev |
| By: | Yanyan Gao |
| Abstract: | Urban bias has long been China’s dominant economic policy. The persistent urban bias leads to a severe rural-urban income gap and diverts physical as well as an effect of diverting the rural resource out of agricultural sector, and thus is detrimental to agricultural growth. This paper uses China’s provincial panel data from 1978 to 2007 to investigate the diverting effects of the rural-urban income gap on agricultural growth. The empirical results suggest that the persistent rural-urban income gap caused by urban bias has produced strong current, but smaller lagged resource-diverting effects on agriculture. The further study shows that the diverting effect is decreasing over time and it is larger in the middle provinces than other provinces. The time and region patterns are confirmed to be a “U shape” relationship between the rural-urban income gap and agricultural growth. |
| Keywords: | Urban Bias, Income Gap, Agricultural Growth, China |
| JEL: | O13 Q18 R15 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:mos:moswps:2010-34&r=dev |
| By: | Asadul Islam |
| Abstract: | The objective of this paper is to estimate the impacts of medium and long term participation in microfinance programs. It utilises a new, large and unique panel dataset collected from treatment and control households from 1997 to 2005. The data enables us to identify continuing participants in the program as well as newcomers and leavers. We employ different estimation strategies including triple-difference and propensity score matching methods to control for selection bias. The impact estimates indicate that the benefits from microfinance vary more than proportionately with the duration of participation in a program. Larger benefits are realized from longer-term participation, and that the benefits continue to accrue beyond departure from the program. The findings indicate the need to observe longer periods of participation to provide a reliable basis for assessing the effectiveness of microfinance lending. |
| Keywords: | Microfinance, Bangladesh, triple-difference, matching, medium-term,long-term. |
| JEL: | C21 C33 H43 G21 I31 O12 O16 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:mos:moswps:2010-02&r=dev |
| By: | Asadul Islam; Russell Smyth |
| Abstract: | In most developing countries children provide some form of insurance against risks when parents are old, which, in turn, justifies parental preference to have more children. In this paper, we examine the causal effect of number of children on several measures of health status of elderly parents using newly available China Health and Retirement Survey data. Because number of children in a family is not exogenously determined, we use a natural experiment (variations in China’s one child policy) and preferences for a son to account for exogenous variation in family size. We show that both variation in the one-child policy and having a first born child who is a daughter significantly increase the family size. Overall, our results suggest that having more children has a negative effect on self-reported parental health, but generally no effect on other measures of health. We find no difference between the effect of number of children on maternal and paternal health. We find some evidence that having an adult daughter living at home, or in close geographical proximity, has a positive effect on parental health. The results also suggest that upstream financial transfers have a positive effect on parental health. |
| Keywords: | Children, Parental Health, China, One-child policy, Sex preference |
| JEL: | O12 J13 I10 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:mos:moswps:2010-29&r=dev |
| By: | Pushkar Maitra; Anu Rammohan; Ranjan Ray; Marie-Claire Robitaille |
| Abstract: | Despite its economic success, India has made little progress towards meeting its Millennium Development Goal targets of reducing undernourishment, particularly among children. Using nationally representative data, our analysis finds evidence of an improvement in the anthropometric measures of height-for-age, but a worsening in weight-for-height z-scores for children aged 0 – 3 over the period 1998 – 2006. There is also a worsening in both cereal consumption and calorie intake over this period, with some of the most noticeable declines taking place in households with children aged 0 – 3. This suggests a possible link between declining food intake and poor nutritional outcomes of children during this period. |
| Keywords: | India, Weight-for-height, Height-for-age, calorie consumption, expenditure patterns |
| JEL: | I12 C25 O12 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:mos:moswps:2010-19&r=dev |
| By: | Paul A. Raschky; Manijeh Schwindt |
| Abstract: | The aim of this paper is to determine the drivers of a donor’s decision on the composition of aid. We apply a dataset on international post-disaster assistance between 2000 and 2007 that includes information on the channel (bilateral vs. multilateral) and type (cash vs. in-kind) of each aid flow. Our results suggest that the choice of the channel and type of disaster assistance is mainly determined by strategic interests and transaction costs. Moreover, we find differences in the allocation behavior of OECD and non-OECD countries. |
| Keywords: | Foreign aid, natural disasters, bilateral vs. multilateral, type of aid |
| JEL: | O17 O19 Q54 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:mos:moswps:2010-06&r=dev |
| By: | Wenshu Gao; Russell Smyth |
| Abstract: | China‟s rural-urban migrants have been the engine room that has driven China‟s high rate of economic growth; however, their living and working conditions are poor. This paper addresses the question: What keeps China‟s migrant workers going? We seek to answer this question through examining the determinants of the happiness of China‟s rural-urban migrants, drawing on a large-scale survey administered across 12 cities in 2005. We find that expectations as to future income is an important determinant of happiness. This suggests that many migrants expect their financial position and, by extension, their lives more generally to get better in the future and that this is having a positive effect on their current levels of happiness. The effect of optimistic expectations outstrips any realistic increase in own income. We find that for those who expect a big increase in income over the next five years, this translates to an increase in average monthly income of 380 per cent and for those who expect a small increase in income over the next five years this translates to an increase in average monthly income of 200 per cent to obtain an equivalent increase in happiness compared with those who expect no change in income. This finding has important implications for economic growth and socio-economic stability in China given that maintaining socio-economic stability is important to maintain China‟s high rate of economic growth and positive expectations about future income are important for maintaining socio-economic stability during times of economic transition. |
| JEL: | I32 O15 |
| Date: | 2010–05 |
| URL: | http://d.repec.org/n?u=RePEc:mos:moswps:2010-14&r=dev |
| By: | Islam, Asadul |
| Abstract: | The objective of this paper is to estimate the impacts of medium- and long-term participation in microcredit programs. It utilises a new and large panel dataset collected from treatment and control households from 1997 to 2005. The data enables us to identify continuing participants in the program as well as newcomers and leavers. We employ different estimation strategies including triple-difference and propensity score matching methods to control for selection bias. The impact estimates indicate that the benefits from microcredit vary more than proportionately with the duration of participation in a program. Larger benefits are realized from longer-term participation, and that the benefits continue to accrue beyond departure from the program. The findings indicate the need to observe longer periods of participation to provide a reliable basis for assessing the effectiveness of microcredit lending. |
| Keywords: | Microcredit; Bangladesh; fixed effects; triple-difference; matching; medium-term. |
| JEL: | I31 H43 C33 C21 G21 |
| Date: | 2010–04–29 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:24950&r=dev |
| By: | Blecker, Robert A.; Esquivel, Gerardo |
| Abstract: | In this chapter, we analyze the expectations and the realities about the economic impact of NAFTA on Mexico in terms of economic convergence, trade, investment, employment, wages, and income distribution. We show that NAFTA has basically failed to fulfill the promise of closing the Mexico-U.S. development gap, and we argue that this was due in part to the lack of deeper forms of regional integration or cooperation between Mexico and the United States. We also explore other factors that could explain this negative outcome, and we briefly discuss the opportunities for both Mexico and the United States to mutually benefit from a further economic integration process. |
| Keywords: | NAFTA, globalization, trade, democratization, labor, economic integration |
| Date: | 2010–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:usmexi:1545102&r=dev |