nep-dev New Economics Papers
on Development
Issue of 2010‒09‒25
forty-two papers chosen by
Mark Lee
Towson University

  1. Convergence Patterns in Latin America By Paola Andrea Barrientos Quiroga
  2. Children's Resources in Collective Households: Identification, Estimation and an Application to Child Poverty in Malawi By Geoffrey Dunbar; Arthur Lewbel; Krishna Pendakur
  3. Conflict Experiences and Household Expactations on Recovery: Survey Evidence from Northern Uganda By Carlos Bozzoli; Tilman Brück; Tony Muhumuza
  4. What Explains Microfinance Distribution Surplus? A Stakeholder-oriented Approach By Anaïs Périlleux; Marek Hudon
  5. Human Capital Investment and the Gender Division of Labor By Mark M. Pitt; Mark Rosenzweig; Nazmul Hassan
  6. Do household definitions matter in survey design? By Beaman, Lori; Dillon, Andrew
  7. Evaluating the Effects of Large Scale Health Interventions in Developing Countries: The Zambian Malaria Initiative By Nava Ashraf; Günther Fink; David N. Weil
  8. The effects of financial development on income inequality and poverty By Kappel, Vivien
  9. Ganyu Labor in Malawi: Efficiency Problems and Determinants of Supply By Dimowa, Ralitza; Michaelowa, Katharina; Weber, Anke
  10. Productivity growth, human capital and distance to frontier in Sub-Saharan Africa By Danquah, Michael; Ouattara, Osman; Speight, Alan
  11. Expenditure Patterns of Migrant Households: Evidence from Moldova By Poppe, Robert
  12. Foreign Aid and Recipients Exports By Nowak-Lehmann D., Felicitas; Martínez-Zarzoso, Inmaculada; Cardozo, Adriana; Klasen, Stephan
  13. How Do Rural Households Cope With Shocks? Evidence from Northeast Thailand By Tongruksawattana, Songporne; Waibel, Hermann; Schmidt, Erich
  14. The Dynamics of Job Creation and Job Destruction: Is Sub-Saharan Africa Different? By Shiferaw, Admasu; Bedi, Arjun
  15. Dynamic Effects of Foreign Direct Investment When Credit Markets are Imperfect By Gall, Thomas; Schiffbauer, Marc; Kubny, Julia
  16. The Tsunami and the Chit Fund- Evidence from the Indian Ocean Tsunami Hit on Credit Demand in South India By Czura, Kristina; Klonner, Stefan
  17. What is Happening with the Government Expenditure of Developing Countries - A Panel Data Study By Shonchoy, Abu
  18. The Gender Inequalities Index (GII) as a New Way to Measure Gender Inequality in Developing Countries By Ferrant, Gaëlle
  19. Financial Development and Household Welfare: Microevidence from Thai Households By Gloede, Oliver; Ornsiri Rungruxsirivorn
  20. A household-based Human Development Index By Harttgen, Kenneth; Klasen, Stephan
  21. Land reform and the formalization of houshold credit in rural Vietnam By Kemper, Niels; Klump, Rainer
  22. Improving on Africa's roads - Modeling infrastructure investment and its effect on subsistence agriculture By Schürenberg-Frosch, Hannah
  23. Does AIDS-Related Mortality Reduce Per-Capita Household Income? Evidence from Rural Zambia By Omar Mahmoud, Toman; Thiele, Rainer
  24. Premises of Aid for Trade By Königer, Jens; Busse, Matthias; Koopmann,Georg
  25. Towards Comparative and Aggregate Vulnerability: An Analysis of Welfare Distributions in Rural Provinces in Thailand and Vietnam By Hardeweg, Bernd; Wagener, Andreas; Waibel, Hermann
  26. The Fertility Transition Around the World - 1950-2005 By Strulik, Holger; Vollmer, Sebastian
  27. The impact of natural disasters on crime By Susmita Roy
  28. Looking Beyond Universal Primary Education: Gender Differences in Time Use among Children in Rural Bangladesh By Sajeda Amin; S. Chandrasekhar
  29. Working Group on Development of Children for the Eleventh Five Year Plan (2007-2012): (Volume One) By Government of India Ministry of Women and Child Development
  30. Impact of Remittances on Poverty in Developing Countries By Rashmi Banga; Pritish Kumar Sahu
  31. Distributions in motion: economic growth, inequality, and poverty dynamics By Ferreira , Francisco H. G.
  32. Skill Premium in Chile: Studying Skill Upgrading in the South By Francisco Gallego.
  33. Inequality and growth: the neglected time dimension By Daniel Halter; Manuel Oechslin; Josef Zweimüller
  34. Critical Evaluation of Cross-Border Infrastructure Projects in Asia By Manabu Fujimura; Ramesh Adhikari
  35. Socioeconomic Impacts of Cross- Border Transport Infrastructure Development in South Asia By John Gilbert; Nilanjan Banik
  36. Determinants of Urban Poverty: The Case of Medium Sized City in Pakistan By Masood Sarwar Awan; Nasir Iqbal
  37. Rural to Urban Migration in Pakistan: The Gender Perspective By Shahnaz Hamid
  38. Can Social Security Boost Domestic Consumption in the People’s Republic of China? By Wang Dewen
  39. Foreign Aid in Equatorial Guinea: Macroeconomic Features and Future Challenges By Larrú, José María
  40. Beyond the agricultural sector in Latin America: territorial approaches for rural development By Pisani, Elena
  41. Return to schooling in Vietnam during economic transition: Does return to schooling in Vietnam reach its peak? By Doan, Tinh; John, Gibson
  42. Emigration Prospects and Human Capital in the Developing Countries: The Possibility of the Qualitative Brain Gain By Kouni, Mohamed

  1. By: Paola Andrea Barrientos Quiroga (School of Economics and Management, Aarhus University, Denmark)
    Abstract: Literature on convergence among Latin American countries is still scarce compared to other regions. Moreover, almost none of the research connects convergence to the economic history of Latin America and the usual finding is one speed of convergence. In this paper I analyze 32 countries and 108 years, more observations than any other study. This long span of data allows me to use economic history to explain, analyze, validate, and understand the results of convergence patterns in the region. I find more than one speed of convergence (clubs) related to the known historical background, country characteristics, and external shocks in the region. I study three important phases, following Thorp (1998): from 1900 to 1930, the exporting phase, from 1931 to 1974, the industrialization phase, and from 1975 to 2007, the globalization phase. During the last two phases, I find strong evidence of convergence among those countries that succeeded in industrializing and/or building good institutions. The reason is that technology dissusion and capital accumulation is easier when these 2 phenomena occur.
    Keywords: Latin America, economic history, convergence, growth
    JEL: N0 N16 O0 O40 O47
    Date: 2010–09–15
  2. By: Geoffrey Dunbar (Simon Fraser University); Arthur Lewbel (Boston College); Krishna Pendakur (Simon Fraser University)
    Abstract: The share of household resources devoted to children is hard to identify, because consumption is measured at the household level, and goods can be shared. Using semiparametric restrictions on individual preferences within a collective model, we identify how total household resources are divided up among household members, by observing how each family member’s expenditures on a single private good like clothing varies with income and family size. Using data from Malawi we show how resources devoted to wives and children vary by family size and structure, and we find that standard poverty indices understate the incidence of child poverty.
    Keywords: Collective Model, Cost of Children, Bargaining Power, Iden- tication, Sharing rule, Demand Systems, Engel Curves
    JEL: D13 D11 D12 C31 I32
    Date: 2010–06–01
  3. By: Carlos Bozzoli; Tilman Brück; Tony Muhumuza
    Abstract: We analyse the role of mass violent conflict in influencing individual expectations. We hypothesise that individuals are likely to report negative expectations if they were exposed to conflict events in the past. We combine individual and household level data from the Northern Uganda Livelihood Survey of 2007 with a disaggregated conflict exposure index based on the Armed Conflict Locations Events Data (ACLED). We run logistic regression models to study the strength of the association between conflict and expectations. Results indicate that conflict intensity is correlated with a decrease in the probability of expecting economic recovery. The effect of conflict on general welfare however is less robust.
    Keywords: Conflict, expectations, war, welfare
    JEL: D84 H56 O10
    Date: 2010
  4. By: Anaïs Périlleux; Marek Hudon
    Abstract: What are the drivers of productivity surplus distribution to microfinance stakeholders? This paper shows that the size of the institution is the main indicator that can explain the gain in productivity surplus but also the surplus given to clients (decrease of interest rates) and staff. Moreover, cooperatives keep a significantly lesser part of their surplus for future growth, reserve, or distribution to investors. Finally, larger, more subsidised MFIs, and particularly cooperatives, tend to give a greater part of their surplus to their employees.
    Keywords: Microfinance; Surplus; Governance; Size; Subsidies; Cooperatives
    JEL: O16 O50 G21
    Date: 2010–09
  5. By: Mark M. Pitt (Brown University); Mark Rosenzweig (Department of Economics, Yale University); Nazmul Hassan (Dhaka University)
    Abstract: We use a model of human capital investment and activity choice to explain facts describing gender differentials in the levels and returns to human capital investments. These include the higher return to and level of schooling, the small effect of healthiness on wages, and the large effect of healthiness on schooling for females relative to males. The model incorporates gender differences in the level and responsiveness of brawn to nutrition in a Roy-economy setting in which activities reward skill and brawn differentially. Empirical evidence from rural Bangladesh provides support for the model and the importance of the distribution of brawn.
    Keywords: brawn, health, schooling, gender
    JEL: O1 J1 J2
    Date: 2010–09
  6. By: Beaman, Lori; Dillon, Andrew
    Abstract: Household definitions used in multi-topic household surveys vary between surveys but have potentially significant implications for household composition, production, and poverty statistics. Standard definitions of the household usually include some intersection of keywords relating to residency requirements, common food consumption, and intermingling of income or production decisions. Despite best practices intending to standardize the definition of the household, it is unclear which types of definitions or which intersections of keywords in a definition result in different household compositions. This paper conducts a randomized survey experiment of four different household definitions in Mali to examine the implications for household-level statistics. This approach permits analysis of the trade-offs between alternative definition types. We find that additional keywords in definitions increase rather than decrease household size and significantly alter household composition. Definitions emphasizing common consumption or joint production increase estimates of the levels of household assets and consumption statistics, but not on per adult equivalency asset and consumption statistics, relative to open-ended definitions of the household. In contrast, definition type did not affect production statistics in levels, although we observe significant differences in per adult equivalency terms. Our findings suggest that variations in household definition have implications for measuring household welfare and production over time and across countries, as well as evaluation studies where the correct measure of spillover effects within and across households is necessary for measuring the benefits of an intervention.
    Keywords: assets, Consumption, household definition, randomized experiment,
    Date: 2010
  7. By: Nava Ashraf; Günther Fink; David N. Weil
    Abstract: Since 2003, Zambia has been engaged in a large-scale, centrally coordinated national anti- Malaria campaign which has become a model in sub-Saharan Africa. This paper aims at quantifying the individual and macro level benefits of this campaign, which involved mass distribution of insecticide treated mosquito nets, intermittent preventive treatment for pregnant women, indoor residual spraying, rapid diagnostic tests, and artemisinin-based combination therapy. We discuss the timing and regional coverage of the program, and critically review the available health and program rollout data. To estimate the health benefits associated with the program rollout, we use both population based morbidity measures from the Demographic and Health Surveys and health facility based mortality data as reported in the national Health Management Information System. While we find rather robust correlations between the rollout of bed nets and subsequent improvements in our health measures, the link between regional spraying and individual level health appears rather weak in the data.
    Date: 2010
  8. By: Kappel, Vivien
    Abstract: This paper examines the effects of financial development on income inequality and poverty. The results of both cross-country and panel data regressions suggest that inequality and poverty are reduced not only through enhanced loan markets, but also through more developed stock markets. We show that ethnic diversity and the distribution of land are significant and robust determinants of both income inequality and poverty. Finally, we find evidence that government spending leads to a reduction in income inequality in high income countries. In low income countries, however, we find no significant effect. --
    Keywords: Financial development,inequality,poverty
    Date: 2010
  9. By: Dimowa, Ralitza; Michaelowa, Katharina; Weber, Anke
    Abstract: In Malawi, informal off-farm labour (ganyu) has often been described as a survival strategy which eventually drives poor rural households into even further destitution. Based on data from the Second Integrated Household Survey for 2004, we estimate the determinants of the decision to supply labour in the ganyu market and the amount of labour supplied. Our results do not support the conjecture that ganyu is necessarily a low-return strategy that confines subsistence constrained households to a vicious circle of poverty. However, we do find evidence that ganyu is used as an ex-post coping strategy in the event of shocks, and as an ex-ante social insurance mechanism. Moreover, we generally find a positive reaction of ganyu supply to an increase in the ganyu wages, and no evidence of any backward bending segment of the supply curve for households close to the subsistence level. While ganyu does not appear to drive poor households into further destitution, these households do seem to suffer the most when they face demand side constraints in times of greatest needs. --
    Keywords: rural labor supply,insurance strategies,poverty,Malawi
    JEL: O12 J22 J24
    Date: 2010
  10. By: Danquah, Michael; Ouattara, Osman; Speight, Alan
    Abstract: Using the Malmquist productivity index and panel data methods, we study the role of total human capital and its composition in the technological "catch-up" process and productivity growth via the channels of innovation and adoption of technology in a panel of 19 sub -Saharan African countries between 1960 and 2003. Our findings indicate different roles played by the composition of human capital and a follow-on consistent and significant contribution of total human capital to productivity growth. Primary and secondary school attainment (unskilled labour) contribute significantly to the adoption of technology(the main source of productivity growth in sub-Saharan Africa) whilst tertiary school attainment (skilled labour) plays a significant role in local innovation. Total human capital on the other hand, contribute more significantly to the adoption of technology and innovation. Technological "catch-up" remains a significant element in productivity growth in sub-Saharan Africa and economies with higher tertiary school attainment(skilled labour) and higher total human capital tend to contribute significantly to productivity growth through the channel of technological "catch-up". Our results rather point towards a circuitous depiction of the symbiotic characteristics of the composition of human capital in enhancing productivity growth in sub-Saharan Africa and hence efforts in scaling- up investments in human capital by governments, development partners etc should not be too concentrated on one composition of human capital. --
    Keywords: Productivity growth,Human capital,Sub-Saharan Africa
    JEL: D24 O47 O55
    Date: 2010
  11. By: Poppe, Robert
    Abstract: This paper examines the effect of temporary and permanent migration on household expenditures and on asset/durables ownership. Using household survey data from Moldova, this paper relies on the matching approach for identification. It is shown that temporary migrant and permanent migrant households have additional expenditures for food compared to non-migrant households. Concerning the ownership of goods or assets compared to the regional crisis in 1998, temporary and permanent migrant households are more likely to own more goods or assets than non-migrant households. Migration has stronger effects on ownership in rural areas. Overall, the findings indicate that temporary migration has a stronger effect on household expenditures than permanent migration. --
    Keywords: Expenditures,Remittances,Migration,Propensity Score Matching
    Date: 2010
  12. By: Nowak-Lehmann D., Felicitas; Martínez-Zarzoso, Inmaculada; Cardozo, Adriana; Klasen, Stephan
    Abstract: This paper uses the gravity model of trade to investigate the link between foreign aid and exports in recipient countries and tests for the transmission channels between aid and exports/economic development in developing countries. Most of the theoretical work emphasizes the negative impact of aid on recipient countries exports primarily due to exchange rate appreciation, disregarding the positive impact of aid linked to the income effect. The empirical findings, in contrast, indicate that the net impact of aid on recipient countries exports is positive and that the average return for recipients exports is about 1.50 US$ for every aid dollar spent. The paper also estimates the effect of different types of aid (bilateral aid [from one donor to one specific recipient, and bilateral aid from all the other donors to one specific recipient], as well as multilateral aid flowing to a specific recipient) and finds that at least two types of aid have a positive and significant effect on recipients exports, thus ruling out a major crowding out effect. It is further found that aid is hardly export-enhancing in Africa. --
    Keywords: International Tade,Foreign Aid,Recipient Exports,Real Exchange Rate
    JEL: F10 F35
    Date: 2010
  13. By: Tongruksawattana, Songporne; Waibel, Hermann; Schmidt, Erich
    Abstract: Rural households in emerging market economies are often vulnerable to poverty due to negative shocks and limited capacity for effective ex-post coping. This study analyses the relationship between shock types and coping decisions of rural households using the panel survey data of some 2,200 households in Northeast Thailand in the context of the DFG Research Unit 756. Empirical observations show that a large share of households suffered shocks mainly related to ecological, economic, health and social aspects. Results from a univariate probit model show that wealth status and shock severity in terms of income and asset losses encourage coping action. Regarding types of coping measure, asking for remittances from migrant household members and relatives, taking on public support programs, reallocating household resources, borrowing from formal and informal sources, using savings and selling assets are dominant. Multivariate probit model elaborates on the effect of shock types, household characteristics and location factors on the choice of coping activity. Overall, the results suggest that shocks experienced by rural households are likely to negatively affect their future welfare and more effective social risk management strategies are needed. --
    Keywords: Keywords: shocks,coping actions,vulnerability to poverty,rural households,Thailand
    Date: 2010
  14. By: Shiferaw, Admasu; Bedi, Arjun
    Abstract: Agricultural production is an important source of income and employment for developing countries, yet it is the cause of serious environmental problems. Though ECO-labels appear as a promising alternative to control the negative effects of agriculture on the environment and to increase the income of rural poor, the proportion of agricultural land and exports certified as is quite small. We investigate the factors that affect the adoption of certified organic coffee in Colombia and in particular study the effect of economic incentives on adoption. We find that those who have lower cost of adoption are more likely to be certified as organic. Correcting for sample selection, we find that certified organic production is 40% less productive and 31% less costly than non-certified production. Given the price premium in 2007, certified organic production is 15% less profitable than non-organic production. We find that in order to make organic production attractive, the price premium of certified organic coffee should be about 5 times higher than in 2007. --
    Keywords: Job Creation,Job Destruction,Job Reallocation,Firm Dynamics,Africa,Ethiopia
    JEL: J20 J23 J49
    Date: 2010
  15. By: Gall, Thomas; Schiffbauer, Marc; Kubny, Julia
    Abstract: This paper argues that foreign direct investment in economies with credit market imperfections may increase their vulnerability to capital flow shocks. Due to better access to financial markets foreign firms can use other wage contracts than domestic ones. This alters the domestic wage composition and the subsequent wealth distribution. When credit markets are imperfect, the wealth distribution typically determines an economy's growth potential in autarky; hence, high exposure to foreign direct investment may significantly impede the capability to recover from sudden withdrawals of foreign capital. This is substantiated by empirical evidence on durations of output recovery after systemic sudden stops. --
    Keywords: Credit market imperfections,foreign direct investment,growth,occupational choice,sudden stops
    JEL: F43 F23 O16
    Date: 2010
  16. By: Czura, Kristina; Klonner, Stefan
    Abstract: We analyze the effects of the 2004 Indian Ocean Tsunami on credit demand in South India. Combining data from a semi-formal financial intermediary with geophysical data on the Tsunami, we estimate the extent to which the price of credit and the structure of credit flows changed in response to this shock. We find a significant increase in the interest rate by 5.3 per cent on average in the affected branches around the Tsunami. Interest rates increased most dramatically in the first three months after the Tsunami hit and decreased subsequently over the year 2005. We conclude that (i) funds provided by Roscas did play a role for coping with this huge negative shock, (ii) repercussions of the Tsunami in the Rosca credit market were limited in terms of the order of magnitude of effects, and (iii) semi-formal credit and official aid are substitutes as disaster coping mechanisms rather than complements. --
    Keywords: Roscas,Credit and Savings Associations,Rural Finance,Microfinance,Coping Strategies,Natural Disaster,Impact Evaluation
    Date: 2010
  17. By: Shonchoy, Abu
    Abstract: The paper focuses on the recent pattern of government expenditure for developing countries and estimates the determinants which may have influenced government expenditure. Using a panel data set for 111 developing countries from 1984 to 2004, this study finds evidence that political and institutional variables as well as governance variables significantly influence government expenditure. Among other results, the paper finds new evidence of Wagner's law which states that peoples' demand for service and willingness to pay is income-elastic hence the expansion of public economy is influenced by the greater economic influence of a nation Cameron (1978). Corruption is found to be influential in explaining the public expenditure of developing countries. On the contrary, size of the economy and linguistic fractionalization is found to have significant negative association over government expenditure. The study finds that military governments are more conservative in terms of large public expenditure other than spending on defence equipments. --
    Keywords: Government expenditure,Panel data,Corruption,Fractionalization,Governance.
    JEL: E01 E61 E62 H2 H4 H5 H6 O11 O5
    Date: 2010
  18. By: Ferrant, Gaëlle
    Abstract: The measurement of gender inequalities has become an important topic in the academic literature. First, appropriate indicators are needed to compare the relative situation of women in developing countries. Second, there is renewed attention given to the relationship between gender inequality and economic growth. Measuring gender inequalities contributes to knowing whether greater inequality promotes or hampers growth. The aim of this paper is twofold. First, the Gender Inequalities Index (GII) is built through a new methodology using Multiple Correspondence Analysis (MCA), which determines endogenously the weight of each variable. The GII avoids comparison between countries and ranking. Second, the GII is used to study the relationship between gender inequalities and economic growth using seemingly unrelated regressions. Results show large variations between regions: South Asia has the worst score with an average of 0.63, Sub-Saharan Africa and Middle East and North Africa follow with an average of 0.48 and 0.46 respectively. These situations lead to reducing the potential growth rate by 4% in South Asia and 3% in Sub-Saharan Africa and Middle East and North Africa countries. --
    Keywords: Composite index,gender inequality,development economics
    JEL: J16 O11 O57 C43
    Date: 2010
  19. By: Gloede, Oliver; Ornsiri Rungruxsirivorn
    Abstract: We provide new micro evidence on the discussion about the relation- ship between financial development and welfare. Relying on the concept of local financial development our analysis focuses on three dimensions of household welfare: vulnerability to poverty, investment, and consumption smoothing. Even though we cannot find a significant effect on vulnerability, we provide evidence that financial development is correlated with higher investment and better possibilities to smooth consumption. The extent of both effects is also economically significant. Our results hold for alternative specifications and variations in the measurement of financial development. --
    Keywords: financial development,credit rationing,vulnerability,consumption smoothing,investment,poverty,growth
    JEL: O16 O17 G21
    Date: 2010
  20. By: Harttgen, Kenneth; Klasen, Stephan
    Abstract: One of the most serious weaknesses of the human development index (HDI) is that it considers only average achievements and does not take into account the distribution of human development within a country or by population subgroups. All previous attempts to capture inequality in the HDI have also used aggregate information and there exists no HDI at the household level. This paper provides a method and illustration for calculating the HDI at the household level. This immediately allows the analysis of the HDI by any kind of population subgroups and by household socioeconomic characteristics. Furthermore, it allows to apply any kind of inequality measure to the HDI across population subgroups and over time. We illustrate our approach for 15 developing countries. Inequality in the HDI is largest in poorer countries, particularly in Sub-Saharan Africa. We also find large inequalities within countries between population subgroups, particularly by income, location, and education of the household head. We also find considerable inequality when looking at inequality measures like the Theil or the Gini coefficient; within-group inequality is, however, invariably larger than between-group inequality and inequality in the HDI within countries is of similar order of magnitude of inequality in the HDI between countries. --
    Keywords: Human Development Index,Income Inequality,Differential Mortality,Inequality in Education
    JEL: I10 I20 I32 O10 O50
    Date: 2010
  21. By: Kemper, Niels; Klump, Rainer
    Abstract: This article evaluates the impact of land-use certificate (LUC) issuance on credit market outcomes of households in rural Vietnam. Given the absence of appropriate data for the creation of a baseline (e.g. for difference-in-difference estimation), we propose an alternative regression-based evaluation procedure hinging on two pivotal steps: Firstly, we express the covariates related to a change in LUC status in terms of the household specific economic, social and geographic environment at the time the change occurred. Secondly, we estimate the propensity score to account for systematic pretreatment differences between households in the observational data. Conditional on the propensity score, we estimate the causal effect of LUC status on borrowing outcomes. We find that LUCs have a strong positive effect on formal borrowing, while households without LUCs collect loans in the informal credit sector. --
    Keywords: Credit,consistency,land reform,program evaluation,Vietnam
    JEL: O16 C13
    Date: 2010
  22. By: Schürenberg-Frosch, Hannah
    Abstract: Investment in infrastructure is considered as a crucial prerequisite for economic development. Given the scarce resources for public investment in developing countries a detailed perspective on the effects of each form of infrastructure is needed. This paper focuses on transport infrastructure in Africa. The effects of better and longer roads are investigated in a theoretical model, an empirical setup and in a Computable General Equilibrium (CGS) model. The effects on production, consumption and income distribution are shown. Most importantly the model is used to investigate the effect of roads on the economic participation of rural households. The presented CGE model may be used as a toolkit for the investigation of different policy scenarios concerning the type and volume of investment as well as the possible financing alternatives. Robustness checks show that in order to prevent reliable quantitative results much more information is needed about the exact value of particular parameters in the model. --
    Keywords: Infrastructure,Computable General Equilibrium,Transport networks,Africa,rural development,subsistence agriculture
    JEL: O11 O55 R42
    Date: 2010
  23. By: Omar Mahmoud, Toman; Thiele, Rainer
    Abstract: --
    Keywords: HIV/AIDS,prime-age mortality,per-adult equivalent income,difference-in-difference,propensity score matching,spillovers,Zambia
    JEL: I31 J19 C14 C23
    Date: 2010
  24. By: Königer, Jens; Busse, Matthias; Koopmann,Georg
    Abstract: --
    Keywords: economic growth,development assistance,trade promotion
    JEL: F13 F43 C33
    Date: 2010
  25. By: Hardeweg, Bernd; Wagener, Andreas; Waibel, Hermann
    Abstract: Several measures of vulnerability to poverty have been suggested in the literature. In practise, only little is known about the robustness of vulnerability comparisons based on these often quite specific measures. The theory of stochastic orders can be applied to shed some light on such issues. In the DFG research project "Impact of Shocks on the Vulnerability to Poverty: Consequences for Development of Emerging Southeast Asian Economies" (DFG FOR 756), an extensive panel survey was carried out in six rural provinces of Thailand and Vietnam in 2007. We establish cumulative distribution functions for income and consumption at the provincial level and search for stochastic dominance relations between these distributions. Our comparisons allow for initial, but quite robust conclusions on welfare and provide benchmarks for assessing the vulnerability to poverty in the research regions. --
    Keywords: welfare distribution,stochastic ordering,vulnerability
    JEL: D31 I32 O15
    Date: 2010
  26. By: Strulik, Holger; Vollmer, Sebastian
    Abstract: In this paper we analyze the distribution of fertility rates across the world using parametric mixture models. We demonstrate the existence of twin peaks and the division of the world's countries in two distinct components: a high-fertility regime and a low fertility regime. Whereas the significance of twin peaks vanishes over time, the two fertility regimes continue to exists over the whole observation period. In 1950 about two thirds of the world's countries belonged to the high-fertility regime and the rest constituted the low-fertility regime. By the year 2005 this picture has reversed. Within both the low- and the high-fertility regime the average fertility rate declined, with a larger absolute decline within the high-fertility regime. Visually, the two peaks moved closer together. For the low fertility-group we find both ?- and ?- convergence but we cannot establish any convergence pattern for the high fertility regime. Overall our findings are difficult to reconcile with the standard view of a fertility trap but they support the differentiated take-off view established in the Unified Growth literature. --
    Keywords: Fertility,Convergence,Twin Peaks,Fertility Regimes,Unified Growth
    Date: 2010
  27. By: Susmita Roy (University of Canterbury)
    Abstract: This study addresses the following questions in the context of a developing coun- try. Do crimes increase following natural disasters? Does an upcoming election or the presence of a strong local media, which potentially increases the incentive of the gov- ernment to provide disaster relief, mitigate the eect of disasters on crime rates? I nd that crime rates tend to increase following moderate to big disasters. Furthermore, a higher pre-disaster growth of newspapers has a mitigating eect on the crime response to disasters. Elections also in uence the crime response to disasters. Crimes are more likely to rise following disasters in the years that are close to an election year.
    Keywords: crime rate; natural disaster; role of media and elections; developing country
    JEL: Q54 K42
    Date: 2010–09–14
  28. By: Sajeda Amin; S. Chandrasekhar
    Abstract: This paper addresses gender equity in parents‘ educational investments in children in a context of rising school attendance in rural Bangladesh. Our premise is that in addition to factors such as school enrollment and aspects of school quality, attention should focus on household level private investments in education. By private investments we mean time allocated to studying at home and access to private tutoring after school. Using data from the nationally representative 2005 Bangladesh Adolescent Survey, we analyze correlates of time spent in school, studying outside school, and work, using a data set on time-use patterns of school-going children and adolescents. We find that time spent in work varies inversely with the amount of time spent studying at home, while time at school shows no such association. We find support for two hypotheses regarding household influences on education. First, time spent in school is insensitive to factors such as poverty and gender. Second, time spent studying outside school is strongly influenced by household decisions that favor boys, who appear to have about 30 minutes more discretionary study time than girls. [Working Paper No. 17]
    Keywords: gender, parents, education, investments, bangladesh, private investment,
    Date: 2010
  29. By: Government of India Ministry of Women and Child Development
    Abstract: Nineteen per cent of world’s children live in India. India is home to more than one billion people, of which 42 per cent are children, defined as persons under 18 years of age. In international comparisons of the status and condition of children, India continues to rank poorly on several key counts. The world’s tenth largest economy unfortunately ranks 127 on the Human Development Index (HDI). If all child rights indicators were to become a critical measure for HDI, India would fare even worse, because of its low levels of achievement on accepted national goals for the survival, development and protection of its children.
    Keywords: India, children, international comparisons, Human Development Index (HDI), survival, development, protection
    Date: 2010
  30. By: Rashmi Banga; Pritish Kumar Sahu
    Abstract: This study undertakes impact analysis of remittances on poverty in developing countries at two levels. Firstly, it estimates the impact of remittances on poverty in 77 developing countries; Secondly, separate analyses are undertaken for 29 developing countries and 21 Asian developing counties, which have 5 per cent or more share of remittances in GDP.
    Keywords: remittances, development,Poverty Headcount ratios, PPP, international migration, political, economic, cultural, GDP, Asian countries, developing, poverty,
    Date: 2010
  31. By: Ferreira , Francisco H. G.
    Abstract: The joint determination of aggregate economic growth and distributional change has been studied empirically from at least three different perspectives. A macroeconomic approach that relies on cross-country data on poverty, inequality, and growth rates has generated some interesting stylized facts about the correlations between these variables, but has not shed much light on the underlying determinants."Meso-"and microeconomic approaches have fared somewhat better. The microeconomic approach, in particular, builds on the observation that growth, changes in poverty, and changes in inequality are simply different aggregations of information on the incidence of economic growth along the income distribution. This paper reviews the evolution of attempts to understand the nature of growth incidence curves, from the statistical decompositions associated with generalizations of the Oaxaca-Blinder method, to more recent efforts to generate"economically consistent"counterfactuals, drawing on structural, reduced-form, and computable general equilibrium models.
    Keywords: Rural Poverty Reduction,Achieving Shared Growth,Inequality,Services&Transfers to Poor,Economic Theory&Research
    Date: 2010–09–01
  32. By: Francisco Gallego.
    Abstract: The evolution of the skill premium (i.e., the wage di erential between skilled and unskilled workers) has interest from at least two perspectives: it is a rough measure of inequality among workers of different quali cations and provides information on the characteristics of the development process of the economy. In this paper, I investigate empirically the evolution of the skill premium in Chile over the last 40 years. After some fuctuations in the 1960s and 1970s, the skill premium increased in the 1980s and has remained roughly constant since then. The data suggest that this evolution is an outcome of a signi cant increase in relative demand for skilled workers in the 1980s and 1990s and a sizeable increase in the relative supply in the 1990s. Sectoral evidence shows that, after controlling for sector and time e ects, (i) the relative demand increased faster in the same industries in Chile than in the US and (ii) the correlation is stronger for tradable industries and non-tradable industries that are intensive in imported capital, as expected. This result is consistent with a number of theories that link skill upgrading in developed and developing countries. To try to disentangle among these theories, I present time series evidence suggesting that, after controlling for other determinants of skill premium, not only there is a positive correlation between skill premium in Chile and in the US but also the size of the correlation is consistent with the Acemoglu (2003a) model of endogenous technological choice in which new technologies are produced in developed countries (like the US) and adopted in developing economies (like Chile).
    Keywords: Wage premium, Skill Change, Chile
    JEL: O3 J31
    Date: 2010
  33. By: Daniel Halter; Manuel Oechslin; Josef Zweimüller
    Abstract: The empirical literature on the relationship between inequality and growth offers a contradictory assessment: Estimators based on time-series (differences-based) variation indicate a strong positive link while estimators (also) exploiting the cross-sectional (levelbased) variation suggest a negative relationship. Using an expanded dataset, the presentpaper confirms this conflicting pattern — and reconciles it on the basis of a simple model. We argue that the differences-based methods are prone to reflect the mostly positive shortor medium-run implications of inequality while the level-based estimators also incorporate more negative long-term consequences. Thus, the latter estimates come close to reflecting the adverse overall impact of inequality in the long run.
    Keywords: Inequality, growth, medium-run effects, long-run effects
    JEL: O11 O15 O43 C23
    Date: 2010–09
  34. By: Manabu Fujimura; Ramesh Adhikari (Asian Development Bank Institute)
    Abstract: This paper attempts to fill gaps faced by policymakers and practitioners in the evaluation of cross-border infrastructure projects. It first defines what constitutes cross-border infrastructure projects, and then outlines an analytical framework and criteria to evaluate them. The criteria identify additionalities and externalities specific to cross-border infrastructure projects that need to be stressed in covering broader and indirect impacts that are not usually captured in the analysis of national projects. Then the paper examines to what extent the defined criteria are applicable in evaluating recent cross-border infrastructure projects. It also reports on emerging impacts patterns evidenced in relevant studies. The paper draws lessons and implications for design and implementation of cross- border infrastructure projects.
    Keywords: cross-border infrastructure, additionalities, externalities
    JEL: H41 O22
    Date: 2010
  35. By: John Gilbert; Nilanjan Banik (Asian Development Bank Institute)
    Abstract: Although the overall economic performance of economies in South Asia in recent years has been impressive, there is concern that an aging and increasingly inadequate infrastructure may limit the potential for further growth and economic development. A critical infrastructure component is the transportation network, and there are currently several transportation infrastructure projects in the South Asia Subregional Economic Cooperation (SASEC) region, connecting Nepal, eastern India, Bangladesh, and Bhutan. This paper uses computable general equilibrium (CGE) methods to address how these infrastructure developments might affect the broader economy in SASEC, and in particular impact on income distribution and poverty. The paper describes a new CGE model for South Asia, covering India, Sri Lanka, Bangladesh, Nepal, and Pakistan, which incorporates modifications to household structure in order to capture the implications of reform for changes in intra-household income. The scenarios that are considered reflect proposed investments in land transport infrastructure in the SASEC region. These should result in reductions in the land transport component of international transport margins, which vary bilaterally by commodity. We found that all SASEC economies would benefit from the reductions in terms of aggregate welfare, with the largest gains accruing to India in absolute terms, but the largest relative gains to Nepal, followed by Bangladesh and Sri Lanka when the margin reduction is prorated to intra-South Asian trade rather than just SASEC. In terms of household level distribution, the picture was mixed, with clearly pro-poor outcomes in some countries, such as Nepal, but more ambiguous impacts in others. In terms of potential adjustment costs, examination of the extent of predicted structural changes suggests that these would be minor, although somewhat more significant for the smaller economies in the region.
    Keywords: South Asia Subregional Economic Cooperation, SASEC, South Asia, computable general equilibrium, infrastructure, structural changes
    JEL: F14 F17 D58 O53
    Date: 2010
  36. By: Masood Sarwar Awan; Nasir Iqbal (Pakistan Institute of Development Economics)
    Abstract: Urban poverty, which is distinct from rural poverty due to demographic, economic and political aspects remain hitherto unexplored, at the city level in Pakistan. We have examined the determinants of urban poverty in Sargodha, a medium-size city of Pakistan. The analysis is based on the survey of 330 households. Results suggest that employment in public sector, investment in human capital and access to public amenities reduce poverty while employment in informal sector, greater household size and female dominated households increase poverty. We recommend greater investment in human capital and public amenities as a strategy for poverty alleviation.
    Keywords: Urban Poverty, Pakistan
    JEL: I31 I32 R20
    Date: 2010
  37. By: Shahnaz Hamid (Pakistan Institute of Development Economics)
    Abstract: This paper analyses gender dimensions in rural to urban migration (age 10 years and above) in Pakistan. The study is based on Labour Force Surveys 1996-2006. The findings of the study show that overtime internal migration (age 10 years and above) remained unchanged. Female migrants dominate in internal migration (age 10 years and above). In case of female migration, marriage plays a vital role. Further the direction of migration reveals that over time in internal migration the share of rural to urban migration has increased while urban to urban migration declined, however, the share of urban to urban migration remains highest in internal migration. Females are dominating in recent rural to urban move compared to long term and total rural to urban migration. Gender composition of intra-provincial move of rural to urban migration reveals that in all provinces female migrants are dominated. Further, the trend of intra and inter provincial move indicates that in all provinces long distance movement of females has increased. Not only the share of female migrant in rural to urban migration increased but there seems to be an increasing trend in family migration to cities. This seems to be due to the changes in agrarian structure and rural economy particularly increased in landless households, declined in share cropping and rise in small land holding. In addition to this , the trend in intra and inter-provincial move reveals that except in province of NWFP in all three provinces migration to long distance has an upward trend. Gender composition reveals that in all these three provinces the proportion of both male and female migrants increased over time.
    Keywords: Rural to Urban Migration, Agrarian Structure
    JEL: R23 Q00
    Date: 2010
  38. By: Wang Dewen (Asian Development Bank Institute)
    Abstract: This paper reviews the development of the social security system and trends in the urban labor market in the People’s Republic of China (PRC). Despite its remarkable economic achievement, the PRC faces a difficult path before it can reform and improve its social security system and provide basic support for all of its people. The unemployment shock has caused rural and urban household income to decrease and has thus slowed down household consumption growth. The provision of broader social security would not only mitigate unemployment shocks in the short term, but it would also guarantee individuals and households more security for spending that could reduce the high savings rate and help achieve a balanced growth path in the long run. The author’s findings argue that households with social security coverage spend more and income distribution among urban households is improved through public transfers.
    Keywords: People's Republic of China, social security, unemployment shock, savings rate
    JEL: D12 H55 J26 D63
    Date: 2010
  39. By: Larrú, José María
    Abstract: The paper carries out a deep case study of the international aid that Equatorial Guinea receives. This is an extremely interesting country because, not being a failed state, it presents very low indexes in institutional quality. Its oil richness, which began to be exploited by foreign investors in 1996, has meant a structural change of extraordinary interest without the traditional effects of Dutch disease. While in 1989 the country financed 54% of its GDP with ODA, in 1996 this ratio represented only 22% and nowadays barely reaches 0.5% thanks to the enormous growth of foreign investment. The article analyses empirically the predictability of the ODA flows -mainly composed of Spanish funds-, their stability, cyclical behaviour and stabilizing effect on the GDP. The main findings of the study are that the ODA has been a hardly predictable, relatively stable, counter-cyclical flow and that it does have a stabilizing effect on its product. The FDI (Direct Foreign Investment), on the other hand is much more volatile and pro-cyclical, although it shares the stabilizing effect of the ODA. For every million dollars of the FDI, GDP grew 0.1%. Development aid, on the contrary, doesn’t have a statistically significant impact if we consider the time period 1985-2006. But it does in 1985-1995. Every additional million dollars of ODA made the GDP grow 1.3%. The sectoral analysis of ODA revealed that more than 80% of Spanish aid has been invested in social services, especially education (46%) and healthcare (26%), carried out by two NGOs that somehow became accomplices of the social underdevelopment that the Guinean government maintains since its independence. The article concludes with some ideas on how to improve the quality of Spanish ODA, especially proposing a deadline for the aid and a result-based conditionality, like the Aid Efficiency Agenda of Accra suggests.
    Keywords: development aid; Dutch disease; stabilization; evaluation; results; volatility
    JEL: F35 F59
    Date: 2010–09
  40. By: Pisani, Elena
    Abstract: A recent transition in the field of agrarian economics theory for rural development is the move from a narrow agricultural sector approach, to one which adopts broader territorial vision. This passage seeks to interpret interactions between urban and rural worlds in a more comprehensive manner.This relatively new theoretical perspective is of particular interest to academics and politicians in Latin American countries where, since the mid 1990s, the concept of new rurality has been seen as the source of a new approach to rural development. Therefore the theoretical purpose of this research is to clarify the analytical signposts of the new rurality theme in Latin America and to identify the differences between sectoral and territorial approaches considering the socio-economic, institutional and environmental aspects involved. The transition from sectoral to territorial approaches also means, from an operative point of view, the recognition of homogeneous areas for the suggestion of rural development strategies. The operative purpose of this research consists in proposing a methodology to identify these areas with an application in the Maule Region in Chile. The conclusion underlines some critical elements that should be considered in the definition of territorial rural development strategies.
    Keywords: sectoral and territorial approaches; rural development policy; new rurality; Latin America; Chile; cluster analysis
    JEL: R58 O54 R11
    Date: 2010
  41. By: Doan, Tinh; John, Gibson
    Abstract: A common phenomenon about transition economies is that the return to schooling improves as economic reform progresses. Existing research suggests that Vietnam is not an exception to the pattern. However, the rate of return in period from 1992 to 1998 is still relatively low, below 5 percent, relative to that of the world and other transitional economies. And it is hard to see a clear trend in the current literature due to different methods applied and sets of variables controlled in the earnings equations (see Appendix B). The low returns may result from the gradual economic reforms applied in Vietnam, whilst in Eastern European countries the “Big Bang” transformation was conducted. Therefore, to test whether the return to schooling in Vietnam is rising and reaches other transitional economies’ rate of returns, we re-examine the trend in the rate of return to schooling in Vietnam over the 1998-2008 period, when the reforms have had a longer time to have an effect. We apply the OLS and Heckman selection estimator (Maximum Likelihood approach) and find that the return has increased quickly during the later economic reform but its pace has slowed down when the return reached the global average rate of returns at somewhere between 9 and 10 percent.
    Keywords: economic transition; returns to schooling; Vietnam
    JEL: J31 O15
    Date: 2010–04–21
  42. By: Kouni, Mohamed
    Abstract: In this paper we study the net effect of high-skilled emigration. Hence, we elaborate a simple theoretical model that studies the net effect of high-skilled emigration. The result showed that the emigration in the case where the fraction of human capital that emigrates is inferior to the critical level (equal to the difference between one and the elasticity of brain gain with respect to emigration), as well as in the case of the strong selectivity adopted, the emigration has the possibility to create a quantitative and qualitative brain gain. Indeed, to determine the net effect of brain drain we propose a new method that decomposes the gross investment of human capital into two components: the net domestic incentive effect and the net quantitative brain drain effect. Through This decomposition we can determine the net quantitative effect that arrives from the interior situation and the one arriving from the prospects effect. Finally, we tempt to define the indicator of the qualitative effect of this phenomenon. The empirical results showed that the emigration has an important effect on the human capital investment. Thus, the majority of countries have the possibility to register a net quantitative gain. Nevertheless, little of countries only have the possibility to record a qualitative brain gain.
    Keywords: Brain drain; human capital; development
    JEL: O15
    Date: 2010–09–17

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