nep-dev New Economics Papers
on Development
Issue of 2011‒01‒30
sixteen papers chosen by
Mark Lee
Towson University

  1. Self-Employment and Conflict in Colombia By Carlos Bozzoli; Tilman Brück; NIna Wald
  2. Finance and Growth in Africa: The Broken Link By Panicos O. Demetriades; Gregory A. James
  3. Women’s Labor Force Participation and Childcare Choices in Urban China during the Economic Transition By Fenglian Du; Xiao-yuan Dong
  4. Is it really different? Patterns of regionalisation in the post-Soviet Central Asia By Libman, Alexander; Vinokurov, Evgeny
  5. The Impact of Agricultural Technology Adaption on Income Inequality in Rural China By Shijun Ding; Laura Meriluoto; W. Robert Reed; Dayun Tao; Haitao Wu
  6. Empowering women : the effect of women's decision-making power on reproductive health services uptake -- evidence from Pakistan By Hou, Xiaohui; Ma, Ning
  7. Equity and public governance in health system reform : challenges and opportunities for China By Brixi, Hana; Mu, Yan; Targa, Beatrice; Hipgrave, David
  8. Employment Vulnerability and Earnings in Urban West Africa. By Bocquier, Philippe; Nordman, Christophe J.; Vescovo, Aude
  9. EDUCATION AND LABOUR MARKET OUTCOMES: EVIDENCE FROM INDIA By Geraint Johnes; Aradhna Aggarwal; Ricardo Freguglia; Gisele Spricigo
  10. Inequality in Developing Economies: The Role of Institutional Development By AMENDOLA, Adalgiso; EASAW, Joshy; SAVOIA, Antonio
  11. Government Size and Macroeconomic Stability: Sub-National Evidence from China By Li, Cheng
  12. Does credit improve the food consumption vulnerability of the extreme poor? - Empirical evidence from Bangladesh By Hasan, Mohammad Monirul
  13. On the Sustainability of India’s Non-Inclusive High Growth By Mazumdar, Surajit
  14. Big Business and Economic Nationalism in India. By Mazumdar, Surajit
  15. Dwindling access to basic services in Zimbabwe By Makochekanwa, Albert; Kwaramba, Marko
  16. Trade Costs and Economic Development By Michele Fratianni; Francesco Marchionne

  1. By: Carlos Bozzoli; Tilman Brück; NIna Wald
    Abstract: Many Colombians are confronted with the ongoing conflict that influences their decision making in everyday life, including their behavior in labor markets. This study focuses on the impact of violent conflict on self-employment, enlarging the usual determinants with a set of conflict variables. In order to estimate the effect of conflict on self-employment, we employ fixed effects estimation. Three datasets are combined for estimation: the Familias en Acción dataset delivers information about individuals, a second dataset contains different indicators of the Colombian conflict at the municipality level and the third dataset includes taxes to measure a municipality's economic situation. Our results show that high homicide and displacement rates in the community of origin reduces self-employment, while a high influx of displaced increases the probability of self-employment in the destination municipality.
    Keywords: Self-employment, civil conflict, rural labor markets, Colombia
    JEL: C23 J16 J24 O10
    Date: 2011
  2. By: Panicos O. Demetriades; Gregory A. James
    Abstract: Utilizing the latest panel cointegration methods we provide new empirical evidence from 18 countries that suggests that the link between finance and growth in Sub-Saharan Africa is ‘broken’. Specifically, our findings suggest that banking system development in this region follows economic growth. They also indicate that there is no link between bank credit and economic growth.
    Keywords: Panel cointegration; cross-sectional dependence; African financial under-development; African credit markets
    JEL: G21 O16
    Date: 2011–01
  3. By: Fenglian Du; Xiao-yuan Dong
    Abstract: China’s transition from a centrally planned to a market economy has substantially eroded governmental support for childcare. This paper examines the labor force participation and childcare choices of urban Chinese women during the economic transition and explores the distributional implications of childcare reform. The analysis shows that following child care reform, access to informal caregivers became increasingly critical for women’s labor force participation. The rise of women’s dependence on informal caregivers apparently accounted for much of the decline in women’s labor force participation during the period from 1997 to 2006. In effect, child care reform heightened the tensions between income earning and child rearing for women who had no access to informal care providers and also could not afford to use formal care services.
    JEL: H31 J13 J16 J22
    Date: 2010–10
  4. By: Libman, Alexander; Vinokurov, Evgeny
    Abstract: While the regional economic integration encompassing the former Soviet Union (FSU) transpires to be inefficient, there appears to be a stronger interest in regionalism in smaller groups of more homogenous and geographically connected countries of the region, specifically, Central Asia. Using a new dataset, we find that although the economic links between the Central Asian countries are more pronounced than between that of the CIS in several key areas, this advantage has been disappearing fast over the last decade. In addition, the trend of economic integration of Central Asia strongly correlates to that of the CIS in general. Currently Central Asia should be treated as a sub-region of the post-Soviet world rather than a definite integration region.On the other hand, however, we find that Kazakhstan emerges as a new centre for regional integration, which can bear some potential for regionalism in Central Asia, and that there is an increasing trend towards greater economic interconnections with China in Central Asia. --
    Keywords: regionalisation,economic integration,post-Soviet space,Central Asia
    JEL: F13 F15 P27
    Date: 2010
  5. By: Shijun Ding; Laura Meriluoto (University of Canterbury); W. Robert Reed (University of Canterbury); Dayun Tao; Haitao Wu
    Abstract: This study analyzes the impact on income inequality of government efforts to increase agricultural incomes in rural China. It collects and analyzes survey data from 473 households in Yunnan, China in 2004. In particular, it investigates the effects of government efforts to promote improved upland rice technologies. Our analysis shows that farmers who adopted these technologies had incomes approximately 15 percent higher than non-adopters. Despite this relatively large increase, we estimate that the impact on income inequality was relatively slight. This is primarily due to the fact that lower-income farmers adopted the improved rice technology at rates that were roughly equivalent to those of higher-income farmers.
    Keywords: Rural economic development; Chinese economic development; upland rice; rural-urban income inequality; agricultural income policy
    JEL: O13 O18 O53 Q12
    Date: 2011–01–13
  6. By: Hou, Xiaohui; Ma, Ning
    Abstract: A large body of research has attempted to explore the links between women's autonomy and their uptake of reproductive health services in the South Asia region, but the evidence so far is inconclusive. This study uses the Pakistan Social and Living Standards Measurement Survey to examine the influence of household decision making on women's uptake of reproductive health services. The analysis finds that women's decision-making power has a significant positive correlation with reproductive health services uptake and that influential males'decision-making power has the opposite effect, after controlling for socio-economic indicators and supply-side conditions. The findings suggest that empowering women and increasing their ability to make decisions may increase their uptake of reproductive health services. They also suggest that policies directed toward improving women's utilization of maternity services must target men as well as women in Pakistan.
    Keywords: Health Monitoring&Evaluation,Population Policies,Adolescent Health,Gender and Health,Health Systems Development&Reform
    Date: 2011–01–01
  7. By: Brixi, Hana; Mu, Yan; Targa, Beatrice; Hipgrave, David
    Abstract: Achieving the objective of China's current health system reform, namely equitable improvements in health outcomes, will be difficult not least because of the continuously growing income disparities in the country. The analysis in this paper shows that since 2000, disparity in selected health outcomes has been declining across provinces, largely due to earmarked central government allocations. By contrast, public expenditure on health is increasingly regressive (positively correlated with local income per capita) across provinces, and across prefectures and lower levels within provinces. The increasing inequity in public expenditure at sub-national levels indicates that incentives, responsibilities, and resources at sub-national levels are not well aligned with China's national priorities. To address the weaknesses in equity and efficiency that characterize China's health system and health outcomes, China's health system reform may require complementary reforms to improve governance for public service delivery across sectors.
    Keywords: Health Monitoring&Evaluation,Population Policies,Public Sector Economics,Health Systems Development&Reform,Health Economics&Finance
    Date: 2011–01–01
  8. By: Bocquier, Philippe; Nordman, Christophe J.; Vescovo, Aude
    Abstract: This article develops indicators of vulnerability in employment in seven economic capitals of West Africa and studies their links with individual incomes. Quantitative, distributional and qualitative analyses show that vulnerability compensating mechanism is mainly seen in the informal sector, in the upper tail of the earnings distribution and particularly in the circumstance of visible underemployment. Employment vulnerability is not compensated for the poorest workers in the private sector. Long “job queues” and weak institutional protection of workers may have reduced bargaining power in the formal sector.
    Keywords: Afrique de l'Ouest; West Africa; secteur informel; revenus; différentiels compensatoires; conditions de travail; vulnérabilité; vulnerability; working conditions; compensating differentials; earnings; informal sector;
    JEL: O12 J31 J24
    Date: 2010
  9. By: Geraint Johnes; Aradhna Aggarwal; Ricardo Freguglia; Gisele Spricigo
    Abstract: The impact of education on labour market outcomes is analysed using data from various rounds of the National Sample Survey of India. Occupational destination is examined using both multinomial logit analyses and structural dynamic discrete choice modelling. The latter approach involves the use of a novel approach to constructing a pseudo-panel from repeated cross-section data, and is particularly useful as a means of evaluating policy impacts over time. We find that policy to expand educational provision leads initially to an increased takeup of education, and in the longer term leads to an increased propensity for workers to enter non-manual employment.
    Keywords: occupation, education, development
    Date: 2011
  10. By: AMENDOLA, Adalgiso (CELPE (Centre of Labour Economics and Economic Policy), University of Salerno, Italy); EASAW, Joshy (Department of Economics, University of Bath); SAVOIA, Antonio (University of Exeter Business School)
    Abstract: This paper studies the distributive impact of institutional change in developing countries. In such economies, economic institutions, such as property rights systems, may act to preserve the interests of an influential minority, but this depends crucially on the level of political equality. For example, dominant classes can control key-markets, access to assets and investment opportunities, especially if they enjoy disproportionate political power. We test this hypothesis using cross-section and panel data methods on a sample of low- and middle-income economies from Africa, Asia and Latin America. Results suggest that: (a) increasing the protection of property rights increases income inequality; (b) such an effect is larger in low-democracy environments; (c) a minority of countries have developed a set political institutions capable of counterbalancing this effect.
    Keywords: inequality; developing economies; institutions; property rights; democracy
    JEL: D70 O15 O17
    Date: 2011–01–18
  11. By: Li, Cheng
    Abstract: Both theoretical predictions of Keynesian view and a large body of empirical studies on developed countries suggest that business cycle fluctuations can be partially smoothed by counter-cyclical fiscal policies. Our paper extends this strand of literature by considering the nexus between output fluctuations and government size in the context of Chinese fiscal federalism. Using a sample of 29 Chinese provinces for the period of 1994-2007, we fail to provide consistent evidence for the stabilizing effect of fiscal policies. In particular, we find that under the tax assignment system (fen shui zhi), neither the central government’s fiscal transfers nor the provincial budgetary and extra-budgetary revenues help reduce economic volatility. Such results are shown to be robust across different model specifications, volatility measures and estimation techniques.
    Keywords: business cycles; government size; fiscal federalism; China
    JEL: E62 E32 H5
    Date: 2010
  12. By: Hasan, Mohammad Monirul
    Abstract: This paper examines the extent of seasonal hunger and its food consumption vulnerability among rural households in the North West part of Bangladesh (i.e., the greater Rangpur region) and whether the Programmed Initiative for Monga Eradication or PRIME interventions (such as flexible micro-credit, Emergency loan and cash for work) have some positive impact for improving the consumption ordering of monga affected households or not. Seasonal hunger, also known as monga in greater Rangpur, is caused by a deprivation of food during certain months of the year when households do not have adequate employment, income, and savings. That is, monga is an ex post measure of seasonal deprivation of food. However, for policymaking purpose, knowing who are going to be in seasonal hunger in future is more important than knowing who already are. This ex post measure of seasonal food deprivation through the changes in consumption ordering in two years- 2008 and 2007 can be defined as food consumption vulnerability. That is, vulnerability to seasonal hunger is the likelihood of remaining in or falling into seasonal hunger. Households smooth consumption via income smoothing and other measures, which also reduce their vulnerability to monga. When consumption smoothing does not happen for one reason or another, food deprivation is sure to follow.
    Keywords: Poverty; Microfinance; Impact Analysis; Food Consumption Vulnerability;
    JEL: I31 C23 O22 R51 R2 C33 I32
    Date: 2010–09
  13. By: Mazumdar, Surajit
    Abstract: Abstract: This paper examines the sustainability of the unprecedentedly high aggregate GDP growth witnessed in India from 2003-04 till the eruption of the global crisis. It argues that the post-liberalization highly non-inclusive and corporate-sector led growth trajectory in India suffers from a fundamental contradiction which renders it inherently unstable. This contradiction is between increasing dependence of growth on investment demand and the absence of a commensurate expansion of either output or employment in organized manufacturing, the main sector where rapid growth of capital formation tends to be relatively concentrated. This had already generated a collapse of investment and a manufacturing centered growth slowdown in the second half of the 1990s. The paper shows that high growth in India after 2003-04 did not eliminate this contradiction. Instead, the transmission effects generated by an exceptionally expansionary phase of the global economy enabled a sharp revival of investment which generated this growth, but in the process the contradiction started surfacing again. With the global crisis this phase came to an end, and in the post-crisis situation revival of that growth trajectory appears unlikely. In such circumstances even modest gains on the development front from via the positive effects of high growth on public revenues cannot be guaranteed.
    Keywords: India; Corporate Investment; Non-Inclusive Growth
    JEL: O11 O53
    Date: 2010–12
  14. By: Mazumdar, Surajit
    Abstract: Abstract: This paper emphasizes that economic nationalism in India both contributed to and coexists with the liberalization process initiated since 1991, which marked a decisive break in India’s economic policy and pushed her towards increased integration with the global economy. It is however an inherently more exclusive form of economic nationalism in which capitalist priorities press down harder on an already constrained state. India’s capitalists embraced rather than resisted the liberalization process, in contrast to their active support for a strategy of autonomous development at independence. The paper focuses on this shift in the outlook of the capitalist class represented by India’s big business and tries to identify the reasons why it initially emerged and why it has gathered strength over time. The paper argues that this transformation reflected the development and evolution of Indian capitalism resulting from industrialization under the older autonomous strategy. Embracing liberalization became both possible and necessary for India’s capitalists. The shift in the Indian state’s policy thus was a response to the imperatives of national capitalist development, and the state has continued to assist Indian capital’s growth and development in different ways. Indian capital has in fact gained increased leverage with the state and with its support has grown rapidly and stepped on to the global stage. In the process it has also changed – become less industrial, and more integrated into global production and financial systems. This growth and transformation of Indian big business in turn has reinforced its support for liberalization.
    Keywords: Big Business; Economic Nationalism; India
    JEL: F52 G38 P16
    Date: 2010–09
  15. By: Makochekanwa, Albert; Kwaramba, Marko
    Abstract: The study narrates the decline in access to three basic publicly provided services, namely, health, education, and water and sanitation for Zimbabwe for the period covering 2000 to May 2009. Special emphasis is placed on the impact of fiscal fragility on the ability of the government to provide these services. Through interviews and newspaper articles, the research found that, for the period under study, very few Zimbabweans residing in the country were able to access these basic services because they were not supplied in sufficient amounts, were not supplied at all, or were exorbitantly priced.
    Keywords: fiscal fragility; health; education; water and sanitation
    JEL: O11
    Date: 2010–03–08
  16. By: Michele Fratianni (Department of Business Economics and Public Policy, Indiana University Kelley School of Business); Francesco Marchionne (Universita Politecnica delle Marche)
    Abstract: We test the hypothesis of the circular causality between trade costs and degree of economic development using data on Italian provinces. Using different methods to control for multilateral resistance, we apply a gravity equation to estimate sectoral exports to 188 countries over the period 1995-2004. Provincial trade costs are constructed as the sum of five province-specific elasticities, including distance, adjacency, and common money. We find that Italian provinces are heterogeneous with respect to trade costs. These costs are influenced by lagged provincial per capita income and industrial structure. In turn, trade costs influence future provincial per capita income. This two-way relationship between trade costs and income is broadly consistent with the cumulative causation process emphasized by the New Economic Geography.
    Keywords: trade costs, heterogeneity, economic development, gravity equation
    JEL: F10 F14 O52 R12
    Date: 2010–12

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