|
on Development |
| By: | Vianney Dequiedt (Universit´ e d’Auvergne); Yves Zenou (Stockholm University, IFN, and CEPR) |
| Abstract: | We consider a model of international migration where skills of workers are imperfectly observed by firms in the host country and where information asymmetries are more severe for immigrants than for natives. There are two stages. In the first one, workers in the South decide whether to move and pay the migration costs. These costs are assumed to be sunk. In the second stage, firms offer wages to the immigrant and native workers who are in the country. Because of imperfect information, firms statistically dicriminate high-skilled migrants by paying them at their expected productivity. The decision of whether to migrate or not depends on the proportion of high-skilled workers among the migrants. The migration game exhibits strategic complementarities, which, because of standard coordination problems, lead to multiple equilibria. We characterize them and examine how international migration affects the income of individuals in sending and receiving countries, and of migrants themselves. We also analyze under which conditions there is positive or negative self-selection of migrants. |
| Keywords: | asymmetric information, screening, self-selection of migrants, skill-biased migration, wage differentials |
| JEL: | D82 J61 F22 O12 |
| Date: | 2011–06 |
| URL: | http://d.repec.org/n?u=RePEc:nor:wpaper:2011009&r=dev |
| By: | Tomasz Brodzicki (Faculty of Economics, University of Gdansk) |
| Abstract: | According to Crescezni and Rodriguez-Pose (2008) backward European regions should follow balanced strategies in which infrastructure development is coordinated with policies aimed at developing human capital and the innovative potential of regions. In order to asses their postulates we extend the analysis of Carstensen et al. (2009) further augmenting the neoclassical Solow Model to incorporate both Mincerian schooling externalities and infrastructure externalities in a single theoretical framework. Infrastructure is introduced into the model in a manner similar to Hicks-neutral technological change – potentially rising overall efficiency of economy. We do not assume ax ante the existence of positive externality. Solving the model we obtain a structural equation which is then econometrically tested in order to obtain estimates of both education and infrastructure externalities for a group of European states. Estimates for panel data model bring interesting results. Infrastructure and education externalities are both postitive and statistically significant. The education externality is however significantly stronger for CEE countries while infrastructure externality is not statistically significant for the same group of countries. |
| Keywords: | economic growth, human capital, infrastructure development, augmented Solow model |
| JEL: | O41 H52 H54 C21 C23 |
| Date: | 2011–06 |
| URL: | http://d.repec.org/n?u=RePEc:gda:wpaper:1101&r=dev |
| By: | Jack Joo K. Ree |
| Abstract: | The paper takes stock of the impact of the global financial crisis that began in late 2007 on banking sectors of Asian low-income countries, by exploring bank-level data provided by Bankscope. The paper examines three key channels of possible crisis spillovers: exposures to (i) valuation changes of mark-to-market financial assets, (ii) a drop in crossborder funding, and (iii) rises in NPLs prompted by international real economic linkages. The paper finds that despite relatively low financial integration, the impact of the crisis on LIC banks, particularly the largest ones, were not insignificant. Impacts were most palpable through a loan-to-crossborder funding nexus. |
| Keywords: | Asia , Banking sector , Credit risk , Economic models , Emerging markets , Financial crisis , Financial risk , Global Financial Crisis 2008-2009 , Low-income developing countries , Spillovers , |
| Date: | 2011–05–17 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:11/115&r=dev |
| By: | Ricardo Bebczuk; Arturo Galindo |
| Abstract: | Using a quarterly dataset of 185 listed firms in six Latin American countries between 1993 and 2009 we find that leverage is positively related to tangibility, firm size and the market to book ratio, and negatively related to profitability. The average cost of debt is negatively related with size, tangibility, firm growth, the leverage ratio, and the ratio of long- to short-term debt and positively to profitability. We find that the recent international crisis did not have a significant impact on the set of firms in our sample, but affected the way in which leverage and the interest to debt ratio relate to firm fundamentals. In particular we find that the links between leverage, tangibility and profitability were strengthened, and that financial constraints were not increased during the crisis.The evidence is consistent with a flight-to-quality phenomenon in favor of big, listed firms. |
| Keywords: | Corporate leverage, cost of debt, financial crisis, Latin America. |
| JEL: | F3 G3 O54 |
| Date: | 2011–05 |
| URL: | http://d.repec.org/n?u=RePEc:lap:wpaper:085&r=dev |
| By: | Dominguez-Torres, Carolina; Foster, Vivien |
| Abstract: | Between 2000 and 2005, infrastructure contributed less than 1 percentage point to the Central African Republic's annual per capita GDP growth, despite substantial spending in the road sector. Raising the country's infrastructure endowment to that of the region's middle-income countries could boost annual growth by about 3.5 percentage points. The CAR has made significant progress in the transport, water, power, and information and communications technology (ICT) sectors. But the high cost of fuel, which raises transportation and energy costs, has been a vexing issue across all infrastructure sectors. The CAR's most pressing infrastructural challenge lies in the transport sector, which relies heavily on neighboring countries and could benefit from improved road conditions and enhanced performance at the port of Douala in Cameroon. In the power sector, the country suffers from a deteriorating infrastructure stock that it can no longer afford to maintain, and an inefficient and unreliable power supply. Additional challenges include a need for improved infrastructure in the water and sanitation and ICT sectors. Addressing the CAR's infrastructure challenges will require sustained expenditure of $346 million per year over the next decade. The nation already spends around $134 million per year on infrastructure, with $37 million a year lost to inefficiencies of various kinds. If those inefficiencies were fully eliminated, the country's annual infrastructure funding gap would be $183 million per year. Improvements in funding, coupled with the prospect of an economic rebound and prudent policies, could lift the country from its fragile state back to and beyond the prosperity standards it once enjoyed. |
| Keywords: | Transport Economics Policy&Planning,Town Water Supply and Sanitation,Energy Production and Transportation,Infrastructure Economics,E-Business |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5697&r=dev |
| By: | Dominguez-Torres, Carolina; Foster, Vivien |
| Abstract: | Between 2000 and 2005 infrastructure made a net contribution of less than a third of a percentage point to the improved per capita growth performance of Niger, one of the lowest contributions in Sub-Saharan Africa. Raising the country's infrastructure endowment to that of the region’s middle-income countries could boost annual growth in Niger by about 4.5 percentage points. Niger has made significant progress in some areas of its infrastructure, including water and telecommunications. But the country still faces a number of important infrastructure challenges, the most pressing of which is probably in the water and sanitation sector, as 82 percent of Nigeriens still practice open defecation, the highest in the continent. Niger also faces significant challenges in the power sector, as only 8 percent of the population is electrified. Niger currently spends about $225 million per year on infrastructure, leaving an annual funding gap of $460 million even after savings from curing inefficiencies are taken into account. Niger can close that gap by tapping alternative sources of financing or by adopting lower-cost technologies. There is plenty of room for private-sector participation in Niger's infrastructure sectors, and the adoption of lower-cost technologies could reduce the funding gap by almost half. |
| Keywords: | Transport Economics Policy&Planning,Infrastructure Economics,Town Water Supply and Sanitation,Water Supply and Systems,Energy Production and Transportation |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5698&r=dev |
| By: | Briceno-Garmendia, Cecilia M.; Benitez, Daniel Alberto |
| Abstract: | Cape Verde stands out in West Africa as a country whose economic geography poses major and unique challenges for infrastructure development. Its small population of half a million people is spread across a nine-island archipelago. The islands need complementary infrastructure in terms of roads, water, transport, ports, power, and ICT. Cape Verde already has well-developed infrastructure networks. Road density is relatively high, and most of the national network is paved. Almost all islands have port and airport facilities. Around 70 percent of the population has power and utility water. Indicators for ICT coverage -- penetration, bandwidth, submarine cable, private sector participation -- are relatively good. Nevertheless, prices for all services are exceptionally high. The quality of services is often deficient. At least half of the national road network is in poor condition; power supply is unreliable; and half of the population receives water from standposts. Cape Verde devotes around $147 million per year to infrastructure (almost 15 percent of GDP), among the highest levels of infrastructure spending on the continent. Some $50 million of that is lost each year to operations inefficiencies and underpricing. The country's main challenges are to improve infrastructure management and reduce high costs of services. |
| Keywords: | Transport Economics Policy&Planning,Infrastructure Economics,Energy Production and Transportation,E-Business,Banks&Banking Reform |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5687&r=dev |
| By: | Otsuka, Keijiro; Sonobe, Tetsushi |
| Abstract: | The need to construct an effective strategy for industrial development in low-income countries has been largely ignored by development economists because industrial policies have failed in many developing countries. This does not imply, however, that industrial development cannot be promoted. This paper attempts to synthesize the conventional wisdom in development economics with recent advancements in various fields of economics (such as theories of endogenous growth and agglomeration economies) to provide a useful framework to design a strategy for industrial development, which consists of investments in managerial human capital followed by the provision of credit and the construction of industrial zones. |
| Keywords: | Economic Theory&Research,Labor Policies,ICT Policy and Strategies,Access to Finance,Political Economy |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5703&r=dev |
| By: | Leite, Phillippe; Narayan, Ambar; Skoufias, Emmanuel |
| Abstract: | This paper compares the ex ante simulation of the impacts of conditional cash transfer programs against the ex post estimates of impacts obtained from experimental evaluations. Using data on program-eligible households in treatment areas from the same baseline surveys that are used for experimental evaluations of conditional cash transfer programs in Mexico and Ecuador, the authors use a micro-simulation model to derive ex ante estimates of the impact of the programs on enrollment rates and poverty. The estimates reveal that ex ante predictions of certain impacts of conditional cash transfer programs match up well against the benchmark estimates of ex post experimental studies. The findings seem to support the use of this model to assess the potential impact and cost efficiency of a conditional cash transfer program ex ante, in order to inform decisions about how the program would be designed. |
| Keywords: | Poverty Monitoring&Analysis,Scientific Research&Science Parks,Science Education,Youth and Governance,Primary Education |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5705&r=dev |
| By: | Gine, Xavier; Mansuri, Ghazala |
| Abstract: | In many emerging democracies women are less likely to vote than men and, when they do vote, are more likely to follow the wishes of household males. The authors assess the impact of a voter awareness campaign on female turnout and candidate choice. Geographic clusters within villages were randomly assigned to treatment or control, and within treated clusters, some households were left untreated. Compared with women in control clusters, both treated and untreated women in treated clusters are 12 percentage points more likely to vote, and are also more likely to exercise independence in candidate choice, indicating large spillovers. Data from polling stations suggest that treating 10 women increased turnout by about 9 votes, resulting in a cost per vote of US$ 2.3. Finally, a 10 percent increase in the share of treated women at the polling station led to a 6 percent decrease in the share of votes of the winning party. |
| Keywords: | Population Policies,Parliamentary Government,Gender and Health,Gender and Law,Agricultural Knowledge&Information Systems |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5692&r=dev |
| By: | Jensen, Nathan M; Rahman, Aminur |
| Abstract: | Research on the economic consequences of corruption has been hampered by the inability to directly measure corruption. Using an innovative methodology that allows respondents to report individual experiences with corruption while minimizing self-incrimination and an objective diagnostic to evaluate lying (false responses), this paper explores the extent of business corruption in Bangladesh. The analysis shows that traditional measures of corruption underreport the extent of business corruption in Bangladesh and existing strategies to evaluate and elicit truthful responses have limited effectiveness. The authors identify the types of firms that are associated with false responses and nonresponses to survey questions on corruption. |
| Keywords: | Public Sector Corruption&Anticorruption Measures,Bankruptcy and Resolution of Financial Distress,Social Accountability,Corruption&Anticorruption Law,Poverty Monitoring&Analysis |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5696&r=dev |
| By: | Hasnain, Zahid; Matsuda, Yasuhiko |
| Abstract: | This paper takes advantage of unique intra-country variation in the Philippines power sector to examine under what conditions politicians have an incentive to"capture"an electric utility and use it for the purposes of rent-seeking. The authors hypothesize that the level of capture is determined by the incentives of, and the interactions between, local and national politicians, where the concepts of"local"and"national"are context specific. A local politician is defined as one whose electoral jurisdiction lies within the utility’s catchment area; by contrast, a national politician is defined as one whose electoral jurisdiction includes two or more utility catchment areas. These jurisdictional differences imply different motivations for local and national politicians: because of"spillover"effects, local politicians have a greater incentive to use the utility for rent-seeking than a national politician as they capture only a portion of the political gains from utility performance improvements as some of the benefits of improved service will go to other electoral jurisdictions within the utility’s catchment area. The authors posit that three variables impact the magnitude of these incentives of local and national politicians: (i) the local economic context, specifically the scale of rents that can be extracted from an electricity cooperative (ii) the degree of competitiveness of local politics; and (iii) the political salience of an electricity cooperative’s catchment area for national politicians. The authors illustrate this framework through case studies of specific power utilities, and suggest some policy implications. |
| Keywords: | Public Sector Corruption&Anticorruption Measures,Political Systems and Analysis,Politics and Government,Political Economy,Economic Theory&Research |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5704&r=dev |
| By: | Foster, Vivien; Pushak, Nataliya |
| Abstract: | Infrastructure made a net contribution of around one percentage point to Nigeria's improved per capita growth performance in recent years, in spite of the fact that unreliable power supplies held growth back. Raising the country's infrastructure endowment to that of the region's middle-income countries could boost annual growth by around 4 percentage points. Among its African peers, Nigeria has relatively advanced power, road, rail, and ICT networks that cover the national territory quite extensively. Extensive reforms are ongoing in the power, ports, ICT, and domestic air transport sectors. But challenges persist. The power sector's operational efficiency and cost recovery has been among the worst in Africa, supplying about half of what is required, with subsequent social costs of about 3.7 percent of GDP. The water and sanitation sector has inefficient operations, with low and declining levels of piped water coverage. Irrigation development is also low relative to the country's substantial potential. In the transport sector, Nigeria's road networks are in poor condition from lack of maintenance, and the country has a poor record on air transport safety. Addressing Nigeria's infrastructure challenges will require sustained expenditure of almost $14.2 billion per year over the next decade, or about 12 percent of GDP. Nigeria already spends about $5.9 billion. It is well placed to raise the funds needed for infrastructure, given the strength of the national economy, abundant oil revenues, and efforts at electricity cost recovery and other improvements to operations and management. |
| Keywords: | Transport Economics Policy&Planning,Infrastructure Economics,Public Sector Economics,E-Business,Town Water Supply and Sanitation |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5686&r=dev |
| By: | Limodio, Nicola |
| Abstract: | This research analyzes the success of the infrastructure projects financed by the World Bank, focusing on the causal link between the quality of project implementation and its outcome. The results show that the success of infrastructure projects depends fundamentally on the quality of implementation. Although bad implementation can harm structurally solid projects, good implementation cannot make structurally weak projects successful. This leads to the conclusion that governance and selection of well-designed projects are essential for success and, in order to improve project outcomes, multilateral development banks may need to align their incentives toward thisobjective and invest more in governance and capacity building. |
| Keywords: | Banks&Banking Reform,Debt Markets,Public Sector Corruption&Anticorruption Measures,Emerging Markets,Housing&Human Habitats |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5694&r=dev |
| By: | Fernandez, Manuel; Ibanez, Ana Maria; Pena, Ximena |
| Abstract: | This paper studies the use of labor markets to mitigate the impact of violent shocks on households in rural areas in Colombia. It examines changes in the labor supply from on-farm to off-farm labor as a means of coping with the violent shock and the ensuing redistribution of time within households. It identifies the heterogeneous response by gender. Because the incidence of violent shocks is not exogenous, the analysis uses instrumental variables that capture several dimensions of the cost of exercising terror. As a response to the violent shocks, households decrease the time spent on on-farm work and increase their supply of labor to off-farm activities (non-agricultural ones). Men carry the bulk of the adjustment in the use of time inasmuch as they supply the most hours to off-farm non-agricultural work and formal labor markets. Labor markets do not fully absorb the additional labor supply. Women in particular are unable to find jobs in formal labor markets and men have increased time dedicated to leisure and household chores. Additional off-farm supply does not fully cover the decrease in consumption. The results suggest that in rural Colombia, labor markets are a limited alternative for coping with violent shocks. Thus, policies in conflict-affected countries should go beyond short-term relief and aim at preventing labor markets from collapsing and at supporting the recovery of agricultural production. |
| Keywords: | Labor Policies,Rural Poverty Reduction,Housing&Human Habitats,Labor Markets,Regional Economic Development |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5684&r=dev |
| By: | Lin, Justin Yifu |
| Abstract: | Economic development is a process of continuous industrial and technological upgrading in which any country, regardless of its level of development, can succeed if it develops industries that are consistent with its comparative advantage, determined by its endowment structure. The secret winning formula for developing countries is to exploit the latecomer advantage by building up industries that are growing dynamically in more advanced fast growing countries that have endowment structures similar to theirs. By following carefully selected lead countries, latecomers can emulate the leader-follower, flying-geese pattern that has served well successfully catching-up economies since the 18th century. The emergence of large middle-income countries such as China, India, and Brazil as new growth poles in the world, and their dynamic growth and climbing of the industrial ladder, offer an unprecedented opportunity to all developing economies with income levels currently below theirs --including those in Sub-Saharan Africa. Having itself been a"follower goose,"China is on the verge of graduating from low-skilled manufacturing jobs and becoming a"leading dragon."That will free up nearly 100 million labor-intensive manufacturing jobs, enough to more than quadruple manufacturing employment in low-income countries. A similar trend is emerging in other middle-income growth poles. The lower-income countries that can formulate and implement a viable strategy to capture this new industrialization opportunity will set forth on a dynamic path of structural change that can lead to poverty reduction and prosperity. |
| Keywords: | Economic Theory&Research,Emerging Markets,Achieving Shared Growth,Labor Policies,Inequality |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5702&r=dev |
| By: | Fafchamps, Marcel; McKenzie, David; McKenzie, David; Quinn, Simon; Woodruff, Christopher |
| Abstract: | Standard models of investment predict that credit-constrained firms should grow rapidly when given additional capital, and that how this capital is provided should not affect decisions to invest in the business or consume the capital. The authors randomly gave cash and in-kind grants to male- and female-owned microenterprises in urban Ghana. Their findings cast doubt on the ability of capital alone to stimulate the growth of female microenterprises. First, while the average treatment effects of the in-kind grants are large and positive for both males and females, the gain in profits is almost zero for women with initial profits below the median, suggesting that capital alone is not enough to grow subsistence enterprises owned by women. Second, for women they strongly reject equality of the cash and in-kind grants; only in-kind grants lead to growth in business profits. The results for men also suggest a lower impact of cash, but differences between cash and in-kind grants are less robust. The difference in the effects of cash and in-kind grants is associated more with a lack of self-control than with external pressure. As a result, the manner in which funding is provided affects microenterprise growth. |
| Keywords: | Debt Markets,Economic Theory&Research,Investment and Investment Climate,Science Education,Scientific Research&Science Parks |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5706&r=dev |
| By: | Briceno-Garmendia, Cecilia M.; Dominguez, Carolina; Pushak, Nataliya |
| Abstract: | Despite external shocks, Mali's economy grew by 5.3 percent per year between 2003 and 2006, driven primarily by the telecommunications sector. But Mali's landlocked condition, together with the uneven distribution of population and economic activities between the arid north and the much richer south, defy the country's ability to sustain this pace of growth. Mali depends heavily on regional infrastructure and transport corridors. A strategic focus on regional integration has paid off, and critical institutional decisions are bringing many positive developments. But Mali still faces infrastructure challenges, the starkest of which lies in the power sector. The cost of producing power in Mali is among the highest in the region, with the result that only around 17 percent of the population has access to electricity, much lower than in other low-income African countries. The water and sanitation sectors also represent a challenge, as the nation works to separate the power and water-and-sanitation functions of EDM, the multisector utility. Mali spent about $555 million per year on infrastructure during the late 2000s. A total of $200 million is lost annually to inefficiencies. Assessing spending needs against existing spending and potential efficiency gains leaves an annual funding gap of $283 million per year.Mali will likely need more than a decade to reach the illustrative infrastructure targets outlined in this report. Under business-as-usual assumptions for spending and efficiency, it would take over 50 years for Mali to reach these goals. Yet with a combination of increased finance, improved efficiency, and cost-reducing innovations, it should be possible to reduce that time to 15 years. |
| Keywords: | Transport Economics Policy&Planning,Infrastructure Economics,Energy Production and Transportation,E-Business,Town Water Supply and Sanitation |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5688&r=dev |
| By: | Dominguez-Torres, Carolina; Foster, Vivien |
| Abstract: | Between 2000 and 2005 infrastructure made an important contribution of 1.6 percentage points to Benin's improved per capita growth performance, which was the highest among West African countries during the period. Raising the country's infrastructure endowment to that of the region's middle-income countries could boost annual growth by about 3.2 percentage points. Benin has made significant progress in some areas of its infrastructure, including roads, air transport, water, and telecommunications. But the country still faces important infrastructure challenges, including improving road conditions and port performance and upgrading deteriorating electrical infrastructure. The nation must also improve the quality and efficiency of its water and sanitation systems. Benin currently spends about $452 million a year on infrastructure, with almost $101 million lost to inefficiencies. Comparing spending needs with existing spending and potential efficiency gains leaves an annual funding gap of $210 million per year. Benin has the potential to close that gap by adopting alternative technologies in water supply, transport, and power, which could save as much as $227 million a year. The nation would also benefit from raising tariffs to cost-recovery levels and reducing inefficiencies, which could substantially boost financial flows to the infrastructure sectors. |
| Keywords: | Transport Economics Policy&Planning,Infrastructure Economics,Public Sector Economics,Town Water Supply and Sanitation,Economic Theory&Research |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5689&r=dev |
| By: | Calderon, Cesar; Moral-Benito, Enrique; Serven, Luis |
| Abstract: | This paper offers an empirical evaluation of the output contribution of infrastructure. Drawing from a large data set on infrastructure stocks covering 88 countries and spanning the years 1960-2000, and using a panel time-series approach, the paper estimates a long-run aggregate production function relating GDP to human capital, physical capital, and a synthetic measure of infrastructure given by the first principal component of infrastructure endowments in transport, power, and telecommunications. Tests of the cointegration rank allowing it to vary across countries reveal a common rank with a single cointegrating vector, which is taken to represent the long-run production function. Estimation of its parameters is performed using the pooled mean group estimator, which allows for unrestricted short-run parameter heterogeneity across countries while imposing the (testable) restriction of long-run parameter homogeneity. The long-run elasticity of output with respect to the synthetic infrastructure index ranges between 0.07 and 0.10. The estimates are highly significant, both statistically and economically, and robust to alternative dynamic specifications and infrastructure measures. There is little evidence of long-run parameter heterogeneity across countries, whether heterogeneity is unconditional, or conditional on their level of development, population size, or infrastructure endowments. |
| Keywords: | Transport Economics Policy&Planning,Economic Theory&Research,Banks&Banking Reform,Public Sector Economics,Infrastructure Economics |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5682&r=dev |
| By: | Clarke, Daniel; Mahul, Olivier |
| Abstract: | This paper aims to assist policy makers interested in establishing or strengthening financial strategies to increase the financial response capacity of developing country governments in the aftermath of natural disasters, while protecting their long-term fiscal balance. Contingent credit is shown to increase the ability of governments to self-insure by relaxing their short-term liquidity constraints. In many situations, contingent credit is most effectively used to facilitate risk retention for middle layers, with reserves used for bottom layers and risk transfer (for example, reinsurance) for top layers. Discussions with governments on the optimal use of contingent credit instruments as part of a sovereign catastrophe risk financing strategy can be guided by the output of a dynamic financial analysis model specifically developed to allow for the provision of contingent credit, in addition to reserves and/or reinsurance. This model is illustrated with three country case studies: agricultural production risks in India; tropical cyclone risk in Fiji; and earthquake risk in Costa Rica. |
| Keywords: | Insurance&Risk Mitigation,Access to Finance,Debt Markets,Bankruptcy and Resolution of Financial Distress,Financial Intermediation |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5693&r=dev |
| By: | Stirbat, Liviu; Record, Richard; Nghardsaysone, Konesawang |
| Abstract: | This paper analyzes previously unreleased firm-level customs transaction data from the Lao PDR in order to assess the determinants of cohort survival among exporters. The authors find that export flows in value terms are dominated by the intensive margin, with large firms continuing to supply the same products to the same markets. On the extensive margin, new export spells for firms, products and firm-product-destination units are very small and short-lived, suggesting that although there is significant experimentation and discovery by firms, there is only limited capacity to stay in markets once an entry is made. Regression analyses of the factors that influence survival past the first year reveal that this is positively correlated with the initial dollar value (starting big makes a difference) and is helped by the firm's experience with the product and the destination, but hindered by a lack of focus. Agglomeration of exporters in the same destination with the same product is beneficial, an effect analogous to external economies of scale. The authors conclude by recommending that the focus of export promotion activity should be on helping existing exporters find and stay in new markets. |
| Keywords: | Markets and Market Access,Microfinance,E-Business,Economic Theory&Research,Water and Industry |
| Date: | 2011–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:5695&r=dev |
| By: | Mitra, Sophie; Posarac, Aleksandra; Vick, Brandon |
| Abstract: | Disability and poverty are dynamic and intricately linked phenomena. In developed countries, a large body of empirical research shows that persons with disabilities experience inter alia comparatively lower educational attainment, lower employment and higher unemployment rates, worse living conditions, and higher poverty rates. This study aims to contribute to the empirical research on social and economic conditions of people with disabilities in developing countries. Using comparable data and methods across countries, this study presents a snapshot of economic and poverty situation of working-age persons with disabilities and their households in fifteen developing countries. This research is relevant for several reasons. First, it contributes to a currently small body of empirical evidence on the economic status of persons with disabilities in developing countries. Second, by providing a baseline data on the economic well-being and the poverty status of working-age persons with disabilities and their households in 2003 in the countries under study, it can inform national disability policies. Finally, this study can also inform future data and research efforts on disability in developing countries. This study is structured as follows. Section two provides definitions and some background on disability and poverty. Section three describes the data and methods. Section four presents disability prevalence estimates in the fifteen developing countries under study and results on the economic well-being of working-age population at the individual and household levels. Section five gives results of an analysis of multidimensional poverty across disability status. Section six concludes definitions and some background information on disability and poverty, describes some of the linkages between them and reviews recent literature on the socioeconomic status of persons with disability. |
| Keywords: | Health Monitoring&Evaluation,Population Policies,Disability,Disease Control&Prevention,Gender and Health |
| Date: | 2011–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:hdnspu:62564&r=dev |
| By: | Marcel Fafchamps; Eliana La Ferrara |
| Abstract: | This paper examines the incomes of individuals who have joined self-help groups in poor neighborhoods of Nairobi. Self-help groups are often advocated as a way of facilitating income pooling. We …nd that incomes are indeed more correlated among individuals in the same group than among individuals who belong to different groups. Using an original methodology, we test whether this correlation is due to self-selection of similar individuals into the same groups. We find that this correlation is not driven by positive assortative matching. If anything, selection works in the opposite direction: incomes from group activities would be more correlated if individuals were matched at random. These findings are consistent with the idea that self-help groups play a mutual assistance role. |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:igi:igierp:401&r=dev |
| By: | Olivier Cadot; Leonardo Iacovone; Denisse Pierola; Ferdinand Rauch |
| Abstract: | Using a novel dataset with transactions level exports data from four African countries (Malawi, Mali, Senegal and Tanzania), this paper uncovers evidence of a high degree of experimentation at the extensive margin associated with low survival rates, consistent with high and middle income country evidence. Consequently, the authors focus on the questions of what determines success and survival beyond the first year and find that survival probability rises with the number of firms exporting the same product to the same destination from the same country, pointing towards the existence of crossfirm synergies. Accordingly the evidence is consistent with the hypothesis that those synergies may be driven by information spillovers. More intuitively and consistently with multi-product firms models, the analysis also finds that firms more diversified in terms of products, but even more in terms of markets, are more likely to be successful and survive beyond the first year. |
| Keywords: | Africa, export survival |
| JEL: | F10 F14 O55 |
| Date: | 2011–06 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1054&r=dev |
| By: | Fadi Hassan |
| Abstract: | It is conventional wisdom that richer countries have a higher price level than poorer countries. This paper provides evidence that the price-income relationship is non-linear and that it turns negative, or at best flat, in low income countries. The result is robust along both cross-section and time-series dimensions. Additional robustness checks show that biases in PPP estimation and measurement error in low-income countries do not drive the result. |
| Keywords: | Balassa-Samuelson, Penn effect, developing countries, non-parametricestimation, purchasing power parity, real exchange rate |
| JEL: | E31 F4 O1 |
| Date: | 2011–06 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1056&r=dev |
| By: | Temel, Tugrul |
| Abstract: | This paper analyzes the macroeconomic role that different household groups play in human capital formation, sectoral growth and income distribution in Rwanda. Using a disaggregated SAM for Rwanda and with the assistance of structural path analysis, the paper explores the macroeconomic implications of family size for human capital, sectoral growth and income distribution. The findings support the so-called quantity-quality trade-off hypothesis: the smaller the family size, the higher the investment in human capital. In particular, the human capital investment of households with 1-3 children tends to be more pronounced than that of households with more than 3 children. Moreover, households with 1-3 children act as an important intermediate pole transmitting the influence of human capital investment on agricultural production. As a result, promoting family planning programs seems to be a viable strategy for economic growth and poverty reduction. |
| Keywords: | Family size; human capital; growth; Rwanda; structural path analysis |
| JEL: | J13 O47 H31 D33 H41 I18 O15 I28 C67 |
| Date: | 2011–06–21 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:31741&r=dev |
| By: | Kumar, Santosh; Vollmer, Sebastian |
| Abstract: | Nearly nine million children under five years of age die annually. Diarrhea is considered to be the second leading cause of Under-5 mortality in developing countries. About one out of five deaths are caused by diarrhea. In this paper, we use the newly available data set DLHS-3 to quantify the impact of access to improved sanitation on diarrheal morbidity for children under five years of age in India. Using Propensity Score Matching (PSM) and propensity-based weighted regression, we find that access to improved sanitation reduces the risk of contracting diarrhea. Access to improved sanitation decreases child diarrhea incidence by 2.2 percentage points. There is considerable heterogeneity in the impacts of improved sanitation. We neither find statistically significant treatment eects for children in poor household nor for girls, however, boys and high socioeconomic status (SES) children experienced larger treatment effects. The results show that it is important to complement public policies on sanitation with policies that alleviate poverty, improve parent's education and promote gender equity. |
| Keywords: | Water, Sanitation, Diarrhea, Propensity score, Matching, India. |
| JEL: | C35 D10 I10 O12 |
| Date: | 2011–03–21 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:31804&r=dev |
| By: | Mohamed, Issam A.W. |
| Abstract: | The study focuses on the HIV/AIDS in Khartoum state during the period (2003-2007). The main objectives are to study the situation of HIV/AIDS in Khartoum state through a sample of 1439 of volunteers for the three selected blood testing and counseling centers in Khartoum, Omdurman, and Khartoum North teaching hospitals. The data of the study were collected from secondary source namely the registered information about volunteers after testing blood for HIV. The data were analyzed by using descriptive statistics, chi-square test for dependency between demographic variables and HIV/AIDS incidence, and logistic regression model to discover the effect of predictors variables on the dependent HIV/AIDS incidence. The infected percent is found to be very high in Khartoum center (36.0), 33.5 for Omdurman center. The incidence rate of HIV/AIDS is found to 14.3 for Khartoum North center. The logistic regression model results have concluded social status, Occupation, and education level affect the HIV/AIDS incidence Khartoum state. The trends of the disease during 2007 have indicated that, the pandemic is at increasing rate for both sexes males and females positive although the positive cases for males were greater than females positive cases, except in one or two months. It is recommended that there must be assessment for the current situation of the HIV/AIDS so as to construct strategic plan to stop or eradicate the spread among the people mainly adults. The study has focused on the HIV/AIDS in Khartoum state during the period (2003-2007).Its main objective was to study the situation of HIV/AIDS in Khartoum state through a sample of 1439 of volunteers for the three selected blood testing and counseling centers in Khartoum, Omdurman, and Khartoum North teaching hospitals. The data of the study were collected from secondary source namely the registered information about volunteers after testing blood for HIV checking The data were analyzed by using descriptive statistics, chi-square test for dependency between demographic variables and HIV/AIDS incidence, and logistic regression model to discover the effect of predictors variables on the dependent HIV/AIDS incidence. The infected percent is found to be very high in Khartoum center (36.0), 33.5 for Omdurman center, and The incidence rate of HIV/AIDS is found to 14.3 for Khartoum North center. The logistic regression model results have concluded social status, occupation, and education level affect the HIV/AIDS incidence Khartoum state. The trends of the disease during 2007 have indicated that, the pandemic is at increasing rate for both sexes males and females positive although the positive cases for males were greater than females positive cases, except in one or two months. The study recommended that there must be assessment for the current situation of the HIV/AIDS so as to construct strategic plan to stop or eradicate the spread among the people mainly adults. |
| Keywords: | Sudan; HIV/AIDS; Prevalence; Incidences; Khartoum State; Pandemic; Socioeconomic Status |
| JEL: | I11 K3 A1 I12 C46 H5 A10 C4 O1 K32 H51 J28 H75 I18 I1 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:31783&r=dev |
| By: | Nicola Gennaioli; Rafael La Porta; Florencio Lopez-de-Silanes; Andrei Shleifer |
| Abstract: | We investigate the determinants of regional development using a newly constructed database of 1569 sub-national regions from 110 countries covering 74 percent of the world’s surface and 96 percent of its GDP. We combine the cross-regional analysis of geographic, institutional, cultural, and human capital determinants of regional development with an examination of productivity in several thousand establishments located in these regions. To organize the discussion, we present a new model of regional development that introduces into a standard migration framework elements of both the Lucas (1978) model of the allocation of talent between entrepreneurship and work, and the Lucas (1988) model of human capital externalities. The evidence points to the paramount importance of human capital in accounting for regional differences in development, but also suggests from model estimation and calibration that entrepreneurial inputs and human capital externalities are essential for understanding the data. |
| JEL: | L26 O11 O43 O47 R11 |
| Date: | 2011–06 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17158&r=dev |