nep-dev New Economics Papers
on Development
Issue of 2013‒02‒16
thirteen papers chosen by
Mark Lee
Towson University

  1. Poverty Outreach in Southern and Northern Ghana By Sheremenko, Ganna; Florkowski, Wojciech J.; Klepacka, Anna M.
  2. Micro-credit impact in Kyrgyzstan: A study case By Angioloni, Simone; Kudabaev, Zarylbek; Ames, Glenn C.W.; Wetzstein, Michael E.
  3. Gender Impacts on Adoption of New Technologies: Evidence from Uganda By Tanellari, Eftila; Kostandini, Genti; Bonabana, Jackie
  4. Institutions, Informal Economy and Economic Development By Ceyhun Elgin; Oguz Oztunali
  5. The Economic and Demographic Transition, Mortality, and Comparative Development By Cervellati, Matteo; Sunde, Uwe
  6. A Theory of Cooperation through Social Division, with Evidence from Nepal By Choy, James
  7. Gender Wage-Productivity Differentials and Global Integration in China By Dammert, Ana C.; Ural Marchand, Beyza; Wan, Chi
  8. Measuring the Income-Distance Tradeoff for Rural-Urban Migrants in China By Zhang, Junfu; Zhao, Zhong
  9. Analysis of the Determinants of Income and Income Gap between Urban and Rural China By Su, Biwei; Heshmati, Almas
  10. Financial development dynamic thresholds of financial globalization: evidence from Africa By Simplice A, Asongu
  11. Cluster policy in developing countries By Benner, Maximilian
  12. How much international variation in child height can sanitation explain ? By Spears, Dean
  13. Productivity, innovation and growth in Sri Lanka : an empirical investigation By Dutz, Mark A.; O'Connell, Stephen D.

  1. By: Sheremenko, Ganna; Florkowski, Wojciech J.; Klepacka, Anna M.
    Abstract: This paper examines financial sustainability and social outreach determinants of microfinance institutions’ (MFIs) performance in the Southern and Northern parts of Ghana using the Seemingly Unrelated Regression (SUR) as the estimation technique. Results suggest that although MFIs in both parts of Ghana are profit-driven, they are expected to improve poverty outreach as they expand their clientele.
    Keywords: Microfinance institution, Ghana, SUR, Financial sustainability, Social (poverty) outreach, Agricultural Finance, Community/Rural/Urban Development, G20, G21,
    Date: 2013
  2. By: Angioloni, Simone; Kudabaev, Zarylbek; Ames, Glenn C.W.; Wetzstein, Michael E.
    Abstract: Microcredit has expanded rapidly since its beginnings in the last 1970s, but whether and how much it reduces poverty is the subject of intense debate. Generally it depends on how the program is implemented and the set of policies that regulate it. In this spirit, microcredit impacts in the Kyrgyz Republic are investigated and a modest program evaluation undertaken. Using data set for 5012 households from the Kyrgyzstan Integrated Household Survey (KIHS) that covers 2006-2010. Results indicate micro-credit is more driven forward durable assets as house, land, and to start a new business and less to fight against food insecurity.
    Keywords: Behavioral economics, consumer/household economics, international development, food security and poverty, financial economics, Consumer/Household Economics, Financial Economics, Food Security and Poverty, Institutional and Behavioral Economics, International Development,
    Date: 2013
  3. By: Tanellari, Eftila; Kostandini, Genti; Bonabana, Jackie
    Abstract: This paper examines the effects of gender on the adoption of new technologies of peanut production in Eastern Uganda. The findings suggest that females adopt improved varieties at a lower rate compared to males. In addition, females in female-headed households are less likely to adopt.
    Keywords: Adoption, Gender, Uganda, Community/Rural/Urban Development, International Development,
    Date: 2013
  4. By: Ceyhun Elgin; Oguz Oztunali
    Date: 2013–03
  5. By: Cervellati, Matteo (University of Bologna); Sunde, Uwe (University of Munich)
    Abstract: We propose a unied growth theory to investigate the mechanics generating the economic and demographic transition, and the role of mortality dierences for comparative development. The framework can replicate the quantitative pat- terns in historical time series data and in contemporaneous cross-country panel data, including the bi-modal distribution of the endogenous variables across coun- tries. The results suggest that dierences in extrinsic mortality might explain a substantial part of the observed dierences in the timing of the take-o across countries and the worldwide density distribution of the main variables of interest.
    Keywords: Economic and Demographic Transition, Adult Mortality, Child Mortality, Quantitative Analysis, Unied Growth Model, Heterogeneous Human Capital, Comparative Development, Development Traps
    Date: 2013
  6. By: Choy, James (University of Warwick)
    Abstract: Informal, kin-based groups play an important role in developing country economies. I point out two facts: communities are divided into smaller groups, and many groups prohibit interactions with outsiders. These facts are rationalized in a model in which division of the community into non-interacting groups allows agents to support higher levels of cooperation. Group segregation is sustained in equilibrium through a reputation eect. I test the empirical implication that there should be less cooperation between members of groups that make up a larger percentage of their communities. I discuss implications for underinvestment in education, misallocation of resources, and institutional change.
    Keywords: Cooperation, Caste, Social Institution
    Date: 2013
  7. By: Dammert, Ana C. (Carleton University); Ural Marchand, Beyza (University of Alberta); Wan, Chi (University of Massachusetts Boston)
    Abstract: In the absence of discrimination, there should be no wage-productivity differentials as relative wages should be equal to the relative marginal productivity levels of workers. This paper investigates the role of globalization on the structure and evolution of gender differentials in China by simultaneously estimating demand-side wage and productivity outcomes using nonlinear least squares. The analyses are based on a comprehensive population-wide panel survey of manufacturing firms between the years of 2004 and 2007, covering 94 percent of total industry output and providing an accurate representation of labor demand. The results suggest that more exposure to globalization through increased exports is associated with lower gender wage-productivity differentials, and more exposure through increased foreign investment leads to differentials in favor of female workers. On the other hand, gender discrimination is found to be prevalent among domestically owned and non-exporting firms.
    Keywords: China, gender wage discrimination, globalization, firm ownership
    JEL: D22 F21 J16 J31
    Date: 2013–01
  8. By: Zhang, Junfu (Clark University); Zhao, Zhong (Renmin University of China)
    Abstract: Rural-urban migrants in China appear to prefer nearby destination cities. To gain a better understanding of this phenomenon, we build a simple model in which migrants from rural areas choose among potential destination cities to maximize utility. The distance between a migrant's home village and destination city is explicitly included in the utility function. Using recent survey data, we first estimate an individual's expected income in each potential destination city using a semi-parametric method, controlling for potential self-selection biases. We then estimate the indirect utility function for rural- urban migrants in China based on their migration destination choices. Our baseline estimates suggest that to induce a migrant to move 10 percent further away from home, the income of this migrant has to increase by 15 percent. This elasticity varies very little with migration distance; it is slightly higher for female than male migrants; it is not affected by the migrant's age, education, or marital status. We explore possible explanations of these results and discuss their policy implications.
    Keywords: income-distance tradeoff, rural-urban migration, hukou system, China
    JEL: O15 R12 R23
    Date: 2013–01
  9. By: Su, Biwei (Korea University); Heshmati, Almas (Korea University)
    Abstract: This paper studies on the determinants of income and urban-rural income gap to shed light on the problem of urban-rural income inequality in China. OLS, conditional quantile regression and Blinder-Oaxaca decomposition methods are used to analyze four waves of the China Health and Nutrition Survey (CHNS) household data. Results show that education and occupation are essential determinants of households' income level. These two factors exert heterogeneous effects at different percentiles of the income distribution. In urban areas, education is more valued for high income earners, while for rural areas, specialized or tertiary education are more beneficial for the poorer households. Among all occupational types, farm activities show much lower returns than other types; and this is more evident for individuals at the left tail of the income distribution. We also find that for the sampled provinces, urban-rural income gap increases from the year of 2000 to 2004 but the gap decreases from 2004 to 2009. The income gap can be largely explained by the individuals' attributes, especially by level of education and type of occupation.
    Keywords: urban-rural income gap, Oaxaca-Blinder decomposition, quantile regression, CHNS household data, China
    JEL: O15 O18 D31 D63 C31
    Date: 2013–01
  10. By: Simplice A, Asongu
    Abstract: Purpose – The issue of which financial initial conditions are necessary to materialize the benefits of financial globalization remains open to debate in the literature. In this paper, we try to put some empirical structure on the concept of financial threshold conditions in order to give policymakers guidance on the Kose et al. (2011) and Henry (2007) hypothesis. Its object is to assess if financial benefits of financial globalization are questionable until greater domestic financial development has taken place in African countries. Design/methodology/approach – In framing the financial dimension in a more concrete and tractable manner, we examine the concerns of how domestic financial initial dynamics of depth (economic and financial systems), efficiency (banking and financial systems), activity (banking and financial systems) and size, play out in the financial development benefits of financial globalization. The estimation approach consists of assessing the impact of financial globalization through-out the conditional distributions of domestic financial development dynamics. Findings – The introduction of previously missing financial dimensions into the debate generates a number of important findings. Only financial initial (threshold) conditions of size are necessary to materialize the benefits of financial globalization. While financial depth only partially validates the hypothesis, dynamics of efficiency and activity (credit) do not confirm the hypothesis. Practical implications – Addressing the issue of surplus liquidity in African financial institutions could improve the benefits of financial size and potentially reverse the trends of financial efficiency and activity. Depending on the context of sampled countries, the appropriate role of policy has always been either to stem the tide of capital flows or encourage them. Policymakers who have been viewing their challenges exclusively from the latter perspective for benefits in growth (finance) might be getting the financial dynamics badly wrong. Originality/value – Blanket financial development policies may not reap the financial benefits of financial globalization until domestic financial dynamics of depth, efficiency, activity and size are critically considered. The introduction of the last three previously missing components in the literature sheds more light on the globalization-development nexus.
    Keywords: Banking; International investment; Financial integration; Development
    JEL: F40 F30 O10 F02 F21
    Date: 2012–06–30
  11. By: Benner, Maximilian
    Abstract: After it has been discovered as a vehicle of economic policy in industrialized countries at the beginning of the 1990s, cluster policy has attracted the attention of development policy. Indeed, the case for using cluster policies to promote economic development is in principle not confined to the context of industrialized countries. As cluster policies necessarily have to be specifically tailored to each individual case, it should come as no surprise that their use in developing countries will always differ from their use in industrialized ones. Surely, individual cluster policies in developing contries, too, will differ from each other. Still, some general approaches that respond to typical framework conditions in developing countries can be discerned. This article elaborates some of them and suggests ways to promote clusters on the regional and local levels in developing countries.
    Keywords: clusters; cluster policy; regional policy; development policy; development cooperation
    JEL: R58 O25 O10 O20
    Date: 2013
  12. By: Spears, Dean
    Abstract: Physical height is an important economic variable reflecting health and human capital. Puzzlingly, however, differences in average height across developing countries are not well explained by differences in wealth. In particular, children in India are shorter, on average, than children in Africa who are poorer, on average, a paradox called"the Asian enigma"which has received much attention from economists. This paper provides the first documentation of a quantitatively important gradient between child height and sanitation that can statistically explain a large fraction of international height differences. This association between sanitation and human capital is robustly stable, even after accounting for other heterogeneity, such as in GDP. The author applies three complementary empirical strategies to identify the association between sanitation and child height: country-level regressions across 140 country-years in 65 developing countries; within-country analysis of differences over time within Indian districts; and econometric decomposition of the India-Africa height differences in child-level data. Open defecation, which is exceptionally widespread in India, can account for much or all of the excess stunting in India.
    Keywords: Population Policies,Early Child and Children's Health,Disease Control&Prevention,Health Monitoring&Evaluation,Youth and Governance
    Date: 2013–01–01
  13. By: Dutz, Mark A.; O'Connell, Stephen D.
    Abstract: This study investigates the impact of key business environment indicators on productivity, innovation, and growth in Sri Lanka through a cluster-level productivity analysis, a firm-level total factor productivity analysis, and a firm-level innovation analysis. For the cluster-level productivity analysis (as measured by output and value added per worker), it combines two established data sources in a novel way by importing average'industry-size-location'cluster-level business environment variables from the World Bank Enterprise Survey to the comprehensive Sri Lanka Census of Industry productivity data available for similar clusters of enterprises. For the firm-level total factor productivity analysis, it compares data from the 2011 World Bank Enterprise Survey with those from 2004. For the firm-level innovation analysis, it compares findings from the 2011 World Bank Enterprise Survey with a representative sample of enterprises collected as part of the Sri Lanka Longitudinal Survey of Enterprises. The empirical findings highlight the importance -- for cluster-level productivity, firm-level total factor productivity, and innovation -- of connectivity to global knowledge (reflected by one or more of export participation, directly imported inputs, foreign ownership, and use of the internet), availability of skills, access to finance, and competition. The paper also presents evidence, under the assumption that the samples are statistically representative, that both allocative and average technical efficiency have improved, with allocative efficiency increasing roughly four-fold between 2003 and 2010, and accounting for the overwhelming share of the aggregate increase in total factor productivity over this time period. Most of the improvement in allocative efficiency has occurred among larger firms, and in large rather than small cities.
    Keywords: Environmental Economics&Policies,E-Business,Labor Policies,Economic Theory&Research,Knowledge for Development
    Date: 2013–02–01

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