nep-dev New Economics Papers
on Development
Issue of 2013‒05‒05
eleven papers chosen by
Mark Lee
Towson University

  1. Protests and Beliefs in Social Coordination in Africa By Marc Sangnier; Yanos Zylberberg
  2. Publicness of goods and violent conflict: Evidence from Colombia By Darwin Cortes; Daniel Montolio
  3. South-South migration and the labor market: Evidence from South Africa By Giovanni Facchini; Anna Maria Mayda; Mariapia Mendola
  4. Intrahousehold Distribution and Poverty: Evidence from Côte dIvoire By Olivier Bargain; Olivier Donni; Prudence Kwenda
  6. Freedom, Ratings and Economic Growth: In Search of Reliable Dependencies By Konstantin Yanovsky; Rinat Menyashev
  7. The Cost of Living in China: Implications for Inequality and Poverty By Almås, Ingvild; Johnsen, Åshild Auglænd
  8. Urban Agriculture, Price Volatility.Drought ,And Food Security In Developing Countries. By Jatta, Sylvester
  9. On the effectiveness of foreign aid in institutional quality By Asongu , Simplice A
  10. Plot and Household-Level Determinants of Sustainable Agricultural Practices in Rural Tanzania By Kassie, Menale; Jaleta, Moti; Shiferaw, Bekele; Mmbando, Frank; Muricho, Geoffrey
  11. How to avoid middle income traps ? evidence from Malaysia By Flaaen, Aaron; Ghani, Ejaz; Mishra, Saurabh

  1. By: Marc Sangnier (Aix-Marseille University (Aix-Marseille School of Economics), CNRS & EHESS); Yanos Zylberberg (CREI, Universitat Pompeu Fabra)
    Abstract: Leaders’ misbehaviors may durably undermine the credibility of the state. Using individual level survey in the aftermath of geo-localized social protests in Africa, we find that trust in monitoring institutions and beliefs in social coordination strongly evolve after riots, together with trust in leaders. As no signs of social unrest can be recorded before, the social conflict can be interpreted as a sudden signal sent on a leader’s action from which citizens extract information on the country’s institutions. Our interpretation is the following. Agents lend their taxes to a leader with imperfect information on the leader’s type and the underlying capacity of institutions to monitor her. A misbehavior is then interpreted as a failure of institutions to secure taxes given by citizens and makes agents (i) reluctant to contribute to the state effort, (ii) skeptical about the contributions of others.
    Keywords: Social conflicts, norms of cooperation, trust, institutions.
    JEL: D74 D83 H41 O17
    Date: 2013–04
  2. By: Darwin Cortes; Daniel Montolio
    Abstract: Abstract How the degree of publicness of goods affect violent conflict? Based on the theoretical model in Esteban and Ray (2001) we find that the effect of the degree of publicness depends on the group size. When the group is small (large), the degree of publicness increases (decreases) the likelihood of conflict. This opens an empirical question that we tackle using microdata from the Colombian conflict at the municipality level. We use three goods with different publicness degree to identify the sign of the effect of publicness on conict. These goods are coca crops (private good), road density (public good subject to congestion) and average education quality (a purer public good). After dealing with endogeneity issues using an IV approach, we find that the degree of publicness reduces the likelihood of both paramilitary and guerrilla attacks. Moreover, coca production exacerbates conflict and the provision of both public goods mitigates conflict. These results are robust to size, geographical, and welfare controls. Policies that improve public goods provision will help to fight the onset of conflict.
    Date: 2013–04–24
  3. By: Giovanni Facchini (University of Nottingham, University of Milan, Centro Studi Luca d’Agliano, CEPR and CES–Ifo); Anna Maria Mayda (Georgetown University, Centro Studi Luca d’Agliano, CEPR and IZA); Mariapia Mendola (University of Milan Bicocca and Centro Studi Luca d’Agliano)
    Abstract: Using census data for 1996, 2001 and 2007 we study the labor market effect of immigration to South Africa. The paper contributes to a small but growing literature on the impact of South-South migration by looking at one of the most attractive destinations for migrant workers in Sub–Saharan Africa. We exploit the variation – both at the district level and at the national one – in the share of foreign–born male workers across schooling and experience groups over time. At the district level, we estimate that increased immigration has a negative and significant effect on natives’ employment rates – and that this effect is more negative for skilled and white South African native workers – but not on total income. These results are robust to using an instrumental variable estimation strategy. At the national level, we find that increased immigration has a negative and significant effect on na-tives’ total income but not on employment rates. Our results are consistent with outflows of natives to other districts as a consequence of migration, as in Borjas (2006).
    Keywords: Immigration, Labor market effects, South Africa
    JEL: F22 J61
    Date: 2013–04–24
  4. By: Olivier Bargain; Olivier Donni; Prudence Kwenda (Aix-Marseille Université and IZA; THEMA, Universite de Cergy-Pontoise; University of the Witwatersrand (South Africa))
    Abstract: Poverty measures in developing countries often ignore the distribution of resources within families and the gains from joint consumption. In this paper, we estimate the allocation process and adult economies of scale in households from Côte d'Ivoire using a collective model of household consumption. Identification relies on the observation of adult-specific goods, as in the Rothbarth method, and a joint estimation on couples and singles. Results show that children's shares are small and decline quickly with household size. It results that child poverty, measured on the basis of individual allocations within families, is much larger than in traditional measures ignoring intrahousehold inequality. Adult poverty is smaller because parents are highly compensated by the scale economies due to joint consumption
    Keywords: Collective Model, Engel Curves, Rothbarth Method, Sharing rule, Scale Economies, Equivalence Scales, Indifference Scales.
    JEL: D11 D12 I31 J12
    Date: 2013
  5. By: Konstantin Yanovsky (Gaidar Institute for Economic Policy); Sergey Shulgin (Russian Presidential Academy of National Economy and Public Administration)
    Abstract: In this paper we tested the hypothesis of the "political" basis for the "economic" rights. We constructed our own variables of political regimes' classification for years 1820-2000. We found significant positive interdependencies between the Democracy's indicators and Economic Growth. Protection of the Private property rights requires, first and foremost, due guaranties for the personal immunity as a key precondition. Power to arrest discretionary undermines any formal guaranties of private property, low taxation benefits etc. Personal immunity should be defended even for "unpleasant" person (say, H. Ford or W. Gates) or for the chieftains' challengers (to make "rights of the meanest … respectable to the greatest"). It means the free speech; religious freedom and other "political rights" should be respected. Democracy, as political competition system weakens governments' power to break personal freedoms and property rights.
    Keywords: Rule of Law, Rule of Force, Personal Rights, Private Property Protection, Economic Growth
    JEL: P16 P50 N40 O43
    Date: 2012
  6. By: Konstantin Yanovsky (Gaidar Institute for Economic Policy); Rinat Menyashev (National Research University – Higher School of Economics)
    Abstract: Ratings evaluating the quality of institutions are widely known; they are generally used in academic and research literature. Among such ratings are some whose compilation procedure took decades to perfect. Dozens of assessments have been accumulated, pertaining to a large and growing list of countries. All these ratings use expert evaluations with country ranking. We suppose that such evaluations are essentially incompatible with each other, and therefore inapplicable in a comparative study at some one specific point in time chosen for observation (i.e., for a cross-section analysis). We propose a group of variables of our own, using evaluations of “political” institutions only to ascertain the presence or absence of a certain phenomenon (yes/no). Such a set of variables makes a cross-section analysis feasible. The countries' experience in Rule of Law Democracy and Limited Government (both are quite clearly defined in a formal manner) provides a long-term institutional development aggregate evaluation for cross-section analysis. We also propose a thoroughly simple rating based on combining the proposed variables with indices and indicators which have already become widely accepted, but taking this combination as part of a data panel. At the same time, using a panel regression makes it possible to mitigate the problem of poor compatibility of expert evaluations.
    Keywords: Rule of Law Democracy, Limited Government, Institutions quality indicators, Institutions and Economic growth
    JEL: P50 N40 O43
    Date: 2013
  7. By: Almås, Ingvild (Norwegian School of Economics and Business Administration); Johnsen, Åshild Auglænd (University of Stavanger)
    Abstract: China’s economic development in recent decades has been tremendous, but subject to debate. This paper calculates regional prices that make incomes comparable across both time and space using the Engel-curve approach. Incomes are adjusted using these price indices, providing new estimates of inequality and poverty development. Our findings contrast with measures based on the official consumer price indices (CPIs) – in a time characterized by high economic growth, we find a larger increase in inequality and a more moderate poverty reduction than what is indicated by the CPI-adjusted measures.
    Keywords: China; Poverty; Inequality; CPI
    JEL: D01 E31 F01
    Date: 2013–02–07
  8. By: Jatta, Sylvester
    Abstract: Abstract Urban agriculture may have an important role to play in addressing food insecurity problems, which are bound to become increasingly vital with the secular trends towards the urbanization of poverty and of population in developing countries. Our understanding of the importance, and food security implications of urban agriculture is however plagued by a lack of high quality, reliable data. While studies based on survey research data do exists for several major cities, much of the evidence is still qualitative if not anecdotal. Using a recently created data set bringing together comparable, nationally representative household survey data for 15 developing or transition countries, this paper analyzes in a comparative international perspective the importance of urban agriculture for the urban poor and food insecure. On the one hand, the potential for urban agriculture to play a substantial role in urban poverty and food insecurity reduction should not be overemphasized, as its share in income and overall agricultural production is often quite limited. On the other hand, though, its role should also not be too easily dismissed, particularly in much of Africa agriculture provides a substantial share of income for the urban poor, and for those groups of households for whom it constitutes an important source of livelihood. We also find fairly consistent evidence of a statistical association between engagement in urban agriculture and dietary adequacy indicators.
    Keywords: Keywords: Urban agriculture; Food security; Nutrition, Household surveys
    JEL: Q18
    Date: 2013–04–25
  9. By: Asongu , Simplice A
    Abstract: We extend the Okada & Samreth (2012, EL) and Asongu (2012, EB) debate on ‘the effect of foreign aid on corruption’ by: not partially negating the former’s methodological underpinning (as in the latter’s approach) with a unifying empirical framework and; broadening the horizon of inquiry from corruption to eight institutional quality dynamics (rule of law, regulation quality, government effectiveness, democracy, corruption, voice & accountability, control of corruption and political stability). Core to this extension is a hypothetical contingency of the ‘institutional perils of foreign aid’ on existing institutional quality such that, the institutional downside of development assistance maybe questionable when greater domestic institutional development has taken place. Based on the hypothesis of institutional thresholds for foreign aid effectiveness, the perilous character of development assistance to institutional quality is broadly confirmed in 53 African countries for the period 1996-2010.
    Keywords: Foreign Aid; Political Economy; Development; Africa
    JEL: B20 F35 F50 O10 O55
    Date: 2013–02–08
  10. By: Kassie, Menale; Jaleta, Moti; Shiferaw, Bekele; Mmbando, Frank; Muricho, Geoffrey
    Abstract: Soil fertility depletion is considered the main biophysical limiting factor to increasing per capita food production for most smallholder farmers in Africa. The adoption and diffusion of sustainable agricultural practices (SAPs), as a way to tackle this impediment, has become an important issue in the development policy agenda for sub-Saharan Africa. This paper examines the adoption decisions for SAPs, using multiple cross-sectional plot-level observations, collected in 2010 from 681 farm households and 1,539 plots, in 4 districts and 88 villages of rural Tanzania. We employ a multivariate probit technique to model simultaneous adoption decisions by farm households. Our study reveals that rainfall shocks, insects and disease shocks, government effectiveness, tenure status of plot, social capital, plot location and size, and asset ownership, all influence the adoption decision of sustainable practices. Policies that target SAPs and are aimed at organizing farmers into associations, improving land tenure security, and enhancing skills of civil servants can increase the likelihood that smallholder farmers will adopt SAPs.
    Keywords: sustainable practices, multiple adoption, multivariate probit, Tanzania
    JEL: C01 O55 Q01 Q16
    Date: 2012–01–27
  11. By: Flaaen, Aaron; Ghani, Ejaz; Mishra, Saurabh
    Abstract: Malaysia's structural transformation from low to middle income is a success story, making it one of the most prominent manufacturing exporters'in the world. However, like many other middle income economies, it is squeezed by the competition from low-wage economies on the one hand, and more innovative advanced economies on the other. What can Malaysia do? Does Malaysia need a new growth strategy? This paper emphasizes the need for broad structural transformation; that is, moving to higher productivity production in both goods and services. This paper examines productivity growth for Malaysia at the sectoral level, and constructs several measures of the sophistication of goods and services trade, and puts these comparisons in a global context. The results indicate that Malaysia has further opportunities for growth in the services sector in particular. Modernizing the services sector may provide a way out of the middle income trap, and serve as a source of growth for Malaysia into the future.
    Keywords: Economic Theory&Research,Banks&Banking Reform,Emerging Markets,Labor Policies,Economic Conditions and Volatility
    Date: 2013–04–01

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