nep-dev New Economics Papers
on Development
Issue of 2014‒08‒09
fifteen papers chosen by
Jacob A. Jordaan
Universitiet Utrecht

  1. Can Electronic Procurement Improve Infrastructure Provision? Evidence From Public Works in India and Indonesia By Sean Lewis-Faupel; Yusuf Neggers; Benjamin A. Olken; Rohini Pande
  2. Inequality of Opportunity in Health in Indonesia By Jusot, Florence; Mage-bertomeu, Sabine; Menendez, Marta
  3. Shelter from the Storm: Upgrading Housing Infrastructure in Latin American Slums By Sebastian Galiani; Paul Gertler; Ryan Cooper; Sebastian Martinez; Adam Ross; Raimundo Undurraga
  4. Are Democratizing Countries ‘Rewarded’ with Higher Levels of Foreign Aid? By Szent-Iványi, Balázs
  5. Development Aid and Growth in Transition Economies By Zohid Askarov; Hristos Doucouliagos
  6. The Economics of Fair Trade By Raluca E. Dragusanu; Daniele Giovannucci; Nathan Nunn
  7. Sons as Widowhood Insurance : Evidence from Senegal By Sylvie Lambert; Pauline Rossi
  8. The Dynamics of Rural Non-farm Employment in India: Gender, Agricultural Productivity, and Literacy By Alok Kumar; Kam Shergill
  9. South Africa's post-apartheid microcredit-driven calamity: Comparing 'developmental' to 'anti-developmental' local financial models By Bateman, Milford
  10. Wealth and the Construction of Non-Cognitive Skills. The Case of Colombia By Rodrigo Azuero Melo
  11. Peace, Prosperity and Safety Nets in Timor-Leste: Competing Priorities or Complementary Investments? By Pamela Dale; Lena Lepuschuetz; Nithin Umapathi
  12. Climate variability and household welfare in northern Ghana By Nkegbe, Paul Kwame; Kuunibe, Naasegnibe
  13. Collective Action and Armed Group Presence in Colombia By Margarita Gáfaro; Ana Maria Ibáñez; Patricia Justino
  14. How institutions shape land deals: The role of corruption By Bujko, Matthias; Fischer, Christian; Krieger, Tim; Meierrieks, Daniel
  15. The effect of climate change on economic growth: Evidence from Sub-Saharan Africa By Alagidede, Paul; Adu, George; Frimpong, Prince Boakye

  1. By: Sean Lewis-Faupel; Yusuf Neggers; Benjamin A. Olken; Rohini Pande
    Abstract: Poorly functioning, and often corrupt, public procurement procedures are widely faulted for the low quality of infrastructure provision in developing countries. Can electronic procurement (e-procurement), which reduces both the cost of acquiring tender information and personal interaction between bidders and procurement officials, ameliorate these problems? In this paper we develop a unique micro-dataset on public works procurement from two fast-growing economies, India and Indonesia, and use regional and time variation in the adoption of e-procurement across both countries to examine its impact. We find no evidence that e-procurement reduces prices paid by the government, but do find that it is associated with quality improvements. In India, where we observe an independent measure of construction quality, e-procurement improves the average road quality, and in Indonesia, e-procurement reduces delays in completion of public works projects. Bidding data suggests that an important channel of influence is selection -- regions with e-procurement have a broader distribution of winners, with (better) winning bidders more likely to come from outside the region where the work takes place. On net, the results suggest that e-procurement facilitates entry from higher quality contractors.
    JEL: H57 O12 O53
    Date: 2014–07
  2. By: Jusot, Florence; Mage-bertomeu, Sabine; Menendez, Marta
    Abstract: Whereas health equity issues are undoubtedly more relevant in developing countries, research on health inequalities and, more specifically, on inequality of opportunity in the health dimension, remains scarce in this context. This paper explores the degree of inequality of opportunity in health in a developing country, using the 2007 Indonesian Family Life Survey, a large-scale survey with extremely rich information about individual health outcomes (biomarkers and self-reports) and individual circumstances. We compute a continuous synthetic index of global health status based on a comprehensive set of health indicators and subsequently implement non-parametric and parametric methods in order to quantify the level of inequality of opportunity in the health dimension. Our results show large inequality of opportunities in health in Indonesia, compared to European countries. Concerning transmission mechanisms, parental (particularly maternal) vital status appears as the main channel. Compared to what has been observed in more developed countries, the effect of parental education on health is relatively smaller, and mainly indirect (passing through descendants’ socioeconomic, marital and migration statuses), while the existence of long-term differences in health related to religion, language spoken and particularly province of location suggest a relatively higher relevance of community belonging variables for health equity in the context of a developing country as Indonesia.
    Keywords: Egalité des chances; santé; Indonésie; dominance stochastique; indicateur continu de santé; Equality of opportunity; health; Indonesia; stochastic dominance; continuous health index;
    JEL: D63 I14 O15
    Date: 2014–05
  3. By: Sebastian Galiani (University of Maryland); Paul Gertler (UC Berkeley); Ryan Cooper (J-PAL); Sebastian Martinez (Inter-American Development Bank); Adam Ross (Bill & Melinda Gates); Raimundo Undurraga (New York University)
    Abstract: This paper provides empirical evidence on the causal effects that upgrading slum dwellings has on the living conditions of the extremely poor. In particular, we study the impact of providing better houses in situ to slum dwellers in El Salvador, Mexico and Uruguay. We experimentally evaluate the impact of a housing project run by the NGO TECHO which provides basic pre-fabricated houses to members of extremely poor population groups in Latin America. The main objective of the program is to improve household well-being. Our findings show that better houses have a positive effect on overall housing conditions and general well-being: treated households are happier with their quality of life. In two countries, we also document improvements in children’s health; in El Salvador, slum dwellers also feel that they are safer. We do not find this result, however, in the other two experimental samples. There are no other noticeable robust effects on the possession of durable goods or in terms of labor outcomes. Our results are robust in terms of both internal and external validity because they are derived from similar experiments in three different Latin American countries.
    JEL: I12 I31 J13 O15 O18
    Date: 2014–07
  4. By: Szent-Iványi, Balázs
    Abstract: The paper examines how flows of foreign aid have reacted to events of democratization in developing countries. Using a panel dataset of 136 aid receiving countries between 1980 and 2009, aid allocation regressions reveal that donors in general have tended to react to visible, major democratic transitions by increasing aid to the partner country, but no significant increases can be identified in case of countries introducing smaller democratic reforms. The increases in aid flows are not sustained over time, implying that donors do not provide long term support to nascent democracies. Also, democratizations in Sub-Saharan Africa do not seem to have been rewarded with higher levels of aid.
    Keywords: foreign aid, aid allocation, democratization
    JEL: F35 F59
    Date: 2014–05
  5. By: Zohid Askarov; Hristos Doucouliagos
    Abstract: Empirical studies normally analyze diverse and heterogeneous groups of countries, producing very mixed evidence on the effectiveness of development aid in promoting growth. We focus on whether aid promotes economic growth in transitional economies. We find that aid, on average, has had a positive impact on growth for this specific group of countries. This result is robust to samples, estimators, and the use of alternate instruments to address endogeneity. Aid effectiveness is not conditional on good policy and there is little evidence of non-linear growth effects arising from aid.
    Date: 2014–08–04
  6. By: Raluca E. Dragusanu; Daniele Giovannucci; Nathan Nunn
    Abstract: Fair Trade is a labeling initiative aimed at improving the lives of the poor in developing countries by offering better terms to producers and helping them to organize. In this survey, we provide a critical overview of the economic theory behind Fair Trade, describing the potential benefits and potential pitfalls. We also provide an assessment of the empirical evidence of the impacts of Fair Trade to date.
    JEL: F1 O1
    Date: 2014–07
  7. By: Sylvie Lambert (PSE - INRA); Pauline Rossi (CREST - PSE)
    Abstract: Exploiting original data from a Senegalese household survey, we provide evidence that fertility choices are partly driven by women's needs for widowhood insurance. We use a duration model of birth intervals to show that women most exposed to the risk of widowhood intensify their fertility until they get a son. Insurance through sons entails substantial health costs : short birth spacing raises maternal and infant mortality rates
    Keywords: Intra-household insurance, Gender, Fertility, Health, Senegal
    JEL: D13 I15 J13 O15
    Date: 2014–02
  8. By: Alok Kumar (Department of Economics, University of Victoria); Kam Shergill
    Abstract: This paper analyzes the determinants of the rural non-farm employment in the fifteen major states of India by using panel data analysis for the period 1972-2010. The analysis indicates that there are significant gender differences in the factors affecting the level and the growth of rural non-farm employment. The level of urbanization, the rural literacy rate and the rural unemployment rate have a significant positive effect on the incidence of non-farm employment for male workers. For female workers, agricultural productivity and the incidence of rural poverty have a significant positive effect. There is evidence of convergence in the incidence of rural non-farm employment for both male and female workers, indicating that states with initially low incidence of rural non-farm employment experienced a higher growth rate in the rural non-farm employment than states with initially high incidence.
    Keywords: Rural Non-Farm Employment, Male, Female, Convergence, Panel Data
    JEL: J22 I20 D60
    Date: 2014–07–25
  9. By: Bateman, Milford
    Abstract: Microcredit was once universally lauded in international development community circles as a 'magic bullet'. Using the example of South Africa, this paper shows that microcredit has actually been an 'anti-developmental' local financial model, and one of the most calamitous financial sector interventions in South Africa's short post-apartheid history. This disastrous performance is compared to a benchmark local financial model that I call the 'developmental' local financial model, a financial model that was quite decisive to much recent European and Asian local economic development success. Overall, microcredit can be viewed as South Africa's own sub-prime-style disaster which, like the original US version, has mainly served to benefit a tiny financial elite working within and around the microcredit sector, whilst simultaneously destroying many of the most important pillars of the economy and society. It clearly behoves policymakers in South Africa, as well as policymakers in other African countries and elsewhere in the international development community, to learn from South Africa's negative experience with 'anti-developmental' microcredit to date and promote alternative 'developmental' local financial models. --
    Keywords: Microcredit,South Africa,impact,poverty,informal,SME,institutions
    JEL: G2 H7 O2 O4
    Date: 2014
  10. By: Rodrigo Azuero Melo
    Abstract: The purpose of this article is to identify to what extent there is a causal relationship between wealth and non-cognitive skills for children in Colombia. This article contributes to the existing literature of skills formation in three ways. First, methodological shortcomings of previous works are addressed. Second, variables that have been omitted in earlier studies are included in this analysis. Third, this is first article with such objective in the context of Colombia. One of the major conclusions of the literature of skills formation, in the context of a developed economy is that income has a limited impact in this process. The results of this study suggest that might not be the case in developing countries.
    Keywords: Health, Education, and Welfare: General; Children; Skills; HumanDevelopment
    JEL: I00 J13 J24 O15
    Date: 2014–07–03
  11. By: Pamela Dale; Lena Lepuschuetz; Nithin Umapathi
    Abstract: Social protection cash transfers are a vital policy instrument in tackling poverty, and provide an affordable, broad-based foundation for inclusive growth and social stability. Yet, international experience has shown that many countries have too many programs, but with coverage gaps and fragmented benefits which leave significant proportions of the population without adequate poverty relief or improved economic security. Here, we examine the design and poverty impact of the primary cash transfer programs in the Democratic Republic of Timor-Leste using nationally representative survey data. We find that though Timor-Leste's level of social protection expenditure is high by international standards, the overall poverty impact is incommensurate with spending levels. This is explained by the proportion of expenditure devoted to transfers to veterans, the large proportion of the poor population which is not reached by the current targeting mechanisms, and the small coverage and benefit level of the only program that explicitly targets poor households.
    Keywords: safety nets; Timor-Leste; social pensions; targeting
  12. By: Nkegbe, Paul Kwame; Kuunibe, Naasegnibe
    Abstract: Climate variability poses a major risk to agricultural incomes in Africa. In Ghana, most of the country.s poor people live in the north and households find it difficult to hold back their productive assets during the lean season. This study investigates t
    Keywords: climate variability, panel data, welfare, individual heterogeneity, Ghana
    Date: 2014
  13. By: Margarita Gáfaro; Ana Maria Ibáñez; Patricia Justino
    Abstract: The main objective of this paper is to provide empirical evidence on the mechanisms that shape the relationship between violent conflict and collective action. Conflict dynamics in Colombia allow us to exploit rich variation in armed group presence and individual participation in local organizations. Our identification strategy is based on the construction of contiguous-pairs of rural communities that share common socio-economic characteristics but differ in armed group presence. This allows us to control for unobservable variables that may affect local participation and conflict dynamics simultaneously. The results show that the presence of armed groups increases overall participation in local organizations, with a particularly strong effect on political organizations. Contrary to existing results, we find that stronger individual participation may arise from coercion exercised by armed groups and not from a more vibrant civil society.
    Keywords: collective action, political organizations, armed groups, violent shocks
    Date: 2014–07–11
  14. By: Bujko, Matthias; Fischer, Christian; Krieger, Tim; Meierrieks, Daniel
    Abstract: Large-scale land acquisitions, or land grabs, concentrate in developing countries which are also known for their corruption-friendly setting caused by a weak institutional framework. We argue that corrupt elites exploit this given institutional set-up to strike deals with international investors at the expense of the local population. Using panel data for 157 countries from 2000-2011, we provide evidence that these land deals indeed occur more often in countries with higher levels of corruption. --
    Keywords: large-scale land acquisitions,land grabbing,foreign investments,weak institutions,property rights,corruption,large-N study
    JEL: F21 O13 Q15 Q34
    Date: 2014
  15. By: Alagidede, Paul; Adu, George; Frimpong, Prince Boakye
    Abstract: This paper is a contribution to the empirics of climate change and its effect on sustainable economic growth in Sub-Saharan Africa. Using data on two climate variables, temperature and precipitation, and employing panel cointegration techniques, we estima
    Keywords: climate change, Sub-Saharan Africa, sustainable growth, panel cointegration
    Date: 2014

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