nep-dev New Economics Papers
on Development
Issue of 2015‒12‒12
seven papers chosen by
Jacob A. Jordaan
Universiteit Utrecht

  1. Challenges of Change: An Experiment Training Women to Manage in the Bangladeshi Garment Sector By Macchiavello, Rocco; Menzel, Andreas; Rabbani, Atonu; Woodruff, Christopher
  2. Nudging the Self-employed into Contributing to Social Security: Evidence from a Nationwide Quasi Experiment in Brazil By Juan Miguel Villa; Danilo Fernandes; Mariano Bosch
  3. Religious fragmentation, social identity and rent-seeking: Evidence from an artefactual field experiment in India By Surajeet Chakravarty; Miguel A. Fonseca; Sudeep Ghosh; Sugata Marjit
  4. The Mystery of Saving in Latin America By Ilan Noy; Eduardo A. Cavallo; Oscar Becerra
  5. Human Capital Persistence and Development By Rudi Rocha; Claudio Ferraz; Rodrigo R. Soares
  6. Trade, Aid and Terror By Asongu, Simplice; Kodila-Tedika, Oasis
  7. Tax Incentives and Job Creation in the Tourism Industry of Brazil By Grégoire Garsous; David Corderi; Mercedes Velasco

  1. By: Macchiavello, Rocco (University of Warwick); Menzel, Andreas (University of Warwick); Rabbani, Atonu (University of Dhaka); Woodruff, Christopher (University of Warwick)
    Abstract: Large private firms are still relatively rare in low-income countries, and we know little about how entry-level managers in these firms are selected. We examine a context in which nearly 80 percent of production line workers are female, but 95 percent of supervisors are male. We evaluate the effectiveness of female supervisors by implementing a training program for selected production line workers. Prior to the training, we find that workers at all level of the factory believe males are more effective supervisors than females. Careful skills diagnostics indicate that those perceptions do not always match reality. When the trainees are deployed in supervisory roles, production line workers initially judge females to be significantly less effective, and there is some evidence that the lines on which they work underperform. But after around four months of exposure, both perceptions and performance of female supervisors catch up to those of males. We document evidence that the exposure to female supervisors changes the expectations of male production workers with regard to promotion and expected tenure in the factory.
    Keywords: JEL Classification:
    Date: 2015
  2. By: Juan Miguel Villa; Danilo Fernandes; Mariano Bosch
    Abstract: This paper studies the first large scale effort by the Brazilian government to increase the social security compliance of self-employed workers using behavioral interventions. In 2014, the Brazilian Ministry of Social Security gradually delivered by postal mail a booklet reminding nearly 3 million self-employed workers their obligation to contribute to social security. We find that, sending the booklet increased payments by 15 percent and compliance rates by 7 percentage points. This increase is concentrated around the month the booklet was delivered and disappears three months after the intervention, a pattern known as action and backsliding. The relatively brief increase in payments outweighs the cost of sending the booklet by at least a factor of 2. Our results suggest that active behavioral interventions could be used as policy instruments that are orders of magnitude more cost-effective than subsides to increase social security contributions in developing countries, particularly for the self-employed.
    Keywords: Pension funds, Tax evasion, Social Security, Social Security, Employability
    Date: 2015–11
  3. By: Surajeet Chakravarty (Department of Economics, University of Exeter); Miguel A. Fonseca (Department of Economics, University of Exeter); Sudeep Ghosh (Hong Kong Polytechnic University); Sugata Marjit (DCenter for Studies in the Social Sciences, Calcutta)
    Abstract: We examine the impact of religious identity and village-level religious fragmentation on rent seeking behavior. We report on a series of two-player Tullock contest experiments conducted on a sample of 516 Hindu and Muslim participants in rural West Bengal, India. Our treatments are the identity of the two players and the degree of religious fragmentation in the village where subjects reside. We find no statistically significant differences in rent seeking behavior across different villages. We also do not find any significant differences in behavior as a function of players' identities. This is in contrast to evidence from the same sample which recorded significant differences in cooperation levels in prisoners' dilemma and stag hunt games. We attribute this to the fact that social identity may have a more powerful effect on cooperation than on confl ict.
    Keywords: Social Identity, Social Fragmentation, Artefactual Field Experiment, Rent Seeking.
    JEL: C93 D03 H41
    Date: 2015
  4. By: Ilan Noy; Eduardo A. Cavallo; Oscar Becerra
    Abstract: Using reduced-form regression models, this paper shows that average predicted private saving rates in Latin America and the Caribbean (LAC) are significantly lower than in other regions, particularly Emerging Asia (about 4 percentage points of GDP on average). Predicted public saving rates in LAC are also lower than in Emerging Asia, but by a smaller margin (1 percentage point of GDP on average). It is further shown that LAC private saving rates are below the region-specific prediction by approximately 1. 5 percentage points of GDP on average. Finally, it is found that a greater reliance on external savings does not fully close the negative estimated private saving gap, reducing it by less than 1 percentage point. No gap is found in the case of public saving rates, suggesting that the lower predicted public saving rate in LAC is accounted for by the known determinants of fiscal policy.
    Keywords: Savings, Development Banks, Economic Development & Growth, Saving rates, Saving gap, Determinants of saving, Private saving, Public saving *, IDB-WP-615
    Date: 2015–11
  5. By: Rudi Rocha; Claudio Ferraz; Rodrigo R. Soares
    Abstract: This paper examines the role of human capital persistence in explaining long-term development. We exploit variation induced by a state-sponsored settlement policy that attracted a pool of immigrants with higher levels of schooling to particular regions of Brazil in the late 19th and early 20th century. We show that municipalities that received settlements experienced increases in schooling that persisted over time. One century after the policy, localities that received state-sponsored settlements had higher levels of schooling and income per capita. We provide evidence that long-run effects were driven by persistently higher supply and use of educational inputs and shifts in the structure of occupations towards skill-intensive sectors.
    Date: 2015
  6. By: Asongu, Simplice; Kodila-Tedika, Oasis
    Abstract: This study assesses the role of foreign aid in reducing the hypothetically negative impact of terrorism on trade using a panel of 78 developing countries with data for the period 1984-2008. The empirical evidence is based on interactive GMM estimations with forward orthogonal deviations. Bilateral, multilateral and total aid dynamics are employed whereas terrorism entails: domestic, transnational, unclear and total terrorism dynamics. The following findings have been established. First, while bilateral aid has no significant effect on trade, multilateral and total aids have positive impacts. Second total terrorism, domestic terrorism and transnational terrorism increase trade with increasing order of magnitude. Third, corresponding negative marginal effects on the interaction between foreign aid (bilateral and total) and terrorism display thresholds that are within range. Unexpected signs are clarified and policy implications discussed.
    Keywords: Trade Openness, Foreign Aid; Terrorism; Development
    JEL: F23 F35 F40 O40
    Date: 2015–06
  7. By: Grégoire Garsous; David Corderi; Mercedes Velasco
    Abstract: In recent decades, a significant number of developing countries have implemented fiscal incentives programs for the tourism industry as part of their regional development policies. The main objective of these programs is to increase local investment and employment, as tourism activities are labor intensive. Little evidence is available, however, to assess the effect of these policies on job creation. This paper analyzes a fiscal incentives program that the Brazilian federal government introduced in 2002 to develop the tourism industry in the undeveloped region of Northeast Brazil. It provides evidence that income tax credits had a significant positive effect on job creation. We find that local employment in the tourism industry was on average 34 percent higher in those municipalities that benefited from the program.
    Keywords: Tourism, Tax incentives, Taxation, Fiscal Policy, Investment, Labor markets
    Date: 2015–11

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