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on Development |
| By: | Krantz, Sebastian |
| Abstract: | This paper characterizes economically optimal investments into Africa's road network in partial and general equilibrium - based on a detailed topography of the network, road construction costs, frictions in cross-border trading, and economic geography. Drawing from data on 144 million trans-continental routes, it first assesses local and global network efficiency and market access. It then derives a large network connecting 447 cities and 52 ports along the fastest routes, devises an algorithm to propose new links, analyzes the quality of existing links, and estimates link-level construction/upgrading costs. Subsequently, it computes market-access-maximizing investments in partial equilibrium and conducts cost-benefit analysis for individual links and several investment packages. Using a spatial economic model and global optimization over the space of networks, it finally elicits welfare-maximizing investments in spatial equilibrium. Findings imply that cross-border frictions and trade elasticities significantly shape optimal road investments. Reducing frictions yields the greatest benefits, followed by road upgrades and new construction. Sequencing matters, as reduced frictions generally increase investment returns. Returns to upgrading key links are large, even under frictions. |
| Keywords: | African roads, spatially optimal investments, big data, PE and GE analysis |
| JEL: | O18 R42 R10 O10 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:ifwkwp:302186 |
| By: | Fabrice Defever; Alejandro Riano; Gonzalo Varela |
| Abstract: | This paper evaluates the impact of two large export finance support schemes on firm-level export performance. The Export Finance Scheme (EFS) and the Long-Term Finance Facility for Plant & Machinery (LTFF), provide loans at subsidized interest rates for Pakistani exporters to finance working capital and the purchase of machinery and equipment respectively. We combine customs data with information on firms' participation in each program between 2015 and 2017 and use matching combined with difference-in-differences to estimate the effect of the subsidies on firms' export values, the number of products exported and the number of destinations they serve. We find that both programs deliver a large and positive impact on export growth rates - primarily along the intensive margin - and do so in an effective way relative to the direct financial cost of the subsidies. |
| Keywords: | trade finance, export subsidies, working capital, machinery and equipment, export margins, Pakistan |
| Date: | 2024–08–30 |
| URL: | https://d.repec.org/n?u=RePEc:cep:cepdps:dp2027 |
| By: | Hisaki Kono KONO; Bich-Ngoc T. PHAM |
| Abstract: | Ray and Genicott (2023) proposed a new metric for upward mobility, which also captures the concept of inclusive growth. We proposed several decomposition analyses of this metric using household-level data, which can help identify the factors that contributed to the observed inclusive growth. We applied these methods to Vietnam, a country that experienced rapid and equitable economic growth. Our findings reveal that rural residents, who were initially left behind, experienced more inclusive growth than urban residents, contributing to overall national-level inclusive growth. The impact of household demographic factors such as education levels and job status was relatively minor in explaining inclusive growth in Vietnam. Instead, regional economic performance emerged as a key driver of inclusive growth. The limited impact of education improvement is likely because the poor tended to be low-educated elderly people who would not directly benefit from the improvement of education. These findings underscore the importance of economic growth and expansion of social security systems, such as old-age pension programs, to achieve inclusive growth. |
| Keywords: | Intergenerational income mobility |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:kue:epaper:e-24-003 |
| By: | Rodrigo Chang; Laura Castellanos Author-Name: Esteban Penelas Author-Name: Javier Torres |
| Abstract: | This paper estimates the impact of the introduction of electronic voting technology on Municipal elections in Peru. Using a territorial regression discontinuity design, we estimate the impact on valid votes, and voter turnout. We find that, on average, electronic voting technology decreases blank votes by 1.8 percentage points and invalid votes by 4.4 percentage points. However, it did not have a significant effect on turnout rate. Difference-in-differences estimations and subsequent robustness checks confirm the validity of our results. |
| Keywords: | Electronic voting, political responsiveness, residual votes |
| Date: | 2024–09 |
| URL: | https://d.repec.org/n?u=RePEc:apc:wpaper:203 |
| By: | Kokas, Deeksha (Nanyang Technological University, Singapore); Roche Rodriguez, Jaime Alfonso (World Bank); Lopez-Acevedo, Gladys (World Bank); Robertson, Raymond (Texas A&M University); Karamba, Wendy (World Bank) |
| Abstract: | Cambodia's rapid economic growth in the past few decades has coincided with trade liberalization and structural transformation. This growth has been extensively associated with more employment, higher wages, shared prosperity, and poverty reduction. By combining two complementary approaches, the Gravity model and the Bartik model, this paper estimates: (i) the relationship between trade agreements and trade flows, and (ii) the relationship between trade exposure and various local labor market outcomes. Our gravity estimates show that trade agreements between the Association of Southeast Asian Nations (ASEAN) are positively related with trade flows, and that Cambodia's specific gains from these increases in trade have been larger than for the average trade agreement. This has led to better results for workers in Cambodia's local labor markets. Our shift-share Bartik results suggest that increases in trade exposure in Cambodian districts between 2009 and 2019 correlate with reduced informality and an increase in hours worked, with more positive effects for female workers. |
| Keywords: | trade policy, exports, trade exposure, employment, informality, wages |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17209 |
| By: | Chang, Eunsik (Mississippi State University); Orozco-Aleman, Sandra (Mississippi State University); Padilla-Romo, María (University of Tennessee) |
| Abstract: | This paper studies the effects of mothers' long-term pre-conception exposure to local violence on birth outcomes. Using administrative data from Mexico and two different empirical strategies, our results indicate that mothers' long-term exposure to local violence prior to conception has detrimental effects on infant health at birth. The results suggest that loss of women's human capital and deterioration of mental health are potential underlying mechanisms behind the adverse effects, highlighting intergenerational consequences of exposure to local violence. Our findings shed light on the welfare implications of local violence that are not captured in in-utero exposure to violence. |
| Keywords: | birth outcomes, local violence, pre-conception, maternal stress |
| JEL: | J13 I12 |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17215 |
| By: | Pagel, Jeffrey; Sileci, Lorenzo |
| Abstract: | One potential nature-based solution to jointly address poverty and environmental concerns is large-scale tree planting. This study examines the National Greening Program (NGP) in the Philippines, a major tree planting initiative involving 80, 522 localized projects that directly or indirectly generated hundreds of thousands of jobs. Utilizing a dynamic difference-in-differences approach that leverages the staggered implementation of the NGP, we find a significant and sizable reduction in poverty, measured via traditional and remotely sensed indicators. The NGP also spurred structural shifts, notably decreasing agricultural employment while boosting unskilled labor and service sector jobs. Our analysis estimates that the NGP sequestered 71.4 to 303 MtCO2 over a decade, achieving a cost efficiency of $2 to $10 per averted tCO2. These findings underscore the potential of tree planting as a dual-purpose strategy for climate mitigation and poverty alleviation. |
| JEL: | N0 R14 J01 |
| Date: | 2024–07–29 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:124551 |
| By: | Brunori, Paolo (University of Florence); Ferreira, Francisco H. G. (London School of Economics); Salas-Rojo, Pedro (London School of Economics) |
| Abstract: | Scholars have sought to quantify the extent of inequality which is inherited from past generations in multiple ways, including a large body of work on intergenerational mobility and inequality of opportunity. This paper makes two contributions to that broad literature. First, we show that many of the most frequently used approaches to measuring mobility or inequality of opportunity fit within a general framework which involves, as a first step, a calculation of the extent to which inherited circumstances can predict current incomes. Second, we suggest a new method - within that broad framework - which is sensitive to differences across the entire distributions of groups with different inherited characteristics, rather than just in their means. This feature makes it particularly well-suited to measuring inequality of opportunity, as well as to any inequality decomposition approach that requires going beyond means in assessing between-group differences. We apply this approach to South Africa, arguably the world's most unequal country, and find that almost three-quarters of its current inequality is inherited from predetermined circumstances, with race playing the largest role but parental background also making an important contribution. |
| Keywords: | inequality, opportunity, mobility, transformation trees, South Africa |
| JEL: | D31 D63 J62 |
| Date: | 2024–08 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17203 |
| By: | Calzada, BCO; Spinola, Danilo |
| Abstract: | Export diversification is crucial for economic development, yet many resource-rich countries have struggled to achieve significant progress in diversifying its economic structure. While the lack of capabilities is often highlighted as a primary barrier to diversification, the literature frequently underestimates the significant impact of macroeconomic conditions on diversification potential. This study seeks to bridge the gap between the capabilities literature and macroeconomic factors, particularly in the context of economies heavily dependent on extractive industries. In order to address our question, we initially introduce a novel measure of product relatedness, expanding on the framework developed by Nomaler and Verspagen (2022), and econometrically estimate its relationship with key macroeconomic variables such as international prices, exchange rates, energy and mineral dependency, and GDP per capita. The analysis spans over 5, 000 products across multiple countries from 1995 to 2019, with the objective of determining the relative significance of these factors in predicting diversification patterns and assessing how macroeconomic conditions either facilitate or impede diversification, particularly in non-extractive sectors. Product relatedness predicts diversification, especially in extractive industries where path dependence is highly pronounced. However, macroeconomic factors exert a major influence on diversification outcomes. These macroeconomic variables can either constrain or enable diversification, shaping the pathways through which industries evolve and expand their portfolios. |
| Keywords: | Export Diversification; Product Relatedness; Macroeconomic Factors; Extractive Sectors |
| Date: | 2024–09–03 |
| URL: | https://d.repec.org/n?u=RePEc:akf:cafewp:30 |
| By: | Rose, Julian; Neubauer, Florian; Ankel-Peters, Jörg |
| Abstract: | Banerjee, Duflo, and Sharma (BDS, 2021a) conduct a ten-year follow-up of a randomized transfer program in West Bengal. BDS find large effects on consumption, food security, income, and health. We conduct a replicability assessment. First, we successfully reproduce the results, thanks to a perfectly documented reproduction package. Results are robust across alternative specifications. We furthermore assess the paper's pre-specification diligence and the reporting in terms of external and construct validity. While the paper refers to a pre-registration, it lacks a pre-analysis plan. Assessing the validity of findings for other contexts is difficult absent necessary details about the exact treatment delivery. |
| Keywords: | replicability, randomized controlled trial, transfer programs, research transparency |
| JEL: | A1 O12 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:i4rdps:142 |
| By: | Chen Chen; Koralai Kirabaeva; Danchen Zhao |
| Abstract: | Financially constrained governments, particularly in emerging and developing economies, tend to face a fiscal trade-off between adapting to climate change impacts and pursuing broader development goals. This trade-off is especially relevant in the agriculture sector, where investing in adaptation is critical to ensure food security amidst climate change. International trade can help alleviate this challenge and reduce adaptation investment needs by offsetting agricultural production shortages. However, in the presence of trade fragmentation, the adaptive role of trade diminishes, exacerbating food insecurity and increasing investment needs for adaptation. In this paper, we present a model to guide policymakers in deciding on the cost-efficient balance between investing in adaptation in the agricultural sector versus in broader development under financing and trade constraints. We apply the model to Ghana, Egypt, and Brazil, to examine the adaptation-development trade-off and highlight factors that would potentially lower adaptation investment needs. These factors include trade openness, higher agricultural productivity and efficiency of adaptation spending, and reduced labor market distortions. The key takeaways from the model applications suggest that (i) promoting trade openness and accessing concessional finance for adaptation help tackle climate challenges and ensure food security in lower-income countries; and (ii) domestic structural reforms are necessary to facilitate adaptation investments and reduce investment needs, by improving labor market flexibility, adaptation efficiency, and agriculture productivity. |
| Keywords: | agriculture; investment; adaptation; trade; climate change |
| Date: | 2024–08–23 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2024/184 |
| By: | Luhur Bima; Rachma Indah Nurbani; Sofni Indah Arifa Lubis; Rendy Adriyan Diningrat; Cecilia Marlina; Emmy Hermanus |
| Keywords: | child poverty, urban poverty, children’s voice |
| URL: | https://d.repec.org/n?u=RePEc:agg:wpaper:1641 |