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on Development |
| By: | Nanak Kakwani; Marcelo Neri; Hyun H. Son |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:fgv:epgewp:634&r=dev |
| By: | Nanak Kakwani; Marcelo Neri; Hyun H. Son |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:fgv:epgewp:639&r=dev |
| By: | Kenichi Ueda |
| Abstract: | This paper formally identifies an important role of banks: Banks competitively internalize production externalities and facilitate economic growth. I formulate a canonical growth model with externalities as a game among consumers, firms, and banks. Banks compete for deposits to seek monopoly profits, including externalities. Using loan contracts that specify price and quantity, banks control firms' investments. Each bank forms a firm group endogenously and internalizes externalities directly within a firm group and indirectly across firm groups. This unique equilibrium requires a condition that separates competition for sources and uses of funds. I present a realistic institution that satisfies this condition. |
| Keywords: | Bank-oriented financial system , bank control , firm group , economic growth , Banks , Financial systems , Economic growth , Economic models , |
| Date: | 2006–11–29 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:06/264&r=dev |
| By: | Ray Brooks; Steven Barnett |
| Abstract: | Investment has grown rapidly in China in recent years, reaching more than 40 percent of GDP. Despite good progress on bank and enterprise reforms, weaknesses remain that could contribute to inefficient investment decisions. Manufacturing, infrastructure, and real estate have been the drivers of fixed asset investment. Econometric analysis presented in the paper suggests that manufacturing investment is strongly correlated with firms' liquidity, largely retained earnings. Analysis of residential real estate investment shows that it is weakly correlated with real household income growth and real mortgage interest rates. A policy implication of these findings is that reducing liquidity in firms, for example by requiring state-owned enterprises to pay dividends to the government, and using monetary policy to reduce liquidity increase real interest rates, would slow investment in manufacturing and real estate. |
| Keywords: | China , investment , capacity , Investment , China , Absorptive capacity , Resource allocation , |
| Date: | 2006–11–30 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:06/265&r=dev |
| By: | Ana Rute Cardoso (IZA Bonn and University of Minho); Dorte Verner (World Bank) |
| Abstract: | This paper aims at identifying the major drop-out and push-out factors that lead to school abandonment in an urban surrounding, the shantytowns of Fortaleza, Northeast Brazil. We use an extensive survey addressing risk factors faced by the population in these neighborhoods, which covered both in-school and out-of-school youth, of both genders. The role of early parenthood, child labor, and poverty in pushing teenagers out of school is subject to particular attention. The potential endogeneity of some of the determinants is dealt with in the empirical analysis. We take advantage of the rich set of variables available and apply an instrumental variables approach. Early parenthood is instrumented with the age declared by the youngsters as the ideal age to start having sexual relationships; work is instrumented using the declared reservation wage (minimum salary acceptable to work). Results indicate that early parenthood has a strong impact driving teenagers out of school. Extreme poverty is another factor lowering school attendance, as children who have suffered hunger at some point in their lives are less likely to attend school. In this particular urban context, working does not necessarily have a detrimental effect on school attendance, which could be linked to the fact that dropping out of school leads most often to inactivity, and not to work. |
| Keywords: | school drop-out, investment in human capital, education, development, Latin America, Brazil |
| JEL: | I21 O15 D1 |
| Date: | 2006–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp2515&r=dev |