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on Development |
| By: | Abagna, Matthew Amalitinga; Hornok, Cecília; Mulyukova, Alina |
| Abstract: | This paper provides empirical evidence on the impact of a prominent place-based policy - Special Economic Zones (SEZs) - on the economic well-being of African households. We compile a novel dataset on repeated cross-sections of households living in various distance bands around SEZs in 10 African countries over the period of 1990 to 2020. Exploiting time variation in SEZ establishment, the estimation yields that households in the vicinity of SEZs become significantly wealthier compared to the national average after SEZs are established. The effect is most pronounced for households within 10 km and decays rapidly with distance. We show that this result is not driven by the residential sorting of wealthier households in SEZ neighbourhoods. The rise in wealth is strongest towards the middle of the wealth distribution and goes hand in hand with increased access to household utilities, higher consumption of durable goods, higher levels of education, and a shift away from agricultural activities - patterns that we interpret as indicative of an urbanization trend and the strengthening of the middle class. |
| Keywords: | special economic zone, place-based policy, household wealth, Africa |
| JEL: | F6 F21 O15 O25 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwkwp:283892&r=dev |
| By: | Asyahid, Esa A. (Warwick University) |
| Abstract: | Although local government splits have been widely implemented in developing countries, there is limited empirical evidence on their effects on economic activities. This study investigates the impacts of district splits on household business activities using a rich household-level panel dataset that spans over 20 years and covers an episode of massive district splits in Indonesia. Using a difference-in-differences approach, I found that district splits do not improve non-farm business revenue growth. Instead, they drive more businesses to exit from the industry. On the other hand, district splits improve farm business revenue growth and entry into this industry. However, the growth effect is not driven by productivity improvement as expected, but solely the result of land input expansion, which is likely acquired in unsustainable ways. Additionally, district splits decrease out-migration, aligning with the Tiebout sorting model. Taken together, these findings add another argument for the need to reevaluate the current practices and regulations on local government splits. |
| Keywords: | D13 ; D73 ; H77 JEL classifications: local government splitting ; Indonesia ; household business ; difference-indifference |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:wrkesp:70&r=dev |
| By: | Hajer Habib (University of Tunis El-Manar); Amal Jmaii (University of Tunis El-Manar) |
| Abstract: | In this study, we assess the implications of COVID-19 shocks on household income, food security, and the role of social protection in Tunisia. We used data from the four waves of the Combined COVID-19 MENA Monitor Household Survey conducted by the Economic Research Forum between February 2020 and June 2021. First, the results show that lowincome and labor income-dependent households are the most vulnerable to shocks induced by COVID-19 and that their food habits deteriorated considerably. A total of 78.4 percent of respondents declared that they are in severe food insecurity. Second, we find that food insecurity showed a higher increase in urban areas than in rural areas; self-produced food by farmers who inhabit rural areas represented a food safety net during the pandemic. Finally, households that received a social transfer did not manage to overcome severe food insecurity. The study proves that government social policies have failed to absorb the harmful effects of COVID-19. This is because social protection is mainly oriented toward retired people and excludes those who are most vulnerable to economic shocks. As a result, extending social protection coverage to households that face transitory poverty poses a challenge. |
| Date: | 2023–12–20 |
| URL: | http://d.repec.org/n?u=RePEc:erg:wpaper:1699&r=dev |
| By: | Soyoka OKAMURA; Yotaro UENO; Toma YAMAGOSHI; Hisaki KONO |
| Abstract: | We revisit the empirical investigation of the importance of national institutions for sub-regional economic development using more accurate nighttime light data. In contrast to the original study by Michalopoulos and Papaioannou (2014), we find that national institutions matter even after controlling for ethnic-homeland fixed effects, and even in areas far from the capital. This suggests that the spatial imprecision and blurring of nighttime light data attenuated the association between national institutions and economic activity in their analysis. Nevertheless, our analyses generally corroborate their argument, particularly regarding the role of the limited penetration of national institutions in African countries. |
| Keywords: | Consistency, Nighttime lights, DMSP, VIIRS, national institutions. |
| JEL: | O10 O43 N17 R12 |
| URL: | http://d.repec.org/n?u=RePEc:kue:epaper:e-23-008&r=dev |
| By: | Kumar, Sai Shreyas Krishna (Warwick University) |
| Abstract: | I study the effect of lifting restrictions on night – shift work for women on their labour market outcomes. Using the staggered repeal of night – shift restrictions for women under the Factories Act, 1948 in the Indian states of Punjab, Gujarat, Maharashtra, and Assam, I employ a Triple Difference model to estimate its effect on the share of women workers and daily wages for women in manufacturing. My results suggest no significant impact as the estimated effects are close to 0 and statistically insignificant. I am also able to rule out effects larger than 0.95 p.p and 2.8% on the share of women workers and daily wages respectively, and these estimates are robust to the use of the Stacked Triple Difference regression. I also provide several possible explanations for my results using case studies. |
| Keywords: | Night Shifts ; Female Labour Force Participation ; Wages ; Manufacturing ; India JEL classifications: J08 ; J16 ; J21 ; J31 ; J38 ; K31 ; O14 ; O25 |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:wrk:wrkesp:66&r=dev |
| By: | Galarza, Francisco (Universidad del Pacífico); Kámiche Zegarra, Joanna (Universidad del Pacífico); Gómez de Zea, Rosario (Universidad del Pacífico) |
| Abstract: | We study the role of subnational institutions in forest conservation in a context in which areas near roads are prone to deforestation. We develop an index of institutionalism to examine the extent to which local institutions can contribute to mitigate the road infrastructure’s adverse effect on deforestation. Using a large dataset from Peru, home to the second largest portion of the Amazon rainforest, we find that a higher value of our index of local institutions is significantly correlated with lower deforestation. However, the effect of our institutions index is not sufficiently large to offset the deforesting effect that closeness to roads has, at least not for relatively short distances to road. These results are robust to different specifications of our institutions index and to the inclusión of a large set of control variables. |
| Keywords: | Environment and development, deforestation, infrastructure, institutions. |
| JEL: | D02 O18 Q56 |
| Date: | 2023–06 |
| URL: | http://d.repec.org/n?u=RePEc:pai:wpaper:23-03&r=dev |
| By: | Benson, Todd; De Weerdt, Joachim; Duchoslav, Jan; Masanjala, Winford |
| Abstract: | Malawi has been at the center of the debate on agricultural input subsidies in Africa ever since it significantly expanded its fertilizer subsidy program about two decades ago. When it did so, Malawi was a trailblazer, receiving international attention for seemingly leveraging the subsidy program to move the country from a situation characterized by food deficits and widespread hunger to crop production surpluses. In this paper we trace the history of Malawi’s subsidy program over the past 70 years, describing how the country arrived at that watershed moment earlier this century and how the subsidy program has developed since. We show how donor support for the program has wavered and how external pressure to remove the subsidy has repeatedly been unsuccessful. We also demonstrate how over the years the program’s total fiscal burden has fluctuated significantly. However, we find that since the expansion of the subsidy program in 2004, the fiscal costs of the program have shown little correlation with the maize harvest that same agricultural season. We show that the subsidy program has succeeded in raising awareness about the value of the fertilizer for increased crop productivity. However, despite its continued prominence in the country’s agricultural policy, most Malawian smallholder do not manage to grow sufficient maize to feed their households throughout the year, and every year millions depend on food assistance during the worst months of the lean season. |
| Keywords: | fertilizers; subsidies; maize; food security; Africa; Sub-Saharan Africa; Eastern Africa; Malawi |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:masspp:44&r=dev |
| By: | Bao-We-Wal Bambe; Jean-Louis Combes; Pascale Combes Motel; Chantale Riziki Oweggi |
| Abstract: | We investigate the impact of climate change on firms’ investment in research and development (R&D) in developing countries. The paper relies on two contrasting hypotheses. In the first hypothesis, we speculate an optimistic situation where climate change could induce firms to spend on R&D to both reduce their environmental impact and curb the effects of future climate shocks. In the second hypothesis, we propose a pessimistic scenario where climate change would reduce firms’ incentives to invest in R&D. This second hypothesis would mainly be due to tighter conditions for access to finance from lenders, given the increased uncertainty about the firm’s future returns in the face of climate change. The empirical results support the second scenario, small firms being more severely affected. Furthermore, we examine the underlying mechanisms and identify financial access as the key channel through which climate change reduces R&D investment. |
| Keywords: | Climate change • Firm innovation • Developing Countries |
| JEL: | D22 O3 Q54 |
| Date: | 2024–02 |
| URL: | http://d.repec.org/n?u=RePEc:ise:remwps:wp03122024&r=dev |
| By: | Chiwaula, Levison; De Weerdt, Joachim; Duchoslav, Jan; Goeb, Joseph; Gondwe, Anderson; Jolex, Aubrey |
| Abstract: | Maize prices fluctuate significantly throughout the year in Malawi, creating winners and losers depending on who is selling and who is buying the staple at different times. We link maize market price data to nationally and temporally representative household survey data on maize sales and purchases to quantify welfare gains and losses throughout the year. A stable maize price would lead to only a modest increase in Malawi’s total social surplus when summed across a whole year, but a dramatic reduction in hunger during the lean season. We discuss policy options to smooth maize prices throughout the year. |
| Keywords: | data analysis; economics; households; maize; market prices; surveys; Eastern Africa; Africa; Malawi |
| Date: | 2024 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:masspp:45&r=dev |
| By: | Luigi Minale (Universidad Carlos III de Madrid); Rudi Rocha (São Paulo School of Business Administration, Getulio Vargas Foundation); Bruno Vigna (BNDES) |
| Abstract: | The article investigates the long-term economic effects of immigrant diversity. Focusing on the large immigration wave experienced by Brazil at the turn of the twentieth century, we ask whether municipalities in the State of São Paulo that received a population of immigrants characterized by a more diverse mix of origin countries ended up having better long-term economic outcomes. To identify causal effects, we leverage on unique historical individual-level data in immigrants arriving in São Paulo between 1880 and 1920, and develop an instrumental variable strategy that combines time variation in the composition of immigrants arriving from overseas with the timing of the railway network expansion in the state. We find that a one standard deviation increase in accumulated immigrant diversity in 1920 is associated with a 7-8% higher income per capita in 2000. This effect is economically relevant and robust to various identification tests. Furthermore, when exploring the mechanisms through which immigrant diversity affected long-term development, we document that municipalities that hosted more a more diverse pool of immigrants experienced (i) larger proportions of employment in manufacturing and services as well as greater occupational diversity within manufacturing in the long-term; (ii) higher investment in public goods, as measured by municipal spending on education; (iii) and higher education outputs in the long-run. |
| Keywords: | birthplace diversity, immigration, long-term development |
| JEL: | C36 N36 O15 |
| Date: | 2024–03 |
| URL: | http://d.repec.org/n?u=RePEc:crm:wpaper:2408&r=dev |
| By: | Torsten Wezel; Hannah Sheldon; Zhengwei Fu |
| Abstract: | While deeply undercapitalized banks have been shown to misallocate credit to weak firms, the drivers of such zombie banks are less researched, particularly across countries. To furnish empirical evidence, we compile a dataset of undercapitalized banks from emerging markets and developing economies. We classify zombie banks as those not receiving remedial treatment by owners or regulators or, alternatively, remaining chronically undercapitalized. Using logit regressions, we find that country-specific factors are more influential for zombie status than bank characteristics, alhough some become significant when disaggreating by region. The paper’s overall findings imply the need for a proper regulatory framework and an effective resolution regime to deal with zombie banks more decisively. |
| Keywords: | Banks; Capital Requirements; Financial Crises |
| Date: | 2024–02–23 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2024/036&r=dev |
| By: | Galarza, Francisco (Universidad del Pacífico); Carbajal Navarro, Max Arturo (Pontificia Universidad Católica del Perú); Aguirre Montoya, Julio (Universidad del Pacífico) |
| Abstract: | We study the willingness to pay (WTP) for a large set of improvements in water service related to water quality, continuity, and securing access for people with no house piped water during the COVID-19 pandemic. Using data from urban Peru, and the contingent valuation method, we estimate a mean WTP of around PEN 4.3 (USD 1.05), 3.7 and 1.8, respectively, for the aforementioned sets of improvements, with the combined WTP representing a 23% increase in the households’ water service monthly bill. We find that the WTP for all sets of improvements is influenced by the expenditure in bottled water (which acts as a substitute for tap water) and a proxy variable for household assets. The influence of the individual characteristics typically scrutinized by the literature (e.g. sex, age, and education) varies with the type of improvement examined. We find a significant heterogeneity in WTP across providers and calculate the users’ contribution to a water fund that could crowd-in the public investment in water infrastructure. |
| Keywords: | Access to tap water, Contingent valuation method, Continuity, COVID-19, Households, Quality, Safe water, Willingness to pay. |
| JEL: | C25 D12 I10 L95 Q25 Q51 |
| Date: | 2022–11 |
| URL: | http://d.repec.org/n?u=RePEc:pai:wpaper:22-03&r=dev |