Home      The Africa 25!      Give!      Shop & Give!      Learn      Methodology      Rating Fund      Raters      For Non-Profits

Disjunctive Paradigms: Good Governance and the Privatization of Service Provision in Sub-Saharan Africa

• Currently there is no abstract for this paper.

Do Balance Sheet Effects Matter for Brazil

• The aim of this essay is to verify if exchange rate depreciations have a negative effect on the Brazilian economy as predicted by the models with balance sheet effects. The result of the empirical tests is that the exchange rate seems to have an effect on the country risk but no effect on the induustrial output was detected

SME

• This paper analyses the financial problems of small firms in Turkey by over viewing the problem from both firm owner’s and bank’s point of views, exploring the policy issues, and making use of the survey results of 39 firms in Ankara, in comparison with results of State Institute of Statistics. These empirical analyses suggest that the fragility in the financial markets and lack of competition for small firm financing are the key factors creating the external finance difficulties of entrepreneurs. The financial restructuring era that Turkey is experiencing will promote competition in credit markets; ease those problems of small firm owners and endorse higher growth.

   

Untapped Growth: The Economics of Gender and Education

• There is no abstract currently available for this paper.

P03A7-14

Income Inequality, Fiscal Policy and Institutional Development: One the Redistributive Effects of Income Tax Progressivity and Corruption.

• This paper draws on two existing strands in the public finance literature: one tries to measure and compare the efficiency costs of redistribution through progressive taxation versus public expenditures. The other aims to quantify the effects of institutional failures, e.g. corruption, on inequality. On the one hand, the paper tests and finds econometric evidence against the main policy tenets stemming from the traditional normative approach (Optimal Income Taxation theories) - which advocates the use of public expenditures rather than tax to deal with equity concerns - supporting instead the idea that both income tax and expenditure progressivity are necessary to reduce income inequality. Furthermore, the relationship between income tax progressivity and inequality is shown to be non-linear. On the other hand, the paper strongly supports theories arguing that countries with higher levels of corruption tend to be more unequal. In particular, it is able to show that the channel is indeed fiscal: corruption reduces the effective degree of progressivity of a given tax system. Overall, the paper's main technical contribution to the debate lies in the design of an income tax progressivity index. The calculation of such index over a cross-country sample allows us to model explicitly the effects of fiscal policy and corruption on income inequality.

An Analysis of Past, Present and Future Role of Capital Controls in the Malaysian Economy

• There is no abstract currently available for this paper.

Can N.G.O.s empower the poor and influence policy and planning?

• Abstract
  • This paper discusses the strength and weaknesses of NGO’s, as well as participatory developmental methods, in their efficacy towards achieving empowerment. The NGO can empower in very different ways, also illegitimate, however the causal connection, (positively correlated) between size and authority, i.e. the mutually excluding principles of functioning participation and voice, severely limits this capability. The tendency is for organisation to be the result of a trade off between individual and group empowerment activities.

A Case for Caution: A "Wait and See" Approach for UK Euro Advocacy

• Abstract

  • Any discussion on whether or not to engage in a monetary union involves not only weighing the economic costs and benefits of the project, but also taking into account structural idiosyncrasies particular to that economy with respect to its potential partners.  With these questions in mind, it will be the objective of this essay to outline the advantages and disadvantages of euro membership for the UK, taking into account what distinguishes the UK from its eurozone neighbors in order to recommend whether or not the UK should adopt the euro.  It is advisable that the UK take a “wait and see” approach to EMU membership.  This involves observing if the ECB can develop a credible inflation target that is employment-friendly.  Furthermore, while the fiscal policy limits in the SGP are intended to ensure that member governments’ finances are sustainable, some reforms are necessary if the EMU is to successfully hedge against downside instability.

Investment in Human Capital: Intergenerational Transmission of Income Inequality and Taxation

• Abstract

  • A model is formulated in which altruistic parents can invest in their children’s human capital or bequeath part of their wealth. Parents are certain of the abilities of their children. However, allowing for capital market imperfections, they may be induced to invest in a sub-optimal level of education. This implies that the often-noted conflict between egalitarian redistributive policies and economic efficiency is mitigated. Numerical experiments are conducted to investigate the effects of several tax policy mix scenarios on income inequality and intergenerational mobility. The results point towards a tradeoff between efficiency and intergenerational mobility on the one hand, and equity on the other hand.

Is there a fundamental conflict between the objectives of a liberal world economy and environmental protection?

• Abstract

  • The world is facing inexperienced challenges and threats of environmental degradation. Despite the efforts to overcome the challenge, environmental destruction is still continuing. With economic liberalism firmly in the ascendant across the world, some people argue that following the liberalist doctrine will eventually lead us to sufficient level of environmental protection. However, this paper argues that there is a substantial conflict between the objectives of a liberal world economy and environmental protection. The subordination of the substance of the society to the laws of market is dangerous and unsustainable. Yet the liberal world economy and environmental protection is not incompatible, and in fact, understanding the conflict between these two would be a mere starting point to make both ‘work.’

Undestanding Inflation in Turkey: A Model of Redistribution

• Abstract

  • Turkey has a history of fifty years of high inflation and unsuccessful disinflation programs. The political instability throughout her history has amplified the economic instability. The high levels inflation has also been on of the main reasons of the income redistribution and income inequality, mainly hurting the fixed income group. This paper focuses on the redistribution aspects of the high levels of inflation and develops a model of understanding it in consideration of the Turkish economic and political history. The future adoption of the monetary program of inflation targeting is also discussed and evaluated in this framework.

Personal Computer Adoption - An Empirical Investigation into Herding and Complementarities

• There is no abstract currently available for this paper.

Favela-Houses as Credit Collateral? How can joint liability contracts help to overcome the low external valuation of these houses?

• Abstract

  • This dissertation analyses the possibilities and limitations of a policy that gives poor people formal titles to their “favela (slum)” houses which could serve as collateral to get access to formal credit. This paper concentrates on the problem that the efficiency gain of having collateral might be reduced significantly if the lender values the location – like a “slum” – much less than the current inhabitant. A theoretical model shows how these differences in property valuation can be reduced if the borrowers form a joint-liability network, combine collateral and thereby exploit property valuation externalities and decreasing transaction costs.

How Ethnic Fragmentation And Cultural Distance Affect Moral Hazard in Developing Countries

• Abstract

  • Diverse problems of information and trust encountered in running a business in different markets, industries and countries can be understood as stemming from a common problem of moral hazard, based on unobservability of “effort.” A large amount of literature, therefore, reveals that the typical moral hazard problems arising in developing countries can be reduced by the effect of social networks and more generally by every social structure pushing economic agents to enter repeated relations. The aim of my essay is to extend the analysis of the role that social networks play in tempering the moral hazard problem by allowing the possibility of networks differenced in the ethnic and cultural characteristics of their members. If economic agents are more likely to have repeated relations with people belonging to the most similar networks, then reputational punishments could represent important incentives against moral hazard behaviour only between agents belonging to the same network; this can imply a low development of the activity set up by the principal, and low competition in credit and good’s markets. I build a theoretical model showing how ethnical and cultural fragmentation can lead the economy to a bad equilibrium characterized by low competition and low development.

  • Key Words: Development, Moral Hazard, Fragmentation, Social Networks, Reputational Punishment.

Does FDI Matter for Trade in Brazil? An Application of the Gravity Model

• Abstract

  • Foreign direct investment (FDI) in Brazil was essential for financing a persistent current account deficit since 1995, however several issues concerning its long-term impact remain unclear. One of these issues is the direct effect of FDI on trade. The first part of this essay overviews the literature on multinational enterprise (MNE) and describes the theoretical relationship between FDI and trade in Brazil. A gravity equation is then applied to provide empirical evidence on the effect of FDI on exports and imports of the ten major manufactured goods. The dataset consists of trade flows between Brazil and 38 countries throughout the period of 1996-2002, as well as FDI disaggregated by industry and country of origin. The results indicate the exis tence of a positive relationship between FDI and imports. No relationship is detected in the case of exports. This suggests that FDI was mainly of horizontal type and resulted in more imports, as affiliates started to buy manufactured goods from their home countries. It seems that MNEs in Brazil have only been interested in supplying local markets and that exporting was not their main objective.

Facts about Economic Growth in Mexico

• There is no abstract currently available for this paper.

The Affect of Aid on Governance - An Empirical Study

• Abstract
  • This paper confirms through ordinary least squares regression, the conviction that democratization of a country is not correlated to the amount of aid it receives. The parameter estimated by this regression model used for the coefficient of aid in determining changes in levels of democratization is very close to zero, as might be intuitively expected. This value has certain implications for policies because it disproves any notion that democratic countries will become more democratized by receiving aid. This is important because many donors such as the U.S. donate aid strictly to democracies with the pretense of promoting them.

Determinants of Bank Lending & The Effects of Monetary Policy on Bank Lending in Developing Countries

• Abstract

  • This essay identifies the macroeconomic determinants of bank loan volume across industrialized and developing countries. Macroeconomic and financial sector data from 209 countries are employed to estimate a reduced form equation for bank loan volume to the private sector. Finding that the equilibrium level of private sector credit is influenced negatively by the deposit interest rate and the interest rate spread, among other variables, and non-negatively by inflation, I present a preliminary investigation of the effects of monetary contractions on bank loans in developing countries, using time series data from Brazil as a test case.