the microfinance promise in the past decade microfinance programs have demonstrated that it is possible to lend to low income households while maintaining high repayment rates even without requiring collateral the programs promise a revolution in approaches to alleviating poverty and spreading financial services and millions of poor households are served globally a growing body of economic theory demonstrates how new contractual forms offer a key to microfinance success particularly the use of group lending contracts with joint liability for the most part however high repayment rates have not translated into profits and studies of impacts on poverty yield a mixed picture in describing emerging tensions the paper highlights the diversity of innovative mechanisms beyond group lending contracts the measurement of financial sustainability the estimation of economic and social impacts the costs and benefits of subsidization and the potential to reduce poverty through savings programs rather than just credit the promise of microfinance has pushed far ahead of the evidence and an agenda is put forward for addressing critical empirical gaps and sharpening the terms of policy discussion

unemployment and the coverage extension of collective wage agreements abstract this paper examines how the extension of collective wage bargaining agreements to non unionized firms affects unemployment testing a large number of econometric specifications on data from 15 oecd countries observed between 1965 and 2007 we find a positive significant and robust interaction between the tax wedge and the degree of coverage extension of collective wage bargaining agreements more specifically our results suggest that the tax wedge has a larger positive effect on unemployment than any other labour market policy in countries with wide extension of collective wage agreements coverage such as france or spain conversely in countries where coverage extension is close to zero as in nordic countries unemployment is essentially insensitive to changes in the tax wedge

job destruction and propagation of shocks this paper considers propagation of aggregate shocks in a dynamic general equilibrium model with labor market matching and endogenous job destruction cyclical fluctuations in the job destruction rate magnify the output effects of shocks as well as making them much more persistent interactions between capital adjustment and the job destruction rate play an important role in generating persistence propagation effects are shown to be quantitatively substantial when the model is calibrated using job flow data incorporating costly capital adjustment leads to significantly greater propagation

on the importance of the participation margin for labor market fluctuations abstract conventional analyses of labor market fluctuations ascribe a minor role to labor force participation we show by contrast that flows based analyses imply that the participation margin accounts for around one third of unemployment fluctuations a novel stock flow apparatus establishes these facts delivering three further contributions first the role of the participation margin appears robust to adjustments for spurious transitions induced by reporting error second conventional stocks based analyses are subject to a stock flow fallacy neglecting offsetting forces of worker flows on the participation rate third increases in labor force attachment among the unemployed during recessions are a leading explanation for the role of the participation margin

job search and unemployment insurance new evidence from time use data article i nfo this paper provides new evidence on job search intensity of the unemployed in the u s modeling job search intensity as time allocated to job search activities the major findings are 1 the average u s unemployed worker devotes about 41 min to job search on weekdays which is substantially more than their european counterparts 2 workers who expect to be recalled by their previous employer search substantially less than the average unemployed worker 3 across the 50 states and d c job search is inversely related to the generosity of unemployment benefits with an elasticity between 1 6 and 2 2 4 job search intensity for those eligible for unemployment insurance ui increases prior to benefit exhaustion and 5 time devoted to job search is fairly constant regardless of unemployment duration for those who are ineligible for ui

the cyclicality of separation and job finding rates this paper uses cps gross flow data to analyze the business cycle dynamics of separation and job finding rates and to quantify their contributions to overall unemployment variability cyclical changes in the separation rate are negatively correlated with changes in productivity and move contemporaneously with them while the job finding rate is positively correlated with and tends to lag productivity contemporaneous fluctuations in the separation rate explain between 40 and 50 percent of fluctuations in unemployment depending on how the data are detrended this figure becomes larger when dynamic interactions between the separation and job finding rates are considered

imperfect substitutes the local political economy of informal finance and microfinance in rural china and india abstract banking authorities in both china and india have attempted to limit most forms of informal finance by regulating them banning them and allowing certain types of microfinance institutions the latter policy aims to increase the availability of credit to low income entrepreneurs and eliminate their reliance on usurious financing nonetheless the intended clients of microfinance continue to draw on informal finance in both rural china and india this article argues that the persistence of informal finance may be traced to four complementary reasons the limited supply of formal credit limits in state capacity to implement its policies the political and economic segmentation of local markets and the institutional weaknesses of many microfinance programs

the role of shocks and institutions in the rise of european unemployment the aggregate evidence two key facts about european unemployment must be explained the rise in unemployment since the 1960s and the heterogeneity of individual country experiences while adverse shocks can potentially explain much of the rise in unemployment there is insufficient heterogeneity in these shocks to explain cross country differences alternatively while explanations focusing on labour market institutions explain current heterogeneity well many of these institutions pre date the rise in unemployment based on a panel of institutions and shocks for 20 oecd nations since 1960 we find that the interaction between shocks and institutions is crucial to explaining both stylised facts

unemployment a survey this paper presents a survey of the economics of unemployment it covers competitive and imperfect competition models the role of different methods of wage determination and explanation of postwar unemployment patterns in the oecd countries copyright 1990 by royal economic society

the effect of benefit sanctions on the duration of unemployment this paper investigates the effectiveness of unemployment benefit sanctions in reducing unemployment duration swiss data on benefit sanctions allow us to separate the effect of a warning that a person is not complying with eligibility requirements from the effect of the actual enforcement of a benefit sanction moreover public employment services are given substantial leeway in setting the monitoring intensity results indicate that both warning and enforcement have a positive effect on the exit rate out of unemployment and that increasing the monitoring intensity reduces the duration of unemployment of the nonsanctioned jel j64 j65 j68

macroeconomic effects of regulation and deregulation in goods and labor markets product and labor market deregulation reduce and redistribute rents leading economic players to adjust to this new distribution it typically comes with distribution and dynamic effects to study these effects we build a macroeconomic model on two central assumptions monopolistic competition in the goods market which determines the size of rents and bargaining in the labor market which determines the distribution of rents product market regulation determines entry costs and the degree of competition labor market regulation determines the bargaining power of workers we show the effects of deregulation we then use our results to discuss the political economy of deregulation and recent macroeconomic evolutions in europe

the impossible default qualitative data on borrower responses to two types of social collateral microfinance structures in rural china abstractqualitative data reveal how the social context underlying the ties linking borrowers in microfinance programmes influences their decisions focusing directly on social context makes it possible to distinguish between two social collateral structures and explain why one facilitated repayment while the other did not fieldwork in rural china shows that the basis of the social ties in the social collateral structure is central to explaining whether and why individuals decided to sanction defaulters and repay loans the article closes with reflections on generalisations of these findings to future microfinance research

dowry and intrahousehold bargaining evidence from china this paper analyzes the relationship between a woman s intrahousehold bargaining position and her welfare within marriage using household data from rural china simultaneity problems are overcome by using dowry to proxy for bargaining position omitted variable bias is addressed by using grain shocks in the year preceding marriage as an instrument for dowry instrumented dowry positively impacts numerous measures of a wife s welfare including household purchases the time allocation of household members and the woman s satisfaction with life offering strong evidence in support of collective models of the household

impact of the kyoto protocol on the iberian electricity market a scenario analysis this paper presents an assessment of the impact of the kyoto protocol on the iberian electricity market during two periods the first phase 2005 2007 and the second phase 2008 2012 a market equilibrium model is used in order to analyze different conditions faced by generation companies scenarios involving co2 emission prices hydro conditions demand fuel prices and renewable generation are considered this valuation will show the significance of co2 emission prices as regards spanish and portuguese electricity prices generation mix utilities profits and the total co2 emissions furthermore the results will illustrate how energy policies implemented by regulators are critical for spain and portugal in order to mitigate the negative impact of the kyoto protocol in conclusion the iberian electricity system will not be able to reach the kyoto targets except in very favorable conditions co2 emission prices over 15 ton and the implementation of very efficient energy policies

rational herding toward the poor evidence from location decisions of microfinance institutions within pakistan analyzing the geographical location of almost all the microfinance institutions mfis within pakistan this paper gives further evidence that microfinance activities do not reach the poorest rural areas especially we explore how this result is driven by the uncertainty faced by mfis in their location decision i e they can hardly predict accurately whether or not they will perform financially furthermore we find that mfis are spatially clustered and identify three main reasons for this common attraction factors i e the characteristics of one area fits to the preferences of all mfis so that they are all located in the same areas payoff externalities to be collocated and herd behavior i e mfis follow one another most importantly we find that a significant part of this herding process is rational i e early locations of mfis convey information used by later ones such that it reverses or neutralizes the negative impact of uncertainty resulting then in more locations in needier areas since it allows them to be located in poorer areas mfis improve the achievement of their social goal this latter result is rather good news for those who reckon that a better access to financial services enhances economic growth and fosters poverty alleviation indeed rational herding constitutes an endogenous moderator effect to the big issue that financial services penetration is too weak in the poorest rural areas

unemployment questions and some answers in more or less every country in the oecd unemployment was lower in the decades following the second world war than in any other period of comparable length either before or since for example in britain unemployment has exceeded 5 in every peacetime decade from 1850 onwards except for the 1950s and 1960s alternatively as we can see in table 1 p 779 average unemployment in the 1980s and 90s is higher generally much higher than in the 1960s in every country considered why this is so is one of the questions which underlies this paper a second question which is also illustrated in the unemployment numbers presented in table 1 p 779 concerns the causes of the enormous variation in unemployment rates across the oecd countries as we shall see these are difficult questions the first in particular is one for which we do not have a complete answer by this i do not mean that we do not have theories which are broadly consistent with these numbers in fact we have theories consistent with more or less any numbers what we lack is a satisfactory empirical explanation of the time series pattern of oecd unemployment in what follows we remain focused on these two questions first considering the theoretical background and then looking at some possible answers we finish with some speculative conjectures on the first question

unemployment at risk the policy determinants of labour market exposure to economic shocks this paper examines the vulnerability of labour markets to adverse economic shocks we define labour market exposure as the cumulated amount of excess unemployment generated by a shock before unemployment returns to steady state we use a panel of 19 countries covering the period 1985 2010 to assess the influence of labour market policies on labour market exposure which is also calculated country by country we find that less generous unemployment insurance more active labour market policies or a lower minimum wage imply a trade off between average unemployment and labour market exposure as they help low skilled workers to get out of unemployment at the cost of increased vulnerability to adverse shocks on the other hand reducing the tax wedge is conducive to both lower steady state unemployment and labour market exposure alain de serres and fabrice murtin

energy system impacts and policy implications of the european intended nationally determined contribution and low carbon pathway to 2050 in march 2015 the european union eu submitted to the united nations framework convention on climate change unfccc the intended nationally determined contribution indc in view of the paris conference of parties cop21 the binding target of lowering domestic greenhouse gases emissions by at least 40 by 2030 compared to 1990 levels coupled with long term decarbonisation goals will have profound energy system macroeconomic and policy implications eu targets are qualitatively discussed and quantitatively assessed with the simulation of a reference and an alternative decarbonisation scenario to 2050 simulations are carried out with the technology rich primes energy system model and the gem e3 computable general equilibrium model restructuring of the eu energy system induces changes in the energy mix and production with small effects on the eu gdp 0 4 in 2030 and 1 in 2050 compared to the reference scenario energy efficiency improvements increasing penetration of renewables fuel switching towards natural gas and technical progress in process related to emissions abatement are identified as essential options to the eu indc implementation the electrification of final energy demand particularly transport electrification complemented with decarbonised power supply is found to play a critical role in the successful transition towards a low carbon economy by 2050

do women borrowers augment financial performance of mfis abstractthere is some consensus that depth of outreach and financial performance of microfinance institutions mfi are positively correlated a majority of microcredit borrowers are women and since the prevalence of female borrowers is even greater among the very poor there should be a positive correlation between female borrowers and financial performance most of the mfis target women as preferred borrowers however no study to date has investigated the relationship between targeting women and mfi s sustainability with respect to profitability and yield utilizing a panel of 892 mfis over a period of 10 years this study shows that increased proportion of women borrowers has a statistically significant positive impact on yield and financial performance of mfis consequently this article also analyses the implication as to whether female borrowers have better repayment rate than male borrowers

the unemployment volatility puzzle is wage stickiness the answer i discuss the failure of the canonical search and matching model to match the cyclical volatility in the job finding rate i show that job creation in the model is influenced by wages in new matches i summarize microeconometric evidence and find that wages in new matches are volatile and consistent with the model s key predictions therefore explanations of the unemployment volatility puzzle have to preserve the cyclical volatility of wages i discuss a modification of the model based on fixed matching costs that can increase cyclical unemployment volatility and is consistent with wage flexibility in new matches

product market reforms labour market institutions and unemployment we analyze the impact of product market competition on unemployment and wages and how this depends on labour market institutions we use differential changes in regulations across oecd countries over the 1980s and 1990s to identify the effects of competition we find that increased product market competition reduces unemployment and that it does so more in countries with labour market institutions that increase worker bargaining power the theoretical intuition is that both firms with market power and unions with bargaining power are constrained in their behaviour by the elasticity of demand in the product market we also find that the effect of increased competition on real wages is beneficial to workers but less so when they have high bargaining power intuitively real wages increase through a drop in the general price level but workers with bargaining power lose out somewhat from a reduction in the rents that they had previously captured

rents in the european power sector due to carbon trading abstract the european union emissions trading scheme eu ets has imposed a price on the allowances for co2 emissions of electricity companies integrating this allowance price into the price of electricity earns a rent for companies who have received these allowances for free during phase i 2005 2007 rents corresponding to the aggregate value of allocated allowances amounted to roughly 13 billion per year however due to the specific price setting mechanism in electricity markets true rents were considerably higher this is due to the fact that companies also that have not received any allowances gain additional infra marginal rents to the extent that their variable costs are below the new market price after inclusion of the allowance price producers with low carbon emissions and low marginal costs thus also benefit substantially from carbon pricing this paper develops a methodology to determine the specific interaction of the imposition of such a co2 constraint and the price setting mechanism in the electricity sector under the assumption of marginal cost pricing in a liberalized european electricity market the article thus provides an empirical estimate of the true total rents of power producers during phase i of the eu ets 2005 2007 the eu ets generated in phase i additional rents in excess of 19 billion per year for electricity producers these transfers are distributed very unevenly between different electricity producers in a second step the paper assesses the impact of switching from free allocation to an auctioning of allowances in 2013 we show that such a switch to auctioning will continue to create additional infra marginal rents for certain producers and will leave the electricity sector as a whole better off than before the introduction of the eu ets

the impact of group based credit programs on poor households in bangladesh does the gender of participants matter this paper estimates the impact of participation by gender in the grameen bank and two other group based micro credit programs in bangladesh on labor supply schooling household expenditure and assets the empirical method uses a quasi experimental survey design to correct for the bias from unobserved individual and village level heterogeneity we find that program credit has a larger effect on the behavior of poor households in bangladesh when women are the program participants for example annual household consumption expenditure increases 18 taka for every 100 additional taka borrowed by women from these credit programs compared with 11 taka for men

microfinance with chinese characteristics abstract analyzing household survey data from three microfinance program sites we provide an early systematic assessment of chinese microfinance programs which have grown rapidly since 1994 are based on the grameen model and include an unprecedented large scale government initiative we examine the empirical propositions that underpin successful microfinance programs reaching the poor targeting financial and operational performance sustainability and program benefits impact we find that nongovernmental programs perform well in all three areas but that governmental programs perform poorly given the remote location and focus on agricultural projects in china s poor areas we advocate greater flexibility in loan contract terms especially repayment schedules

two questions about european unemployment a general equilibrium search model makes layoff costs affect the aggregate unemployment rate in ways that depend on equilibrium proportions of frictional and structural unemployment that in turn depend on the generosity of government unemployment benefits and skill losses among newly displaced workers the model explains how before the 1970s lower flows into unemployment gave europe lower unemployment rates than the united states and also how after 1980 higher durations have kept unemployment rates in europe persistently higher than in the united states these outcomes arise from the way europe s higher firing costs and more generous unemployment compensation make its unemployment rate respond to bigger skill losses among newly displaced workers those bigger skill losses also explain why u s workers have experienced more earnings volatility since 1980 and why especially among older workers hazard rates of gaining employment in europe now fall sharply with increases in the duration of unemployment

the costs of the kyoto protocol in the european union we estimate reference co2 emission projections in the european union and quantify the economic impacts of the kyoto commitment on member states we consider the case where each eumember individually meets a co 2 emissions target applying a country wide cap and trade system to meet the target but without trade among countries we use a version of the mit emissions prediction and policy analysis eppa model here disaggregated to separately include 9 european community countries and commercial and household transportation sectors we compare our results with that of four energy economic models that have provided detailed analyses of european climate change policy in the absence of specific additional climate policy measures the eppa reference projections of carbon emissions increase by 14 from 1990 levels the eu wide target under the kyoto protocol to the framework convention on climate change is a reduction in emissions to 8 below 1990 levels eppa emissions projections are similar to other recent modeling results but there are underlying differences in energy and carbon intensities among the projections if eucountries were to individually meet the euallocation of the community wide carbon cap specified in the kyoto protocol we find using eppa that carbon prices vary from 91 in the united kingdom to 385 in denmark welfare costs range from 0 6 to 5 r 2002 elsevier science ltd all rights reserved

downward nominal and real wage rigidity survey evidence from european firms it has been well established that the wages of individual workers react little especially downwards to shocks that hit their employer this paper presents new evidence from a unique survey of firms across europe on the prevalence of downward wage rigidity in both real and nominal terms the authors analyse which firm level and institutional factors are associated with wage rigidity the results indicate that it is related to workforce composition at the establishment level in a manner that is consistent with related theoretical models e g efficiency wage theory insider outsider theory the analysis also finds that wage rigidity depends on the labour market institutional environment collective bargaining coverage is positively related with downward real wage rigidity measured on the basis of wage indexation downward nominal wage rigidity is positively associated with the extent of permanent contracts and this effect is stronger in countries with stricter employment protection regulations

equilibrium credit rationing of small farm agriculture it is often argued that externally imposed contractual restrictions lead to inequitable credit rationing this paper argues that unrestricted laissez faire markets may also inequitably ration credit a formal model which grants borrowers autonomy in credit application and use demonstrates that adverse incentive and selection effects may cause banks to endogenously impose interest rate restrictions and ration small farms out of the credit market consequently liberalization of financial markets may be insufficient to guarantee small farms access to credit