efficient non contractible investments in large economies abstract do investors making complementary investments face the correct incentives especially when they cannot contract with each other prior to their decisions we present a two sided matching model in which buyers and sellers make investments prior to matching once matched buyer and seller bargain over the price taking into account outside options efficient decisions can always be sustained in equilibrium we characterize the inefficiencies that can arise in equilibrium and show that equilibria will be constrained efficient we also show that the degree of diversity in a large market has implications for the extent of any inefficiency journal of economic literature classification numbers c78 d41 d51

aggregate income shocks and infant mortality in the developing world health and income are strongly correlated both within and across countries yet the extent to which improvements in income have a causal effect on health status remains controversial the authors investigate whether short term fluctuations in aggregate income affect infant mortality using an unusually large data set of 1 7 million births in 59 developing countries the authors show a large negative association between per capita gdp and infant mortality female infant mortality is more sensitive than male infant mortality to negative economic shocks suggesting that policies that protect the health status of female infants may be especially important during economic downturns

the pre marital investment game abstract two sides of a finite marriage market engage in costly investment and are then matched assortatively the purpose of the investment is solely to improve the quality of the match that the trader can attain in the second stage the paper studies the limits of equilibrium of these finite matching games as the number of traders gets large it is shown that mixed nash equilibria in the finite games converge to degenerate pure strategy equilibria in the limit in which both sides of the market invest too much

does foreign aid increase private investment evidence from panel cointegration this article uses panel cointegration and causality techniques to examine the long run relationship between foreign aid and private investment our main result is that aid has a statistically significant negative effect on private investment this result is robust to outliers different measures and forms of aid sample selection and the sample period in addition we find that long run causality runs in both directions suggesting that an increase in aid reduces private investment and that in turn higher private investment leads to lower aid inflows

the accuracy of the tick test evidence from the australian stock exchange abstract in the absence of information regarding whether a trade is buyer or seller initiated many researchers have employed the tick rule as a proxy these researchers have been supported in their endeavours by the work of lee and ready 1991 which suggests that the tick rule is 90 accurate unfortunately the difficulty of securing data on this issue has made lee and ready s paper somewhat unique in that there have been few attempts to confirm their result in us markets and no attempts in other markets the purpose of this work is to test the robustness of their result in the australian securities market using cleaner intra day data we mimic the lee and ready study to cast some doubt upon the robustness of their findings in different markets our results suggest an overall accuracy of approximately 74 as opposed to lee and ready s 90 however accuracy in excess of 90 is documented when zero ticks are excluded further analysis provides evidence that a volatile or trending market will decrease the accuracy of the tick rule it is also demonstrated that the tick rule is less likely to accurately classify seller initiated trades and small buyer initiated trades

search theoretic models of the labor market a survey we survey the literature on search theoretic models of the labor market we show how this approach addresses many issues including the following why do workers sometimes choose to remain unemployed what determines the lengths of employment and unemployment spells how can there simultaneously exist unemployed workers and unfilled vacancies what determines aggregate unemployment and vacancies how can homogeneous workers earn different wages what are the tradeoffs firms face from different wages how do wages and turnover interact what determines efficient turnover we discuss various modeling choices concerning wage determination and the meeting process including recent models of directed search

marriage and consumption insurance what s love got to do with it when markets are incomplete individuals may choose to marry to diversify their labor income risk love however can complicate the picture if love is fleeting or the resolution of agents income uncertainty occurs predominantly later in life then marriages with good economic matches last longer in contrast if love is persistent and the resolution of uncertainty to agents income occurs early then marriages with good economic matches are more likely to be caught short with too little love to save a marriage consequently once married the partners will be more likely to divorce evidence is provided to distinguish between these alternative scenarios

misrepresentation and stability in the marriage problem it has been shown previously that for two sided discrete markets of the kind exemplified by the marriage problem no strategy proof procedure for aggregating preferences into stable outcomes exists here it is shown that nash equilibrium misrepresentation of preferences nevertheless results in a stable outcome in terms of the true preferences when the aggregation procedure yields the optimal stable outcome in terms of the stated preferences for one side of the market journal of economic literature classification numbers 022 025 026 0 1984 academic

the relevance of p star analysis to uk monetary policy recent articles have attempted to restore the use of a simple measure of the money supply as an indicator of future price levels p star and to reestablish a causal link from money to prices in this paper we argue that the p star approach is flawed it is certainly more complex than traditional monetarist approaches but the fundamental questions of causality are in no way either affected or resolved we argue that the p star relationship does not have a causal link with prices but rather the causality runs from prices to money we also find that there is some causality running from money to real income so that monetary conditions do seem to have some predictive power for future levels of activity copyright 1994 by royal economic society

the effects of health aid on child health promotion in developing countries cross country evidence although epidemiological knowledge in relation to child health has improved in the last few decades around 3 million children die each year in developing countries from preventable diseases the international development community views increased immunization coverage for children as an important step in eliminating or reducing these deaths many developing countries have very limited resources to tackle major health problems and have to rely on external finance this article examines the impact of foreign aid devoted to the health sector on child health promotion in developing countries two proxies for child health promotion are used a immunization against measles and b immunization against diphtheria pertussis tetanus dpt a range of model specifications and panel data econometric techniques are applied to data covering the period 1990 to 2005 this article finds a positive and statistically significant link between health aid and the measures of child health promotion

foreign aid and human development the impact of foreign aid to the health sector author affiliation claudia r williamson department of economics west virginia university p o box 6025 morgantown wv 26506 6025 usa e mail claudia williamson mail wvu edu acknowledgment i would like to thank the editor and two anonymous referees for their time valuable comments and helpful suggestions i would also like to thank peter t leeson and russell s sobel for their valuable comments and suggestions also i would like to thank matt e ryan for his helpful comments in addition i appreciate the comments received from tomi ovaska and the 2006 southern economic association conference participants 1 introductioninternational aid is one of the most powerful weapons in the war against poverty today that weapon is underused and badly targeted there is too little aid and too much of what is provided is weakly linked to human development united nations development programme 2005 p 75 according to the 2005 human development report united nations development programme 2005 there is a general consensus that foreign aid s first objective should be human development in 2000 governments from various countries met at the united nations and signed the millennium declaration a pledge to free our fellow men women and children from the abject and dehumanizing conditions of extreme poverty one way of achieving these goals is through development assistance united nations development programme 2005 this advice has been widely accepted in the donor community during the past five years because total aid to the health sector has more than doubled for example as illustrated in figure 1 from 1999 to 2004 aid to the health sector rose from 1930 to 4435 millions of 2004 dollars oecd 2007 figure 1 foreign aid to the health sector 1973 2004 figure omitted see article image with growing intensity given to international human development aid an analysis of its effectiveness is worthwhile both conceptual and empirical literature debates the effectiveness of foreign aid for economic development without a general consensus on the role of foreign assistance in economic development two contrasting hypotheses have emerged one is a public interest argument where some authors state that aid can and should be used to assist in the development process sen 1999 sachs 2005 the other is a public choice hypothesis that presents arguments indicating that foreign assistance is ineffective and has the potential to damage future growth opportunities bauer 2000 easterly 2001 these two competing hypotheses lead to different predictions on the use of foreign aid for human development for a clear answer one must turn to empirical analysis current empirical literature primarily supports the public choice perspective indicating that foreign aid is ineffective in promoting economic development filmer and pritchett 1999 svensson 1999 filmer hammer and pritchett 2000 2002 knack 2001 brumm 2003 brautigam and knack 2004 economides kalyvitis and philippopoulos 2004 djankov montalvo and reynal querol 2005 hartford and klein 2005 and heckelman and knack 2005 in these studies the authors focus on the impact of foreign aid on economic development and find no significant impact however in a recent study by gomanee girma and morrissey 2005 the authors show that aid can improve human welfare through increases in certain public expenditures supporting the public interest predictions their methodological approach neglects to control for endogeneity and this could lead to biased results thus further analysis is required with the recent shift in the promotion of aid from economic to human development it is timely to investigate the role of foreign aid for human development purposes this paper provides the next step in the literature by establishing the link between foreign aid and human welfare

the family as an incomplete annuities market families can self insure against uncertain dates of death through implicit or explicit agreements with respect to consumption and interfamily transfers interfamily transfers need have nothing to do with altruistic feelings they may simply reflect risk sharing behavior of completely selfish family members although family annuity markets are incomplete even small families can substitute by more than 70 percent for perfect market annuities given adverse selection and transaction costs family risk pooling may be preferred to public market annuities in the absence of public annuities these risk sharing arrangements provide powerful incentives for marriage and family formation

does foreign aid really raise per capita income a time series perspective we analyze the relationship between per capita income and foreign aid we employ annual data and five year averages and carefully examine the time series properties of the data panel estimations with dynamic feasible generalized least squares dfgls show that aid generally has an insignificant or minute negative significant impact on per capita income particularly in highly aid dependent countries this holds true for countries with different levels of human development and income as well as for different regions we also find that aid has a small positive impact on investment but a significant negative impact on domestic savings crowding out and the real exchange rate appreciation jel classification f35 o11 c23 c51 on analyse la relation entre le revenu per capita et l aide etrangere on utilise des donnees annuelles et des moyennes quinquennales et on examine les proprietes de ces series chronologiques des estimations d un modele dynamique utilisant des donnees de panel a l aide de la methode des moindres carres quasi generalises montrent que l aide a generalement un effet negatif minime ou insignifiant sur le revenu per capita particulierement dans les pays qui dependent beaucoup de l aide etrangere ce resultat tient tant pour des pays a divers niveaux de developpement et de revenus que pour differentes regions on decouvre que l aide a un petit effet positif sur l investissement mais un effet negatif significatif sur l epargne effet d encombrement et sur le taux de change reel appreciation

assortative marriage and the effects of government homecare subsidy programs on gender wage and participation inequality we develop a model of the labor market where firms incur an adjustment cost when one of their workers quits and males and females form households assortatively by skill we show how this environment can lead to an economy where females earn less and drop out more frequently than equally skilled males in equilibrium even when males and females constitute ex ante identical populations we then examine how different government homecare subsidy schemes may affect such gender inequality in the labor market we show that the effect of government homecare subsidy schemes on gender inequality depends crucially on the form in which the subsidy is given and to whom it is allocated

price stabilization as a bonding mechanism in new equity issues abstract underwriters have an incentive to overstate investor interest in order to persuade some investors to purchase shares at a price in excess of their initial estimate of the fair value we show that this incentive is eliminated when the underwriter commits to secondary market price stabilization destroying the underwriter s incentive to overstate interest reduces the total surplus captured by initial investors in initial public offerings further efficiency gains are associated with penalty bid systems that permit the underwriter to make the stabilization commitment selectively price stabilization can thus be viewed as a bonding mechanism that improves the efficiency of the primary equity market

the winner s curse legal liability and the long run price performance of initial public offerings in finland abstract rationing data for initial public offerings ipos in the finnish market make possible a test of rock s 1986 winner s curse hypothesis the evidence from 80 ipos issued between 1984 and 1989 confirms the presence of the winner s curse average returns adjusted for the bias in allocation are lower than average unadjusted returns but the initial returns of these ipos appear unrelated to lawsuit avoidance as the sample firms seem unlikely to incur legal liabilities in the long run consistent with the evidence in the united states the ipo firms substantially underperform the helsinki stock exchange value weighted index

beauty vs earnings gender differences in earnings and priorities over spousal characteristics in a matching model abstract i develop a model of marriage matching where males and females care about two distinct characteristics of their spouse beauty and earnings each individual s beauty is exogenous but earnings depend on human capital investments made by each individual prior to entering the marriage market i show that even if males and females constitute ex ante identical populations with identical underlying preferences and equal access to human capital investment and labor market opportunities there can still exist an equilibrium where on average one gender invests more in human capital than the other and moreover members of one gender are more likely to prioritize beauty over earnings in a spouse while members of the other gender are more likely to prioritize a potential spouse s earnings over beauty

stabilization syndication and pricing of ipos we argue that in the after market trading of an ipo the underwriting syndicate by standing ready to buy back shares at the offer price price stabilization compensates uninformed investors ex post for the adverse selection cost they face in bidding for ipos this domi nates ex ante compensation by underpricing the reason is that stabilization exploits ex post information about investor demand whereas underpricing must be based on ex ante infor mation however liquidity and syndication costs constrain the use of stabilization which in equilibrium generates some underpricing as well we develop a model that formalizes this intuition and generates several empirical implications

does foreign aid distort incentives and hurt growth theory and evidence from 75 aid recipient countries foreign aid transfers can distort individual incentives and hence hurt growth by encouraging rent seeking as opposed to productive activities we construct a model of a growing small open economy that distinguishes two effects from foreign transfers i a direct positive effect as higher transfers allow the financing of infrastructure ii an indirect negative effect as higher transfers induce rent seeking competition by self interested individuals in this framework the growth impact of aid is examined jointly with the determination of rent seeking behavior we test the main predictions of the model for a cross section of 75 aid recipient countries there is evidence that aid has a direct positive effect on growth which is however significantly mitigated by the adverse indirect effects of associated rent seeking activities this is especially the case in recipient countries with relatively large public sectors

wealthier is healthier we estimate the effect of income on health using cross country timeseries data on health infant and child mortality and life expectancy and income per capita we use instrumental variables estimates using exogenous determinants of income growth to identify the pure income effect on health isolated from reverse causation or incidental association the long run income elasticity of infant and child mortality in developing countries lies between 0 2 and 0 4 using these estimates we calculate that over a half a million child deaths in the developing world in 1990 alone can be attributed to the poor economic performance in the 1980s

economic development and the escape from high mortality summary this paper studies the characteristic features of the escape from high mortality as recorded from the historical experience of northwestern europe and from the current experience of less developed countries the paper documents stylized facts of mortality change and measures the contribution of economic development represented by income per capita to the mortality decline during the second half of the 20th century the paper argues that improvements in economic conditions since the 18th century are an important factor behind the decline in death rates in developed countries and in the subsequent reduction of death rates in less developed countries we show that economic development lowers mortality through differential effects in infectious disease mortality and that quantitatively income growth is able to account for between one third and one half of the recent mortality decline

a direct test of rock s model of the pricing of unseasoned issues unique data availability and institutional arrangements for new issues in singapore allow a direct test of the empirical implications of rock s model of pricing unseasoned new issues our empirical results are consistent with the model specifically we find that the unseasoned new issues anomaly disappears when the rationing associated with new issues is incorporated into the analysis the winner s curse is evident in allocation patterns used in singapore

aid policies and growth the authors of this paper use a new database on foreign aid to examine the relationships among foreign aid economic policies and growth of per capita gdp in panel growth regressions for 56 developing countries and 6 four year periods 1970 93 they find that the policies that have a great effect on growth are those related to fiscal surplus inflation and trade openness they construct an index for those three policies and have that index interact with foreign aid they have instruments for both aid and aid interacting with policies they find that aid has a positive impact on growth in developing countries with good fiscal monetary and trade policies in the presence of poor policies aid has no positive effect on growth this result is robust in a variety of specifications which include or exclude middle income countries include or exclude outliers and treat policies as exogenous or endogenous they examine the determinants of policy and find no evidence that aid has systematically affected policies either for good or for ill they estimate an aid allocation equation and show that any tendency for aid to reward good policies has been overwhelmed by donors pursuit of their own strategic interests in a counterfactual they reallocate aid reduce the role of donor interests and increasing the importance of policy such a reallocation would have a large positive effect on developing countries growth rates

marriage and class here we consider a matching model where agents are heterogeneous and utilities nontransferable we utilize this framework to study how equilibrium sorting takes place in marriage markets we impose conditions that guarantee the existence of a steady state equilibrium and then characterize it several examples are developed to illustrate the richness of equilibria the model reveals an interesting sorting externality that can support multiple steady state equilibria even with constant returns to matching excerpt

empirics of health aid education and infant mortality a semiparametric study the present article uses semiparametric regression to capture the impact of foreign aid given for health purposes on the infant mortality rate imr of poor developing countries after controlling for other covariates we also investigate whether education general awareness helps lower imr directly or helps improve effectiveness of health aid in reducing imr in addition the study investigates whether various disaggregated components of health aid for example aid that goes for infectious disease control or nutrition help lower imr we find that although adult education awareness always lowers imr the overall effect of health aid remains insignificant our conclusion is robust to various disaggregated components of health aid as well we also check if health aid has improved prenatal care for expecting mothers but our conclusion regarding the overall ineffectiveness of aid remains unchanged interestingly we find that total health aid as well as nutrition aid may lower imr only after education ex

eight questions about corruption this paper will discuss eight frequently asked questions about public corruption 1 what is corruption 2 which countries are the most corrupt 3 what are the common characteristics of countries with high corruption 4 what is the magnitude of corruption 5 do higher wages for bureaucrats reduce corruption 6 can competition reduce corruption 7 why have there been so few recent successful attempts to fight corruption 8 does corruption adversely affect growth

competing premarital investments this paper studies premarital parental investments in children s wealth where spousal wealth is a public good in marriage by investing in their children s wealth parents increase the wealth of their children and the quality of the spouses that their children can marry in large marriage markets the hedonic return to investment internalizes all the external benefits of premarital investment in wealth so that the competitive equilibrium is efficient marriage market competition also increases investments in small marriage markets relative to no competition but equilibrium investments are not efficient

transplants and implants the economics of self improvement this article examines equilibrium self improvement and marriage proposal strategies in a two sided search model with nontransferable utility singles are vertically differentiated some make better marriage partners than others a complete characterization of equilibrium is provided it is shown there are two externalities to self improvement decisions further these externalities may support multiple pareto rankable equilibria by encouraging everybody to self improve society can create a situation where everybody is forced to improve to remain acceptable but a preferred equilibrium may exist where there is less costly self improvement

price stabilization in the market for new issues abstract this study examines price stabilization in new equity issues stabilizationtruncates the distribution of post issue prices at a floor price lowering the risk of adverse price moves and hence in a competitive dealer market reducing the bid ask spread using 1 523 nasdao traded firm commitment initial public offerings issued between 1982 and 1987 we find that spreads narrow when the market price is close to the offer price and stabilization is most likely moreover significant negative returns are documented after the hypothesized termination of stabilizing activities suggesting that stabilization and its cessation affect market prices

who benefits from secondary market price stabilization of iops abstract initial public offerings that receive secondary market price support from their underwriters are characterized by severely attenuated selling by small quantity presumably retail traders and more aggressive selling by large quantity presumably institutional traders the increase in institutional trading is concentrated in the first day of trading while the attenuation of retail trading persists this pattern exists in spite of the likelihood that retail investors receive relatively large initial allocations of fully priced stabilized offers thus the evidence is consistent with institutional investors being the primary beneficiaries of price stabilization efforts and with the use of penalty bids to constrain retail selling activity

chasing success health sector aid and mortality summary as many cases studies show successful public health measures are being implemented in many places around the globe and country level mortality has fallen significantly in recent decades in all but a few countries are the two linked does development assistance for health dah improve on balance recipient countries mortality trajectory using a new data source containing dah on 96 high mortality countries the regression analysis shows no effect of dah on mortality other types of aid including water development also have no effect economic growth on the other hand has a strong negative effect on mortality these findings confirm and build upon recent work by williamson 2008 and are shown to be robust to a variety of sensitivity analyses and alternative model specifications and estimation methods this analysis also shows that the effectiveness of dah has not increased over time even as the level of that funding has increased fourfold though spending on infectious diseases and family planning may have caused small reductions in mortality furthermore even though it is encouraging that dah has tended to go where the need is highest it also goes to states that have experienced the greatest mortality reductions in the recent past in other words dah appears to be following success rather than causing it

assessing foreign aid s long run contribution to growth in development this paper confirms recent evidence of a positive impact of aid on growth and widens the scope of evaluation to a range of outcomes including proximate sources of growth e g physical and human capital indicators of social welfare e g poverty and infant mortality and measures of economic transformation e g share of agriculture and industry in value added focusing on long run cumulative effects of aid in developing countries and taking due account of potential endogeneity a coherent and favorable pattern of results emerges aid has over the past forty years stimulated growth promoted structural change improved social indicators and reduced poverty

long term partnership formation marriage and employment of course marriage and employment are different nevertheless a worker looking for a job a rm looking for worker or a single person looking for a marriage partner face similar problems as all are seeking a long term partner indeed forming long term partnerships is a common occurrence in life there are many other examples business people search for other business people to form a pro table relationship bridge players seek to nd a suitable partners students search for a good university we would all like to nd a good friend etc the problem becomes signi cant if there are substantial differences in the return obtained from forming a partnership with different partners for example employers differ in the wages they offer or in the work environment they provide in such a situation a worker may reject some job offers similarly as many have learned to their cost some make better marriage partners than others the problem is two sided while a worker is evaluating a potential employer the employer is also evaluating the worker it is this two sided aspect of the problem that generates a signi cant interest a worker s willingness to accept employment at a rm depends not only on the characteristics of the rm but also the other possible options open to the worker the better an individual s opportunities elsewhere the more selective he or she will be in evaluating a potential partnership an academic who believes harvard may make an offer in the near future will be more selective in evaluating offers from lesser universities in this way expectations play a role if a single man believes that few if any women will nd him an acceptable marriage partner then he may accept the rst opportunity that presents itself partnership formation typically does not comply with a classic market situation where all participants know everything and all trades take place at zero cost finding a job nding a husband or wife or nding a business partner is a time consuming activity where opportunities typically arrive over time at uncertain intervals of time of course we can act in ways that in uence the arrival rate of potential partner workers go to employment agencies or read help wanted advertisements in newspapers singles of a certain age go to discos or join tennis clubs the literature on search and matching sm see mortensen 1982 and pissarides 1990 for early examples 1 provides an excellent framework for the economic journal 109 june f307 f334 royal economic society 1999 published by blackwell publishers 108 cowley road oxford ox4 1jf uk and 350 main street malden ma 02148 usa

specialization and competition in marriage models abstract i present a marriage model that includes pre marital investments in human capital individuals expect the future role specialization in marriage the specialization effect but at the same time before marriage individuals have the incentive to invest in order to make themselves more attractive the competition effect the interaction of two effects generates multiple equilibria no equilibria are ex ante efficient when the benefits of role specialization exist the competition effect is a source of coordination failure in the match formation this result stands in contrast to those of other models in which the competition effect leads to efficiency in some equilibrium

marriage markets and assortative mating with household public goods theoretical results and empirical implications this paper analyzes marriage market equilibria when the gains from marriage result from joint consumption of household public goods assuming transferable utility within marriage the paper proves that marriage markets will be characterized by positive assortative mating on wealth when spouses differ only in endowments and the gains to marriage result only from public goods when spouses differ in wages and household public goods are produced at home the results imply offsetting effects with public good economies creating an incentive for positive assortative mating on wages and gains from specialization creating an incentive for negative assortative mating on wages the results help explain the persistent lack of empirical support for becker s prediction of negative assortative mating on wages and have implications for empirical analysis of all joint living arrangement decisions

the fungibility of health aid reconsidering the reconsidered abstractlu et al found that health aid displaces domestically raised government health expenditure which renders health aid at least partially fungible these findings are questioned in the fungibility of health aid reconsidered van de sijpe s emphasis on disaggregating on and off budget aid is a valid contribution although his empirical conclusions are overstated we re evaluate the data he criticises and find they sufficiently capture on budget aid to re measure health aid fungibility we update the lu et al data adding 23 countries and four years of data despite the confidence we have in these data we employ two estimation specifications each of which addresses the measurement error discussed by van de sijpe the extended data and alternative methods show that development assistance for health channelled to governments remains significantly fungible

decreasing relative risk aversion and tests of risk sharing the relative risk aversion rra coefficient of a household whose consumption is close to the subsistence level may be very high for example if consumption is exactly at the subsistence level the household may not be willing to bear any risk if this is the case then the rra coefficient must be a decreasing function of wealth for poor households therefore we should allow the possibility of decreasing rra drra in testing the full risk sharing hypothesis however existing tests in the empirical literature are derived using preferences that exhibit either increasing or constant rra even when they are applied to data containing low income households we therefore use a hyperbolic absolute risk aversion hara utility which implies increasing constant and decreasing rra as special cases to test full risk sharing hypothesis using the international food policy research institute ifpri and the international crops research institute of the semi arid tropics icrisat household level data sets we find evidence in support of the drra hypothesis along with evidence favoring full risk sharing hypothesis at the village level and evidence against the hypothesis at the inter village level when rra is restricted to be constant we replicate the previous results in the literature reject the full risk sharing hypothesis at both levels our tests however reject this restriction and favor drra in almost all cases these results suggest that it is important to allow for drra in testing the full risk sharing hypothesis when data containing low income households are investigated this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this item this abstract was borrowed from another version of this this abstract was borrowed from another version of this item

aid dutch disease and manufacturing growth abstract we examine the effects of aid on the growth of manufacturing using a methodology that exploits the variation within countries and across manufacturing sectors and corrects for possible reverse causality we find that aid inflows have systematic adverse effects on a country s competitiveness as reflected in the lower relative growth rate of exportable industries we provide some evidence suggesting that the channel for these effects is the real exchange rate appreciation caused by aid inflows we conjecture that this may explain in part why it is hard to find robust evidence that foreign aid helps countries grow

male female wage differentials in job ladders much of the male female wage differential exists because men and women are assigned to different jobs within narrow job categories there is no male female differential only a tortured taste theory of discrimination can reconcile these facts we argue that differential movement along job ladders entails comparative advantage so the ability standard for promotion is higher for women this implies that more able women will be passed over in favor of less able men women assumed to have the same ability distribution as men earn less the differential reflects females lower promotion probability not within job discrimination

the flotation of companies on the stock market abstract in some countries the size of the stock market and the number of listed companies have persistently lagged behind the growth of the economy trading externalities can help explain this fact an entrepreneur who goes public increases risk sharing opportunities for others this externality can lead to an inefficiently low number of listed companies and also generate multiple equilibria when flotation decisions are positively correlated across entrepreneurs this happens if these face borrowing constraints and lack liquidity and thus cannot diversify their portfolios unless they go public it also happens if trading shares is costly so that a sufficient number of issues must be listed to lure investors into the market

public debt and growth heterogeneity and non linearity we study the long run relationship between public debt and growth in a large panel of countries our analysis builds on theoretical arguments and data considerations in modelling the debt growth relationship as heterogeneous across countries we investigate the debt growth nexus adopting linear and non linear specifications employing novel methods and diagnostics from the time series literature adapted for use in the panel we find some support for a negative relationship between public debt and long run growth across countries but no evidence for a similar let alone common debt threshold within countries

the long run effect of aid on health evidence from panel cointegration analysis abstractalthough a major objective of aid donors is to improve health outcomes in recipient countries there is relatively little research on whether aid to the health sector leads to improved heal

politics and the effectiveness of foreign aid abstract critics of foreign aid programs have long argued that poverty reflects government failure in this paper i test predictions for aid effectiveness based on an analytical framework that relates aid effectiveness to political regimes i find that aid does not significantly increase investment nor benefit the poor as measured by improvements in human development indicators but it does increase the size of government the impact of aid does not vary according to whether recipient governments are liberal democratic or highly repressive but liberal political regimes and democracies ceteris paribus have on average 30 lower infant mortality than the least free regimes this may be due to greater empowerment of the poor under liberal regimes even though the political elite continues to receive the benefits of aid programs an implication is that short term aid targeted to support new liberal regimes may be a more successful means of reducing poverty than current programs

gender discrimination without gender difference theory and policy responses abstract this paper provides an explanation for the continued existence of gender discrimination in competitive labour markets and analyzes the effects of policies designed to alleviate it unlike previous explanations of gender discrimination this theory arises from the interaction between women and men within the household and does not rely on inherent asymmetries between women and men even though discrimination is seen to be related to factors which can be thought external to the labour market such as higher job turnover and labour market exit rates for women policies which target only labour market outcomes and do not deal with external factors can both lead to reduced discrimination and also alter external factors thereby reducing discrimination further however policies aimed at external factors will in general be less effective in reducing discrimination unless combined with more direct policies

aid government expenditure and aggregate welfare summary this paper tests the hypothesis that aid contributes to increasing aggregate welfare measured by infant mortality and the human development index hdi in recipient countries estimation is based on data for 104 countries over the period 1980 2000 and for subsamples of low income and middle income countries fixed effect estimates provide robust evidence that aid is associated with improved values of the welfare indicators and this effect appears to be greater in low income countries aid appears to increase welfare either directly or through the effect on growth and there is no evidence that aid operates through public spending

matching finding a partner for life or otherwise how do job worker and husband wife relationships form and why do some matched pairs subsequently separate economists and game theorists are in the process of developing and applying an equilibrium explanation of match formation and separation based on the principle of voluntary pairing under competitive conditions the purpose of this paper is to assess the current state of these developments the general existence of patnership structures with the property that no one has an incentive to separate has been established these equilibrium structures maximize aggregate value over the set of all feasible match structures in the transferable utility case according to this pure theory of matching competition for partners can be expected to yield equilibrium match structures that are both stable and socially efficient at least under conditions of frictionless certainty search theoretic models that take account of meeting costs and initial uncertainty about match values have been developed to explain sepa

consumption smoothing migration and marriage evidence from rural india a significant proportion of migration in low income countries particularly in rural areas is composed of moves by women for the purpose of marriage we seek to explain these mobility patterns by examining marital arrangements among indian households in particular we hypothesize that the marriage of daughters to locationally distant dispersed yet kinship related households is a manifestation of implicit interhousehold contractual arrangements aimed at mitigating income risks and facilitating consumption smoothing in an environment characterized by information costs and spatially covariant risks analysis of longitudinal south indian village data lends support to the hypothesis marriage cum migration contributes significantly to a reduction in the variability of household food consumption farm households afflicted with more variable profits tend to engage in longer distance marriage cum migration the hypothesized and observed marriage cum migration patterns are in dissonance with standard models of marriage or migration that are concerned primarily with search costs and static income gains