learning and wage dynamics we develop a dynamic model of learning about worker ability in a competitive labor market the model produces three testable implications regarding wage dynamics 1 although the role of schooling in the labor market s inference process declines as performance observations accumulate the estimated effect of schooling on the level of wages is independent of labor market experience 2 timeinvariant variables correlated with ability but unobserved by employers such as certain test scores are increasingly correlated with wages as experience increases and 3 wage residuals are a martingale we present evidence from the nlsy that is broadly consistent with the model s predictions

natural resources and sub national economic performance does sub national democracy matter abstract the differentiation in the impact of resources on economic growth is often explained by the specifics of institutional factors the aim of this paper is to investigate how sub national political differences influence the effect of natural resources on economic growth using a dataset of russian regions this paper demonstrates that sub national democratization influences the growth effects of resources and considers possible mechanisms for this influence the paper finds that in russia natural resources are only capable of promoting growth in the regions with non democratic political systems that at the same time have an efficient and non corrupt bureaucracy

the geographical dimension of the development effects of natural resources we study the contribution of natural resource intensity to long term development along different dimensions per capita income institutional quality and education we allow natural resources to affect these dimensions differently in different regions of the world the evidence suggests that natural resources are generally a positive driver of development but in sub saharan africa ssa their contribution is almost negligible if not even negative we explain these cross regional differences with the fact that in ssa more than anywhere else large resource endowments are combined with a particularly bad disease environment some historical evidence and formal econometric results support this hypothesis

the resource curse revisited governance and natural resources the paper analyzes the impact of natural resource abundance on selected governance indicators we use a panel data set with observations on a large number of countries over an extended period of time and employ an instrumental variable technique to account for endogeneity the results show that exports of natural resources have above all led to an increase in corruption this result is robust to both different model specifications and an alternative indicator for natural resource abundance for other governance indicators such as law and order and bureaucratic quality we either find no results or results that lack robustness

the big push natural resource booms and growth a simple application of big push reasoning suggests that natural resource booms can be important catalysts for development in poorer countries in this paper we present evidence from seven latin american countries that natural resource booms are sometimes accompa nied by declining per capita gdp we present a model with natural resources increasing returns in the spirit of big push models and expectations to clarify some of the reasons this may happen q 1999 elsevier science b v all rights reserved

reverification of the resource curse hypothesis based on industrial agglomeration evidence from china abstract although the resource curse hypothesis has been supported by many empirical studies focusing on the transnational and regional levels there has always been a point of contention about the proper method of estimating and selecting natural resource indicators in literature this paper proposes a mixed estimation method for panel data of 10 typical oil and gas resource based cities in china from 1998 to 2015 the results show that resource industry agglomeration can mirror the distribution and dependence on the resource industry by location rather than by merely measuring the influence of the relative scale of resource extraction on economic growth using resource industry agglomeration as the main explanatory variable for regional economic growth verifies the resource curse hypothesis and shows the nonlinear characteristics of the negative correlation between resources and economic growth despite mostly similar indicator parameter estimates marked differences exist in measured effects for material capital investments and technological innovation investments the result of using resource industry agglomeration as the main explanatory variable is basically consistent with the economic theory and is more in line with observed reality than the alternative indicator the research conclusions can provide evidence and data for index selection in the studies on the mediating effect of resource curse transmission and international comparison

does the resource curse hold for growth in genuine income as well summary existing studies analyzing the so called resource curse hypothesis regress growth in gross domestic product gdp on some measure of resource intensity this is problematic as gdp counts natural and other capital depreciation as income deducting depreciation from gdp to arrive at genuine income we test whether the curse still holds true we find supporting evidence but the growth disadvantage of resource intensive economies is slightly weaker in terms of genuine income than gdp we suggest that this provides additional but somewhat weak and limited evidence in support of those who argue that the curse is partly due to unsustainable overconsumption

oil shocks and subnational public investment the role of institutions in regional resource curse abstract theoretical and empirical studies on oil price shocks have mainly focused on measuring its relationship with national macroeconomic performance in developing countries nevertheless research is scarce on the effects of natural resource booms on local governments and even more on public investment using a difference in differences strategy this paper contributes to identifying the causal effects of the recent oil boom in colombia 2008 2016 on subnational public investment our results suggest that the rise in international oil prices had mostly positive and disproportionate effects on public investment in oil producing departments and municipalities although municipalities and departments prioritized different sectors both increased their investments in sectors with high social returns suggesting a lower likelihood of a resource curse we also found that an institutional reform in 2012 was a source of heterogeneity and the main driver of the causal effects on subnational public investments

the political economy of resource driven growth abstract in recent decades resource poor countries have out performed resource abundant ones a stylised facts model of competitive industrialisation describes the long run development of a resource poor country with a political state that is developmental only minor change is required to adapt the model to trace the development trajectory of a resource abundant country with a similar political state however most resource abundant countries engender a political state that is factional or predatory and distorts the economy in the pursuit of rents a staple trap model describes the development trajectory under these conditions the model predicts a growth collapse from which recovery is protracted especially for small economies that lack a niche trade link with a large economy

natural resources and economic development new panel evidence the question as to whether natural resources are a curse on economic growth and development is subject to considerable debates and remains controversial using heterogeneous panel cointegration techniques this paper provides a fresh re examination of the resource curse while allowing for cross section heterogeneity and commonalities in the nexus between natural resource abundance and economic development it finds in a sample of developing countries that economies endowed with abundant natural resources tend to develop more slowly than countries with scarce resources natural resources are on average a curse however there is considerable heterogeneity in the effects of resource abundance on economic development across countries perhaps because of differences in the extent of government intervention access to sound money legal structures and the security of property rights the degree of globalization and or corruption

an empirical analysis of a regional dutch disease the case of canada while there has been extensive research on the dutch disease dd very little attention if any has been devoted to the regional mechanisms through which it may manifest itself this is the first empirical attempt to research a regional dd by looking at the local and spatial impacts of resource windfalls across canadian provinces and territories we construct a new panel dataset to examine separately the key dd channels namely the spending effect and the resource movement effect our analysis reveals that the standard dd mechanisms are also relevant at the regional level specifically we find that a resource windfalls are associated with higher inflation and a labour capital shift from to non primary tradable sectors b resource windfalls in neighbouring regions are associated with a capital labour shift from to non primary tradable sectors in the source region c the spatial dd explains 51 20 of the adverse effects of resource windfalls in neighbouring regions on region specific non mineral international exports in the source region and does not significantly affect domestic ones

the curse of natural resources in fractionalized countries abstract this paper develops a model that can explain why natural resources are a blessing for some countries but a curse for others in this model natural resources cause fighting activities between rivalling groups fighting reduces productive activities and weakens property rights making productive activities even less attractive the aggregate production decrease exceeds the natural resources direct positive income effect if and only if the number of rivalling groups is sufficiently large the model thus predicts that natural resources lower incomes in fractionalized countries but increase incomes in homogenous countries empirical evidence supporting this prediction is provided

learning by doing vs learning about match quality can we tell them apart understanding the accumulation of match specific capital is crucial in shedding light on the reasons for the prevalence of long term employ ment relationships and on the welfare consequences of turnover in the labor market one of the most important source of match specific capital is human capital acquired through match specific learning such learn ing can take on two distinct forms in the first case workers accumulate match specific human capital through learning by doing in the second case a worker and a firm in an employment relationship learn about the quality of the match over time thereby acquiring valuable information i construct a structural model that embeds these two learning explana tions i show that it is possible to distinguish the two explanations given turnover data on employing firms coupled with data on workers such data now exist in the form of matched employer employee data sets i use a matched french data set to estimate the structural model using the efficient method of moments a simulation based estimation method i find that while learning by doing could be present in the first few months of an employment relationship learning about match quality dominates at tenures above half a year this finding has important consequences for economists understanding of the sources of match specific capital and for the desirability of policies that alter the incentives for turnover for workers of different tenure

combining revealed and stated preference methods to value environmental amenities at residential locations this paper combines an established revealed preference method discrete choice he donic analysis and a relatively new stated refer ence method choice based conjoint analysis in order to estimate more accurately the aesthetic benefits generated by the presence and quality of environmental amenities associated with residen tial locations it applies the combined approach to the housing market of fairfield connecticut which contains several environmental amenities and is experiencing an improvement in the quality of its coastal wetlands due to active restoration efforts jel q26

natural resources and small island economies mauritius and trinidad and tobago historically small economies especially resource rich ones underperformed on average relative to their larger counterparts small island economies appear still more disadvantaged due to remoteness from both markets and agglomeration economies yet a comparison of two small island economies with similar initial conditions other than their mineral endowment suggests that policy outweighs size isolation and resource endowment in determining economic performance resource poor mauritius adopted an unfashionable policy of export manufacturing that systematically eliminated surplus labour which drove economic diversification that sustained rapid gdp growth and political maturation like most resource rich economies trinidad and tobago pursued policies that absorbed rent too rapidly which impeded diversification and created an illusory prosperity vulnerable to collapse

optimal dutch disease growth models of the dutch disease such as those of krugman 1987 matsuyama 1992 sachs and warner 1995 and gylfason et al 1999 explain why resource abundance may reduce growth however the literature also raises a new question if the use of resource wealth hurts productivity growth how should such wealth be optimally managed this question forms the topic of the present paper in which we extend the growth literature on the dutch disease from a positive to a normative setting we show that the assumptions in the previous literature imply that the optimal share of national wealth consumed in each period needs to be adjusted down however some dutch disease is always optimal thus lower growth in resource abundant countries may not be a problem in itself but may be part of an optimal growth path the optimal spending path of the resource wealth may be increasing or decreasing over time and we discuss why this is the case

learning to love the dutch disease evidence from the mineral economies abstract recent literature proposes that a booming minerals sector may not only lead to dutch disease effects it may also be a development curse mineral economy case studies have tentatively confirmed this recourse curse thesis this paper examines the long run economic and development performance of a more general grouping of mineral based economies and finds little corroborating evidence

the resource curse a statistical mirage abstract a surprising feature of resource rich economies is slow growth it is often argued that natural resource production impedes development by creating market or institutional failures this paper establishes an alternative explanation a slow growing resource sector a declining resource sector is disproportionately reflected in resource dependent countries additionally there is little evidence that resource dependence impedes growth in non resource sectors more generally this paper illustrates the importance of considering industry composition in cross country growth regressions

rent seeking and resource booms abstract this paper develops a model of rent seeking in which the opportunity cost of rent seeking is foregone entrepreneurship it provides conditions under which resource booms tend to lead to an increase in rent seeking activity and those in which they induce entrepreneurship we identify an important difference between the two activities which leads resource booms to bias gains in favour of rent seeking over entrepreneurship but we also show that this bias depends on the nature of the initial equilibrium

is the income elasticity of the willingness to pay for pollution control constant how willingness to pay for environmental quality changes as incomes rise is a central question in several areas of environmental economics this paper explores both theoretically and empirically whether or not the willingness to pay wtp for pollution control varies with income our model indicates that the income elasticity of the marginal wtp for pollution reduction is only constant under very restrictive conditions our empirical analysis tests the null hypothesis that the elasticity of the wtp for pollution control with respect to income is constant employing a multi country contingent valuation study of eutrophication reduction in the baltic sea our findings reject this hypothesis and estimate an income elasticity of the wtp for eutrophication control of 0 1 0 2 for low income respondents and 0 6 0 7 for high income respondents thus our empirical results suggest that the elasticity is not constant but is always less than one this has implications for how benefits transfer exercises and for theoretical explanations of the environmental kuznets curve

the paradox of plenty a meta analysis since sachs and warner s seminal article in 1995 numerous studies have addressed the link between natural resources and economic growth although the resource curse effect was commonly accepted at first many articles have challenged its existence and the results found in the literature are ambiguous in this paper we aim to quantitatively review this literature in order to i identify the sources of heterogeneity and ii assess the impact of natural resources on economic growth a meta analysis is performed on 69 empirical studies on the resource curse totaling 1 419 estimates our findings show that i only developing countries suffer from the resource curse although it is soft ii the way natural resources are taken into account is crucial to understand the heterogeneity found in the literature iii the negative impact of the volatility of the terms of trade on growth should be qualified an additional mra performed on indirect effects size also indicate that when institutions are at their best level the resource curse disappears and may be turned into a blessing

rentierism energy and economic growth the case of algeria and egypt 1965 2010 abstract the algerian economy is an example of a high level of rentierism while the egyptian economy shows a low moderate level of rentierism the ardl bounds test approach was used upon annual time series data from 1965 to 2010 the results suggest cointegration for both countries bi causality between energy consumption and growth in the long run was found for algeria there is a reversed negative energy growth nexus adding a new relationship to the traditional four causal hypotheses on the energy growth nexus for egypt we found positive elasticity both of oil price and energy which is in line with the mainstream

riparian buffers and hedonic prices a quasi experimental analysis of residential property values in the neuse river basin riparian buffers the strips of vegetation along banks of rivers and streams have been proposed as a key instrument to protect water quality in the united states riparian buffers impose a restriction on the use of private property limiting harvest and development but buffers can also provide for aesthetic and recreational benefits that may accrue to property owners with data from the neuse river basin in north carolina this study attempts to provide empirical evidence on the effect of a mandatory buffer rule on the value of riparian properties spatial autoregressive hedonic models are estimated within a quasi experimental framework using the imposition of the buffer rule as the treatment and nonriparian properties as a control group results indicate that a riparian property generally commands a high premium we find no evidence however that the mandatory buffer rule has had a significant impact on riparian property values when compared with the control group copyright 2009 oxford university press

beach nourishment as a dynamic capital accumulation problem abstract beach nourishment is a common coastal management strategy used to combat erosion along sandy coastlines it involves building out a beach with sand dredged from another location this paper develops a positive model of beach nourishment and generates testable hypotheses about how the frequency of nourishment responds to property values project costs erosion rates and discounting by treating the decision to nourish as a dynamic capital accumulation problem the model produces new insights about coupled economic geomorphological systems in particular determining whether the frequency of nourishment increases in response to physical and economic forces depends on whether the decay rate of nourishment sand exceeds the discount rate

the role of the informal sector in the early careers of less educated workers abstract does work experience gained in the informal sector affect the career prospects of less educated workers this paper examines two roles that informal sector jobs play in the early stages of a worker s career informal jobs may i provide the opportunity to accumulate skills and ii act as a screening device that enables employers to learn a worker s ability the paper develops a matching model of the informal and formal sectors that can accommodate both roles implied hazard rates from informal to formal sectors as a function of tenure are shown to differ depending on the role of informal sector jobs human capital accumulation or screening using the enoe a longitudinal employment survey from mexico hazard functions are estimated for less educated workers the estimated hazard functions indicate that informal sector jobs play an important role by screening young less educated workers

natural resource abundance and human capital accumulation summary this paper studies the link between resource abundance and human capital accumulation it reviews the commonly used indicators of resource abundance and human capital accumulation the case for a form of resource curse in human capital accumulation is not robust to reasonable changes in these indicators in fact subsoil wealth and resource rents per capita are shown to be significantly correlated with improved indicators of human capital accumulation if mineral wealth is what authors have in mind when they refer to natural resource abundance then they should choose indicators that measure this concept as accurately as possible

a competitive model of the informal sector abstract in developing nations formal workers tend to be more experienced more educated and earn more than informal workers these facts are often interpreted as evidence that low skill workers face barriers to entry into the formal sector yet there is little empirical evidence that such barriers are important this paper describes a model where in equilibrium the characteristics of formal and informal workers differ systematically even though labor markets are perfectly competitive the informal sector emphasizes low skill work as in the data because informal managers have access to less outside financing and choose to substitute low skill labor for physical capital

hedonic amenity valuation and functional form specification this paper uses gis data to develop variables representing the physical extent and visibility of surrounding land use cover features in a hedonic model of a rural suburban residential housing market three equations are estimated to determine if views

resource intensity institutions and development summary we examine the relationship between resource abundance and several indicators of human welfare consistent with the existing literature on the relationship between resource abundance and economic growth we find that given an initial income level resource intensive countries tend to suffer lower levels of human development while we find only weak support for a direct link between resources and welfare there is an indirect link that operates through institutional quality there are also significant differences in the effects that resources have on different measures of institutional quality these results imply that the resource curse is a more encompassing phenomenon than previously considered and that key differences exist between the effects of different resource types on various aspects of governance and human welfare 2005 elsevier ltd all rights reserved

corruption and the extractive industries transparency initiative the extractive industries transparency initiative eiti has received much attention as a scheme that can help reduce corruption in mineral rich developing economies to our knowledge this paper provides the first empirical attempt using panel data to explore how eiti membership links to changes in corruption levels we also examine whether the different stages in eiti implementation initial commitment candidature full compliance influence the pace of changes in corruption we find that eiti membership offers on the whole a shielding mechanism against the general tendency of mineral rich countries to experience increases in corruption over time

the quality of political institutions and the curse of natural resources we propose a theoretical model to explain empirical regularities related to the curse of natural resources which emphasises the behaviour and incentives of politicians we extend the standard voting model to give voters political control beyond the elections this gives rise to a new restriction that policies should not give rise to a revolution our model clarifies when resource discoveries might lead to revolutions namely in countries with weak institutions it also suggests that for bad political institutions human capital depends negatively on natural resources while for high institutional quality the dependence is reversed this finding is corroborated in cross section regressions

the voracity effect abstract we analyze an economy that lacks a strong legal political institutional infrastructure and is populated by multiple powerful groups powerful groups dynamically interact via a fiscal process that effectively allows open access to the aggregate capital stock in equilibrium this leads to slow economic growth and a voracity effect by which a shock such as a terms of trade windfall perversely generates a more than proportionate increase in fiscal redistribution and reduces growth we also show that a dilution in the concentration of power leads to faster growth and a less procyclical response to shocks jel f43 o10 o23 o40

shadow economies size causes and consequences using various methods the size of the shadow economy in 76 developing transition and oecd countries is estimated average size varies from 12 percent of gdp for oecd countries to 23 percent for transition countries and 39 percent for developing countries increasing taxation and social security contributions combined with rising state regulations are driving forces for the increase of the shadow economy especially in oecd countries according to some findings corruption has a positive impact on the size of the shadow economy and a growing shadow economy has a negative effect on official gdp growth

natural resources and economic growth a meta analysis summary an important question in development studies is how natural resources richness affects long term economic growth no consensus answer however has yet emerged with approximately 40 of empirical papers finding a negative effect 40 finding no effect and 20 finding a positive effect does the literature taken together imply the existence of the so called natural resource curse in a quantitative survey of 605 estimates reported in 43 studies we find that overall support for the resource curse hypothesis is weak when potential publication bias and method heterogeneity are taken into account our results also suggest that four aspects of study design are especially effective in explaining the differences in results across studies 1 controlling for institutional quality 2 controlling for the level of investment activity 3 distinguishing between different types of natural resources and 4 differentiating between resource dependence and abundance

the specification of hedonic indexes for urban housing most studies evaluating the effect on housing prices of regulatory programs for controlling urban growth use econometric methods hedonic price models without considering the research design aspects of the task this article examines the strengths and

rule of law and the resource curse abundance versus intensity we examine the resource curse using new data on historic resource stocks and an improved econometric methodology the paper distinguishes between resource abundance stocks and extractive intensity flows focusing on relationships between resources and rule of law previously unavailable information on past resource stocks is estimated we find that economically large initial natural resource stocks are associated with subsequent lower levels of rule of law and do not directly affect growth while raw resource exports do not have a significant effect on rule of law when stocks are included in the analysis but do affect average growth rates sample size is maximized through the use of an emis expectation maximization with importance sampling algorithm to replace missing data minimizing the bias and inefficiency associated with listwise deletion which commonly eliminates half or more of the available data in this setting

unobservables in consumer choice residential energy and the demand for comfort a model of consumption of residential energy in dwellings is developed distinguishing between attributes of housing that provide direct benefits to consumers and attributes that serve as inputs in the production of final goods for example the thermal comfort of dwellings empirical estimates are made of the mode based upon the annual housing survey and the results are used to calculate the effects of changes in energy prices on the consumption of housing residential energy and other goods the analysis suggests that the adjustment process within the housing market permits a great deal of substitution in response to energy price changes copyright 1989 by mit press

using contingent pricing analysis to value open space and its duration at residential locations to estimate benefits from open space adjacent to residences this paper blends contingent valuation and conjoint analysis within a housing market context the resulting framework contingent pricing analysis represents the stated preference counterpart to hedonic pricing analysis by asking individuals to state prices for hypothetical housing locations which include an environmental amenity then it asks individuals to state their willingness to pay for a better and longer lasting environmental amenity as an advantage over hedonic pricing analysis it directly isolates willingness to pay results indicate that potentially short lasting open space adds no value while preserved open space adds 5 066 or 5 to housing value

savings growth and the resource curse hypothesis an important connection between recent attempts to understand the determinants of economic growth and the measurement of sustainability is the finding of a negative and significant relationship between natural resource abundance and economic growth this is the so called resource curse hypothesis using cross country regressions we offer evidence that the curse may itself be a manifestation of the inability of governments to manage large resource revenues sustainably in particular these results offer another perspective on the resource curse hypothesis the countries where growth has lagged are those where the combination of natural resource macroeconomic and public expenditure policies have led to a low rate of genuine saving net saving adjusted for resource depletion

viewscapes and flood hazard coastal housing market response to amenities and risk coastal amenities and risk are so highly correlated that separate identification within the hedonic framework is potentially challenging in this study we construct a three dimensional measure of ocean view viewscape accounting for natural topography and built obstruction that varies independent of risk classification to disentangle these spatially integrated housing characteristics a spatial autoregressive hedonic model is developed to provide consistent estimates of the willingness to pay for coastal amenities and risk our findings suggest that incorporating the gis based view measures can be successful in isolating risk factors from spatial amenities

segmented or competitive labour markets a normal roy model with four sectors is developed it allows to derive tests of several assumptions on the working of the labor market strongly or weakly competitive or segmented it shows that more important a feature of labor markets than segmentation is the presence of comparative advantages for individuals between the various economic sectors the model is applied to data on women s labor force participation in the main towns of colombia in 1980 it uses multivariate probit and tobit techniques copyright 1991 by the econometric society

natural resources education and economic development economic growth since 1965 has varied inversely with the share of natural capital in national wealth across countries four main channels of transmission from abundant natural resources to stunted economic development are discussed a the dutch disease b rent seeking c overconfidence and d neglect of education public expenditure on education relative to national income expected years of schooling for girls and gross secondary school enrolment are all shown to be inversely related to the share of natural capital in national wealth across countries natural capital appears to crowd out human capital thereby slowing down the pace of economic development

natural resources rent seeking and welfare abstract a new and very simple mechanism to explain why natural resource abundance may lower income and welfare is developed in a model with rent seeking a greater amount of natural resources increases the number of entrepreneurs engaged in rent seeking and reduces the number of entrepreneurs running productive firms with a demand externality it is shown that the drop in income as a result of this is higher than the increase in income from the natural resource more natural resources thus lead to lower welfare

institutions and the resource curse countries rich in natural resources constitute both growth losers and growth winners we claim that the main reason for these diverging experiences is differences in the quality of institutions more natural resources push aggregate income down when institutions are grabber friendly while more resources raise income when institutions are producer friendly we test this theory building on sachs and warner s influential works on the resource curse our main hypothesis that institutions are decisive for the resource curse is confirmed our results contrast the claims of sachs and warner that institutions do not play a role

it s the rents stupid the political economy of the resource curse a number of studies suggest that natural resources can have a negative impact on the developing prospects of countries empirical results suggest that political economy models of patronage and rent seeking are central to understanding why such a resource curse arises in other words the resource curse is created by certain resource rents leading to dysfunctional behaviour this article introduces the term impartiality enhancing institutions to structure policy debates by distinguishing conditions under which negative effects of resources can be mitigated moreover it is argued that viewing institutions as an equilibrium outcome has implications for the analysis of institutional change policy initiatives that do not promote the impartiality of institutions nor attend to the underlying interests and incentives keeping a bad institutional equilibrium in place will not help lift the resource curse

demographic transition in resource rich countries a blessing or a curse summary this study argues that resource wealth is a key factor for understanding income effects of demographic transition we develop a simple model highlighting how the income effect of increased labor supply may depend on resource rents and provide empirical evidence that support the theoretical predictions using panel data covering the period from 1982 to 2006 for more than 120 countries we find a negative interaction effect between resource wealth and demographic transition on national income moreover the negative interaction effect does not depend on institutional quality and is found also across different samples

the varieties of resource experience natural resource export structures and the political economy of economic growth many oil mineral and plantation crop based economies experienced a substantial deceleration in growth following the commodity boom and bust of the 1970s and early 1980s this article illustrates how countries dependent on point source natural resources those extracted from a narrow geographic or economic base such as oil and minerals and plantation crops are predisposed to heightened economic and social divisions and weakened institutional capacity this in turn impedes their ability to respond effectively to shocks which previous studies have shown to be essential for sustaining rising levels of prosperity analysis of data on classifications of export structure controlling for a wide array of other potential determinants of governance shows that point source and coffee and cocoa exporting countries do relatively poorly across an array of governance indicators these governance effects are not associated simply with being a natural resource exporter countries with natural resource exports that are diffuse relying primarily on livestock and agricultural produce from small family farms do not show the same strong effects and have had more robust growth recoveries

flexible parametric estimation of duration and competing risk models in this paper we specify and estimate a flexible parametric proportional hazards model the model specification is flexibly parametric in the sense that the baseline hazard is non parametric while the effect of the covariates takes a particular functional form we also add parametric heterogeneity to the underlying hazard model specification we specify a flexible parametric proportional competing risks model which permits unrestricted correlation among the risks unemployment duration data are then analysed using the flexible parametric duration and competing risks specifications we find an important effect arising from the exhaustion of unemployment insurance and significantly different hazards for the two types of risks new jobs and recalls

resource rents redistribution and halving global poverty the resource dividend summary this paper considers the proposal that each country distributes its resource rents directly to citizens as a universal and unconditional cash transfer or resource dividend and estimates its potential impact on global poverty for the years 2000 06 using a global dataset on resource rents and the distribution of income i find that if every developing country implemented the policy then the number of people living below 1 a day would be cut by between 27 and 66 depending on the year and the assumptions made looking ahead poverty could be better than halved as long as commodity prices do not drop below their 2004 level

does the measurement of environmental quality affect implicit prices estimated from hedonic models hedonic property value models are often used to derive point estimates for identifying the relationship between environmental quality and property prices the measurement of the environmental quality variable is often selected based on convenience but variables reflecting different perceptions about environmental quality may result in implicit prices that vary substantially this case study derives implicit prices for nine measures of water clarity using hedonic property value models of lakefront properties in maine results show that water clarity variables based on different perceptions may result in differences in implicit prices large enough to potentially affect policy decisions

the social development effects of primary commodity export dependence on the question of whether natural resources are a curse for growth the jury is still out while waiting for a decision we study whether resource intensity has any effect on social development over and above the effect it might have on income or growth we measure social development by a combination of health and education outcomes and resource intensity by the share of primary commodities in total merchandise exports we find that after controlling for per capita income and other macroeconomic and institutional factors a higher dependence on primary commodity exports is negative for social development the transmission mechanism seems to operate via income inequality and macroeconomic volatility

buen vivir vs development ii the limits of neo extractivism like the entire andean region ecuador has an economic structure that is dependent on primary exports during the last boom in commodity prices the neo extractivist development strategy generated economic growth and simultaneously reduced inequality however this bonanza was not used to advance in economic diversification or for transition towards buen vivir sumak kawsay good living as postulated in the constitution and the national development plans we establish that neo extractivism is not compatible with buen vivir analysing three concrete aspects to this end the failure to fulfill the rights of nature and ecological sustainability the lack of advances in transforming the productive matrix insufficient results in matters of redistributive social policies

human capital accumulation and labor market equilibrium the objective of this paper is to analyse an equilibrium search model with on the job search and human capital accumulation in our model wages are disperse because firms pay workers of the same productivity different wages and workers of different productivies earn different wages new entrants to the labour market increase their wages mainly through on the job search as workers gain more experience and move up the offer distribution job to job transitions become less frequent and human capital accumulation dominates wage growth this interaction generates a wage distribution that exhibits a density with a unique mode and a long and decreasing right tail as observed in the data

environmental amenities as a source of market power site specific environmental amenities can provide a source of product differentiating market power using estimates from hedonic price equations and residual demand models our analysis recovers firm specific estimates of price markups as measures of market power and uses these markups to estimate the implied marginal value for access to coastal beaches the application involves rental price and occupancy data for several thousand beach properties along a portion of the north carolina coastline during the 1987 to 1992 rental seasons

the resource curse revisited a bayesian model averaging approach abstract the evidence for the effects of oil rents on growth is mixed a result which can be explained with model uncertainty we address the issue using bayesian model averaging techniques and an updated cross country data set for long term growth in the period 1970 2014 including 91 countries and 54 potential growth determinants we do not find empirical evidence for the existence of a natural resource curse in our sample on the contrary our results suggest a robust positive effect of oil rents on long term economic growth we then introduce interaction terms of oil rents with potential conditions under which oil dependency can lead to sub standard growth the results indicate that the positive effect of oil rents may be conditional on the quality of institutions we test the robustness of our results using a panel data set and find neither a curse nor a positive effect of oil rents on short to medium run growth

how to spend it resource wealth and the distribution of resource rents natural resource revenues differ from other government revenues both in their time profile and in their political and legal status they are volatile and exhaustible and belong to all citizens of the country in which they are located this paper discusses the theory of natural resource revenues and examines expenditure practices in a range of resource rich countries it considers both the distributional impact and the efficiency of expenditure policies focusing on the extent to which they succeed in providing all citizens with their share of the benefits due to natural resources

the spatial extent of water quality benefits in urban housing markets water quality regulation continues to be controversial as demonstrated by recent litigation between the u s environmental protection agency and the state of florida over nutrient standards while the costs of standards are usually known benefits may be diverse and difficult to identify this study investigates the effects of enhanced water quality on both waterfront and nonwaterfront property prices using hedonic models within an urban market findings indicate 1 the value of increased water quality depends upon the property s location and proximity to waterfront and the surface area of the water body and 2 aggregate benefits to nonwaterfront homes may dominate those realized by waterfront homeowners

informal labor markets and on the job training evidence from wage data i introduction this study explores the role of informal jobs in the formation of human capital among young less educated workers an informal job is a job that fails to comply with some or all of the labor regulations 1 the set of all informal jobs constitute what is typically known as the informal sector due to the lack of compliance with the labor laws informal jobs are not registered with the authorities 2 however it is often argued that compliance with these laws is of great significance in developing countries to ensure social justice for workers berg and kucera 2008 and to protect them against the forces of reallocation in the labor market inter american development bank 2003 in spite of these arguments the lack of compliance with these mandates in developing countries is common practice leading to the existence of sizable informal labor markets especially among the youth and the less educated 3 hence the importance of understanding what role the informal sector is playing in the lives of young less educated workers the traditional views of the informal sector in the literature are that of a sector that is the last resort for many workers who are rationed out of the protected and better paid jobs in the formal sector e g ozorio de almeida et al 1995 or that it is the disadvantaged sector in a segmented labor market e g fields 1975 harris and todaro 1970 4 the support for these views of the informal sector is mixed in the literature the work of maloney 1999 amaral and quintin 2006 and galiani and weinschelbaum 2012 suggests that the existence of informal labor markets is not necessarily evidence of segmentation and that could be an equilibrium outcome in a competitive labor market however the work of arias and khamis 2008 presents some evidence that is consistent with the rationing of formal salaried jobs and with segmentation in the labor market 5 despite the ongoing debate informal jobs play an important role in the work lives of less educated workers maloney 1999 argues that informal salaried jobs serve as the main point of entry for young poorly educated workers into paid employment the current study further explores this idea focusing on the group of young less educated workers in mexico the study explores the extent to which less educated workers in the informal sector experience wage growth and how wage growth in the informal sector compares with wage growth in the formal sector the basic question is whether informal jobs offer wage growth and skill accumulation to less educated workers and how it compares with formal jobs the empirical analysis uses a household survey from mexico the enoe acronym in spanish for encuesta nacional de ocupacion y empleo the panel structure of the survey allows the construction of measures of wage growth and continuing sector participation the results indicate that young less educated workers in the informal sector experience faster wage growth than their peers in the formal sector based on existing models of on the job training acemoglu and pischke 1999a 1999b becker 1993 stevens 1994 this result suggests that informal jobs offer valuable general training opportunities to young less educated workers the literature provides little evidence on wage growth in the informal sector or on how it compares with wage growth in the formal sector there is some evidence on the wage gain or loss from informality for example maloney 1999 and alcaraz et al 2011 provide estimates of the wage change associated with transitions between the formal and informal sectors in mexico the results in both studies indicate that informal to formal transitions are associated with positive wage changes while transitions in the opposite direction are associated with negative wage changes however none of these two studies provide evidence on wage growth experienced by workers in the informal sector or how it compares to wage growth in the formal sector

institutional analysis and the resource curse in developing countries abstract the present article examines the recent advances reported in the literature regarding the mechanisms underlying the resource curse in developing countries by analyzing the rule of law index we investigated how the institutions responsible for allocating hydrocarbon royalties can help minimize the effects of the resource curse we used a qualitative methodology based on case studies the results show that evidence of legal violations on the part of these institutions and the lack of tools in resource rich developing countries to uphold basic social and economic rights are associated with the resource curse our findings suggest that strengthening the institutions closer monitoring of oil revenue allocations and public participation can help to alleviate the resource curse

nonlinear budget constraints and consumer demand an application to public programs for residential housing abstract this study presents a methodology for exploiting the nonlinear hedonic nature of housing prices to estimate the compensated demands of households for particular housing attributes the methodology is employed to provide hicksian benefit measures of a particular housing subsidy program typical of those undertaken recently in developing countries

the formal sector wage premium and firm size abstract we show theoretically that when larger firms pay higher wages and are more likely to be caught defaulting on labor taxes then large high wage firms will be in the formal and small low wage firms will be in the informal sector the formal sector wage premium is thus just a firm size wage differential using data from ecuador we illustrate that firm size is indeed the key variable determining whether a formal sector premium exists

unemployment insurance and unemployment spells this paper tests the effects of the level and length of unemployment insurance benefits on unemployment durations the paper particularly studies individual behavior during the weeks just prior to when benefits lapse higher unemployment insurance benefits are found to have a strong negative effect on the probability of leaving unemployment however the probability of leaving unemployment rises dramatically just prior to when benefits lapse individual data are used with accurate information of spell durations and the level and length of benefits the semiparametric estimation techniques used in the paper yield more plausible estimates than conventional approaches and provide useful diagnostics copyright 1990 by the econometric society

the effects of labour market policies in an economy with an informal sector in this article we build an equilibrium search and matching model of an economy with an informal sector our model extends mortensen and pissarides 1994 by allowing for ex ante worker heterogeneity with respect to formal sector productivity we use the model to analyse the effects of labour market policy on informal sector and formal sector output on the division of the workforce into unemployment informal sector employment and formal sector employment and on wages finally we examine the distributional implications of labour market policy specifically we analyse how labour market policy affects the distributions of wages and productivities across formal sector matches in this article we construct a search and matching model that we use to analyse the effects of labour market policies in an economy with a significant informal sector what we mean by an informal sector is a sector that is unregulated and hence not directly affected by labour market policies such as severance or payroll taxes we find that labour market policies that apply only to the formal sector nonetheless affect the size and the composition of employment in the informal sector this is important since there is substantial economic activity in the informal sector in many economies particularly in developing countries estimates for some latin american countries put the informal sector at more than 50 of the urban work force 1 the informal sector is also important in many transition countries as well as in some developed economies 2 although much of the literature treats the informal sector as a disadvantaged sector in a segmented labour market framework this interpretation is not consistent with recent empirical evidence from latin america under a segmented or dual labour market interpretation one would expect jobs to be rationed in the primary sector and workers to be in the secondary or informal sector involuntarily and to be queuing for formal sector jobs maloney 2004 presents evidence for several latin american countries that challenges this view and instead interprets the informal sector as an unregulated micro entrepreneurial sector similarly using data from the argentinian household survey pratap and quintin 2006 reject the notion that labour markets are segmented in the greater buenos aires area concluding that there is no evidence of a formal sector wage premium after controlling for individual and establishment we thank mauricio santamaria for stimulating conversations that inspired our interest in this topic we also thank bob hussey and fabien postel vinay as well as our editor steve pischke and two anonymous

the curse of the haven the impact of multinational enterprise on environmental regulation abstract we analyze the behavior of multinational enterprises in the context of resource rich and poor countries and regarding high and low income countries we depart from the pollution haven hypothesis and the resource curse the pollution haven hypothesis states that multinational enterprises move their dirty operations to countries with weak environmental regulation the resource curse holds that economic growth in countries abundant in natural resources is reduced we find that more polluting firms are relatively more often located in countries with weak environmental regulation however multinational enterprises do not have a significant impact on environmental regulation in the host country it appears that it is mainly the quality of institutions that drives both the pollution haven and the resource curse

how do mineral states learn path dependence networks and policy change in the development of economic institutions summary based on case study methods i draw lessons from the political economy of macroeconomic management in chile and peru to explain how mineral states learn to think long term and eventually escape the resource curse i give an institutionalist account of the rise of countercyclical funds showing how the long term development of elite networks qualifies the contemporary making of curse escapes policy networks compose one central avenue of institutional development for both the reproduction of path dependence and the making of institutional change the exposition challenges political economy of development frameworks which over emphasize structural initial conditions and assume steady rent seeking behavior of state agents

political foundations of the resource curse in this paper we argue that the political incentives that resource endowments generate are the key to understanding whether or not they are a curse we show 1 politicians tend to over extract natural resources relative to the efficient extraction path because they discount the future too much and 2 resource booms improve the efficiency of the extraction path however 3 resource booms by raising the value of being in power and by providing politicians with more resources which they can use to influence the outcome of elections increase resource misallocation in the rest of the economy 4 the overall impact of resource booms on the economy depends critically on institutions since these determine the extent to which political incentives map into policy outcomes countries with institutions that promote accountability and state competence will tend to benefit from resource booms since these institutions ameliorate the perverse political incentives that such booms create countries without such institutions however may suffer from a resource curse

assessing the economic cost of greenhouse induced sea level rise methods and application in support of a national survey the potential cost of sea level rise has dominated many of the recent estimates of the economic damage that greenhouse warming might inflict on the united states over the course of the next century the cost of coastal protection and abandonment accounted for more than 80 of the early nordhaus estimate of likely damages part of a review of the then existing evidence which suggested that an effective doubling of atmospheric carbon concentrations might cost 0 26 of annual gdp the proportion of total cost attributed to sea level rise was a much smaller 11 in cline but the sea level rise costs that he quoted were among the most broadly accepted of his longer list of damages the relative importance of sea level rise in assessing the potential cost of greenhouse warming and thus in evaluating the potential benefit of any mitigating strategy has brought the original damage estimates under closer scrutiny a series of integrated assessments of aggregate damages has begun each has noted that the titus estimates were based on the assumptions that all developed property would be protected and that all undeveloped property including wetlands would be abandoned these assumptions were supported by comparisons of the economic vulnerability estimatesmore produced by yohe and protection cost estimates produced by weggel but they are clearly too simplistic some of each type of property will be abandoned though in which case the true future economic cost of sacrificed property must also be added to the damage calculus across an equally diverse collection of coastal sites moreover the decision of when whether and for how long to protect any piece of property will involve accurately weighing the tradeoff between the cost of its protection and the economic cost of its abandonment a balancing calculation which must be conducted on a site by site basis the key is to consider the world as it is likely to be and not necessarily as it is now 26 refs 1 fig 7 tabs less

globalization and the politics of natural resources much political science scholarship including important work in this journal has explored the implications of natural resource endowments particularly oil and other highly valuable export commodities on political and economic outcomes although the first wave of literature emphasized the negative effects of these resources more recent work emphasizes how domestic institutions can condition the relationship sometimes leading to positive effects in this special issue the authors expand this literature in two important ways first they renew attention on the international dimensions of this relationship exploring how trade migration foreign investment and other global forces influence the effects these resources have on countries second they link the study of the globalization natural resources nexus to broader debates in international and comparative political economy such as how domestic institutions shape the impact of globalization and how economic factors affect the political survival of r

economic freedom and productivity growth in resource rich economies summary the focus of this paper is to test whether free market institutions that protect property rights and support freedom of choice and voluntary exchange can change the curse of natural resources into a blessing to examine the above question this paper uses the fraser institute s economic freedom index and its five sub indices namely government size property rights access to sound money freedom to trade and setting proper regulations using data from 99 sample countries over the period 1970 2010 the system gmm estimates suggest that the negative growth effects of resource rents may turn positive in countries with greater economic freedom

on the economic analysis of the urban informal sector abstract this paper examines the links and interactions between the formal and the informal sector in developing countries it is argued that both the factor and the product markets show these links based on the assumption that for most products demand consists of a specific and a nonspecific demand the paper presents an analysis of the product and labor markets and discusses the effects of shifts in demand on development strategies it concludes that successful measures have to include the informal as well as the formal sector

corruption and the political economy of resource based development a comparison of asia and sub saharan africa we model how the supply and demand for bribes affects resource use by an economy and the reinvestment of resource rents in other assets this requires adjusting the world bank s measure adjusted net savings for any rent dissipation due to corruption the impacts of corruption on long run changes and periodic growth in the adjusted net savings rate are estimated across african and asian economies from 1970 to 2003 corruption rather than resource dependency per se affects negatively the ability of african countries to reinvest resource rents in the short term but for asian countries corruption is less important than point resources corruption influences long run growth in adjusted net savings rates in all countries and is also the pathway through which this growth is affected by patterns of resource use trade and abundance

export diversification what s behind the hump hy should export diversification be taken as a policy objective per se there are two reasons that it should not first according to ricardo countries should specialize not diversify second the heckscher ohlin model implies that export patterns are largely determined by endowments so if anything we should worry about factor accumulation not diversification yet export diversification is a constant preoccupation of policymakers in developing countries as de ferranti et al 2002 note a recurrent preoccupation of latin american policymakers is that their natural riches produce a highly concentrated structure of export revenues which then leads to economic volatility and lower growth p 38 the notion that export patterns are fully determined by endowments is of course naive the relationship of endowments trade and growth is a complex and imperfectly understood one intra industry trade models showed long ago that many factors other than endowments including market failures and policies can affect trade patterns more recently hausmann hwang and rodrik 2007 argued that export patterns can display path dependence in the presence of externalities

the opportunity cost of coastal land use controls an empirical analysis for more than a decade demographers have been documenting the migration of the u s population from interior to coastal states a belief that this trend will persist has led to concern about increased housing and commercial development in coastal areas added development brings water pollution and reduces the natural cover of the coastline many states have responded to this trend with land use controls that limit new residential and commercial development on land adjacent to coastal water controls such as these have essentially three economic efficiency effects first on the positive side is the preservation of coastal open space and reduction of water pollutants benefits enjoyed by residents and visitors second and on the negative side is decreased residential and commercial proximity to the coast fewer households and businesses can locate near the

cursing the blessings natural resource abundance institutions and economic growth summary since sachs and warner s sachs j d warner a m 1995a natural resource abundance and economic growth nber working paper no 5398 contribution there has been a lively debate on the so called natural resource curse this paper re examines the effects of natural resource abundance on economic growth using new measures of resource endowment and considering the role of institutional quality we find a positive direct empirical relationship between natural resource abundance and economic growth in both ols and 2sls regressions the positive resource effects are particularly strong for subsoil wealth our results also show no evidence of negative indirect effects of natural resources through the institutional channel

natural resource abundance and economic growth this paper explores whether natural resource abundance leads other things equal to slower growth rates we distinguish between natural resource dependence rd and the natural resource endowment re we estimate three models using world bank data on national capital stocks in a one equation model we show that rd has a negative effect on growth rates apparently confirming the main results of the resource curse literature re however has a positive impact on growth we then estimate a twoequation model in which the impacts of re are much weaker finally we estimate a three equation model in which the impacts of natural resources on growth disappears

opportunity cost estimation of ecosystem services land use changes rank among the most significant drivers of change in ecosystem services worldwide the enhancement of important services such as biodiversity and carbon sequestration requires modifications in land use that can lead to the decline in other ecosystems services targeting the most suitable areas for particular land uses based on comparative advantages requires opportunity cost information across large regions this is a demanding task because the input output relations are ill defined and determined by spatially heterogeneous operational and environmental conditions to address this methodological challenge this paper presents a two stage semiparametric technique that enables multi dimensional production possibility frontiers to be estimated from data provided by biophysical models specific advantages of the proposed frontier approach are its flexibility with regard to assumptions on the convexity of the production possibility set and its freedom from any separability assumptions for the input output space and the space of the heterogeneous background variables the method is illustrated for a case study of 18 central and eastern european countries results show that opportunity costs of changes in ecosystem services provision differ substantially between regions those areas having already relatively high levels of carbon sequestration have a comparative advantage in sequestering carbon opportunity costs of biodiversity are generally positively related with the level of biodiversity up to a turning point after which they are negatively related to illustrate the policy consequences of the observed economies and diseconomies of scope we compare two management regimes to illustrate the potential gains from smart land management