bluuebunny/crossref_metadata_2025 huggingface dataset:
Regional Integration: What is in it for CARICOM?
Authors: Mendoza Eduardo , Mesquita Moreira Mauricio
Published: March 2024

Economic and political integration have been a perennial and neuralgic issue in the Caribbean agenda. This paper draws on the literature on trade, growth and regional agreements to discuss the motivation behind the Caribbean drive for integration, the results obtained so far and what is in stock for the future. It argues, with the help of descriptive statistics, an empirical growth model and a gravity model, that the traditional, trade related gains from regional integration have been and are bound to be limited because of (1) the countries¿ high openness; (2) the limited size of the "common", enlarged market; and (3) the countries¿ relatively similar factor endowments. It also argues, though, that gains in the area of "non-tradables", due to economies of scale which cannot be mitigated by trade and openness, can be substantial.
OLPC Pre-Pilot Evaluation Report (Haiti)
Authors: Kipp Scott , Cruz Jessica , Steiner-Khamsi Gita , Ibarrarán Pablo , Näslund-Hadley Emma
Published: March 2024

This working paper discusses the One Laptop Per Child (OLPC) pilot program carried out by the Haitian Ministry of Education and Vocational Training (MENFP) conducted in collaboration with the IDB. The OLPC pre-pilot project was implemented at the Ecole Nationale Republique du Chili (ENRC), an all-female public school located in Port-au-Prince. Because the school year had ended before the OLPC pre-pilot began, the project was conducted as a summer camp entitled "XO Camp," held on June 30th-July 18th, 2008. The camp enrolled 116 student participants and the XO laptop, an educational tool designed by One Laptop Per Child (OLPC), a nonprofit organization headquartered at the Massachusetts Institute of Technology, was selected as the educational device for the initial implementation. Although the original intention was to create a context of one-to-one computing, the XO Camp operated primarily with one-to-two computing owing to an unexpected shortage of XO laptops.
Evaluating a Program of Public Funding of Scientific Activity: A Case Study of FONCYT in Argentina
Authors: Rossi Martín , Ubfal Diego , López Andrés , Chudnovsky Daniel
Published: March 2024

This report contains an evaluation of the Scientific and Technological Research Projects (PICT) funded by the Scientific and Technological Research Fund (FONCYT). FONCYT is managed by the National Agency of Scientific and Technological Promotion (ANPCYT), an organization that is part of the Argentine federal government. The main function of FONCYT is to support, through the granting of subsidies, research projects aimed at generating scientific or technological knowledge. In order to carry out the evaluation, the authors have taken advantage of a series of econometric techniques that allow them to identify the impact of having received a subsidy from the FONCYT on the academic performance, distinguishing this impact from other factors that could also be affecting the performance of the researchers that are part of both analyzed groups (funded and not funded).
Hysteresis in Unemployment: Evidence from Latin America
Authors: Mednik Matias , Ruprah Inder J. , Rodríguez César
Published: March 2024

This paper tests the hysteresis hypothesis in unemployment for 13 Latin American countries covering the period 1980-2005. The tests exploit the time series and the cross sectional variation of the series, and allows for cross section dependence and a different number of endogenously determined structural breakpoints. The findings give support to the hysteric dynamic hypothesis for the majority of the countries analyzed. The implications of the results have ramifications regarding macro-stabilization, structural reform, and the design of social safety protection.
Incapacity to Pay or Moral Hazard?: Public Mortgage Delinquency Rates in Chile
Authors: Ruprah Inder J. , Marcano Luis
Published: March 2024

High delinquency rate of publicly provided mortgages in social housing programs are often interpreted to be due to moral hazard. In this working paper, the authors show that the typically used parametric approaches give misleading results due to overlooked confounding and selection biases. As evidenced by using the more appropriate impact or treatment non-parametric approach the problem of high delinquency rate in publicly provided mortgages is due to the incapacity to pay and not due to moral hazard. The results caution against public policies to encourage private mortgage providers to move down market, and suggest eliminating mortgages and correspondingly increasing the grant component of the programs.
Regional Competitiveness Policies for Deeper Integration in MERCOSUL
Authors: Flôres Jr. Renato G.
Published: March 2024

In this paper, the authors discuss the deepening of MERCOSUL's integration in the context of enhancing regional competitiveness. The paper focuses on regional policies related to the trade flows, creating a united area for investment and common competitiveness policies, and regional cohesion funds for MERCOSUL. The authors argue that the road to a common market appears appears only after abiding by a strong comprehensive strategy and implementation.
The Impact of Technology Adoption on Agricultural Productivity: The Case of the Dominican Republic
Authors: Gonzalez Diez Verónica M. , Maffioli Alessandro , Ibarrarán Pablo , Rozo Sandra
Published: March 2024

This paper is part of the project 'Ex-post Evaluation of the IDB Agricultural Technology Uptake Programs.' This paper evaluates the impact of agricultural extension services in the Dominican Republic and analyzes the direct impact of the Program for Technological Support in the Agricultural Sector (PATCA). The analysis relies on a unique dataset gathered by PATCA's executing unit in 2008 and the survey included 1,572 farmers operating in crop growing, breeding or milk production. Using a propensity score matching technique, the authors found that the technologies financed through PATCA effectively improved the productivity of rice producers and breeders. The outcome was the authors did not find any significant impact on other producers. These heterogeneous impacts could be due to the different level of effectiveness of the promoted technologies in the short run, where landleveling and pasture conservation could be the fastest in showing significant effects. Finally, the authors did not find any clear evidence that the program had a significant impact on the quality of production that was reflected on prices reported by farmers.
Social Assistance and Birth Outcomes: Evidence from the Uruguayan PANES
Authors: Manacorda Marco , Amarante Verónica , Miguel Edward , Vigorito Andrea
Published: March 2024

This paper estimates the impact of a large temporary poverty relief program, Uruguay's PANES on birth outcomes. Using program administrative data and longitudinal vital statistics, a significant and precisely estimated reduction in the fraction of low-weight newborns (less than 2,500 g. ) on the order of 10 to 20 percent was found to be a result of treatment. The cash (and in-kind) transfer components of the program were considered to drive the results, suggesting that unrestricted social assistance has the potential to positively affect birth outcomes, most likely through improved nutrition. Assuming that all the effect of the program was through the transfer, an elasticity of low birthweight with respect to welfare transfers on the order of around 0. 30 can be inferred.
Beyond The Average Effects: The Distributional Impacts of Export Promotion Programs in Developing Countries
Authors: Volpe Martincus Christian , Carballo Jerónimo
Published: March 2024

Do all exporters benefit the same from export promotion programs? Surprisingly, not matter how obvious this question may a priori be when thinking of the effectiveness of these programs there is virtually no empirical evidence on how they affect export performance in different parts of the distribution of export outcomes. This paper aims at filling this gap in the literature. We assess the distributional impacts of trade promotion activities performing efficient semiparametric quantile treatment effect estimation on assistance, total sales, and highly disaggregated export data for the whole population of Chilean exporters over the period 2002-2006. We find that these activities have indeed heterogeneous effects over the distribution of export performance, along both the extensive and intensive margins. In particular, smaller firms as measured by their total exports seem to benefit more from export promotion actions.
Export Promotion Organizations in Latin America and the Caribbean: An Institutional Portrait
Authors: Jordana Jacint , Volpe Martincus Christian , Gallo Andrés
Published: March 2024

Virtually all Latin American and Caribbean countries have established specialized organizations to promote their exports. Existing analyses of these organizations are at best partial and fragmentary. This paper aims at overcoming these limitations of the literature by presenting a consistent, detailed organizational characterization of the major export promotion entities in their respective countries. This characterization is primarily based on data collected through an extensive survey that we have conducted among organizations in the region, and, to put them into an appropriate perspective, among relevant organizations from countries outside of the region. Moreover, for a few countries, we have carried out in-depth case studies not only to report more precise information on those aspects covered by the survey, such as the number and diversity of other actors, both public and private, engaged in export promotion along with their interaction patterns.
The Impact of Trade Liberalization on Employment, Capital, and Productivity Dynamics: Evidence from the Uruguayan Manufacturing Sector
Authors: Fachola Gabriela , Casacuberta Carlos , Gandelman Néstor
Published: March 2024

This paper studies the impact of trade liberalization on labor and capital gross flows and productivity in the Uruguayan manufacturing sector. Uruguay opened its economy in the presence of -at least initially- strong unions and structurally different industry concentration levels. Higher international exposure implied slightly higher job creation and an important increase in job and capital destruction. Unions were able to dampen this effect. Although not associated with higher creation rates, unions were effective in reducing job and capital destruction. Industry concentration also was found to mitigate the destruction of jobs but had no effect on job creation or capital dynamics. The changes in the use of labor and capital were accompanied by an increase in total factor productivity, especially in sectors where tariff reductions were larger and unions were not present. The authors found no evidence of varying productivity dynamics across different industry concentration levels.
The Impact of Public and Private Job Training in Colombia
Authors: Medina Carlos , Núñez Jairo
Published: March 2024

In this working paper, the authors present various matching estimators of the impact on earnings for individuals who attended public and private job training programs in Colombia, namely the National Learning Service (SENA). The authors estimate propensity scores by controlling for the wide variety of personal and socioeconomic background variables of those individuals, measuring the effect of training disaggregated by type of institution (private, SENA, or other public programs), time (short and long-term) and gender.
Discrimination and Social Networks: Popularity among High School Students in Argentina
Authors: Elías Julio , Ronconi Lucas , Elías Víctor
Published: March 2024

The objective of this paper is to better understand peer popularity during adolescence and detect discrimination. The paper subsequently explores how student's characteristics affect their popularity. It is found that physically attractive students and with high academic performance are highly ranked by their peers, but the former effect is only significant in mixed schools, suggesting that is primarily driven by mating. Other traits, such as skin color, nationality and parental socioeconomic background do not affect peer popularity, although ethnic origin and parental education are statistically significant in some specifications. The findings are informative about discrimination in the school system. In particular, it appears that the unequal treatment based on race, wealth and nationality found in other social environments in Argentina is not observed among adolescents attending school.
The Role of Social Networks in the Economic Opportunities of Bolivian Women
Authors: Kruger Diana , Ochoa Marcelo , Contreras Dante , Zapata Daniela
Published: March 2024

This paper explores the role of social networks in determining the participation of Bolivian women in income-generating activities. The empirical analysis intends to explore the impact of this new social variable on the economic choices of women and its relative importance with respect to other individual characteristics, such as education or number of children in the household. The empirical framework defines social network as the average outcome of people living in the same neighborhood. Estimation results suggest that social networks are an effective channel through which women obtain access to salaried jobs, which are of higher quality than jobs as self-employers. In contrast, their male counterparts find a positive but statistically insignificant effect from social networks. When considering the sex of the contact, it is found that women in urban areas benefit from other women being employed, while in rural areas women benefit from the presence of more employed male workers.
Ethnic and Social Barriers to Cooperation: Experiments Studying the Extent and Nature of Discrimination in Urban Peru
Authors: Castillo Marco , Petrie Ragan , Torero Máximo
Published: March 2024

This paper presents a series of experiments on discrimination in urban Lima, Peru. The experiments exploit degrees of information on performance as a way to assess how personal characteristics affect how people sort into groups, and the results show that behavior is not correlated with personal socio-economic and racial characteristics. However, people do use personal characteristics to sort themselves into groups. Height is a robust predictor of being desirable, as is being a woman. Looking indigenous makes one less desirable, and looking "white" increases one's desirability. Interestingly, our experiments show that once information on performance is provided, almost all evidence of discrimination is eliminated. Although there is evidence of stereotyping or preference-based discrimination, clear information trumps discrimination.
Discrimination in the Provision of Social Services to the Poor: A Field Experimental Study
Authors: Candelo Natalia , Sethi Rajiv , Gaviria Alejandro , Cárdenas Juan Camilo , Polanía Sandra
Published: March 2024

This paper uses an experimental field approach to investigate the pro-social preferences and behavior of social services providers and the behavior of potential beneficiaries in Bogota, Colombia. Field experiments were conducted using games including a newly designed Distributive Dictator Game in order to examine traits and mechanisms guiding pro-sociality. Replicating the patterns of previous studies, individuals showed a preference for fair outcomes, positive levels of trust and reciprocity, and willingness to punish unfair outcomes. The results provide evidence that the poor trigger more pro-social behavior from all citizens, including public servants, but the latter display strategic generosity. Additional observations include a bias in favor of women and households with more dependents, but discriminatory behavior against stigmatized groups.
Is There Labor Market Discrimination among Professionals in Chile?: Lawyers, Doctors and Businesspeople
Authors: Bravo David , Urzúa Sergio , Sanhueza Claudia
Published: March 2024

This paper analyzes gender differences in three Chilean professional labor markets, business, law and medicine, utilizing a new and rich data set collected for this purpose. The results show that differences in wages attributed to gender are only present in the legal profession. In business/economics, a vector of current family condition eliminates the gender effect and in Medicine, taking into account hours worked, size of firm and region also eliminates gender differences. The paper further shows that individuals' perceived locus of control (internal or external) is relevant in explaining the distribution of earnings.
On the Determinants and Effects of Political Influence
Authors: Chong Alberto E. , Gradstein Mark
Published: March 2024

This paper uses a large cross-country survey of business firms to assess their influence on government policies. It is found that influence is associated with larger, government-owned firms that have a high degree of ownership concentration. In contrast, foreign ownership matters little. It is also found that the extent to which government policies and legislation are viewed as impeding firm growth decreases with political influence and, independently, with a country's level of institutional quality.
Argentina's Housing Market in the 2000s
Authors: Bermúdez Guillermo , Moya Ramiro , Cristini Marcela
Published: March 2024

In the last three decades, the supply of housing in Argentina has not kept pace with demand. This study analyzes the main drivers of Argentina's housing market and relates them to the macroeconomic environment in order to advance a policy agenda for housing policy reform. The demand for housing was calculated and tenure choice was analyzed. Structural characteristics affecting Argentina's housing market include the high concentration of the urban population in a few large metropolitan areas, te association of urban poverty with the housing deficit, and overcrowding. The mortgage market lost its appeal following the 2001-02 crisis due to widespread breaches of contract legitimized through protective legislation (still in place), insufficient long-term financing, and high inflation. The housing deficit could be eliminated in five to eight years if well-coordinated policy initiatives to develop the mortgage market and provide low-income housing were adopted under a decentralized, demand-driven, subsidized program.
Developing Economies as Toyota Production Systems: Why the Analogy Makes Sense, How It Can Inform Industrial Policy
Authors: Sabel Charles
Published: March 2024

This essay explores the governance mechanisms by which an industrial policy based on Toyota Production System (TPS) principles can learn from, collaborate with and ultimately help transform the context of the economic actors without being captured by them. This working paper was prepared for the Latin America/Caribbean and Asia/Pacific Economics and Business Association (LAEBA)'s 2nd Annual Meeting held in Buenos Aires, Argentina on November 28th-29th, 2005.
Early Nutrition and Cognition in Peru: A Within-Sibling Investigation
Authors: Outes-Leon Ingo , Sánchez Alan , Porter Catherine
Published: March 2024

This paper examines the causal link between early childhood nutrition and cognition, applying instrumental variables to sibling-differences for a sample of preschool aged Peruvian children. Child-specific shocks in the form of food price changes and household shocks during the critical developmental period of a child are used as instruments. The analysis shows significant and positive returns to early childhood nutritional investments. An increase in the Height-for-Age z-score of one standard deviation -keeping other factors constant- translates into increases in the Peabody Picture Vocabulary Test (PPVT) score of 17-21 percent of a standard deviation. The period of analysis includes the recent global food price crisis that also affected Peru between 2006 and 2008. This therefore is also a quantification of the nutritional and subsequent cognitive costs of food prices on the sample, which could be magnified in later years.
What Makes Inter-Agency Coordination Work?: Insights from the Literature and Two Case Studies
Authors: Serrano Rodrigo
Published: March 2024

The purpose of this report is to discuss some of the key aspects involved in achieving Interagency Coordination (IC) that come out from the academic literature as well as from two case studies of ongoing operations funded by the Inter-American Development Bank. Four general questions that are addressed here: 1) What are the arguments in favor and against IC? Where does the consensus lie now?; 2) What are the coordination tools and strategies available for public managers?; 3) What are the conditions that favor or hinder effective IC?; 4) What practical recommendations policymakers need to bear in mind when designing and implementing programs that involve IC? The case studies of the Women Heads of Household Plan (Plan Jefas de Hogar) in Argentina, and the Darien Sustainable Development Program (Desarrollo Sustentable de Darién) in Panamá are given.
Latin American Middle Classes: The Distance between Perception and Reality
Authors: Fajardo Johanna , Lora Eduardo
Published: March 2024

The main contribution of this paper with respect to previous work is the use of data on subjective perceptions to identify the Latin American middle classes. This paper provides a set of comparisons between objective and subjective definitions of middle-class using data from the 2007 World Gallup Poll. Seven objective income-based definitions of social class are contrasted with a self-perceived social status measure. Mismatches between the objective and the subjective classification of social class are the largest when the objective definition is based on median incomes. Mismatches result from the fact that self-perceived social status is associated not just with income, but also with personal capabilities, interpersonal relations, financial and material assets, and perceptions of economic insecurity. Objective definitions of the middle class based on absolute incomes provide the lowest mismatches and the most accurate differentiation of the middle class from other classes.
Competition Law and Policy in El Salvador: A Peer Review
Authors: Clark John
Published: March 2024

The OECD has been active in promoting competition policy among countries in Latin America and the Caribbean and formed a partnership with the Inter-American Development Bank to further this aim. The principal feature of this partnership has been the annual Latin American Competition Forum (LACF), at which senior officials from countries in the region discuss, in roundtable fashion, issues of competition policy of interest to them. El Salvador volunteered to be peer reviewed at the sixth LACF meeting, held in Panama, on 10-11 September 2008. This review examines El Salvador's competition law and policy: content and application of the competition law and enforcement structure and practices; the limits of competition policy; and promotes competition advocacy.
Travelling the Distance: A GPS-Based Study of the Access to Birth Registration Services in Latin America and the Caribbean
Authors: Corbacho Ana , Osorio Rivas Rene
Published: March 2024

Birth registration is essential to guarantee a child's right to an identity. Without proper documentation of their identity, children have limited access to health, education and social assistance, laying the foundation for lifelong exclusion. Geographic distance to registration facilities is often cited as a significant barrier in qualitative surveys. Using Global Positioning System (GPS) data, this paper quantifies the impact of distance on birth registration in Bolivia, the Dominican Republic and Peru. The results suggest that increasing the distance to the nearest registry office by 25 kilometers is associated with a 4 percentage point increase in the probability of not registering a child's birth in Bolivia, and 12 percentage points in the Dominican Republic. These effects are as or more important than other socioeconomic characteristics that also affect birth registration, such as maternal education levels and the ability to deliver in a health center. In Peru, distance did not appear to be statistically significant, in line with both the lowest percentage of unregistered births and more even geographic distribution of access to civil registries than Bolivia and the Dominican Republic.
Reducing Reliance on Natural Resource Revenue and Increasing Subnational Tax Autonomy in Bolivia
Authors: Brosio Giorgio
Published: March 2024

This paper addresses options for restructuring the revenue system of Bolivia's subnational governments, particularly prefectures, emphasizing reduction of dependence on natural resources and strengthening of subnational tax autonomy. The paper additionally identifies tax instruments or tax bases that could be assigned exclusively to regional governments or shared with the central government, assessing their main advantages and disadvantages through a simulation of revenue generation. The results show that several options exist for increasing the tax autonomy of local governments. The tax instruments proposed in this paper carry relatively low administrative costs. In fact, the taxes proposed would not require the establishment of new agencies but could be collected by existing agencies and, in the case of energy and fuel taxes, by producing and distributing firms.
Financial Dependence, Formal Credit and Firm Informality: Evidence from Peruvian Household Data
Authors: Morón Eduardo , Salgado Edgar , Seminario Cristhian
Published: March 2024

This paper examines the link between financial deepening and formalization in Peru. Using data from the National Household Survey, Bloomberg and the Central Bank of Peru Central Bank, the Catão, Pagés, and Rosales (2009) model is implemented at activity level (2-digits ISIC), and the Rajan and Zingales (1998) approach of sectors' dependence on external funds is followed. The sample is divided into three firm size categories, and two formality measures are assessed. Using the accounting books specification, robust results are obtained, supporting a significant and positive effect of credit growth on formalization only for the self-employment firms category. Alternatively, using the pension enrollment specification, the channel is found positively significant only for firms with more than 10 workers; there is a smaller effect for firms with 2-10 workers. There is also a significant between effect, explaining the transition from small firms to larger firms due to greater credit availability.
Inter-Firm Linkages and Finance in Value Chains
Authors: Pietrobelli Carlo , Navas-Alemán Lizbeth , Kamiya Marco
Published: March 2024

The literature on small and medium-sized enterprise (SME) finance highlights linkages with large firms in value chains as a possible way to enhance access to credit. However, much of the literature on value chains emphasizes issues of coordination and governance of those linkages and their effects on industrial upgrading with little mention to the financial implications for SMEs. This paper explores this gap by looking for evidence on the impact of SMEs' access to finance of inter-firm linkages and specifically interactions with large firms. Using original enterprise-level data in three different Latin American and Caribbean sectors and countries (agro-industry in Argentina, furniture in Brazil, and information and communications technologies in Costa Rica), a comparison between the different sources and instruments of finance used by SMEs is presented. A distinction is made between arm's length financial mechanisms based on "hard data" and relationship finance based on "soft data." Findings suggest that chain governance matters for the type of role large firms can play in enhancing SMEs' access to finance. Policies should take into account the type of chain governance between large firms and SMEs across industries and countries when providing incentives to increase the role of large firms as direct financiers or guarantee providers for SMEs.
Middle-Class Entrepreneurs and Social Mobility through Entrepreneurship in Colombia
Authors: Mejia Paula , Meléndez Arjona Marcela
Published: March 2024

The paper uses microeconomic data to characterize entrepreneurs by income group and selected household, individual and business characteristics, finding that entrepreneurship is rare but more frequent in the upper class than the middle or lower classes. Middle-class entrepreneurs are, on average, better off than middle-class employees of similar characteristics but differ greatly from upper-class entrepreneurs in terms of educational attainment, the size of their businesses, and their outcomes. While entrepreneurs appear to have more income mobility than the average worker, this paper cannot establish whether this is true for middle-class entrepreneurs in particular, nor provide evidence to support the hypothesis that middle-class entrepreneurs' activity is an engine for economic growth. Instead, the findings suggest that the types of businesses run by these entrepreneurs are characterized by low productivity. Consequently, policies to increase social mobility seem to hold greater promise for promoting higher productivity and welfare than policies encouraging entrepreneurship.
Partial Credit Guarantees and Firm Performance: Evidence from the Colombian National Guarantee Fund
Authors: Arráiz Irani , Meléndez Arjona Marcela , Stucchi Rodolfo
Published: March 2024

This paper studies the effect of government-backed partial credit guarantees on firms' performance. These guarantees are automatically granted to firms without enough collateral in order to lift their credit constraints. We put together a panel, covering the period 1997-2007, that combines data from DANE's Annual Manufacturing Survey; DIAN's export and import information; and firm-level records from the National Guarantee Fund (NGF), the government agency in charge of implementing this policy. Using propensity score matching and difference-in-differences, we found that firms that gain access to credit backed by the NGF are able to grow in terms of both output and employment. However, we did not find any effect on productivity, wages, or investment. These results suggest that firms use the new funds as working capital to grow their businesses rather than for investment in new durable goods that increase their capital stock.
Causal Estimates of the Intangible Costs of Violence against Women in Latin America and the Caribbean
Authors: Agüero Jorge M.
Published: March 2024

Violence has a striking gender pattern. Men are more likely to be attacked by a stranger, while women experience violence mostly from their partners. This paper estimates the costs of violence against women in terms of intangible outcomes, such as women's reproductive health, labor supply, and the welfare of their children. The study uses a sample of nearly 83,000 women in seven countries from all income groups and all sub-regions in Latin American and the Caribbean. The sample, consisting of 26.3 million women between the ages of 15 and 49, strengthens the external validity of the results. The results show that physical violence against women is strongly associated with their marital status because it increases the divorce or separation rate. Violence is negatively linked with women's health. The study shows that domestic violence additionally creates a negative externality by affecting important short-term health outcomes for children whose mothers suffered from violence. To obtain the child health outcomes, the study employs a natural experiment in Peru to establish that these effects appear to be causal. Finally, the paper presents evidence indicating that women's education and age buffer the negative effect of violence against women on their children's health outcomes.
The Effect of Violence on Birth Outcomes: Evidence from Homicides in Rural Brazil
Authors: Manacorda Marco , Koppensteiner Martin Foureaux
Published: March 2024

This paper uses microdata from Brazilian vital statistics natality and mortality data between 2000 and 2010 to estimate the impact of in-utero exposure to local violence -measured by homicide rates- on birth outcomes. Focusing on small communities, where it is more plausible that local homicide rates reflect actual exposure to violence, the analysis shows that exposure to violence during pregnancy leads to deterioration in birth outcomes: one extra homicide during the first trimester of pregnancy increases the probability of low birthweight by around 6 percent. Results are particularly pronounced among children of poorly educated mothers, implying that violence compounds the disadvantage that these children already suffer as a result of their households¿ lower socioeconomic status.
Regional Financial Development and Firm Growth in Peru
Authors: Salgado Edgar , Morón Eduardo , Seminario Cristhian
Published: March 2024

This paper documents the relationship between regional financial development and firm growth in the Peruvian manufacturing sector. In order to control for mutual causality between credit availability and firm growth, industry differences in financial dependence on external funds are exploited. The 1994 and 2008 rounds of the National Economic Census are used, permitting analysis at the firm level as well as the activity level. Results suggest a significant and positive effect of financial deepening on surviving firms` growth. However, this effect is smaller for micro enterprises, suggesting that the cost of external funding decreases with financial development mainly for large firms. The conclusions remain unchanged when entering and exiting firms are included. The paper further finds that credit expansion have encouraged not only firm growth but also firm entry. The results are robust using an alternative measure of financial dependence.
Ideology and Taxation in Latin America
Authors: Caro Lorena , Stein Ernesto H.
Published: March 2024

This paper examines the impact of ideology on tax revenues in Latin America, using a panel of 17 countries from 1990 to 2010. As a first approach, a fixed- effects model is used to identify the impact of ideology on taxation; left-leaning governments are associated with increases in total tax revenues and income tax revenues of 2.1 and 1.3 percent of GDP, respectively. There is no effect on revenues from VAT or social security taxes. To deal with endogeneity problems, an event study and a difference in difference methodology are used to track the behavior of revenues around the time of the shifts to the left. Tax revenues and income tax revenues increase by 1.5 and 0.8 percent of GDP when comparing revenues immediately before and after the shift in ideology. The pattern of tax revenues around ideological shifts suggests that the effects are causal.
Normative Fiscal Policy and Growth: Some Quantitative Implications for the Chilean Economy
Authors: Espino Emilio , González Rozada Martín
Published: March 2024

This paper explores the qualitative and quantitative implications of optimal taxation in a developing economy when economic growth is endogenously determined. We differentiate this class of economies from a developed economy in two aspects: informal sector is quantitatively significant and tax-collecting technologies are more rudimentary. We characterize competitive equilibrium allocations and Ramsey allocations in the context of a small open economy in which the interest rate is endogenously determined, some workers can be hired in the informal market, and imperfect tax-collecting technology can be heterogeneous across different types of taxes. We calibrate the parameters of our model to the Chilean economy. Overall, our results suggest that capital should still be taxed but considerably less than actual taxes (that is, 10.78 percent versus 18.5 percent). Labor should be subsidized (to stimulate accumulation of human capital), while consumption taxes should be increased by 50 percent approximately (from 19 percent to 28 percent). As expected, the better the tax collecting technologies, the higher the corresponding taxes. In this context, the resulting growth rate increases only slightly along the balanced growth path.
Terms of Trade and Fiscal Sustainability when the Sovereign Exploits a Natural Resource
Authors: Andrian Leandro Gaston , Oviedo Marcelo P.
Published: March 2024

When it comes to assess the sustainability of fiscal policy and public debt in Andean countries, two idiosyncratic facts of fiscal revenues have to be considered. First, fiscal revenues coming from natural resources represent up to 44% of total fiscal revenues, producing a strong correlation between terms of trade and the overall fiscal balance, ranging from 0.79 in Ecuador to 0.90 in Peru. Second, in most of Andean countries, it is the sovereign who exploits the natural resource by its own and who extends transfers to the private sector according to the results of that exploitation. Under these conditions, terms-of-trade shocks that could threaten the sustainability of a prevailing fiscal policy affect the fiscal balance through both direct and indirect mechanisms. A highly useful tool to discern the final effect of these and other shocks on the sustainability of fiscal policy is a general equilibrium model. This paper offers such a tool which is proven to be an appropriate resource for future evaluations of fiscal policy in Andean countries. Calibrations of the model to Peru and Colombia are used to explore variants of fiscal reactions that these two countries could have employed to withstand the effects of the negative terms-of-trade shock that Latin America experienced in 2009.
Politics Under the Weather: Droughts, Parties and Electoral Outcomes
Authors: Bastos Paulo , Miller Sebastián J.
Published: March 2024

The increased occurrence of extreme weather conditions leading to drought is a key development challenge. This paper studies how these extreme events interact with the political process at the local level using rich administrative data for drought declarations and mayoral elections in Brazil. While accounting for current and historical rainfall patterns, the paper finds that that: i) municipalities led by a mayor affiliated with the President¿s party are more likely to receive formal drought declarations prior to the municipal election; and ii) receiving a drought declaration reinforces the electoral advantage of incumbent mayors running for reelection. These results are robust to the inclusion of a rich set of controls for municipal attributes.
Measuring the Political Economy of Tax Lawmaking: A Methodology and Evidence from Argentina
Authors: Bonvecchi Alejandro , Gómez Sabaini Juan C. , Bonilla-Castro Elssy , Alvaredo Javier , Calvo Ernesto , Castillo Carrillo Maximiliano
Published: March 2024

Although recent research has shed new light on the political determinants and economic consequences of tax lawmaking, existing analyses rely on coarse data measuring political aggregates. Consequently, little is known about the political processes determining how tax legislation is written or their effect on the nature of tax reforms. This paper therefore develops a methodology to examine how Congress edits the content of tax legislation by measuring the ways Deputies, Senators, Presidents, and Ministers propose and amend such legislation. The Legislative Substance Scale proposed here measures the distance between a bill's original position and the actual outcome of the legislative process by comparing the differences in content according to coding of the main tax policy dimensions. The scale is used to build the first systematic database of tax lawmaking in Argentina, and to describe its general patterns of authorship, approval and substantive content across presidencies in the current democratic period.
Bank Linkages and International Trade
Authors: Candelaria Christopher , Borisov Sergey , Hale Galina , Caballero Julián
Published: March 2024

This paper shows that bank linkages have a positive effect on international trade. A global banking network (GBN) is constructed at the bank level, using individual syndicated loan data from Loan Analytics for 1990-2007. Network distance between bank pairs is computed and aggregated to country pairs as a measure of bank linkages between countries. Data on bilateral trade from IMF DOTS are used as the subject of the analysis and data on bilateral bank lending from BIS locational data are used to control for financial integration and financial flows. Using a gravity approach to modeling trade with country-pair and year fixed effects, the paper finds that new connections between banks in a given country-pair lead to an increase in trade flow in the following year, even after controlling for the stock and flow of bank lending between the two countries. It is conjectured that the mechanism for this effect is that bank linkages reduce export risk, and four sets of results that support this conjecture are presented.
Does Technology in Schools Affect Repetition, Dropout and Enrollment? Evidence from Peru
Authors: Czerwonko Alejo , Cristia Julian P. , Garofalo Pablo
Published: March 2024

Many developing countries are allocating significant resources to expanding technology access in schools. Whether these investments will translate into measurable educational improvements remains an open question because of the limited evidence available. This paper contributes to filling that gap by exploiting a large-scale public program that increased computer and Internet access in secondary public schools in Peru. Rich longitudinal school-level data from 2001 to 2006 are used to implement a differences-in-differences framework. Results indicate no statistically significant effects of increasing technology access in schools on repetition, dropout and initial enrollment. Large sample sizes allow ruling out even modest effects.
Trade and Employment: Evidence from Latin America and the Caribbean
Authors: Pagés Carmen , Márquez Gustavo
Published: March 2024

This paper examines the impact of the recent wave of trade liberalization and economic reform on employment. Four alternative measures of openness and four measures of the real exchange rate are used to measure the impact of trade reforms on manufacturing and economy-wide employment. Across a wide range of specifications, trade reforms have had a negative, albeit small, effect on employment growth. This effect has been reinforced by real exchange rate appreciation.
Dealing with Negative Oil Shocks: The Venezuelan Experience in the Eighties
Authors: Hausmann Ricardo
Published: March 2024

The Venezuelan experience in the 1980s is a particularly fertile ground for the analysis of negative shocks. Two large shocks took place under very different control regimes, thus highlighting the role the institutional setting plays in determining the response. Moreover, the experience can shed a different light into the convenience of alternative exchange rate regimes for countries subject to large and frequent trade shocks. In addition, the analysis can be simplified for two reasons. First, oil shocks only have direct effects on the public sector, thus implying that it is the policy reaction to the shock that will affect households and firms. Secondly, the supply response of the oil industry is not of macroeconomic interest.
How Much do Teachers Earn?
Authors: Piras Claudia , Savedoff William D.
Published: March 2024

In the continuing debate over how to improve education systems, many people argue that teachers' salaries need to be increased. This paper seeks to establish a reliable method for analyzing the issue using household survey data from Bolivia.
How Early Childhood Interventions Can Reduce Inequality: An Overview of Recent Findings
Authors: Deutsch Ruthanne
Published: March 2024

Early Childhood Interventions (ECI) are ideally designed to achieve a series of mutually reinforcing objectives with the overarching goal of helping to improve equality of opportunity for children in poverty. In this discussion the authors analize programs targeted to overcome some or all of the cognitive, emotional, and resource limitations that may characterize the environments of disadvantaged children during the first several years of life. Section II of this paper presents a review of findings that attempt to measure the short-term or immediate benefits of early childhood interventions. Section III reviews the literature that addresses the longer term benefits of early childhood interventions, such as program participants' improved school performance and earnings opportunities in later years, and a reduced probability for program participants to later engage in criminal or violent acts. Section IV summarizes the economic rationale for public support of ECI programs. In the final Section V we address some of the policy and operational issues involved in designing and implementing early childhood intervenion programs.
The Mexican Oil Boom: 1977-1985
Authors: Gavin Michael
Published: March 2024

The Mexican oil boom was characterized by a period of high investment, followed by capital flight. The private sector and households responded to the 1977-1981 windfall by attaining high savings rates. On the other hand, the Mexican government, the proprietor of the state oil company and the principal beneficiary of the oil boom, used windfall revenues to finance unsustainable spending and even engage in dissaving. These policies produced macroeconomic dislocations that made Mexico highly vulnerable to the inevitable external shocks.
A Decade of Structural Reforms in Latin America: What Has Been Reformed and How to Measure It
Authors: Lora Eduardo
Published: March 2024

During the past decade, structural polices in the region have been aimed increasingly at improving economic efficiency and reducing government interference in economic decisions. The effects of this shift have not yet been accurately evaluated due to the lack of systematic measurements of the magnitude of structural reforms. The aim of this document is to summarize the most characteristic features of the reform process during the past decade and to propose a method for quantifying the state of structural policies
Economic Analysis of the Environmental Aspects of Investment Projects
Authors: Vaughan William J. , Ardila Sergio
Published: March 2024

This working paper develops upon the idea that economic analysis has a definite role to play in informing decision makers about the desirability of going ahead with an investment project designed to improve environmental quality and also that the role of precision in this matter is not trivial. The authors focus mainly on the costs and benefits of projects directly aimed at natural resource or environmental quality improvement, and the costs implied by the mandatory environmental assessment of investment projects whose primary purpose is not environmental. Also included is a review of IDB environmental procedures and the IDB's experience with mitigating measures and costs.
Inflation Targeting and Quantitative Tightening: Effects of Reserve Requirements in Peru
Authors: Castillo Paul , Vega Marco , Armas Adrián
Published: March 2024

This paper provides an overview of the reserve requirement measures undertaken by the Central Bank of Peru. It provides a rationale for the use of these instruments as well as empirical evidence of their effectiveness. In general, the results show that tightening reserve requirements has the desired effects on interest rates and credit levels at both banks and smaller financial institutions (cajas municipales).