rafmacalaba/data-use-mentions-extended huggingface dataset:
# **Household Savings in Central Eastern and Southeastern Europe: How Do Poorer Households Save?**<sup>**1**</sup>

Elisabeth Beckmann<sup>2</sup>

**Keywords** : Household savings, portfolio choice, shared prosperity, survey data, Central Eastern Europe and Western Balkans

**JEL** : O16, D12, D14, G11, P34

> 1 This paper was written while the author was on secondment at the Chief Economist Office, Europe and Central Asia Region in 2015. It is a background paper for the flagship report “Gould, D. and M. Melecky (2017) Risks and returns: Managing financial trade-offs for inclusive growth in Europe and Central Asia. Washington, DC, World Bank.”

> 2 Foreign Research Division, Oesterreichische Nationalbank, Vienna, Austria. Tel.: +43 1 40420 5252, <u>elisabeth.beckmann@oenb.at</u> The views expressed in this article are those of the author and do not necessarily reflect those of the Oesterreichische Nationalbank or the Eurosystem of Central Banks. I am very grateful to David Gould for his support and guidance in writing this paper. Thorsten Beck, Ross Levine, Davide Mare, Martin Melecky, Ugo Panizza, Hans Timmer and Hernan Winkler provided helpful comments and suggestions.
. Decker (2012). “Sex Role Stereotypes: Does Business Education Make a Difference?” _Gender in Management: An International Journal_ 27(1): 36–50.

Pham, T., and O. Talavera (2018). “Discrimination, social capital, and financial constraints: The case of Viet Nam.” _World Development_ 102: 228–242.

Phelps, Edmund S. (1972). “The statistical theory of racism and sexism.” _The American Economic Review_ 62(4): 659–61.

Powell, Gary N., D. Anthony Butterfield, and Jane D. Parent (2002). “Gender and managerial stereotypes: Have the times changed?” _Journal of Management_ 28(2): 177–93.

<mark>Peng, Congmin and Po-Wen She (2020). “Are women less likely to be managers in the UK labour market?”</mark> _<mark>Economic Modelling</mark>_ <mark>85: 317-324.</mark> Rajan, R. and L. Zingales (1998). “Financial dependence and growth.” _<mark>The A</mark> merican Economic Review_ 88(3): 559–586.

<mark>Sekkat, Khalid, Ariane Szafarz, and Ilan Tojerow (2015). “</mark> Women at the Top in Developing Countries: Evidence from Firm-Level Data” _IZA Discussion Papers_ <mark>9537, Institute of Labor Economics (IZA).</mark> <mark>Vershinina, Natalia, Gideon Markman, Liang Han, Peter Rodgers, John Kitching, Nigar Hashimzade, and Rowena Barrett (2022). “Gendered regulations and SME performance in transition economies.”</mark> _<mark>Small Business Economics</mark>_ <mark>58(2): 1113-1130.</mark> 32
**-** **<u>Table 4: Comparison of self reported area to remotely sensed area for program</u>**

||<br>**Remotely s**<br>**0**|<br>**ensed cultivated a**<br>**0-120 ha**|<br>**rea category**<br>**>120 ha**|**Total**|
|---|---|---|---|---|
|Number of farms|31|20,368|46|20,445|
|Registered land plots|1.5|7.0|67.8|7.2|
|Self-reported area|8.1|19.2|91.2|19.3|
|Remotely sensed area|0.0|18.8|157.7|19.1|

_Source:_ Own computation from SAR records and cadastral data as described in the text _Note:_ Among the >120 ha category, only one farm has agricultural land in conflict areas. For this farm, remotely sensed cultivated area excluding and including parcels in conflict areas was 121 ha and 124 ha respectively.

20
provides a “macro” view of the financing of infrastructure. Finally, it reports on progress in policy reform before providing some rough estimates of investment needs.

# **2. Infrastructure, Growth and the Millennium Development Goals**

The links between infrastructure services, growth and social outcomes like the Millennium Development Goals operate through multiple channels as depicted in figure 1. The delivery of services like water, sanitation, transportation and energy directly benefit households and can dramatically improve their welfare. But many of the benefits of infrastructure services accrue to firms – in France, for example, that input-output tables reveal that firms consume two-thirds of all infrastructure services (Prud’homme, 2004). Thus it is through this channel that costs are lowered and, most importantly, market opportunities are expanded (especially through telecommunications and transport). The resulting gains in competitiveness and production are what drive the gains in economic growth and ultimately welfare.

**Figure 1 – How Infrastructure Contribute to Development**

<!-- Start of picture text --> Infrastructure<br>Benefit<br>Benefit<br>enterprises<br>households<br>Improve Lower<br>welfare Enlarge costs<br>markets<br>Source: Prud’homme (2004)<br>Growth<br><!-- End of picture text --> 4
WPS3920

# **Resolution of Failed Banks by Deposit Insurers Cross-Country Evidence**

## **Thorsten Beck and Luc Laeven***

**Abstract:** There is a wide cross-country variation in the institutional structure of bank failure resolution, including the role of the deposit insurer. We use quantitative analysis for 57 countries and discussion of specific country cases to illustrate this variation.  Using data for over 1,700 banks across 57 countries, we show that banks in countries where the deposit insurer has the responsibility of intervening failed banks and the power to revoke membership in the deposit insurance scheme are more stable and less likely to become insolvent. Involvement of the deposit insurer in bank failure resolution thus dampens the negative effect that deposit insurance has on banks’ risk taking.

JEL Classifications: G21, G28, G30 Keywords: bank fragility; bank failure resolution; deposit insurance

### World Bank Policy Research Working Paper 3920, May 2006

_The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the view of the World Bank, its Executive Directors, or the countries they represent. Policy Research Working Papers are available online at http://econ.worldbank.org._

* Beck is at the World Bank and Laeven is at the World Bank and CEPR. Corresponding author: Thorsten Beck, World Bank, TBeck@worldbank.org, Phone: (202) 473-3215, Fax: (202) 522-1155. We would like to thank Asli Demirguc-Kunt and Ross Levine for very useful comments and Baybars Karacaovali for excellent research assistance.
controlled for why an individual joins a group and why certain group features operate differently in a Grameen Bank type of group-lending system. In addition, many such studies have not distinguished the positive role of joint liability, which imposes sanctions on individual behavior as a way to reduce individual loan-default costs, from the potential negative role of groups, where one member’s default can encourage that of other members. In short, past studies have failed to address the reflection problem of social capital as embodied in group lending.

This paper has exploited the unique group-level, panel data on the repayment history of 297 groups of the Grameen Bank since their inception and estimated a dynamic model using the GMM method to establish the causal effect of group incentive, after controlling for individual incentive to repay, on the amount of loan received and its repayment in the Grameen Bank system. The GMM results show that, after controlling for initial conditions and the common time effect, both the amount of loan and repayment respond negatively with both individual and group liability.

For example, group incentives to default (in terms of past quarterly loan repayment of group members) negatively affect the amount of current borrowing, at least for women borrowers of the Grameen Bank. That is, the higher the rates of missed payments among group members, the lower the amount of money a woman member obtains from the Grameen Bank. Group incentives thus matter in Grameen Bank lending, even after controlling for the potential role of individual default incentives and both observed and unobserved initial conditions that led to the groups’ formation and existence.

Group incentives to default also matter in the Grameen Bank’s loan recoveries, and are equally true for both women and men group members. This means that an individual 27
<br>=<br>$10,000<br>5,000<br>: (_\<br>2 o> o @ @ iS 9<br>Nate: ExeludingPEPBe the tap 11EL cuntriesinGOSEELSthesurveyELES LIESBOOSIESN)ISG SE RIS<br>Source: ENTA Q4 2009 Debt Trading Volume Survey<br><!-- End of picture text -->
To study cropland dynamics, we also mobilize a set of biophysical variables at the same pixel level. As a measure of climate stress, we use the annual number of drought months reconstructed from the Palmer Drought Severity Index (PDSI) developed by TerraClimate (https://www.climatologylab.org/terraclimate.html), where drought months are defined as periods for which the index was below -3. We calculated the distance to rivers and coast using the shapefile from Natural Earth (https://www.naturalearthdata.com/).<sup>1</sup> We also calculated the distance to the nearest city using the UrbanPop dataset (Blankespoor et al., 2017). Land suitability for cultivation was obtained from the FAO Global Agro-Ecological Zones (GAEZ) v4 product (https://gaez.fao.org/). We constructed an aggregate index comprised between 0 and 100 that measures how suitable the pixel is for rainfed cultivation of an umbrella crop of seven major crops under a high input scenario (i.e., taking the maximum individual suitability index over these seven crops).<sup>2</sup> We also use measures of institutional quality. This includes measures of land governance from two different datasets. The first is the Quality of Land Administration index (denoted QLA hereafter) from the World Bank Doing Business 2020 database.<sup>3</sup> QLA is a composite of five subsidiary indexes measuring the reliability of land administration infrastructure, the transparency of information, the geographic coverage of registries, the legal framework for land dispute resolution, and whether men and women have equal access to property rights. Alternatively, we use the Institutional Profile Database (CEPII, Agence Française Développement, and Ministère de l’Économie et des Finances: <u>http://www.cepii.fr/institutions/en/ipd.asp) for 2012. The database provides several country-level</u> measures of land governance
the corresponding 90-percent confidence intervals. We find that PIQ-D is positively and statistically significantly correlated with PIMI up to 2013. After that the correlation goes to zero and becomes insignificant, which supports the conjecture that PIMI may not be an accurate measure of the quality of public investment management in more recent years. By contrast, PIQ-D index remains positively and significantly correlated with the time-variant measures of institutional quality.

We find that LICs have low investment quality and lag other EMDEs (Figure 2.3).<sup>17</sup> This is consistent with what has been found for other indicators of public sector efficiency (IMF 2015; Dabla-Norris et al. 2012). There is also a large gap between commodity-exporting EMDEs and other EMDEs. In line with the “paradox of plenty,” we find that commodity exporters have low PIQ scores.<sup>18</sup> There is also evidence that the gap between rich and poor EMDEs, as well as that between commodity exporters and commodity importers has widened over time (Figure 2.4). Comparing across regions, we find that countries in Sub-Saharan Africa (SSA) and in the Middle

> 16 The correlation between PIQ and PIMI is much higher when the number of control variables in the computation of PIQ is minimized and the period spans only the years over which the underlying PIMI data were collected. 17 This is even though the PIQ indexes are derived while controlling for real per capita GDP. PIQ values obtained without controlling for GDP per capita show even larger differences across income groups.

> 18 This is also consistent with the findings in Dabla-Norris et al. (2012).

9
Well-Being during a Time of Change: Timor-Leste on the Path to Independence Kaspar Richter World Bank, 1818 H Street NW, Washington, DC 20433, USA 1?

Abstract Countries undergoing fundamental economic and political transformations might experience differential adjustments in material well-being and empowerment. This paper evaluates self-rated welfare and power changes in Timor-Leste, covering the period from prior to the 1999 referendum on independence from Indonesia to the eve of independence in end 2001. Drawing on the first nationally representative household survey and village census, it demonstrates how subjective, objective and recall information can be combined to provide a rich profile of trends in well-being from the pre- to post-conflict stage. The analysis shows that changes in self-rated welfare and power broadly corresponded to changes recorded by objective indicators. While economic well-being improved little, empowerment increased dramatically. The changes were not uniform across the population but some groups benefited more than others. The evidence for Timor-Leste is consistent with these hypotheses: economic resources increase welfare, and more than power; social resources increase power, and more than welfare; welfare winners have low initial economic resources; power winners have high social resources; and economic shocks reduce welfare and power, but welfare more than power.

Key words: Subjective welfare, Power, Timor-Leste ! Email:krichter@worldbank.org. I would like to thank Benu Bidani, Martin Cumpa, Berk Ozler and participants at the 2004 Minnesota Development Economics conference for valuable discussions and comments. 2 JEL classification numbers: 130, O10 Preprint submitted to Elsevier Preprint December 2004
is associated with policies that support private sector development. Similarly, high-speed Internet connectivity is associated with a 0.12 sd increase in the government effectiveness index. Overall, the results herein provide suggestive evidence that Internet connectivity is associated with an improvement in the quality of governance, which could plausibly incentivize foreign investments.

> 27https://info.worldbank.org/governance/wgi/

> 28The anglophone/francophone/Lusophone classification is used as a proxy for the legal origins of the country, i.e., common law vs civil law, as the current legal framework in many African countries was inherited from their colonial rulers (Anderson, 2018).

18
the regime.<sup>2</sup> The coalescing of these various groups and interests makes the situation, and return prospects, in northern Syria incredibly complex. Turkey has faced a lack of stability and domestic political strife over the influx of refugees since 2011, yet as the situation draws on many seem less likely to return. In 2017 the annual Syrians Barometer poll conducted by Murat Erdoğan indicated that 17% of Syrians would not return under any conditions, and in 2019 this had increased to 52% (Erdogan (2019)). Many more indicate they would only return if the war ended and a governance structure which they favored was put into place. In order to stem the flow of refugees, and in some instances force return, Turkey has taken strong offensive actions which limit international humanitarian aid through both stifling opportunity and igniting humanitarian concerns over treatment of Kurds.<sup>3</sup> In many areas governing and aid provision are overseen by the governors of neighboring Turkish provinces (Hoffman and Makovsky (2021), Al-Hilu (2019)). In Idlib, most of the structure is provided by former Al-Qa’eda affiliated Hayat Tahrir Al Sham, with some collaboration with Turkey. The segmentation of areas of control and the closure of border crossings other than Bab al-Hawa make the work of humanitarian actors in Syria quite difficult. Many actors have channeled aid for their own purposes to control goods provision, and the burden of provisioning aid falls overwhelmingly on Syrian workers who may also be targets for attack (Hall and Todman (2021)). Though satisfaction with the impact of humanitarian aid has increased, organizations still face challenges in regards to incorporating refugees into aid processes and decision making, funding local organizations who can target aid, and coordinating aid provision (Voluntas (2019)).

Since the defeat of ISIS by the International Coalition forces in Ar-Raqqa in October 2017 the war in Syria seems to be nearing its end. However, though 75% of displaced Syrians would like to one
of debt with the household sector, thus avoiding excessive reliance on banks and monetization of the debt. This was facilitated by the large supply of household financial savings in both countries and by the limited availability of alternative investments, which was partly caused by the imposition of strict controls on holding foreign assets and partly by the absence of local institutional investors. Preferential tax treatment of investment income from government securities also played an important part.

- Another common feature was the use of variable-cost short-to-medium-term instruments. Some instruments were denominated in local currency and bore variable interest rates linked to short-term rates. Other instruments carried fixed nominal coupons but were indexed to the ECU and other foreign currencies.

- Both countries made little use of price-indexed instruments. Financial indexation was preferred because it enjoyed greater credibility than price indexation and because it implied a lower long-term cost. The lack of public trust in official price indices and the fear of official manipulation of the indexation mechanism also probably

> 1 The point was made by Conti and Hamaui (1994) for the case of Italy but it also applies to Greece.

> 2 In the case of Greece, shortcomings in recording and reporting public debt data concealed a much higher level of public debt that may have been closer to 150 percent of GDP at its peak.

3
activities declines monotonically with higher levels of welfare. However, it is worth mentioning that given the complex nature of measuring income accruals from informal sector activity and different kinds of payment systems in existence in the sector, formal sector employment and formalized manufacturing sector has mostly been the subject of analysis in earnings and employment literature. It is worth noting the fact that in informal sector activities accruals are a mixture of wage and profits and hence can not be used in more conventional wage earnings analysis that follow in the next section.

# 5. **Education and Earnings**

An important issue in the analysis of labor markets in Ghana is the way the economic decline and subsequent recovery of the economy has impacted the earnings differences in Ghana with respect to education. The availability of the GLSS data set for the period when the economic recovery program was just beginning to have an impact and more recently for 1991-2 enable us to shed some light on this major topic.

It should be clearly stated at the outset that the variation of earnings with education levels might be quite different for the three major types of labor which existthe self-employed, the wage employees in the private sector, and wage employees in the public sector. Clearly wage determination in the public sector is administrative. Although the significant size of this sector would be a factor in affecting the demand for labor in the labor market as a whole, private employers would tend to set wages in a much more competitive way. As far as the self-employed are concerned, it might be argued that if the labor market functioned well, their structure of earnings would be the same as that of the private sector wage earners. But there are two relevant points against this happening. First, the observed earnings of the self-employed are only partly returns to labor-for many a major part of the income might be returns to entrepreneurship and capital. Secondly, in a developing country the many factors segmenting labor markets drive a wedge which keeps returns to labor apart in different segments. In particular, we have already
# **5. Conclusion**

Rising unemployment during an economic crisis is a concern for policy makers and 22 countries around the world used some form of wage subsidy program to promote employment retention during the recent economic crisis. However, empirical evidence on the effects of such programs is scarce. This paper measures the effect of a wage subsidy program in Mexican on employment in manufacturing firms during and after the recent economic crisis, using monthly administrative data along with propensity score matching and a difference‐in‐difference strategy.

I find a positive, but not statistically significant effect of the wage subsidies on employment during the program’s duration, ranging from 5.7 percent to 13.2 percent in magnitude, depending on the specification. The size of the effect increases to 24 percent after the program ended and the results indicate that employment after the program recovered faster in eligible industries than in ineligible industries. In fact, the data show that in eligible industries employment levels were back at pre‐crisis levels in 2011, while in ineligible industries employment levels were still not back at pre‐crisis levels in 2013.

The findings thus suggest that the Mexican wage subsidy program was an effective tool for tackling unemployment in the wake of an economic crisis. However, this paper does not find evidence that the wage subsidies helped to preserve job specific skills, which was part of the economic rationale for the program. Instead, the positive effect on employment seems to have come from the payment of the subsidy funds itself.

15
While all three sectors experienced declines in their high rates of growth after mid-2007, manufacturing, where exports are concentrated, experienced a sharp drop at the time of the crisis, and some of the effects of this shock likely spilled over into the services sector as well.

# 3. **The Financial Crisis and Shocks to Employment**

Anecdotal reports started showing up in both the Chinese and the international press that sparked early concern that the global financial crisis would have a serious impact on employment. For example, in October 2008, the owner of a textile factory in Shaoxing, a city 100 miles from Shanghai, fled in the middle of the night and left 4,000 workers unemployed and US$200 million in unpaid bills. When employees showed up to work in the morning and found the factory gates bolted, they erupted in protest (Xiao 2008). In addition, there was frequent documentation of laid-off migrant workers returning home to villages early for the spring festival in 2009 (see, for example, Johnson and Batson 2009) and in some cases creating conflict with those renting their land (Yang 2008).

Surveying firms, households, or individuals yields some perspectives on the employment impact of the crisis. Surveys at each level have both advantages and disadvantages. A firm survey that enumerates employment and vacancies is more likely to capture changes in demand for labor at the firm level. Since firms in export sectors can then be separated from other types of firms, this approach promises to provide a direct link to export shocks. At the same time, however, firm surveys typically oversample larger firms and may thus miss the effect of shocks on smaller firms, which are less likely to be in the formal sector. In addition, firm surveys—especially if they are repeated cross-sectional surveys—may understate the effects of labor market shocks because they do not capture shocks to employment resulting from firm bankruptcies **.** Alternatively, firm surveys may overstate labor market shocks if all firm attrition from a panel