rafmacalaba/datause-encoder-data huggingface dataset:
Mexico MFA 21 remaining groups 1, 3, 5, and 6, only in group 1 was the hypothesis that no composition effect was at work rejected. For groups 1, 3, 5, and 6, the hypothes.s that no rent-sharing was in effect could be rejected. Under the most conservative assumptions, then, we can test for rent-sharing only in groups 3, 5, and 6 with the assurance that no composition effect will bias the results.
7 Table 1 shows the extent of external payments deficits and surpluses in key large trading economies. The two most notable cases are the largest deficit economy, the US (its payments deficit hovered around five percent of GDP) and China (whose payments surplus in 2008 was 11 percent of GDP). Also notable is the case of Spain (deficit of almost 10 percent of GDP in 2008) and the UK (a deficit almost three percent of GDP). Some of the other smaller OECD economies showed even greater trade deficits, notably Greece (15 percent of GDP) and Iceland (40 percent of GDP in 2008). A significant feature of this performance was the growth in these structural imbalances during the 2000s.

**Table 2: Savings and Household Consumption Expenditure** **<u>(Percent of Country GDP)</u>**

||**Gross Domestic**|**Household Final consumption**|**Savings to Consumption**|
|---|---|---|---|
||**Savings**|**expenditure**|**Ratio**|
|||**Brazil**||
|1990|21|59|0.36|
|2000|16|64|0.26|
|2008|19|61|0.31|
|||**China**||
|1990|40|46|0.86|
|2000|38|47|0.80|
|2008|49|37|1.34|
|||**India**||
|1990|23|66|0.35|
|2000|23|64|0.36|
|2008|33|56|0.59|
|||**Germany**||
|1990|23|58|0.40|
|2000|22|59|0.38|
|2007|25|57|0.45|
|||**Japan**<br>||
|1990|34|53|0.65|
|2000|27|56|0.48|
|2006|25|57|0.44|
|||**Spain**||
|1990|23|60|0.38|
|2000|23|60|0.39|
|2007|25|57|0.44|
|||**United Kingdom**||
|1990|18|62|0.29|
|2000|16|65|0.25|
|2007|15|63|0.24|
|||**United States**||
|1990|16|67|0.24|
|2000|17|69|0.24|
|2006|14|70|0.20|

Source: Compiled from World Development Indicators accessed November 2009.

Table 2 shows the disparities in savings and consumption rates which underpinned these structural trade imbalances. The striking characteristics of this data are, first, the relatively low rates of final household consumption expenditure in China and, second,
The model’s reference year is 2014 and the model is initialized and calibrated to the GTAP Data Base, Version 10 pre-release 2.<sup>25</sup> The 141 regions in the database have been aggregated to 34 regions, see Table A-1.<sup>26</sup> Similarly, the database’s 57 sectors have been aggregated to 28, see Table A-2, with an emphasis on the more traded manufacturing sectors, and the trade and transport services.<sup>27</sup> <u>Table A-2: Sector dimension</u>

||**Sector name (code in parenthesis)**|
|---|---|
|1|Agriculture(AGR)|
|2|Coal(COA)|
|3|Oil(OIL)|
|4|Gas(GAS)|
|5|Minerals n.e.s.(OMN)|
|6|Processed foods(PFD)|
|7|Woodproducts(LUM)|
|8|Paperproducts, publishing (PPP)|
|9|Textiles(TEX)|
|10|Wearingapparel(WAP)|
|11|Leathergoods(LEA)|
|12|Energyintensive manufacturing (KE5)|
|13|Petroleum, coalproducts(P_C)|
|14|Chemical,rubber, plasticproducts(CRP)|
|15|Transport equipment(TRQ)|
|16|Electronics(ELE)|
|17|Metalproducts(FMP)|
|18|Machineryand equipment(OME)|
|19|Manufactures, n.e.s.(XMN)|
|20|Electricity (ELY)|
|21|Construction(CNS)|
|22|Trade services(TRD)|
|23|Air transport(ATP)|
|24|Water transport(WTP)|
|25|Other transport(OTP)|
|26|Hospitalityservices(ROS)|
|27|Other business services(XBS)|
|28|Other services(XSV)|

> 25  Pre-releases are only made available to GTAP Board members. The public version of Version 10 is expected to be available in the summer of 2019.

> 26

> 27

> The GTAP concordance is available in Table A-3.

> The GTAP concordance is available in Table A-4.

- 63 -
On average, (self-reported) satisfaction with life in the transition region has remained constant compared to 2006 levels (recorded in LiTS I), but this reflects different dynamics across countries. Satisfaction with life dropped in 15 countries and increased in 13. These changes are correlated with the severity of the 2009-10 economic contraction. The countries where average life satisfaction levels declined the most - Latvia, Lithuania and Romania - experienced severe recessions. Conversely, average satisfaction with life increased in countries that had higher growth - for example, Azerbaijan, Mongolia and Poland. This is consistent with the view that income is an important determinant of satisfaction.<sup>16</sup> But recent growth (or lack of it) is insufficient to explain differences in the evolution of satisfaction with life across countries, as satisfaction _increased_ in many south-eastern European countries compared to 2006 levels. In terms of individual comparisons - within countries, and after taking into account such factors as income, status, employment, health status, education and so on - those who were subjectively affected by the crisis report significantly lower satisfaction with life than those who were not, and the greater the severity of the impact the lower their satisfaction with life. We show in table 6 results of OLS, ordered probit and probit regressions (with country fixed effects) of life satisfaction on crisis impact and individual characteristics. Consistent with the literature on the determinants of life satisfaction, we find that relative income (measured as the respondent's assessment of his position in a ten-step income ladder) is strongly correlated with life satisfaction. In fact, when relative income (with respect to others and in relation to the past) is included in the regression, the positive association between absolute income and life satisfaction becomes non-significant. Good health, higher education and asset ownership are also positively correlated with higher life satisfaction.

# **4.3. Perceptions of government performance**

The severity of the downturn was associated with more negative perceptions of the evolution of government performance (see Figure 10). In countries where economic growth remained strong,

> 16 See Deaton (2008), who shows that in the cross-country comparison, higher incomes are associated with higher satisfaction with life. However, he also finds that “economic growth is associated with _lower_ reported levels of life satisfaction”. Much of the literature has found that, within countries and over time, growth in income has not been associated with higher life satisfaction (the “Easterlin paradox”) in the long run because of adaptation of material norms to higher incomes (see Easterlin, 1995), although income changes may have transitory impacts on life satisfaction (see Di Tella et al, 2007).

20
35 ~ ...

and suggests that the foreign trade specifications adopted in ~pplied general equilibrium analysis need improvement. Second, as indicated in table 7, the inward-looking (IS) strategy is modeled by assuming that macroeconomic adjustment comes entirely on the import aide via rationing of imports when there is excess demand for imports, rather than by a real exchange rate devaluation which would also relieve the foreign exchange constraint by stimulating exports. The implication of this adjustment mechanism is that a pr..tua on imports develops in the IS strategy resulting in the strong bias against exporting in the trade regime shown in table 7. Third, is the significant effect on the relative price of capital goods~ This effect, equivalent .to an upward ah~ft of the I 0 t 0 schedule in figure 3, results in leas real investment froa a given savings rate. · Thus, policy choices affect growth via the bias in the trade regime and the cost of capital goods. Table 7 reports the results of simulations designed to provide rough bounds on the extent to which the choice of development strategy is likely to affect growth. Though not reported here, the ~odel was also used to examine the aarginal productivity of foreign aid under different trade strategies. Based upon extensive sensitivity analysis to key parameters in the model, the exercise suggests that up to one percentage point in average annual growth (over a 20 year period) can be explained by the mechanisms describing alternative trade strategies that were incorporated in the model.

# 6. Applications to tntertemporal Issues ~

Even though allueion was made to the role of forward-looking decisions in the application to Chile on absorption under a disequilibrium real exchange rate (see section 5.2), all the models considered so far have
12

# **IV. Income Levels and Income Distribution**

Ideally, tax policy analysis and reform proposals should be based upon estimates of the distribution of income and the burden of existing taxes. Knowledge of how equally (or unequally) income is distributed is essential to the- determination of the desired degree of progressiveness (or regressiveness) of the tax system. If the distribution of income is already extremely unequal, a regressive tax system would impose even higher burden on the poor and lower income classes, while a mildly progressive tax system would not tap the tax revenue potential of those in the top income classes<sup>9</sup> . Moreover, without knowledge of the effective tax rates, it is not possible to know whether and how taxation corresponds with a country's views of the concept of equity. In general, the level of income in a nation is probably an important determinant of society's views of equity.

In Bulgaria, household incomes have fallen significantly in real terms during the transition. GDP has fallen by nearly 30 percent, since 1989 when the political transition began (World Bank, 1994a; Rose, 1993). A recent UNICEF (1994) study indicates that household incomes have probably fallen by roughly the same amount. One should caution, however, about comparing household incomes since the onset of the transition, because of dramatic changes in the structure of income and taxation over tie past few years.

Nevertheless, it is safe to say that most households have suffered significant income losses and many face increased uncertainty over their future incomes.

2JThe classic study by Kaldor (1963) made a similar argument for progressive taxation in the context of the Latin American countries.
# REFERENCES

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- Barro, Robert J., and Jong Wha Lee. “International data on educational attainment: updates and implications.” _Oxford Economic Papers_ 53, no. 3 (2001): 541-563.

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- Becker, Gary S. “Investment in human capital: A theoretical analysis.” _Journal of Political Economy_ 70, no. 5, Part 2 (1962): 9-49.

- Campbell, Susanna G., and Murat Üngör. 2020. “Revisiting human capital and aggregate income differences.” _Economic Modelling_ .

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- Gennaioli, Nicola, Rafael La Porta, Florencio Lopez-de-Silanes, and Andrei Shleifer. “Human capital and regional development.” _The Quarterly Journal of Economics_ 128, no.1 (2013): 105164.

- Friedman, Joseph, Hunter York, Nicholas Graetz, Lauren Woyczynski, Joanna Whisnant, Simon I. Hay, and Emmanuela Gakidou. “Measuring and forecasting progress towards the educationrelated SDG targets.” _Nature_ (2020): 1-4.

- Hanushek, Eric A. and Dennis D. Kimko. “Schooling, Labor-force Quality, and the Growth of Nations.” _American Economic Review_ 90, no.5 (2000): 1184-1208.

- Hanushek, Eric A., and Ludger Woessmann. “Do Better Schools Lead to More Growth? Cognitive Skills, Economic Outcomes, and Causation.” _Journal of Economic Growth_ 17, no.4 (2012a): 267-321.

- Jones, Benjamin F. “The Human Capital Stock: A Generalized Approach.” _American Economic Review_ 104, no.11 (2014): 3752-77.

- Jones, Benjamin F. “The Human Capital Stock: A Generalized Approach: Reply.” _American Economic Review_ 109, no. 3 (2019): 1175-95.

- Kim, Jim Yong. “The Human Capital Gap: Getting Governments to Invest in People.” _Foreign Affairs_ 97 (2018): 92

- Kolen, Michael J., and Robert L. Brennan. _Nonequivalent groups: Linear methods. Test equating, scaling, and linking_ . (2014): 103-142.

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- Krueger, Alan B. and Mikael Lindahl. “Education for Growth: Why and For Whom?” _Journal of Economic Literature_ 39, no.4 (2001): 1101-1136.

- Lange, Glenn-Marie, Quentin Wodon and Kevin Carey. _The Changing Wealth of Nations 2018: Building a Sustainable Future._ The World Bank, 2018.

16
10 In the Polonoroeste area, for example, between 1982 and 1988, FUNAI demarcated a total of almost 7 million hectares of land as indigenous reserves in 34 indigenous areas, of whaich 20 totalling 5.4 million hectares were fully regularized. An additional 2.9 million hectares of land were officially identified by the government, but not demarcated; and, 16 indigenous areas, with an estimated 1.9 million hectares, were still to be identified (31).

Despite the fact that FUNAI was able to regularize relatively large amounts of indigenous land, it was not able to actually protect them from outside encroachments. Of 518 indigenctus areas included in a 1987 CEDI/PETI study, 214 or 41 percent experienced or were scheduled to be affected by the impacts of placer mining, mineral exploration, hydroelectric developments, or highway construction. In areas of rapid economic expansion, even fully regularized indigenous reserves were vulnerable to encroachment (32).

Recently, there have been several changes in the Brazilian situation, especially as regards land regularization. These include new provisions in the 1988 Brazilian Constitution recognizing indigenous land rights; the transfer of FUNAI from the Ministry of the Interior to the Ministry of Justice; the elimination of the Inter-Ministerial Work Group; and the streamlining of the demarcacion process. In 1991 ans 1992, the government demarcated several important indigenous areas, including the 9.4 million hectare Yanomami reservein Roraima and the Menkragnoti-Kayapo reserve in Mato Grosso, which has a perimeter of 1500 kilometers and borders the Xingu Indian Park (33,34). While these steps have improved the administrative process of regularizing indigenous lands, they do not address the structural problems of a protectionist approach. In fact, a major problem in this model is the existence of a bureaucratic, centralized agency which lacks the technical competence, financial resources and political authority to defend indigenous lands. Furthermore, this model impedes the ceding of authority to indigenous peoples and does not recognize their own models of land tenure, social organization and resource management. Those articles in the new Brazilian Constitution relating to Indian rights are general enough to include an alternative model, but this has yet to
<!-- Start of picture text --> (6)<br>35% 33% 1% 30%<br>30%<br>24%<br>25% 22%<br>20% 17%<br>15%<br>10%<br>5%<br>ov<br>2 8 oS iJ oS<br>é r: 2 z<br><!-- End of picture text --> <!-- Start of picture text --> (Rs tn) (6)<br>25.0<br>149<br>15.3 153 160 161 158 16.2 15.7 45) 16.9<br><!-- End of picture text --> <!-- Start of picture text --> “gg 8 8g 228 23 ele<br>ek EER EEE EEE S<br>femme Manufacturing GDP (Rs tn) —=%of GDP (RHS)<br><!-- End of picture text -->
**Figure 4 Traditional versus public-private partnership procurement of infrastructure in India, 2001–2017**

<!-- Start of picture text --> 400<br>300<br>200<br>100<br>0<br>PPP Traditional<br>2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017<br>1000 Rs. Crore<br><!-- End of picture text --> _Source:_ Department of Economic Affairs, Ministry of Finance, India and PPI database. _Note:_ For public-private partnerships, year is the year of the concession agreement, financial closure, or the appointed date, whichever is available, in that order. For traditional procurement the year is the project award year.

# **4. Fiscal risks from contingent liabilities due to early termination of PPPs**

The objective of the analysis in this section is to value the fiscal risks from contingent liabilities that are realized when an infrastructure PPP project is distressed. In this analysis, distress refers to early termination of the PPP project. The fiscal risks estimated in this section are the costs that a government incurs in the event of early termination of the project, which can occur as a result of government’s default or voluntary termination of the project, private partner’s default or breach of contract, or force majeure.

> 10 In the calculation of E , correlations across projects in the same country are taken into account via both the distress probabilities and the standard errors calculated via the delta method using the coefficient variance-covariance cc,99% matrix, which was estimated assuming that the observations are clustered at the country level.

10
# **Figure 10 Change in STRI between 2008-11 and 2016 by economy**

<!-- Start of picture text --> Sector: Commercial banking<br>THA<br>URY<br>BGD<br>EGY<br>VNM<br>PHL<br>IDN<br>PRT<br>PAK<br>ECU<br>CHL<br>CRI<br>RUS<br>MYS<br>PER<br>UKR<br>NGA<br>BRA<br>IND<br>CAN<br>GBR<br>JPN<br>FRA<br>ITA<br>KEN<br>MEX<br>KAZ<br>OMN<br>DEU<br>POL<br>AUS<br>AUT<br>LKA<br>COL<br>HUN<br>LTU<br>ZAF<br>BEL<br>KOR<br>TUR<br>-30 -20 -10 0 10<br>Note: Change in WB-WTO STRI scores.<br>Negative values denote lower scores in 2016 compared to 2008.<br><!-- End of picture text --> Digging deeper into the policy data on commercial banking services reveals certain patterns worth noting. We see convergence of policies related to entry – with most liberalization already undertaken by 2008 – but in the context of reinforced scrutiny of foreign service suppliers, for prudential or even security reasons. As a result of gradual trade liberalization, a large majority of economies allow entry into their markets through the acquisition and control of domestic entities, through the establishment of wholly-owned subsidiaries and through direct branching (Figure 11). The preferred avenue is the acquisition of already licensed institutions, which may be explained by the host regulators' wish to recapitalize local institutions (notably after the 2008-2009 crisis) while maintaining the existing market structure and therefore current intensity of competition. Both fullyowned subsidiaries and direct branches have been increasingly allowed in most economies, but the former remains a preferred option for local regulators, given the potential for risk transmission that foreign bank branches present, as was evident in the 2008-2009 financial crisis. Interestingly, however, no economy in our sample abrogated access through branching – the increased share of governments allowing direct branching is the result therefore of additional liberalization in emerging economies (e.g. Colombia, Egypt, Indonesia, Philippines, Russian Federation).

20
Rodrik, D. 2018. “An African growth miracle?” _Journal of African Economies_ 27:10–27. 1

- —. 2013. “Unconditional convergence in manufacturing.” _Quarterly Journal of Economics_ 128:165–204. 3.2, 10

- Üngör, M. 2017. “Productivity growth and labor reallocation: Latin America versus East Asia.” _Review of Economic Dynamics_ 24:25–42. 1

- Van Biesebroeck, J. 2009. “Disaggregate productivity comparisons: Sectoral convergence in OECD countries.” _Journal of Productivity Analysis_ 32:63–79. 7

- Wong, W.K. 2006. “OECD convergence: A sectoral decomposition exercise.” _Economics Letters_ 93:210–214. 2, 2.3, 6, A.2

- World Bank. 2021. _Global Economic Prospects,January 2021_ . Washington, DC: World Bank. 1

- —. 2020. _Global Productivity: Trends, Drivers, and Policies_ . Washington, DC: World Bank. 1, 3.2

15
riots). However, with the addition of any of the indicators of the degree of civil liberties<sup>29</sup> , the impact of political manifestations is reduced in magnitude. For instance the coefficient on riots falls from 0.56 to 0.32 in specification A. That is, for any given level of civil liberties, neither riots nor strikes are associated with better performance, but protest demonstrations seem to still have some independent affect.

The results support a chain of causation that runs from greater civil liberties to higher levels of the citizen's involvement--including civil manifestations--and to better projects. This is not to suggest that civil unrest is itself the mechanism: it is more likely that environments in which civil unrest is possible are also those in which other mechanisms for expression of popular (dis)content with government performances are available and effective.

9 Only the Freedom House civil indicator is shown in table 8, but the results for the other three are similar.

- 24 -
In that environment, the Treasury and the Central Bank probably did not want to issue long maturity debt. An interest rate of 43% per year (with the inflation rate well below 5%<sup>per</sup> year and an exchange-rate devaluation of 7.5% per year) is clearly unsupportable in the long run, being sustainable only briefly to counteract a speculative attack. Therefore,<sup>had</sup> the Treasury and the Central Bank decided to place one or two year bonds at such a high rate, they could conceivably have sparked a panic, because of the informational content<sup>of</sup> such move. Placing debt at 43% for short periods might be desirable, but paying such high rates for long periods puts the govermnent budget on a clearly unsustainable path. That could then trigger expectations of a government default. In other words, in such a situation, there may be no equilibrium with such a high interest rate and long maturity.15 The only equilibrium may be the one with very short maturity bonds. An alternative<sup>explanation is</sup> that the maturity premium asked by the market for longer maturity bonds was beyond<sup>the</sup> maximum premium implied by the auction managers' reservation<sup>prices.16That rollover</sup> strategy had the effect of decreasing the maturity of the stock of debt. Figure 11.6<sup>shows that</sup> interest rate volatilities increased tenfold during this turbulent period.<sup>As a consequence, so</sup> did the V@R measures.

Until the end of 1997, only three-month maturity bonds were placed,<sup>all with negative</sup> maturity _premia._ During the first five months of 1998, the Treasury<sup>and the Central Bank</sup> were able to place nominal debt with increasing maturity. However,<sup>when the Russian</sup> crisis first hit in May 1998, even short-term bonds (three or six months)<sup>became extremely</sup>

> 14 The jump in average maturity that occurred in September, 1997, is a mistake. The Central Bank<sup>is trying to</sup> correc **t** hat statistic. We will replace the Chart when the correct data are ready.

> **'5** The argument here follows the lines of the credit rationing model of Stiglitz and Weiss [ 1981]. 16 We asked the Central Bank staff member what had happened in those<sup>auctions. He answered that the</sup> Central Bank and the Treasury offered longer term bonds, but the bids<sup>were all refused, because they were</sup> deemed insufficient in quantity, and the yields asked were both too high and too<sup>volatile.</sup>

12