rafmacalaba/datause-encoder-data huggingface dataset:
15 generate ray economies of scale even in the presence of product-specific diseconomies. Conversely, sufficiently strong diseconomies of scope might result in ray diseconomies of scale even if product-specific economies of scale exist. Evidently, since product-specific economies of scale, like ray economies of scale, are a long-run concept, AIC and MC ought to be evaluated using a long-run cost function.

# 3. Hospital costs in Kenya

Anderson (1980) reports the results of a cost function estimated on data for 51 provincial and district public hospitals in Kenya in 1975/76. His estimating equation takes the form (19) ln(C/I) = ao + a,lnB + a2lnR + a3 lnS + a4ln(OUTP/I) .+ a5lnSAT + a 6PROV + v, where C is total cost, B is the stock of beds, R is the occupancy rate, I is inpatient days, S is mean length of stay, OUTP is outpatient visits, SAT is the number of associated sub-hospital facilities, PROV is a dummy taking a value of one if the hospital is a provincial hospital and zero if it is a district hospital and v is an error term. If we substitute R=I/(365-B) and S=I/A, where A is admissions, eq (19) can be rearranged as a total cost function of the form (19') lnC = **_aO_** + (a,-a3)lnB + (l+a2 +a3-a4 )lnI - a3lnA + a4lnOUTP + a5lnSAT + a 6PROV + v.

The equation estimated (eq 19) implies an elasticity of cost with respect to inpatient days of one minus the elasticity of cost with respect to outpatient visits if occupancy rate and length of stay are not allowed to change. The total cost form allows R and S to change, but the interrelationship of the coefficients in the total cost form remains, of course, entirely the artifact of the equation estimated. Note too that this Cobb-Douglas-type cost function implies that if either output is zero, cost is automatically zero, which is consist **_'_** with the equation being interpreted as a variable cost equation. Anderson's estimates of the parameters of eq (19) are shown in table 1.

Table 1: Parameter Estimates of

|Anderson's Equation<br>A<br> <br>||
|---|---|
|Variable<br>Parameter|Value|
|Constant<br>_a0_|6.57|
|inB<br>_a,_|-0.20|
|InR<br>_a2_|-0.44|
|InS<br>_a._|-0.07|
|ln(OUTP/1)<br>_04_|0.29|
|InSAT<br>a.|0.19|
|PROV<br>_a°_|0.28|
|Adjusted R<sup>2</sup><br>0.75||

Note: Dependent variable is ln(C/I). Parameters taken from column labelled R- 4 of Anderson's table 1.
Galal & Nauriyal 12 fair rate of return on revalued assets, using the capital asset pricing model (as elaborated in Box 1 below).

**Table 4. Price regulation in sample countries**

|Country|Pricing<br>formula|Frequency of<br>tariff review|Inflation<br>adjustment|Productivity paramneter/<br>Rate of return|
|---|---|---|---|---|
|Argentina<br>Chile<br>Jamaica<br>Malaysia<br>Mexico|PC<br>BM<br>ROR<br>PC<br>PC|Semi annual<br>Every 5 years<br>Company request<br>Company request<br>Every 4 years<br>after 1998.|Indexed to U.S. CPI<br>Indexed to CPI<br>Indexed to CPI<br>Indexed to CPI<br>Indexed to CPI|X=0%<br>Min. ROA=12%<br>Min. ROE=17.5-20%<br>X=0%<br>X=0% 1990-96; X=3%<br>1997-98|
|Philippines<br>Venezuela|ROR<br>PC|Company request<br>Quarterly|None<br>Fully Indexed to WPI<br>until 1996. Partial<br>Indexation for 1997-2000|Max. ROA=12 %<br>X=O%<br>.|

Sources: Hill and Abdala (1994); Galal (1994); Spiller and Sampson (1993); World Bank (1993, 1990); Wellenius et al. (1994); Esfahani (1994); and Clemente (1994).

The Philippines and Jamaica followed rate of return regulation, although in different forms. While Jamaica allows for inflation adjustment, the Philippines is the only country in the sample which does not. Jamaica guarantees the operator net after tax profits within a band of 17.5-20% of shareholders equity. In contrast, the Philippines leaves price determination to a Supreme Court ruling that established a ceiling of 12 % as a fair rate of return on assets of all utilities.

# **III.4 How did the sample countries attempt to resolve the commitment problem?**

With respect to _conflict resolutions,_ all countries in the sample anticipated conflicts over pricing, entry, and interconnection, and devised rules to deal with them. The main difference lies in the specificity with which the rules were stated. The degree of specificity is greatest in Chile and Jamaica, and weakest in Argentina, Malaysia and Venezuela.

On the one hand, Chile's regulation defines step by step procedures for arbitration and appeals. Disputes between the firm and regulator over pricing are resolved through a three member arbitration committee, one member selected by each party and the third by mutual agreement. Disputes over entry are resolved by the anti-trust commissions, with
on-the-job training requires the introduction of the firm as a decision maker, a formal study of the relationship between health and returns to schooling requires the introduction of household production. A larger fraction of health is produced within the household than either schooling or job-specific skills, Understanding the determinants of investments in health necessitates the study of household production. Since women are the primary agents in household (or nonmarket) production, the role of women becomes central to the study of accumulation of human capital.

The issue of complementarity between health and schooling within the context of a household is thus a richer one than the study of this relationship at the level of an individual. Studies have documented that the health of children, as reflected in anthropometric measures such as height-by-age, weight-by-age and mortality rates, is positively correlated with the education of the parents (See Behrman 1990 for a survey). Less well documented but also significant is the finding that differences in schooling and health of sons and daughters are negatively correlated with the economic status (occupation and/or education) of women in the household. This paper incorporates decisions by parents regarding both the education and health of children into a model of the household that highlights the status of women.

On this issue of women's status, the aims of this paper are: First, to make precise some of the claims and allegations made regarding the See, for example, Rosenmweig and Schultz (1982) and Gertler and Alderman (1989) for investments in health, and Gill (1990) for investments in schooling.

3
wife, on the other hand, does not have the ability to make legally binding transactions such as obtaining credit from a bank or other financial institutions to start a business of her own without her husband’s consent.<sup>22</sup> In 1970, the Married Persons Property Act changed the default marital regime in a civil law marriage from community of property to a separate property regime.<sup>23</sup> The husband’s marital powers under the optional community of property regime remained in place. In the 1980s, the Law Commission explored the possibility of legislation that would codify the consequences of customary law marriages, and recommended that such marriages would be in community of property but this did not materialize.<sup>24</sup> In 1986 the Botswana Law Reform Commission undertook an extensive tour of the country in order to gauge public opinion on the integration of customary and civil law marriage, and on a new amendment to the Citizenship Act that had recently been passed, which restricted Botswana women married to foreign citizens from passing on citizenship to their children.<sup>25</sup> After interviewing people throughout the country in _Kgotle_ style gatherings,<sup>26</sup> it was concluded that people generally wanted a consolidation of customary law and civil law marriage into one statute. They also found that the majority of people interviewed supported the amendments to the Citizenship Act, and only a small group of urban women married to foreigners opposed it.<sup>27</sup>

# **_The Unity Dow Case: Challenging Discriminatory Statutory Law Using the Constitution._**

Opposition to the 1984 Citizenship Act mobilized a small group of educated women called _Emang Basadi_ (Stand Up, Women), to become a vocal movement in Botswana.<sup>28</sup> They focused their efforts on challenging the Citizenship Act, which culminated in in the case of _Attorney General v Dow_ (1992), a milestone judgment delivered by the Botswana Court of Appeal, the highest court in the land.<sup>29</sup> The court set in place a progressive approach to constitutional interpretation, where the Preamble, containing the only textual mention of gender, was determined to be justiciable and where the court affirmed its obligation to interpret domestic law in a manner consistent with international law.

Judge President Amissah of the Court of Appeal, held that Article 3 of the Constitution was not merely a Preamble providing all people with fundamental rights and freedom, regardless of “race, place of origin, political opinions, color creed or sex” but was to be considered an umbrella proviso under which all the subsequent rights fell. The court stipulated that the Article 15 provisions dealing with non-discrimination could not be read in isolation, but must be read in

> 22 Government of Botswana, submission to CEDAW Committee

> 23 DFID time series

> 24 Id 39

> 25 Quansah (date)

> 26 A community council that also functions as a community court. Originally women did not participate in these proceedings but now they are now more inclusive.

> 27  Seng 1993

> 28 Van Allen 2011

> 29 AG v Dow (2001) AHRLR 99 (BwCA 1992)

6
through the existence of credit registries is especially valued by banks operating in developing countries and by foreign banks.

# **IV. Banks’ business models in serving SMEs**

In this section, we examine the business models banks follow to serve SMEs. In particular, we address questions such as: how do banks structure their operations to serve SMEs? What degree of decentralization do they allow for? How do banks make lending decisions? What criteria do banks use to make loans? What types of collateral are most commonly used?

Most banks, independently of their country of operation or ownership type, have set up separate departments to manage their relations with SMEs (Figures 10a and 10b). More than 60% of banks have an SME department, separate from the division that deals with large businesses. Banks in developed countries are more likely to distinguish between small and medium-sized firms. Relative to private and foreign-owned banks, government banks are somewhat less likely to have separate SME departments. While 93% of private and foreignowned banks have separate departments for SMEs, approximately 80% of public banks do so.<sup>6</sup> The majority of banks operating both in developed and developing countries have decentralized the selling of non-lending products to small and medium-sized enterprises (Figure 11a). 61% of banks in developing countries and 70% of banks operating in developed countries respond that the sales of non-lending products to small businesses is done only or primarily at branches.<sup>7</sup> Relative to foreign and government-owned banks, private domestic banks are somewhat less likely to decentralize the sale of non-lending products (Figure 11b). Only 50% of private banks say they have decentralized the sale of non-lending products compared to roughly 70% of government and foreign-owned banks.

In contrast to sales, banks’ loan approval, risk management, and non-performing loan recovery functions tend to be more centralized, in particular, among developing country banks (Figure 11a). The differences are particularly striking for loan approval and risk management.

> 6 Here we are summing the percentage of banks that responded that they have a separate department for small firms, for medium sized firms, for SMEs combined, and for small and medium sized enterprises separately. 7 Decentralization is somewhat less prevalent when it comes to medium-sized lending. 60% of developed country banks and 51% of developing country banks select the same option for medium-sized enterprises.

10
were through early life health.<sup>13</sup> Second, for a reader who was already convinced that the first year of life is a critical period for the effects of health an net nutrition on subsequent development, they make less likely that that our results reflect a spurious correlation of general sanitation trends with general educational trends: only a properly timed matching of cause and effect (in this interpretation) finds an effect on learning outcomes.

# **7.1 Effect in first year: Displacing TSC exposure for six-year-olds**

In which year of life does latrine exposure have the steepest gradient with subsequent cognitive achievement at age six? Table 5 reports the results, studying the same six-year-olds as in our main analysis, but different years of TSC implementation. As expected, TSC exposure in the first year of life is most associated with subsequent cognitive achievement. Indeed, only exposure in this year is statistically significantly associated with outcomes. This is consistent with the mechanism that we hypothesize, and further suggests that our result may not be a spurious correlation of general trends.<sup>14</sup>

# **7.2 Effect in first year: No effect on older children in same data**

Another approach to assessing the importance of the year of exposure is to hold constant the calendar years of TSC implementation that are used as the independent variable and examine the effect on children of different ages in the years 2007 through 2009.<sup>15</sup> Studying

> 13We note that other effects are possible, although outside the scope of this paper. Miguel and Kremer (2004) find an effect of deworming medicine on school attendance in Kenya, although not on test scores. Adukia (2013) shows that construction of latrines at schools (unlike the household latrines we study) promotes contemporaneous school attendance. (We reiterate from table 1 that we find no effect of early-life exposure to the TSC on school _enrollment_ .) We believe that this paper’s focus on early-life effects is justified by evidence of early-life critical periods, and by evidence that the TSC matters for infant mortality and child height (Spears, 2012a).

> 14Although we would not have been surprised to find an effect in the second year of life, as well, we are not concerned that we did not. First, our timing measures are noisy, as they are as coarse as calendar years, so estimates are attenuated and some children may even be matched with sanitation exposure more similar to their _third_ year of life. Second, it is exactly from first year exposure that Spears (2012a) finds an effect on infant (first year) mortality and subsequent height.

> 15This is similar to the parallel trends test with the IHDS in section 6.3, but uses the same data sources as the main analysis and is more narrowly focused on isolating the early-life period.

26
# **Conclusions**

The rapid take-off of some coastal provinces since the beginning of the economic reforms generated the largest aggregate growth spillover effects on the entire Chinese economy, but at the expense of a widening regional development gap. This paper argues that a policy of encouraging the growth of the non-coastal regional hubs, such as Sichuan and Hubei, would have strong forward and backward linkages with the inland/western regions and thus reduce the regional development gap without sacrificing much aggregate growth.

## **Reference:**

- Amiti M., Javorcik B. (2004), “Trade cost and location of foreign firms in China”, paper presented in ABCDE 2004, _Economists’ Forum_ , The World Bank.

- Bao S., Chang G.H., Sachs J.D., Woo W.T. (2003), "Geographic factors and China’s regional development under market reforms, 1978-1998", _China Economic Review_ , Vol.13, No.1, pp. 89-111.

- Barro R.J. (1991), "Economic growth in a cross section of countries", _Quarterly Journal of Economics_ , Vol.106, No.2 (May), pp. 407-443.

- Barro R.J., Sala-i-Martin (1995), _Economic Growth_ , New York: McGraw-Hill, Inc.

- Baumont C., Ertur C., Le Gallo J. (2001), " Spatial econometric analysis of geographic spillovers and growth for European regions, 1980-1995 ", presentation of the _6th RSAI World Congress 2000 "Regional Science in a small world ",_ Lugano, Switzerland.

- Ben-David D. (1994), "Convergence clubs and diverging economies", _CEPR discussion paper 922._

- Ben-David D. (1997), "Convergence clubs and subsistence economies", _NBER working paper 6267_

- Bergstrand J.H. (1985), "The gravity equation in international trade: some microeconomic foundations and empirical evidence", _The Review of Economics and Statistics_ , August 1985, pp. 474-481.

- Berthelemy J.C., Demurger S. (2000), “Foreign direct investment and economic growth: theory and application to China, _Review of Development Economics_ , Vol.4, No.2., pp.140-155.

- Chuang Y., Hsu P. (2004), “FDI, trade, and spillover efficiency: evidence from China’s manufacturing sector”, _Applied Economics_ , Vol.36, pp.1103-1115.

- Chen J., Fleisher B.M. (1996), "Regional income inequality and economic growth in China", _Journal of Comparative Economics_ , Vol.22, pp. 141-164.

- Courcier M., Lafay G. (1972), "Simulation économique multinationale", _Statistique & Etudes Financières_ , 1972/8, 4<sup>ème</sup> trimestre.

- Cozzi G. (1997), "Exploring growth trajectories”, _Journal of Economic Growth_ , Vol.2, No.4, pp.385-398.

- Deardorff A. (1995), "Determinants of bilateral trade: does gravity work in a neoclassical world?", _NBER working paper No.5377_ .

- Démurger S., Sachs J.D., Woo W.T., Bao S. (2002), "Geography, economic policy and regional development in China", _Asia Economic Papers_ , Vol.1., No. 1.

24
A one standard deviation increase in productivity increases the probability of being a Q star by 2.31% whereas a one standard deviation in markups increases the probability of being a Q star by 3.4%.

In Table 6, we investigate the effect of market competition on firm star status directly by examining the effect of increased market competition on markups, ROIC, output and investment of both star and non-star firms. In general, we would expect that an increase in competitive pressure would cause a decline in ROIC, Markups, and output. However, those firms that have market power, are going be less affected than firms without such advantages.<sup>19</sup> Thus, star firms rely on market power to generate profits more than other firms, then we would expect that an exogenous increase in competitive pressure in their industry would affect them less than non-star firms. We test this below.

We measure increases in market competition by the penetration of Chinese imports at the 4- digit NAICS level. To address endogeneity issues we instrument Chinese imports into the U.S., _ImportsUSA_ , by Chinese imports into eight other developed economies, _ImportsOTH_ . Our identification strategy is derived from Autor et al. [2013] and identifies the component of US import growth that is due to Chinese productivity and trade costs. Autor et. al. identify the supplydriven component of Chinese imports by instrumenting the growth in Chinese imports to the United States using contemporaneous composition and growth of Chinese imports in eight other developed countries. The identifying assumption underlying this strategy is that the surge of Chinese exports across the world is primarily driven by China-specific events: China’s transition to a market-oriented economy and its accession to the WTO and the accompanying rise in its comparative advantage and falling trade costs explain the common within-industry component of rising Chinese imports to the United States and other high-income countries.

In panel A of Table 6, we find that, as expected, imports reduce Markups, ROIC, and Output in general. We see very little evidence of the effect of import competition on Capex or R&D potentially because firms are investing to meet the competitive challenge. In panel B, we present some descriptive tests to see if star firms are differentially affected by import competition by interact-

> 19Market power can arise because firms have differentiated brands and products, unique products, control of distribution channels, network externalities, regulatory capture, among other reasons.

24
first three years of the 1990s based a comparison of Call Report data from 1989:Q4 with 1992:Q4 (Berger, Kashyap, and Scalise, 1995). Although some of the decline may be due to reduced credit demand, the massive size of the drop and the fact that it corresponds with a period of significant bank distress means that there was almost surely a credit crunch, or significant reduction in credit supply.

The extent to which the credit crunch harmed the real economy depends in large part on alternative opportunities of the potential borrowers. Large businesses more often have alternative sources of external finance, while small businesses are more often bank-dependent and face financial constraints. Call Reports at that time reported no information on loan or firm size, but one study combines the Call Report data with information from the Federal Reserve's Survey of Terms of Bank Lending to Business (STBL) to try to differentiate the effects by firm size. The authors’ estimates suggest much more severe credit cuts for small businesses – reductions of 38.5% in loans to firms with less than $1 million in bank credit, and 45.2% for small business borrowers with credit below $250,000 (Berger, Kashyap, and Scalise, 1995, Tables 8, A2, A8, A10). It seems very likely from these results that the credit crunch had significant negative real economic consequences and contributed to the recession.

A significant amount of banking research focuses on whether the toughening of bank prudential policies helped cause the credit crunch. Some test the effects of implementation of the Basel I risk-based capital requirements (e.g., Haubrich and Wachtel 1993, Berger and Udell 1994, Hancock and Wilcox 1994, Wagster 1999), and some test the effects of higher explicit (regulatory) or implicit (supervisory) capital standards based on leverage ratios (e.g., Berger and Udell 1994, Peek and Rosengren 1994, 1995, Hancock and Wilcox 1994, Hancock, Laing, and Wilcox 1995, Shrieves and Dahl 1995). It is difficult to differentiate between them, but the research provides 57