rafmacalaba/datause-encoder-data huggingface dataset:
participants systematically underpredicted yields. We include these “error” measures—which we can treat as _unanticipated_ rate changes—in columns ( _E4_ )–( _E6_ ).

Table 2: Regressions for gross financial inflows with expectational measures, unbalanced quarterly panel, 2000Q1–2013Q2<sup>_†_</sup>

||**E1**|**E2**|**E3**|**E4**|**E5**|**E6**|
|---|---|---|---|---|---|---|
|Lagged infows|0.462|0.462|0.462|0.461|0.463|0.463|
||(0.02)<sup>_∗∗∗_</sup>|(0.02)<sup>_∗∗∗_</sup>|(0.02)<sup>_∗∗∗_</sup>|(0.02)<sup>_∗∗∗_</sup>|(0.02)<sup>_∗∗∗_</sup>|(0.02)<sup>_∗∗∗_</sup>|
|All QE|0.031|0.031|0.031|0.028|0.029|0.030|
|episodes|(0.01)<sup>_∗∗∗_</sup>|(0.01)<sup>_∗∗∗_</sup>|(0.01)<sup>_∗∗∗_</sup>|(0.01)<sup>_∗∗∗_</sup>|(0.01)<sup>_∗∗∗_</sup>|(0.01)<sup>_∗∗∗_</sup>|
|3M T-bill|-0.001||0.019||||
|(expectation)|(0.02)||(0.06)||||
|Yield curve<br>||0.002<br>|0.012<br>||||
|(expectation)||(0.01)|(0.03)||||
|3M T-bill||||-0.005||0.003|
|(error)||||(0.01)||(0.01)|
|Yield curve|||||0.013|0.017|
|(error)|||||(0.01)|(0.01)|
|Channel variables|Yes|Yes|Yes|Yes|Yes|Yes|
|Basic controls|Yes|Yes|Yes|Yes|Yes|Yes|
|Adj. R<sup>2</sup><br>|0.367|0.367|0.366|0.367|0.368|0.367|
|R<sup>2 </sup>(within)<br>|0.372|0.372|0.372|0.373|0.373|0.373|
|R<sup>2 </sup>(between)|0.527|0.527|0.527|0.527|0.527|0.527|
|N (countries)|1,938 (60)|1,938 (60)|1,938 (60)|1,925 (60)|1,925 (60)|1,925 (60)|

> _†_ All level variables are in logarithmic form, but rates, indices, and indicator variables are untransformed. Bootstrapped standard errors (with 100 replications) are reported in parentheses. A time trend, country fixed effects, and constant term were included in the regressions, but not reported.<sup>_∗_</sup> indicates significance at 10 percent level,<sup>_∗∗_</sup> indicates significance at 5 percent level, and<sup>_∗∗∗_</sup> indicates significance at 1 percent level.

On the basis of these results, we see no basis for attributing the QE episode effect to unmeasured expectations. Both classes of expectational measures enter with small, and statistically insignificant, signs. In some ways, this should not be entirely surprising; market-implied forecasts of interest rates generally perform rather poorly, especially at longer horizons (Campbell & Shiller 1991; Lange, Sack & Whitesell 2003). We are thus inclined to discount the possibility that the QE effect due to unobservables is due to either anticipated or unanticipated expectations of future interest rates changes.

The second explanation that we explore is whether the QE episode indicator is indirectly capturing structural shifts in the observable factors, due to the unprecedented nature of QE. Framed another way, the magnitude of monetary policy intervention in asset markets may have led to a change in the elasticity of response of gross inflows to the conventional, observable channels.

We operationalize this hypothesis by interacting our measures of the liquidity, portfolio balance, and confidence channels with the QE episode indicator. For each channel, we consider both the 17
<!-- Start of picture text --> 1989 1989<br>1994 1994<br>2000 2000<br>2005 2005<br>2009 2009<br>0 20 40 60 80 100 0 20 40 60 80 100<br>percent percent<br>1989<br>1994<br>2000 ME Primary.<br>2005 MEE Secondary<br>2009 ME interiorH<br>0 20 40 60 80 100<br>percent<br><!-- End of picture text -->
The project, and so the APAs, dropped the component on local property tax systems in 2016 because the national government re-centralized the collection of property taxes to the Tanzania Revenue Authority. Citizens were asked the following question:

- Willingness to pay taxes, as measured by the extent to which they agree with statements along the following lines: citizens should pay taxes so the local government develops; better to pay high taxes to get more services; not paying taxes is wrong and punishable; tax code and collection is fair. These types of questions are the focus of current research on state capacity (Besley, 2020; Papaioannou, 2020; Bisin, 2020; Bowles, 2020).

An agnostic approach to measuring the impact of the project involves examining all the variables described above as equally likely to be important for state capacity and allowing the data to reveal where there are any differences in changes over time across project and non-project local governments. As we will discuss in detail below, a striking finding from the data is that only one of the many variables listed above exhibits greater improvement over time in project than in non-project local governments. We will also focus on the outcomes emphasized in the current research literature as measures of state capacity—the ability to raise revenues. Although the project dropped the component on local property tax systems in 2016 because the national government re-centralized the collection of property taxes to the Tanzania Revenue Authority, if state capacity is increasing in the country over time, we would expect to see this captured in the questions listed above on willingness to pay taxes to contribute to the development of the local state.

In addition to the variables discussed so far, our surveys included additional modules to gather data on the administrative capacity of local government officials such as whether they have access to computers, can write emails and memos, and have received any training recently. We also estimate the impact of the project on these measures of administrative capacity of local personnel, in line with how the literature has examined local state capacity (Acemoglu et al., 2015).

Finally, other modules in the survey drew upon advances in research on the importance of informal institutions, such as culture or norms and beliefs in complex organizations, which shapes their capacity to perform (Bloom & Van Reenen, 2010; Rasul & Rogger, 2018). Khemani (2019) provides a review focusing on public sector organizations. These modules included the following types of questions posed to local government officials:

- Extent to which officials feel peer pressure to perform their tasks well

- Extent to which officials take pride in their work

- Extent to which they trust their peers

- Extent to which they share values with their peers

In sum, the outcome variables on which impact is evaluated are numerous and rich, with careful surveys of two types of respondents—local government officials and households. These 13
_14_ _Ways Out of Poverty - Diffusing Best Practices and Creatingz Capabilities_ practices. The superior performance of direct foreign investors tends to provide them with greater market share in their sector. Over time, local competitors may be able<sup>to</sup> catch up as well, but initially they tend to lose market share.<sup>40</sup> Similar<sup>processesare at</sup> work within countries. Efficient companies from one part of a country<sup>move into other</sup> regions and improve productivity there.

**Learning by buyers and suppliers.** Subcontractors to foreign investors appear<sup>to be</sup> helped by their presence. Dealing with demanding foreign investors helps<sup>themupgrade</sup> their quality and reduce costs. In varying degrees foreign investors provide<sup>active support</sup> to their suppliers to improve performance.<sup>4</sup> ' Contracting also takes place<sup>across borders.</sup> Export opportunities provide the competent domestic firms with the option to expand their market, and firms can learn to upgrade their productivity, as studies<sup>of firms from</sup> East Asia and Mexico suggest (figure 8).42 Demanding customers in high-quality<sup>markets</sup> are a key force driving performance improvements.

**Figure 8: Exporters spend more on training and acquiring foreign technology (ratio of expenditure by exporters to domestic-oriented firms)**

<!-- Start of picture text --> Indonesia<br>Korea<br>RPilippines<br>Thailand<br>1.00 1.50 2.00 2.50 3.00<br>o Training * Foreign Tech<br><!-- End of picture text --> Source: Hallward-Driemeier (2001).

Firms as incubators for new entrepreneurs. Another important way<sup>for new and more</sup> productive firms to emerge is for people who learned in one firm to leave<sup>and set up their</sup> own firm. Take the garment industry in Bangladesh, where locals learned<sup>from a Korean</sup> company, Daewoo (box 2). They later set up their own businesses in Bangladesh,<sup>which</sup> in turn produced more small entrepreneurs. In a short time the garment<sup>industry became</sup> Bangladesh's leading export industry, accounting for almost 75 percent of the export earnings in 2001. In India the most efficient machine tool company was set up by employees from older, less efficient machine tool companies.

> 40 Aitken and Harrison, 1999; Djankov and Murrell, 2002.

> 4t Batra and Tan, 2000; Batra and Tan, 1995.

> 42 Hallberg et al., 2000.
For example, in Belo Horizonte the health council actively monitored how the government allocated resources to public health clinics and programs as well as to outsourced service delivery (Wampler 2015). In one instance, the health councils refused to approve the government’s request to build a new hospital because the government had provided no information about the new project. The council ultimately approved the hospital, but not until after government presentations describing the project and several months of deliberation. This deliberative process generated wide-ranging discussions around resource allocation, tax revenues, municipal bonds, curative vs. preventive health care. Thus, the council made transparent and informed what had been a pro forma, opaque decision.

Oversight through participatory institutions limits waste, fraud, and incompetence in project implementation. Services expand and improve as a result and community members recognize these changes. In turn, community members are more likely to hold governments to their promises to deliver services using their tax revenue and to see governments as legitimate. Individuals and firms are then more likely to comply with local tax regulations.

We evaluate this potential using data on the formal, legalized presence of policy councils. Policy council representatives must approve the annual budget, significant policy additions, and year-end reports for their respective agency/department (e.g., health, education). In addition, council representatives (citizens voluntarily serving on councils) can more easily engage in ongoing monitoring because they are afforded a formal status that permits them to request and receive public information as well as enter public facilities (e.g., public hospitals).

<u>Collective Coalition-Building: The literature lends wide support to the importance</u> of coalitions between governments and citizens to carry out tax reforms (Brautigam 2004; Fjeldstad 2014; Flores-Macias 2016). Simultaneously, participatory processes are associated with building or sustaining broad social and political coalitions. These institutions increase contacts between governments, citizens, and CSOs, which leads to opportunities for building broader coalitions around policy reform and new institutional arrangements.

Building this broader political and policy coalition then allows for reforms, which may include creating administrative efficiencies. In turn, these administrative efficiencies may include better tax facilitation and enforcement mechanisms, which would increase tax collection. This has been the case, for instance, in some municipalities in the South-Kivu Province (DRC), with PB providing an enabling environment for local governments to review their administrative procedures and to implement reforms that may not have taken place otherwise. As Mbera & Allegretti (2014) show, through the PB implementation process in 2011, citizens and local authorities engaged in a constructive dialogue on how to increase local governments’ tax revenues. This dialogue culminated with the abolishment of the 13
job protection; the infant industry argument for protection; and the relationship between exchange rate and trade policy.

Out of the Soviet Union has emerged one very large economy, Russia; one medium-sized economy, the Ukraine; and thirteen small ones, the latter being .lt very different stages of development. At the time of writing (January 1992) Russia was taking radical steps to move towards free market pricing, but it was not clear which of the other Republics would follow. One might expect the Baltic Republics and Georgia to move (or try to move) towards the market fairly rapidly, and four or five of the central Asian republics to move more slowly, if at all, while the matter is still uncertain with regard to the others. But all such remarks are just speculation and can soon be negated by events.<sup>2</sup> In looking ahead it is useful to think in terms of three time periods or episodes.

The first is the transition -eriod during which a Republic takes the essential steps to create a domestic market economy, freeing most domestic prices and creating incentives for state-owned and privately-owned enterprises to respond in a market way, notably by removing various restrictions, and providing the necessary legal framework, taxation system, and so on. Possibly this stage would require extensive privatization. There is no shortage of discussion of the characteristics and vast problems of such a transformation, and here it will be assumed that it takes place,

> 2 For background on the recent state of the Soviet economy, see International Monetary Fund, et al. (1991) and Aslund (1991). Many of the issues of this paper are discussed in International Monetary Fund, et al. (1991), in Williamson (1991), and in Havrylyshyn and Williamson (1991), the latter dealing particularly with monetary stabilization, with exchange rate policy, and with the question of the financing of bilateral payments imbalances. The last subject is not discussed here. See also Tarr (1991), Havrylyshyn and Tarr (1991), Cooper (1991), and Gros and Steinherr (1991).

2
Democrats or Independents but not among Republicans. Udalov and Welfens (2021) demonstrate that Internet use is positively associated with several dimensions of environmental concern, including knowledge and pro-environmental behaviors, in high-income and low-income countries. <u>Diehl et al. (2021)</u> find that reliance on social media is associated with a decreased climate skepticism, based on survey data from 20 countries. At the same time, the media can also be a source of climate change disinformation <u>(Ejaz et al., 2023). These patterns are crucial for</u> understanding the relationship between age and climate action because younger cohorts tend to use digital communication tools more than older adults do (Seifert and Cotten 2021).

# **3. Theoretical framework**

We start from the assumption that the age-related variation in support for climate policies is determined by the length of exposure to climate change, the intensity of climate change impacts on wellbeing, and the effectiveness of mitigation and adaptation measures. The expected exposure of the elderly to climate change is shorter than that of younger people, but the risks from the effects of climate change increase with age at any given time.<sup>5</sup> Older demographic groups are at higher risk of being affected by natural disasters like droughts, floods, and hurricanes <u>(Harper 2019).</u> Comorbidities and frailty increase the adverse effects of air pollution and exposure to high temperatures by older people (Gamble et al. 2016).

A simple theoretical framework illustrates how the interplay between the length of exposure to climate change impacts and the intensity of such impacts affects an individual’s attitudes toward climate change. Consider an individual who lives for periods. In every period , she derives utility ) from consuming and faces the cost of climate change ) caused by pollution stock . Function tt TT tt UU(cc is increasing and strictly concave in consumption, that is, tt tt , , and function tt is cc DD(PP PP UU increasing and strictly convex in pollution stock, that is, , . The assumption that UU′ > 0 UU′′ < 0 DD is convex implies that higher pollution stock causes greater marginal damage to an individual’s DD′ > 0 DD′′ > 0 wellbeing. The overall lifetime welfare of the individual is DD

> 5 Climate change is also one of the leading threats to health and wellbeing of children under five (Zhang et al. 2007).

6
countries, for example, Ghana and Zimbabwe, a number of applied tariffs were higher than the bindings (TPRs, Ghana 2008, Zimbabwe 2010).

Ceiling bindings, just like unbound rates, allow flexibility in developing country policy, when governments feel the need to increase protection. Since 2008, a number of developing countries, notably Brazil and Indonesia but also Fiji and Sri Lanka increased their MFN tariffs (see Section V).

However, ceiling bindings also carry significant risks. First, domestically, they are an invitation to particular interest groups to exert pressure on governments to increase protection. Second, for foreign suppliers they reduce predictability and increase uncertainty in terms of the market access barriers they will be facing. This in turn impedes the activity of private agents, especially where investments are marked by a degree of irreversibility, and could result in reduced inflows of foreign financing. At the same time, their widespread existence undermines developing countries’ arguments that their development requires intrinsically higher levels of protection than those agreed in the WTO.

The amount of actual policy flexibility ceiling bindings offer is much less than the formal difference between the MFN and the bound rates: some of the bound rates are so high as to be redundant and economically meaningless, in the sense that no imports would occur, even if the rates were substantially lower. Similarly, some of the applied rates are based on preferential agreements and thus cannot be increased without retaliation or other adverse trade repercussions. About a third of the difference between bound and MFN rates is thus not available policy space for low and middle-income developing countries (Foletti _et al._ 2009). Perhaps the greatest 7
The proof of this proposition is provided in an appendix. As in the Costinot et al (2011), cross-country differences in the convexity parameter (in our case _θi_ ) ensures a unique allocation of tasks across countries in the free trade general equilibrium. As discussed above, our model distinguishes itself from Costinot et al (2011) in its ability to explain endogenous chain lengths as measured by F, and in its links to data elements such as the GOVA ratio. Moreover, note that our model offers more flexibility as it does not impose any relationship between wages and the position along supply chains.

However, the free-trade model presented here (and its counterpart in Costinot et al., 2011) retains predictions that make it unsuitable for quantitative analysis. Contrary to what we observe in international trade data, both models predict that every country but one will produce (and export) only intermediate goods. In all but the country producing final goods, both models imply that imports constitute 100% of consumption, and both models predict that two-way trade in goods occurs only within the final two countries in the chain. These free-trade models also predict extremely long chains of production, with every country participating in every chain. This implies, in turn, extremely large measures of upstreamness (or other measures of chain length), which is inconsistent with evidence that we present below. Clearly a richer model structure is needed. We introduce trade costs and heterogeneity into our framework in order to build a richer theory of supply chain trade. We begin by relaxing the free trade assumption in a two-country model that allows analytical links between trade costs, trade flows and welfare.

# **4.2 A two-country case**

In this subsection, we reintroduce trade costs _τ >_ 1 as well as heterogeneity in productivity as in Eaton and Kortum (2002).

**Two-country setting:** We consider only two countries: country _D_ and country _U_ . Country _D_ has a parameter value _θD_ for coordination costs, while country _U_ has a parameter value _θU_ . To justify these country names, we assume that _θU > θD_ .

As specified in equation (9) in section 2, labor efficiency _aD_ ( _ω_ ) and _aU_ ( _ω_ ) are distributed Frechet with coefficient _TD_ and _TU_ respectively for countries _D_ and _U_ . We make no assumption about the relative ranking of _TD_ and _TU_ . We also make no assumption about relative transaction costs _γD_ and _γU_ for countries _D_ and _U_ . Also, we normalize _wD_ = 1. As demonstrated in the previous sections (equation 21), it is useful to instead define an _θD θU_ adjusted labor costs parameter _AD_ ( _ω_ ) = _aD_ ( _ω_ ) � _γD_<sup>_<u>θD</u>_</sup> _θD_<sup><u>+1</u></sup> � and _AU_ ( _ω_ ) = _aU_ ( _ω_ ) � _γU_<sup>_<u>θU</u>_</sup> _θU_<sup><u>+1</u></sup> � . The effect of transaction costs is equivalent to a shift in labor productivity. The resulting _AD_ ( _ω_ ) 25
Table 3

# The Proportion of the Labor Forca<sup>and</sup> Type of Employment that is **Female** and Annual **Rates** of Change, by Region

||||Wom<br>|en as a Fract<br>|ion of Jo<br>|b Categorv<br>|||
|---|---|---|---|---|---|---|---|---|
||La<br>Mean|bor Force<br>Rate of<br>Change|Waa<br>Mean|e Earners<br>Rate of<br>Change|UnDaid<br>Mean|Family Workers<br>Rate of<br>Change|Sel<br>Mean|Emploved<br>Rate of<br>Change|
|World|.31|-.31|.32|.13|.57|.09|.21|-1.02|
|High Income|.36|.22|.36|.35|.68|.03|.19|.18|
|Low Income|.27|-.67|.26|-.20|.53|.13|.22|-1.28|
|Latin America|.24|.30|.27|.29|.31|.26|.16|.26|
|North Africa|.14|-.13|.09|.09|.31|-.22|.17|-.34|
|East Asia|.37|.29<br>-|.34|.21|.60|.22|.24|.42|
|South and<br>West Asia|.25|-1.21|.26|-.52|.51|-.02|.22|-1.86|

Sources: See sample composition Table A-1<sup>and special adjustments and data sources in Data Appendix.</sup>
# **9. METHODOLOGY**

The Equity Adjusted Coverage Index (EACR) is a measure of the availability of services, discounted or “penalized” by how unfairly the services are distributed among the population. The EACR calculations in this paper generate three indicators:

- **Coverage** : Overall level of availablity/access of the indicator across the pouplation

- **Dissimilarity (D-index)** : The difference in access rates for a given service for groups defined by circumstance compared with the average access rate for the same service for the population as a whole.

- **Equity Adjusted Covergae rate (EACR)** : Average access rate in the population, penalized by the degree of dissimilarity in coverage across different types of indicators.

The variation between calculated EACR values for different units of observation or changes across time can be decomposed in to three effects:

- **Scale** : Changes related to the expansion of the overall coverage of a particular good or service

- **Equalization** : Changes on distribution of access

- **Composition** :  Changes in the relative importance of different groups in society (i.e. demographic changes)

The D-index can be decomposed using the Shapley decompositoin which identifies the contribution of each circumstance to inequality in access to opportunities.

**The Shapley decompostion** decomposes the main explanatory factors of the dissimilarity

Constructing the Equity Adjusted Coverage Index<sup>5</sup> :

1. A separable logistic model is estimated based on whether the individual i has access to a given indicator (etc, bank account usage, savings). Different specifications were chosen for circumstances; categorical for age and income and binary for the other indicators. The coefficent estimations were oibtained as a result of the logistic regression.

2. With the coefficent estimates, the probablity of access to the finanical service was precited for each individual in the sample. <mark>Probability (p</mark> �<sup><mark>) is based on the predicted relationship of</mark></sup> <mark>�</mark> �� <mark>, and a vector of the circumstances �</mark> ��<sup><mark>.</mark></sup> 3. The coverage rates, C, were computed

> 5 The mathematical framework of the Equity Adjusted Coverage Index is based on “Do Our Children Have A Chance?Index”, Molinas Vega et al. (2010) pg 49

28