rafmacalaba/datause-encoder-data huggingface dataset:
Development bank experiences suggest that it will not be possible to conduct implementation audits in time to incorporate their results in agreements that this round of negotiations will reach. The Hong Kong Ministerial asks that the round be completed in calendar 2006. World Bank experience shows that even after project identification, the process of project design and appraisal usually requires 18 months to complete. (Table 4.1. provides the timetable for a recently completed project.) Moreover, project identification and preparation presupposes the existence of an overall development strategy (for poorer countries, a Poverty Reduction Strategy Paper). Also in the background will be a Country Assistance Strategy, CAS. The CAS, produced by the Bank in co-operation with the government and stakeholders in the country, outlines out a program of Bank Group support linked to the country’s development strategy.<sup>22</sup> Given the platform to do so collectively does not yet exist and there is small likelihood that any Member will offer implementation audits for its proposals, the realistic alternatives must therefore accept that the rules or standards written into a Doha Development Agenda agreement will be unaudited when the agreement goes into effect. The alternatives therefore are the following:

1. Implementation would not be a legal obligation.  Following the African Group proposal (TN/TF/W/56), acceptance of the new rules or standards as legal obligation would be taken up as a follow-up negotiation or review, and conditioned on provision by developed countries of assistance that is – in the <u>view of the recipient country</u> – effective, long-term, sustainable and adequate to implement the new commitments.

2. Implementation of unaudited obligations, as in the Uruguay Round Agreements, would be a legal obligation. A developing member would be able to request an extension of implementation deadlines; discussion of that request would include an implementation audit and take up the provision of assistance. The argument advanced by the African Group during the negotiations, as reflected in Table 4.2, goes quite a bit further, including binding obligations on special and differential treatment, call for specific technical assistance, and suggestion that trade facilitation needs are “enormous.” The first of these follows the thrust of the July 2004 Work Program. It would include neither legal obligation to provide implementation assistance nor legal obligation to implement. Rather than reaching balance in the manner Ricupero recommended – bound obligation to implement, bound obligation to provide assistance, it moves toward a nihilist balance – the agreement would obligate

> 22 The World Bank webpage on “The Project Cycle” provides information on the steps in the process and links to information about particular projects.  From the Bank’s home page, click “Projects and Operations,” then “Project Cycle.”

> http://web.worldbank.org/WBSITE/EXTERNAL/PROJECTS/0,,contentMDK:20120731~menuPK:41 390~pagePK:41367~piPK:51533~theSitePK:40941,00.html

13
were asked only in the transition economies of Eastern Europe and Central Asia. The sample includes about 3000 enterprises from 21 transition economies.<sup>19</sup> The enterprise level data from the WBES is supplemented with data from a variety of other sources. In addition to characteristics of the enterprise paying the bribe, the analysis also includes characteristics of the utilities, the enterprises receiving the bribe payments. In the electricity sector, we focus on the distribution utilities, since these are the enterprises that will generally interface with the (mostly small) enterprises in the WBES sample. However, for the most part, we focus on the telecommunications sector because there are readily available measures of competition and privatization in the telecommunications sector. By the late 1990s, cellular services provided significant competition for fixed line services in many developing and transition economies. By 1999, most of the countries included in this analysis had significant penetration by cellular services (see Figure 1) and in some countries there were nearly as many cellular subscribers as fixed main lines. Further, since the WBES does not provide information on the enterprises' locations within the country, and because electricity distribution is often handled on a local or regional basis, it is generally easier to observe privatization in the telecommunications sector than it is in the power sector.<sup>20</sup> The information on the privatization of telecommunications operators was provided by the World Bank Telecommunications Department and information on the privatization of electricity distribution was obtained from Bacon (1999). Information on number of fixed lines come from International Telecommunications Union (2000), while the number of cellular companies operating in each country was calculated using information from EMC (2001) and _Telecoms and Wireless Reports: Eastern Europe/Commonwealth of Independent State_ by Pyramid Research.

> 19 The countries in the sample for transition economies are: Albania, Armenia, Azerbaijan, Belarus, Bulgaria, Croatia, the Czech Republic, Estonia, Georgia, Hungary, Kazakhstan, the Kyrgyz Republic, Lithuania, Moldova, Poland, Romania, Russia, Slovenia, the Slovak Republic, Ukraine, and Uzbekistan.

> 20 Bacon (1999) provides information on whether any privatization of electricity distribution had occurred by 1999, but did not provide information on the extent of privatization.
# **4. Data and Construction of Service Export Sophistication**

We build upon the HHR framework, which uses a good export sophistication measure _Goods EXPY_ as a proxy for the most productive set of goods the country can produce at a given time. They argue that export data is the best way to reveal this production frontier as we can expect countries to export those goods in which it is most productive. Along the same reasoning and as described below we will construct a _Service EXPY_ to proxy the service production frontier of a country, by and large following the methodology developed by HHR.

We start by constructing so-called _PRODY_ ‘s for each category of goods exports, reflecting the income/productivity level associated with each good, and we do the same for each category of services. _PRODYj_ is the income value associated with the service _j_ , and is constructed by using the service export ( _x_ ) share of a country _i_ in world‘s export of service _j_ , divided by the sum of shares of _j_ in world exports of _j_ across all countries exporting that service.<sup>7</sup> These ratios are multiplied by the exporting countries‘ respective per capita income level ( _Y_ ) and the result is summed up across all countries. In other words, the _PRODY_ becomes the weighted average of per capita GDPs, where the weights represent the revealed comparative advantage in service _j_ for each country.<sup>8</sup> _PRODY_ s are constructed for each service category, for each year of available data, and are by construction the same for all countries.

_EXPY_ is then the weighted income value of services exported by a country, computed as the sum of _PRODY_ s using as weights the share of the particular service in the country‘s total service export basket. _EXPY_ s are constructed for each country and for each year with available data.

The trade data come from the IMF Balance of Payments statistics which has data available for over 190 countries from 1990 to 2007. Due to data being reported inconsistently on service exports, we end up with a sample of approximately 100 countries 1990 to 2007. GDP per capita data is taken from the World Bank Indicators database. Before describing the service EXPY we would like to discuss two of its characteristics that differ from preexisting goods index – the need for dynamic PRODYs and the high level of aggregation.

First, the _Goods EXPY_ were constructed using _static PRODY_ s (the _PRODY_ for each good is held constant at the average value 1999-2001). This means that any increase in _Goods EXPY_ measures a country‘s jump from a low _PRODY_ product to a high _PRODY_ product (that is the share of high _PRODY_ good in the export basket increased). However, in the case of _Service_

> _xij_ 7 _X i_ is hence the value-added share of commodity j in the country‘s overall export basket.

> 8 The rational for using revealed comparative advantages as weights is to control for country size when ranking the services.

12
19. Gabriel, Paul E. and Suzanne Schmitz, “Favorable Self-Selection and the Internal Migration of Young White Males in the United States,” Journal of Human Resources, 30(3), 460-71, Summer 1995 20. Greenwood, Michael J., “Research on Internal Migration in the United States: A Survey,” Journal of Economic Literature, 13(2), 397-433, June 1975 21. Harris, John and M. Todaro, “Migration, Unemployment and Development: A Two-Sector Analysis,” Amer. Econ. Rev., 60, 126-142, 1970 22. Henderson, J. Vernon, Urban Development: Theory, Fact, and Illusion, Oxford University Press, New York, 1988 23. Hojvat-Gallin, Joshua, “Net Migration and State Labor Market Dynamics,” Journal of Labor Economics, 22(1), 1-21, January 2004 24. Jackman, Richard and Savvas Savouri, “Regional Migration in Britain: An Analysis of Gross Flows Using NHS Central Register Data,” Economic Journal, 102(415), 1433-50, November 1992.

25. Lall, Somik and Christopher Timmins, “Rural-Urban Migration: Successful Integration or just "Bright Lights"? Evidence from Brazil and Mexico,” Department of Economics, Duke University, 2008 (mimeograph) 26. Lokshin, Misha, Mikhail Bontch-Osmolovski and Elena Glinskaya, “Work Migration and Poverty in Nepal,” World Bank, mimeograph, 2007.

27. Lucas, Robert E. Jr, “Life Earnings and Rural-Urban Migration,” Journal of Political Economy, 112(1), S29-59, Feb. 2004 33
4 considerable risk. First, in section 2, we consider a food poverty line for households with a taste for variety but facing dilemmas in opting for a diet that meets its calorie requirements in full compliance to that taste. Within the confines of given calorie requirements, we subsequently discuss the adaptation of a chosen diet to the price vector (revealed preferences) and to local tastes (heterogeneous preferences). We will conclude that observed behavior may neither reveal preferences nor detect heterogeneity among the poor. Section 3 extends the analysis in order to include the use of non-food and basic services, focusing on the urban-rural dimension of utility equivalence under an implicit price vector that is driven by rationed supply. The results in sections 2 and 3 urge caution on the use of a CSPL for national poverty assessments and, in section 4, we illustrate this with evidence from Mozambique and Ghana. In the penultimate section, we briefly discuss the broader social-choice argument against the adaptation of a poverty line to individual preferences. Section 6 concludes.

# **2 The food poverty line**

Food is by far the most important consumption category of the poor, covering three-quarters and more of their total expenditures (see Banerjee and Duflo, 2007, inter alea). Ideally, the construction of a food poverty line requires the fulfillment of both utility maximization conditions and minimum calories intake criteria. In this section, we show the intricacies involved for the two to be at par. In terms of utility, a household opting for a diet composed mainly of cheap food items can hardly be compared with a household opting for a diet with similar calorie contents but more variety and more expensive items in it. We argue that the fact that poor households tend to opt for cheaper calories has to do more with their need to meet a calories requirement than with their preferences for the chosen food basket.

**2.1 Mono-diet and most-preferred-diet** Consider a simple illustrative model of the food consumption of a poor household. Its diet is composed of two types of food, one luxury food c1, say filet, and one staple food c2, say cassava or millet. Both types of food will be of interest, also to the poor, although the staple food has a much higher caloric content per unit,  γ2 > γ1 , where for convenience we set the quantity of the staple food c2 such that one unit is precisely sufficient to fulfill the calorie requirements. For example,  _2 2000_ Kcal reflects a level close to the minimum calorie requirements per capita per day of a typical poor household.<sup>1</sup>

> 1 Household energy requirements are commonly based on a requirement of 3,000 Kcal for an 18 to 35 years old male and applying an adult equivalent scale for other household members (James and Schofield, 1990). The equivalent
Sumatra, Lampung, Bali, West Nusa Tenggara, South Kalimantan, South Sulawesi, and all provinces of Java. The baseline sample, comprising more than 7,000 households and over 30,000 individuals, accounted for 83 percent of the Indonesian population (Peterson, 1995).<sup>8</sup> Since 1993, four full follow-up waves in 1997, 2000, 2007, and 2014 have been conducted. In addition, a smaller survey comprising 25 percent of the baseline sample was conducted in 1998 to better understand the impact of the Asian Financial Crisis (Thomas, Frankenberg, & Smith, 2001). The IFLS remains as one of the longest-running high-quality longitudinal surveys among low- and middle-income countries.

Relative to SAKERNAS, the IFLS is a much more comprehensive survey comprised of various modules on different topics, such as household income, expenditure, wealth, health and wellbeing, migration, and employment. The employment module gives the IFLS a distinct advantage over SAKERNAS due to the rich set of information it collects from respondents. In addition to basic labor market information also collected in SAKERNAS, the 2007 and 2014 waves of the IFLS also ask respondents about their overall job satisfaction and other characteristics of their job (e.g., physical effort, job stress). The longitudinal nature of the IFLS, combined with its extensive time coverage spanning 21 years, makes it a key resource for analyzing household and individual-level changes as well as long-term trajectories. This feature is especially important in the context of informality, where labor market transitions and longer-term employment outcomes remain an active area of research. Importantly, the longitudinal dimension of the survey allows panel methods to be deployed to address – or at the very least, minimize – the endogeneity of informal employment.

While the IFLS has clear advantages over SAKERNAS, it also has several limitations. First, it contains limited measures of informal employment that do not fully capture the ICLS-17 definition. Unlike SAKERNAS, which integrated more direct questions to capture informality in 2016, the IFLS

> 8 IFLS provinces were selected to maximize representativeness and capture the country's cultural and socioeconomic diversity while also keeping costs manageable given Indonesia's size and terrain (Frankenberg et al., 1995).

10
9 In contrast, Anuradhapura is one of the most irrigated agricultural areas in the country, having access to 11 major tanks and receiving water from the country’s main irrigation system – Mahaweli – as well. In both districts, some farmers have access to water from the irrigation system, making it possible for them to cultivate even during a drought.

# **6. Design of the Index Insurance Product**

A farmer in either district, who relies on rainfed or minor irrigation for his/her farming, could be covered through the pure rainfall index insurance product (refer Box 2). This product would reflect the losses suffered by the farmer due to adverse weather conditions.

Farmers with access to medium and major irrigation schemes have relatively low-risk exposure to drought and dry spells in comparison to solely rainfalldependent farmers. The farmer, even if the rainfall is below average, can access water from medium and major tanks. However, such farmers could still face a fall in their profit margins due to the higher cost of

# _Box 2: Functionality of pure index insurance products_

Index insurance products provide compensation to farmers based on pre-agreed rules and thresholds. For example, if a dry spell is defined as 20 consecutive days with rainfall below normal, a weather index insurance product protecting farmers against dry spells would automatically trigger payouts to the insured farmers if the actual rainfall observed reached this specific trigger over a specified time period. There is no need and usually no scope for farmers to report claims for pure index insurance products. Similarly, there is also no need usually for the insurance company to verify actual losses on the ground, which is usually a very expensive and time-consuming process and often lacks transparency on both sides.

production (e.g. cost of operating pumps for irrigation). They can also incur crop losses if there is insufficient water in the tanks for irrigation.

While small tanks and some medium ones rely exclusively on rainfall, the major ones are fed by both rain from different catchment areas as well as major rivers. In Anuradhapura, for instance, rain is not the sole source of water for the tanks. While developing index insurance products in such situations, it is thus very important to consider the type of water supply to each farm in terms of rainfall dependency as well as access to minor, medium and major irrigation channels.

Given that minor tanks are solely rainfed, their storage levels in Anuradhapura district vary significantly from the major tanks whose source of water is different.

However, there is positive correlation between tanks of a similar type within the district. The tank levels also follow a seasonal cycle every year, which is closely correlated to the rainfall in the district and also to rainfall in surrounding districts. Analyses of historical tank storage data and historical rainfall data
# <mark>922. https://doi.org/10.1038/s41560-017-0025-8</mark>

Mohtadi, Hamid (1996) "Environment, Growth & Optimal Policy Design," Journal of Public Economics, 63: 119 140.

Mohtadi, H., Ross, M., & Ruediger, S. (2014). _Do natural resources inhibit transparency?_ Economic research Forum working paper 906; Working Paper, University of Wisconsin and UCLA.

Mohtadi, Hamid, Michael Ross, Uchechukwu Jarrett and Stefan Ruediger (2019) “Kleptocracy and Tax Evasion under Resource Abundance” Economics and Politics, 1- 51.

Ross, M. (2001). Does oil hinder democracy? World Politics, 53(3), 325–361. ttps://doi.org/10.1353/wp.2001.0011 Ross, M. (2011). Mineral wealth and budget transparency. Working paper, UCLA, Department of Political Science.

Tagliapietra S. (2019) The Impact of Global Energy Transition on MENA oil and gas producers. Energy Strategies Reviews 26: 100397. <u>https://doi.org/10.1016/j.esr.2019.100397</u> Timilsina, G. (2022) “Carbon Taxes” Journal of Economic Literature 60(4), 1452-1502.

United Nations (2021), <u>https://www.un.org/sites/un2.un.org/files/media_gstc/FACT_SHEET_Climate_Change.pdf</u> Van der Ploeg, F. (2011). “Natural resources: Curse or blessing?”. Journal of Economic Literature, 49(2), 366420.

Van der Ploeg, F., & Poelhekke, S. (2009). Volatility and the natural resource curse. _Oxford economic papers_ , _61_ (4), 727-760.

National Oceanographic and Atmospheric Administration (NOAA), Payne Institute and Colorado School of Mines, GGFR.

<mark>World Resources Institute, “9 Charts Explain Per Capita GHG Emissions by Country,” World Resources Institute, Insights, May 8 2023.</mark> 37
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<!-- Start of picture text --> Policy, Research, and External Affairs I<br><!-- End of picture text --> <!-- Start of picture text --> World Development Report<br><!-- End of picture text --> <!-- Start of picture text --> WPS 674<br><!-- End of picture text --> This papera product of the Trade Policy Division, Country Economics Department -was prepared as a background paper for the _1991 World Development Report._ Copies are available free fiom the World Bank, 1818 H Street NW, Washington, DC 20433. Please contact the World Development Report office, room SI 3-060, cxtension 31393 (36 pages, with figures and tables).

The 1980s was a period of extemal shocks for developing countries, and (iomestic macroeconomic imbalance and structural inefficiencies compound>l the effects. But the performance of developing lountries was **not** uniform.

The authors devised a model for simulating the effects of tcrms of trade and interest rate shocks on two archetype economies, one representing an average Latin American economy, and the other an average African economy.

The study examined the effects of **the** shocks and of different adjustiment policies. Identical shocks and adjustiment packages yield different outcomes for growth, poverty, and income distribution in the two economies.

The simulations suggest three importint conclusions: With the standard adjustmcnt package, inequality increased significantly for the Latin American archetype but decreased significantly for the African archetype.

This happened for two reasons. In the Latin American archetype, the rich are able to protect their financial assets through capital flight. In the African archetype, the poor are helped as **ihc** real incomes in rural areas increase because of the higher export earnings induced by the real cxchange rate depreciation.

a Adjustment can lead to a sharp redistribution of income from groups with low marginal propensities to save towards groups wiLh a high marginal propensity to save.

> * Trade anld tax refonns that improve allocative efficiency by equalizing incentives across sectors can induce inequality signilicantly, provided that goveinments are able to implement these revenue-nleutral measures.

**The** l'RE Working Paper Series disseminates tihe findings of work under way in thc Bank's Policy, RcsearT h, and Extemal AffairsComplex. An objectiveofilie scries is to get these findings out quickly, cven ifpresentations ;re less Iall fully poAlished. Thc findings, interpreLations and conclusions in thesc papers do not necessarily represent official Bank policN.

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