rafmacalaba/datause-encoder-data huggingface dataset:
substantially—except for the short-term creditors. The long-term prospects for the debtor country are likely to worsen as are those for the remaining private creditors.

Returning to the 1980s, some might argue that Baker to Brady was the right sequence: as Cline (1990) noted, the U.S. financial system was saved. But at what cost and to whom? According to an FDIC study (FDIC 1997), the four largest debtors, Mexico, Brazil, Venezuela and Argentina, owed $37 billion to the eight largest US banks, which amounted to 147 percent of their capital and reserves. Suppose the banks had to take a 25 percent haircut on these loans. This would have amounted to $9.25 billion and wiped out some 37 percent of these banks‘ capital. However, even their total exposure, $37 billion, was less than 1 percent of U.S. GDP in 1985. Different and less costly strategies were conceivable that would have benefited millions of poor people in Latin America who eventually bore the brunt of its lost decade even as official intervention kept the banks going. Borrowing access by the debtor countries would probably have been disrupted; but such a hardening of their budget constraint was needed to address the underlying fiscal and political economy problems, as the country studies in Sachs (1990) bring out.

Similarly, suppose that the official community had persuaded Russia to float the ruble in May 1998, backed it in seeking a haircut for private creditors and given it an official rescue package at the risk-free rate. The situation would still have been difficult and the U.S. probably would still have had to bail out the systemic hedge fund operated by Long Term Capital Management (LTCM) which fell victim to the contagion from the Russian default (see Dungey et al. 2006) but the problem would have been smaller, as noted by Rogoff. Including the swap, dollar-denominated public debt had increased by $16 billion or 8 percent of post-crisis GDP over the previous 10 weeks.<sup>41</sup> In the case of Greece, the October 2011 EU Summit announcements on the need for haircuts for private creditors were in line with the conclusion in Chamley and Pinto (2011). In

> 41 Details may be found in Kharas, Pinto and Ulatov (2001) and Pinto and Ulatov (2012).

26
Policy Research Working Paper 6803

# **Abstract**

This paper examines the association between the intensity, timing, and persistence of personal history of mobility on individual support for redistribution. Using both rounds of the Life in Transition Survey, the paper builds measures of downward mobility for about 57,000 individuals from 27 countries in Eastern Europe and Central Asia. The analysis finds that more intensive, recent, and persistent downward mobility increases support for redistribution more. A number of extensions and checks are done by, among others, taking into account systematic bias in perceived mobility experience, considering an alternative definition of redistributive preferences, and exploring the severity of omitted variable bias problems. Overall, the results are robust.

This paper is a product of the Poverty Reduction and Economic Management Department, Africa Region. It is part of a larger effort by the World Bank to provide open access to its research and make a contribution to development policy discussions around the world. Policy Research Working Papers are also posted on the Web at http://econ.worldbank.org. The authors may be contacted at adabalen@worldbank.org.

_The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent._ Produced by the Research Support Team
ceptions such as Ukraine and Russian Federation (and to a smaller degree Armenia), where the adverse economic conditions in recent years, and military conflict in the case of Ukraine, are reflected in the sharply lower expectations with respect to future socio-economic mobility. In other words, there is a considerable degree of stability in the region with respect to the beliefs about equality of opportunity; similarly, even though data from the 2010 round of the survey were collected in the aftermath of the financial crisis, which may have altered individuals beliefs about mobility (in the empirical analysis I will account for this explicitly), these beliefs also appear to be reasonably stable rather than transitory.

Having these inter-temporal patterns in mind, the estimates from the empirical specification in (1) are presented in Table 4. The results are presented for the pooled sample of countries, and also, separately, for the European Union member states and Non-EU countries. To some degree this distinction between EU and non-EU countries is arbitrary. The results are reported for these country groupings for the following reasons: (i) because this is a standard division of countries in publications based on LiTS survey data, inclusively in the publications by EBRD that rely on LiTS data; (ii) given the focus on institutional aspects, the distinction is meaningful analytically in the sense that in EU countries formal institutions may be stronger, and similarly in non-EU countries reliance on informal institutions (such as connections, for instance) may be more prevalent. I will return to this below when I discuss the use of connections.

Column (1) of table 4 presents the estimates of regressions for the pooled LiTS sample. Both hypotheses appear to be rejected by the data. First, when there is inequality of access to opportunities, connections matter ( _δ_ 2 + _δ_ 3 _<_ 0), meaning that expectations of future mobility are lower in the group that views connections to be vital but does not have any connections, in comparison with the group that similarly views connections to be vital to get ahead, and does indeed possess such connections. Second, when connections are unavailable, it matters whether the playing field is level ( _δ_ 1 + _δ_ 3 _<_ 0), in other words, expectations of future mobility are lower in the group that views connections as vital to get ahead and does not have them, as compared to 16
WPS3432

# **Growth, Inequality and Simulated Poverty Paths for Tanzania, 1992-2002**

Gabriel Demombynes and Johannes G. Hoogeveen*

**Abstract** – Although Tanzania experienced relatively rapid growth in per capita GDP in the 19952001 period, household budget survey (HBS) data shows only a modest and statistically insignificant decline in poverty between 1992 and 2001. To assess the likely trajectory of poverty rates over the course of the period, changes in poverty are simulated using unit-record HBS data and national accounts growth rates under varying assumptions for growth rates and inequality changes. To this end the projection approach of Datt and Walker (2002) is used along with an extension that is better suited to taking into account distributional changes observed between the two household surveys. The simulations suggest that following increases in poverty during the economic slowdown of the early 1990s, recent growth in Tanzania has brought a decline in poverty, particularly in urban areas. Unless recent growth is sustained, the country will not meet its 2015 Millennium Development Goal (MDG). Poverty reduction is on track in urban areas, but reaching the MDG target for bringing down poverty in rural areas, where most Tanzanians live, requires sustaining high growth in rural output per capita.

* Demombynes is a consultant to the World Bank. Hoogeveen is with the World Bank. Please send correspondence to both gabriel@demog.berkeley.edu and jhoogeveen@worldbank.org.

## World Bank Policy Research Working Paper 3432, October 2004

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

This paper was written in preparation for the Tanzania Country Economic Memorandum. Robert Utz was instrumental in starting the paper and his support and feedback are gratefully acknowledged. The authors thank Emmanuel Mungunasi for collecting the data on regional growth rates and Trudy Owens and Patrick Ward for assistance with the consumption aggregates for 1991/92 and 2000/01. Helpful comments and suggestions were also provided by Louise Fox, Tim Harris, David Sahn, Erik Torbecke, Stephen Younger, participants at the PADI workshop in Dar es Salaam in February 2004, and various members of the Research and Analysis Working Group.
12

# **B.   Trade and Income Before and After the Great Recession: Quarterly Data**

In this section, we use (seasonally adjusted) quarterly data to study the changing tradeincome relationship within the 2000s.<sup>7</sup> We divide the period in roughly half: pre-Great Recession (2001q1-2007q4) and post-Great Recession (2008q1-2013q4). The results are presented in Table 2, which also reports for comparison the estimates of the coefficients in equation (1) using quarterly data for the period 1991-2000.

Consider first the long-run trade elasticity (- δ/γ). For both the pre- and the post-Great Recession periods, trade is less responsive to changes in income compared to the 1990s, as on average the long-run trade elasticity fell by half, from 2.4 to 1.2. This finding simply confirms with quarterly data the analysis of the previous subsection. More interestingly, the decline in the long-run responsiveness of trade to income first takes place in the early 2000s, even if it appears to be much stronger in the post-Great Recession world. Specifically, the long-run trade elasticity is 1.5 in the period (2001q1-2007q4) and 0.7 in the second period (2008q1-2013q4). This suggests that the change in the trade-income relationship predated the Great Recession and, hence, cannot be entirely attributed to this event.

The short-run elasticity (  ) is higher in the 2000s compared to the 1990s, respectively 2.6 and 1.5. More importantly, the impact elasticity of trade to income is higher for both the preand post-Great Recession periods relative to the 1990s, as its estimates are 4.0 for the period 2001q1-2007q4 and 2.2 for 2008q1-2013q4. The speed of adjustment has a less clear-cut behavior, being lower (respectively, higher) in the pre-Great Recession (post-Great Recession) period relative to the 1990s.

> 7 We do not have quarterly data for 1970-1990. The regression analysis using quarterly data provides results for the period 1991-2000 that are in line with the findings for the period 1986-2000. The results from the quarterly and the yearly analysis of the 2000s are substantially the same, as expected.
# **Abstract**

This paper is concerned with the role of education as a determinant of health care choices. The central premise of the paper is that utilization of health services is determined not solely by an individual’s own education, but rather by a notion of _effective education_ , which incorporates the educational attainment of other household members. The paper sets out a general framework for representing intrahousehold education externalities, and proposes a number of specific hypotheses concerning the way in which the education of different household members affects health care choices. These hypotheses are tested on data from Mozambique, focusing on maternity services and child immunizations. We draw five major conclusions from the analysis. First, while maternal education seems to be the education variable of primary importance for the health care choices under consideration, the education of other household members has a significant and sometimes large effect. Second, the analysis suggests that while the education of the person (nonspouse) in the household with the highest-level education is important, the level of education of additional household members does not have an impact on health care choices. Third, the data provide no evidence of a gender difference in education externalities. Fourth, we examine the merits of two alternative representations of the education externality, but are unable to conclude unambiguously in favor of one specification over the other.

ii
Development Programs on Women’s Labor force participation and Older Children’s Schooling in Kenya”, Policy Research Report on Gender and Development, Working Paper Series No 10, World Bank, Washington, DC.

Lundberg, S, RA Pollak and TJ Wales (1997) “Do Husbands and Wives Pool their Resources? Evidence from the United Kingdom Child Benefit”, _Journal of Human Resources_ , 32, 463-480.

McElroy, M and MJ Horney (1981), “Nash-Bargained Household Decisions: Toward a Generalization of the Theory of Demand”, _International Economic Review_ , 22, 333-349.

Manser, M and M Brown (1980), “Marriage and Household Decision Making”, _International Economics Review_ , 21, 31-44.

Pitt, MM and MR Rosenzweig (1990), “Estimating the Intrahousehold Incidence of Illness: Child Health and Gender-Inequality in the Allocation of Time”, _International Economic Review_ , 31, 969-980.

Pitt, MM and MR Rosenzweig (1986), “Agricultural Prices, Food Consumption, and the Health and Productivity of Indonesian Farmers”, in I Singh, L Squire and J Strauss, eds, _Agricultural Household Models_ , A World Bank Publication, Johns Hopinks University Press.

Pollak, R and M Wachter (1975), “The Relevance of the Household Production Function and Its Implications for the Allocation of Time”, _Journal of Political Economy_ , 68, 349-359.

Pollak, RA and TJ Wales (1979), Welfare Comparisons and Equivalence Scales”, _American Economic Review_ , 69, 216-221.

Samuelson, P (1956), “Social Indifference Curves”, _Quarterly Journal of Economics_ , 70, 1-22.

Sobrado, Carlos (2001), “The Consumption Aggregate”, in World Bank, “ _Nicaraguan Poverty Assessment: Challenges and Opportunities for Poverty Reduction_ ”. Report 20488. World Bank, Poverty Reduction and Economic Management Sector Unit, Latin America and the Caribbean Region, Washington, DC.

Schultz, TP (1990), “Testing the Neoclassical Model of Family Labor Supply and Fertility”, _Journal of Human Resources_ , 15 (4), 599-643.

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63
My second measure of the share of annual stock of economy _k_ imported products subject to a TTB in year _t_ , reflecting the three modifications to equation (1) and thus weighted by the “value” of imports, is defined as There are at least three other and more subtle transmission mechanism through which (1) and (2) can diverge in addition to the ways through which I have already identified trade‐weighting the HS‐ 06 products as leading to differences between series resulting from equations (1) and (2). First, defining the series according to the stock of covered HS‐06 products prevents the case of a product already subject to a TTB in _t_  1 from being double counted if a new TTB is imposed over the same product in subsequent years (e.g., in year _t_ ). For example, suppose a HS‐06 product from a given foreign trading partner became subject to an AD barrier in _t_  1 and then a CVD in _t_ . Since I am measuring the “stock” of products affected by TTBs, this would not result in a change to series (1) or (2) between _t_  1 and _t_ . On the other hand, if there is a _new_ trading partner being subject to the TTB between _t_  1 and _t_ , even if the underlying product is unchanged, there can be a change in series (2). A change in trading partner coverage could occur because either the second partner was targeted under a different underlying TTB policy instrument (e.g., AD vs. CVD) or because of differences in the timing under the same policy instrument (e.g., the first AD imposed over the HS‐06 product was imposed against country A in _t_  1 and not against country B until _t_ ). Third, the stock series can also be affected through differential timing in the _removal_ of a previously‐imposed TTB over the same HS‐06 product. For example, if the TTB on trading partner A is removed in _t_  1 but the TTB on trading partner B is not removed until _t_ , this differential timing in the removal will affect series (2). However, there will be no change in series (1) until _all_ previously‐imposed TTBs affecting this product are removed.

# I conclude this section with a discussion of four remaining caveats to my approach.

First, some economies impose TTBs at a level of product disaggregation (e.g., HS‐08, HS‐10) that is finer than the HS‐06 level that is my focus. Nevertheless, examination at the HS‐06 level is desirable for our context, since HS‐06 is the finest level of disaggregation that is both comparable across countries and with available import value data over the 1990‐2009 period. While the application of measures using HS‐06 data will overstate the trade impact (in the level) for any economy that typically does not cover all sub‐products within an HS‐06 category, because my measures are defined consistently over 11
# Figure 1: Teachers’ time spent teaching is low

_Percentage of time officially allocated to schooling, when a teacher is present at school, and actually spent on teaching and learning_ <!-- Start of picture text --> 100<br>80 Percentage of time<br>teacher is:<br>60 Scheduled<br>to teach<br>Present in<br>40<br>the classroom<br>Teaching<br>20<br>0<br>Egypt, Arab Rep.Morocco LebanonYemen, Rep.Lao PDRTunisiaCambodiaNigeriaSenegal MadagascarTogo ZambiaTanzaniaKenyaUgandaMozambiqueGhana<br>Brazil (Pernambuco)<br>Percent<br><!-- End of picture text --> _Source:_ World Bank 2017 17
discounted to the price of fuels in terms of the cost per kilometer traveled. The price of E100 at parity (cars get about 30 percent less kilometers per liter of E100 relative to fuel) is denoted by the dotted line in Figure 4. But historically, E100 prices were at a substantial discount compared to the fuel parity, often reaching levels 25 percent lower than the parity fuel price. This encouraged the adoption of flex cars and infrastructure like E100 dispensing stations. But as the share of flex cars has increased, and hydrous ethanol prices have risen, this discount in the past 2-3 years has disappeared.

**Figure 2: Brazil Sugarcane Processed (million tonnes)**

<!-- Start of picture text --> 400<br>Sugar Ethanol<br>350<br>300<br>250<br>200<br>150<br>100<br>50<br>0<br>Source: CONAB (Brazilian Food Supply Agency)<br><!-- End of picture text --> The market price of anhydrous ethanol exceeds that of hydrous ethanol because more sugarcane is required to produce a gallon of anhydrous ethanol and there is additional nonsugarcane related production costs associated with anhydrous production. Because sugarcane is used to produce sugar, hydrous ethanol and anhydrous ethanol, then it must be that for a flexible plant – modeled in this paper – the marginal benefits of these three production processes are equal (adjusted for ethanol from molasses, a by-product from sugar production).

4
Cai and Thai Nguyen in the north, Nghe An and Binh Thuan in the center, and Kon Tum and Tra Vinh in the south of the country.<sup>10</sup> Project communes were randomly selected for inclusion in the survey from province-specific lists of all communes with road links proposed for rehabilitation. Another list was drawn up of remaining communes in districts with proposed road links from which a random sample of non-project communes was drawn. The eventually sampled communes (100 project and non-project each) were located in 29 of 38 potential survey districts.

Non-project communes located in the same districts as the treatment communes will share many of the same characteristics as the project communes. But we additionally use matching techniques to ensure selection of the most appropriate comparison communes. Districts are large and the distances between project and non-project communes tend also to be large.<sup>11</sup> Contamination from project to non-project communes is unlikely for the type of small localized road improvements under study.

The commune data were acquired in part by drawing on annually collected commune records. Each commune appoints a ‘statistician’ who collects and maintains commune-level information such as pertaining to vital statistics, land use and distribution, production activities and finances. There is some concern that the reliability of these data varies according to average commune income and education, and local pressures to compile statistics that conform to pre-determined ‘plans.’ To minimize such potential problems, we focus on variables likely to be less vulnerable to these biases. Our analysis focuses on commune level impacts and uses primarily the commune data.

> 10 Lao Cai, Thai Nguyen or Nghe An are located in what was previously known as North Vietnam or the Democratic Republic of Vietnam.

> 11  Early on during data collection, we mapped many of the non-project communes and judged them to be sufficiently far from our road links to be confident that contamination is unlikely.

14