rafmacalaba/datause-encoder-data huggingface dataset:
Political accountability and
            regulatory performance in infrastructure industries : an
            empirical analysis
The aim of this paper is to empirically
            explore the relationship between the quality of political
            institutions and the performance of regulation, an issue
            that has recently occupied much of the policy debate on the
            effectiveness of infrastructure industry reforms. Taking the
            view that political accountability is a key factor that
            links political structures and regulatory processes, the
            authors investigate, for the case of telecommunications, its
            impact on the performance of regulation in two
            time-series-cross-sectional data sets on 29 developing
            countries and 23 industrial countries covering the period
            1985-99. In addition to confirming some well documented
            results on the positive role of regulatory governance in
            infrastructure industries, the authors provide empirical
            evidence on the impact of the quality of political
            institutions and their modes of functioning on regulatory
            performance. The analysis of the data sets shows that the
            (positive) effect of political accountability on the
            performance of regulation is stronger in developing
            countries. An important policy implication of this finding
            is that future reforms in these countries should give due
            attention to the development of politically accountable systems.
Trade liberalization, employment
            flows, and wage inequality in Brazil
Using nationally representative,
            economywide data, this paper investigates the relative
            importance of trade-mandated effects on industry wage
            premia; industry and economywide skill premia; and
            employment flows in accounting for changes in the wage
            distribution in Brazil during the 1988-95 trade
            liberalization. Unlike in other Latin American countries,
            trade liberalization appears to have made a significant
            contribution toward a reduction in wage inequality. These
            effects have not occurred through changes in
            industry-specific (wage or skill) premia. Instead, they
            appear to have been channeled through substantial employment
            flows across sectors and formality categories. Changes in
            the economywide skill premium are also important.
Does services liberalization benefit
            manufacturing firms ? Evidence from the Czech Republic
While there is considerable empirical
            evidence on the impact of liberalizing trade in goods, the
            effects of services liberalization have not been empirically
            established. Using firm-level data from the Czech Republic
            for the period 1998-2003, this study examines the link
            between services sector reforms and the productivity of
            domestic firms in downstream manufacturing. Several aspects
            of services reform are considered and measured, namely, the
            increased presence of foreign providers, privatization, and
            enhanced competition. The manufacturing-services linkage is
            measured using information on the degree to which
            manufacturing firms in a particular industry rely on
            intermediate inputs from specific services sectors. The
            econometric results lead to two conclusions. First, the
            study finds that services policy matters for the
            productivity of manufacturing firms relying on services
            inputs. This finding is robust to several econometric
            specifications, including controlling for unobservable firm
            heterogeneity and for other aspects of openness. Second, it
            finds evidence that opening services sectors to foreign
            providers is a key channel through which services
            liberalization contributes to improved performance of
            downstream manufacturing sectors. This finding is robust to
            instrumenting for the extent of foreign presence in services
            industries. As most barriers to foreign investment today are
            not in goods but in services sectors, the findings may
            strengthen the argument for reform in this area.
Social health insurance reexamined
Social health insurance (SHI) is
            enjoying something of a revival in parts of the developing
            world. Many countries that have in the past relied largely
            on tax finance (and out-of-pocket payments) have introduced
            SHI, or are thinking about doing so. And countries with SHI
            already in place are making vigorous efforts to extend
            coverage to the informal sector. Ironically, this revival is
            occurring at a time when the traditional SHI countries in
            Europe have either already reduced payroll financing in
            favor of general revenues, or are in the process of doing
            so. This paper examines how SHI fares in health care
            delivery, revenue collection, covering the formal sector,
            and its impacts on the labor market. It argues that SHI does
            not necessarily deliver good quality care at a low cost,
            partly because of poor regulation of SHI purchasers. It
            suggests that the costs of collecting revenues can be
            substantial, even in the formal sector where nonenrollment
            and evasion are commonplace, and that while SHI can cover
            the formal sector and the poor relatively easily, it fares
            badly in terms of covering the nonpoor informal sector
            workers until the economy has reached a high level of
            economic development. The paper also argues that SHI can
            have negative labor market effects.
Social health insurance reexamined
WPS4111

# Social Health Insurance Reexamined

## by

## Adam Wagstaff<sup>a</sup>

a Development Research Group, The World Bank, Washington DC, USA

### <u>Abstract</u>

Social health insurance (SHI) is enjoying something of a revival in parts of the developing world at the moment. Many countries that have in the past relied largely on tax finance (and out-of-pocket payments) have introduced SHI, or are thinking about doing so. And countries with SHI already in place are making vigorous efforts to extend coverage to the informal sector. Ironically, this revival is occurring at a time when the traditional SHI countries in Europe have either already reduced payroll financing in favor of general revenues, or are in the process of doing so. This paper examines how SHI fares in health care delivery, revenue collection, covering the formal sector, and its impacts on the labor market. It argues that SHI does not necessarily deliver good quality care at a low cost, partly because of poor regulation of SHI purchasers. It suggests that the costs of collecting revenues can be substantial, even in the formal sector where nonenrollment and evasion are commonplace, and that while SHI can cover the formal sector and the poor relatively easily, it fares badly in terms of covering the nonpoor informal sector workers until the economy has reached a high level of economic development. The paper also argues that SHI can have negative labor market effects, including formal sector workers moving into the informal sector, and poor households covered at the taxpayer’s expense being caught in a poverty trap.

**Contact author:** Adam Wagstaff, World Bank, 1818 H Street NW, Washington, D.C. 20433, USA. Tel. (202) 4730566. Fax (202)-522 1153. Email: <u>awagstaff@worldbank.org.</u>

**Keywords:** social health insurance; health financing.

**Acknowledgements:** Without wishing to incriminate them in any way, I should like to thank Jan Bultman, Pablo Gottret, Matthew Jowett and Magnus Lindelow for helpful comments on an earlier version of this paper. The findings, interpretations and conclusions expressed in this paper are entirely those of the author, and do not necessarily represent the views of the World Bank, its Executive Directors, or the countries they represent.

### World Bank Policy Research Working Paper 4111, January 2007

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.
Can Sub-Saharan Africa leap into
            global network trade
This paper examines opportunities for
            Sub-Saharan African countries to effectively participate in
            globalization, particularly given the increasing interest of
            China and India in Sub-Saharan Africa. How can Sub-Saharan
            Africa fully engage and gain benefits from global network
            trade? Over the past 15 years Asia has become Africa's
            fastest growing export market. Asian countries are much more
            open to trade than Europe or America. There seems to be no
            evidence to suggest that this trend will not continue in the
            near future. The authors acknowledge the numerous caveats in
            Asia's growing interest in the African continent, not
            least the "resource curse" of exports that are
            heavily concentrated on oil, minerals, and raw materials, as
            well as the fierce competition from Asia's cheap
            manufactured exports. However, they believe that there is
            strong evidence to suggest a clear potential for South-South
            cooperation in trade and investment. Drawing on evidence
            from their extensive research into international value
            chains, the authors identify five critical factors for
            effective participation in global network trade: price,
            speed-to-market, labor productivity, flexibility, and
            product quality. Underlying competitive performance of these
            critical factors are a country's policies and
            institutions. Effective policies, efficient institutions,
            and the necessary infrastructure will ensure the best
            outcome for trading countries. To improve the depth and
            sustainability of these five critical factors, it is
            important that developing countries create a supportive
            policy and institutional framework from the outset.
Location decisions of foreign banks
            and competitive advantage
While institutional differences have
            been found to affect country growth patterns, much has
            remained unexplained, including how economic actors
            "overcome" institutional weaknesses and how
            internationalization helps or hinders development. Banking
            is an institutionally-intensive activity and the location
            decision of foreign banks provides a good test of how
            institutional differences are dealt with and how they may
            affect economic choices. Specifically, the authors examine
            whether banks seek out those markets where institutional
            familiarity provides them with a competitive advantage over
            other foreign competitor banks. Using bilateral data on
            banking sector foreign direct investment in all developing
            countries and controlling for other factors, they find that
            competitive advantage is an important factor in driving
            foreign banks' location decisions. The findings suggest
            that high institutional quality is not necessarily a
            prerequisite to attract foreign direct investment in banking
            and that there are specific benefits, as well as risks, to
            international financial integration between developing countries.
Location decisions of foreign banks
            and competitive advantage
WPS4113

# **Location Decisions of Foreign Banks and Competitive Advantage**

## Stijn Claessens and Neeltje Van Horen<sup>*</sup>

## Abstract

While institutional differences have been found to affect country growth patterns, much has remained unexplained, including how economic actors “overcome” institutional weaknesses and how internationalization helps or hinders development. Banking is an institutionally-intensive activity and the location decision of foreign banks provides a good test of how institutional differences are dealt with. Specifically, we examine whether banks seek out those markets where institutional familiarity provides them with a competitive advantage over other foreign competitor banks. Using bilateral data on banking sector FDI in all developing countries and controlling for other factors, we find that competitive advantage is important in driving foreign banks’ location decisions. The findings suggest that high institutional quality is not necessarily a prerequisite to be able to attract foreign direct investment in banking and that there are specific benefits, as well as risks, to international financial integration between developing countries.

## **JEL Classification Codes:** F21, F23, G21

**Keywords:** foreign direct investment, international banking, institutions

## World Bank Policy Research Working Paper 4113, January 2007

_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._

* Claessens is with the World Bank, University of Amsterdam and CEPR, and Van Horen is with the World Bank and the University of Amsterdam. We are grateful to Allaeddin Twebti, Siret Dinc, Matias Gutierrez and Haocong Ren for their help with collecting the data. Financial support for this project by United Kingdom's Department for International Development received through DECRG trade and services project is gratefully acknowledged. Email addresses: <u>sclaessens@worldbank.org and nvanhoren@worldbank.org.</u>
Survey of land and real estate
            transactions in the Russian Federation : statistical
            analysis of selected hypotheses
This paper analyzes land transactions
            between municipalities and private businesses based on
            official data and business surveys in 15 regions of the
            Russian Federation. Since the Russian Federation passed the
            new Land Code in 2001, land privatization has been
            officially encouraged by the federal government and in
            particular, land under previously privatized buildings was
            supposed to be privatized to the owner at a nominal price.
            The paper shows that many subnational authorities (which own
            or control the vast majority of land of interest to
            businesses) appear to use a combination of high statutory
            land buy-out prices and administrative barriers to deter
            land privatization and to offer "long-term leases"
            (which are not fully marketable) instead. On the other hand,
            regions that have established low buy-out prices and taken
            steps to remove unnecessary administrative barriers to land
            privatization appear to have higher rates of land ownership
            by businesses, and to face lower levels of corruption in the
            privatization process. The paper concludes that further
            reductions in the statutory prices for privatization of land
            under buildings and elimination of unnecessary
            administrative barriers should help to encourage further
            land privatization and the development of a competitive,
            secondary market in commercial land.
International remittances and the
            household : analysis and review of global evidence
This paper examines the economic impact
            of international remittances on countries and households in
            the developing world. To analyze the country-level impact of
            remittances, the paper estimates an econometric model based
            on a new data set of 115 developing countries. Results
            suggest that countries located close to a major
            remittance-sending region (like the United States,
            OECD-Europe) are more likely to receive international
            remittances, and that while the level of poverty in a
            country has no statistical effect on the amount of
            remittances received, for those countries which are
            fortunate enough to receive remittances, these resource
            flows do tend to reduce the level and depth of poverty. At
            the household level, a review of findings from recent
            research suggest that households receiving international
            remittances spend less at the margin on consumption
            goods-like food-and more on investment goods-like education
            and housing. Households receiving international remittances
            also tend to invest more in entrepreneurial activities.
Child labor across the developing
            world : patterns and correlations
The aim of this study is two-fold.
            First, based on summary data at the country-level for an
            unusually large set of developing countries originally
            obtained from household sample surveys conducted between
            1993 and 2003, the authors construct a detailed profile of
            child economic activity and child labor, attempting,
            wherever the data permit, to identify similarities and
            differences across regions and between genders. Second, they
            link the country-level data on child economic activity and
            child labor to country-level indicators of the state of
            economic and social development in the same time period in
            order to (1) ascertain if cross-country correlations
            previously identified in the literature are found in the
            data, and (2) illumine other possible correlations that may
            exist. As part of this exercise, the authors examine one
            important relationship that has thus far not been directly
            investigated in the literature, namely, the cross-country
            correlation between child labor, agriculture, and poverty.
The impact of remittances on labor
            supply : the case of Jamaica
A puzzle in the recently stagnated
            economy of Jamaica is that high rates of unemployment have
            persisted even when real wages have been increasing. This
            paper examines aspects of the labor supply in an effort to
            understand why high rates of unemployment have existed with
            increasing real wages. This is a sign of a badly functioning
            labor market. The cross-sectional analysis suggests that
            remittances have some impact on labor supply, especially on
            labor market participation. The pseudo panel data analysis
            also confirms that remittances have a strong impact on labor
            participation but not on weekly working hours. Households
            with remittance income have a higher reservation wage and
            have reduced the supply of labor by moving out of the labor force.
The impact of private provision of
            public education : empirical evidence from Bogota's
            concession schools
In 1999 the city of Bogota, Colombia
            launched the concession school program designed to broaden
            the coverage and quality of basic education. It consists of
            a contract between a group of private schools and the public
            educational system such that private agents provide
            education for low-income students. This paper tests three
            main hypotheses concerning the impact of concessions on the
            quality of education: first, dropout rates are lower in
            concession schools than in similar public schools; second,
            other public schools nearby the concession schools have
            lower dropout rates in comparison with other public schools
            outside the area of influence; and third, test scores from
            concession schools are higher than scores in similar public
            schools. The paper presents evidence in favor of the three
            hypotheses using propensity score and matching estimators.
The role of education quality for
            economic growth
The role of improved schooling, a
            central part of most development strategies, has become
            controversial because expansion of school attainment has not
            guaranteed improved economic conditions. This paper reviews
            the role of education in promoting economic well-being,
            focusing on the role of educational quality. It concludes
            that there is strong evidence that the cognitive skills of
            the population-rather than mere school attainment-are
            powerfully related to individual earnings, to the
            distribution of income, and to economic growth. New
            empirical results show the importance of both minimal and
            high-level skills, the complementarity of skills and the
            quality of economic institutions, and the robustness of the
            relationship between skills and growth. International
            comparisons incorporating expanded data on cognitive skills
            reveal much larger skill deficits in developing countries
            than generally derived from just school enrollment and
            attainment. The magnitude of change needed makes it clear
            that closing the economic gap with industrial countries will
            require major structural changes in schooling institutions.