rafmacalaba/datause-encoder-data huggingface dataset:
# **2. The Rise of Private Participation in Transport**

The rise of PPPs in transport has its roots in broader worldwide privatization initiatives during the 1990s. While the catalyzer may have been the dramatic changes introduced by the Thatcher administration in the UK, the bulk of the transactions actually took place in developing countries. Figure 1 provides a snapshot of the dramatic increase in the involvement of the private sector in the development and funding of public facilities and services across infrastructure activities during the 1990s. It shows that transport benefited from a relatively small share of the private commitments to the sector (about 15% of the US$1000 billion or so committed between 1990 and 2005 to all infrastructure sectors). It is also a relatively small share of the investment needs of the sector since the commitments made for this 15 years period represent very roughly the investment needed in 1 year in transport in the developing world.

<!-- Start of picture text --> Figure 1 Investment commitments in infrastructure projects with private<br>participation in developing countries by sector, 1990-2005<br>2005 US$ billion<br>140<br>120 A TABLE?FIGURE ON THE EVOLUTI ON OVERTIME<br>Total<br>100<br>80<br>Telecom<br>60<br>40<br>Energy<br>20 Transport<br>0 Water<br>1990 1995 2000 2001 2002 2003 2004 2005<br>Source: The World Bank and PPIAF, PPI Project database.<br><!-- End of picture text --> While the amounts do not represent a huge share of the investment needs of the sector, they are very significant. On average, these deals represent about US$10 billion annually in the developing world alone and about twice as much when developed countries are considered. This is about 55 projects a year across transport sub-sectors in developing countries alone. There is no strictly comparable data for developed countries but most estimates turn around 20 large projects a year on average over the last 20 years, with a growing number of projects in the last 5 years or so.

4
Comparable patterns are also observed in the investment structure of mutual funds in LAC countries.<sup>23</sup> Funds invest on average a large fraction of their portfolios in government bonds and money market instruments. Like trends in the pension fund industry, funds have been gradually shifting their portfolios toward equity investments (figure 22). In Brazil, for example, the share of public sector bonds declined from 73 percent to 48 percent between 2003–04 and 2005–09 on average. In Chile, this fraction declined from 14 percent to 6 percent, although deposits are a stable and substantial share of its portfolio, 63 percent on average over the same period. This composition of available mutual funds in the region raises the question of whether financial intermediaries or households themselves are responsible for these patterns. For instance, bond and money market funds account for 70 percent of existing mutual funds in LAC7 countries. In contrast, in G-7 and other developed countries, these funds correspond to about 35 percent of all funds. In those countries, equity funds are much more prominent, accounting for between 41 percent and 48 percent of existing funds, whereas in LAC7 countries equity funds typically account for 17 percent of available mutual funds, on average.

These trends suggest that institutional investors have not contributed to the development of local markets as much as expected in the LAC region. At the same time, one has to consider that relatively small and illiquid domestic markets can be viewed as unattractive by these investors, particularly by mutual funds that are subject to sudden withdrawals by clients. In other words, asset managers’ incentives can explain, at least in part, why large institutional investors invest the bulk of their portfolios in government bonds and deposits. This current trap, where investors avoid local corporate capital markets and the markets remain underdeveloped, suggests that there is a great scope for policy actions that channel available funds to foster local markets.

# **8. Final Thoughts: The Road Ahead**

This paper presents a systematic and detailed account of where emerging economies and Latin America in particular stand with respect to financial development. The evidence overall suggests that these countries are in a substantially better position than in the past, even along such dimensions as susceptibility to volatility and crises due to currency and maturity mismatches. In general, domestic financial systems have continued developing since the 1990s, at the same time that standard measures indicate that international financial integration

> 23 Data availability prevents us from providing a broader analysis.

28
school’s province; and whether the student was in a magnet school, an accelerated class in a regular public school, a regular public school class, or a private school. Detailed questions also were asked about the parents of the respondent, including educational attainment, primary industry of employment, occupation, and technical and administrative status.

# **3.  Education Disruptions and the Great Proletarian Cultural Revolution**

In 1966, Mao Zedong initiated a radical political campaign that incited millions of Chinese citizens to revolutionary struggle against corrupt cadres deemed to have betrayed China’s Communist revolution. During this tumultuous period, the system of formal education in China’s cities was thrown into chaos, while rural schooling was less affected (Meng and Gregory, 2002b). Urban elementary and secondary education was disrupted for at least six years, and for much of the period from 1966 to 1968 schools in many urban areas were closed altogether. Most universities were closed for six years. Upon re-opening, family political class background status served as an important eligibility criteria for college admission. Educational disruptions were worse for children with parents who had a bad political class background, and even those with a “middle” background could have been constrained by quotas favoring children of “poor farmers”, “workers” and those with “revolutionary” backgrounds, especially at higher levels of education (Pepper, 1996). Universities did not return to merit-based enrollment of students until 1977.

The shock to post-secondary education is evident in Figure 1, which plots administrative data on enrollments in institutions of higher education by year. The figure shows that there were no new entrants to universities from 1967 through 1970, and a sharp drop in total enrollments during the Cultural Revolution. These disruptions are not nearly as evident when we plot the share of individuals with higher education degrees by birth cohort 8
activities are segmented by gender in subsistence economies. Finally, dummy variables are used to capture imperfections in the oxen market and its e¤ect on farm outputs.

In rainfed agriculture, the in‡uence of negative events on farm income depends on land size and ownership status. Land is, however, a state property in the Ethiopian context and farmers have only usufruct rights. As a result, this variable becomes exogenous to the behavior of farmers and hence their investment and savings decision do not directly in‡uence landholdings. But Dercon and Krishnan (2000) found out that land is highly correlated with other measures of wealth. Based on this fact they hypothesize that land could be used as a good proxy for liquidity constraints. This study closely follows their approach. Speci...cally, the indices of self reported shocks are interacted with dummy variables indicating whether the household is in the lower or upper half of the per capita distribution of land. Interaction of the shock variables with the per capita distribution of land also addresses the fact that returns to land depend on environmental factors.

The time-varying village dummies capture seasonality and community-speci...c e¤ects. These variables account for social and infrastructural di¤erences that a¤ect the marketability of livestock in the respective villages. Besides, they capture the e¤ect of village level shocks, and hence there is no need to look for other exogenous variables to proxy village average unanticipated income component in the estimation.

The model presented in equations (13) and (14) shows that net sales of livestock respond only to large changes in the exogenous variables because of transactions costs. As a result, the usual ...xed and random e¤ects panel data methods yield biased and inconsistent estimators. One approach to deal with this problem is the Maximum Likelihood Estimation (MLE) with an appropriate likelihood function to obtain consistent and asymptotically e¢ cient estimators. A likelihood function is, therefore, constructed assuming a random error component model where The individual speci...c random component, vi, controls household speci...c heterogeneity and, in turn, the demand for precautionary savings. The likelihood function conditional on vi, derived in Appendix A.2, can thus be written as 16
53

# **Annex 3: Growth of Gross Debt as Share of GSDP/GDP in the Pre- and Post-FRL Periods**

## **Table A3.1: Australia**

|VIII.|IX.<br>|Pre-FRL<br>|Post-FRL|
|---|---|---|---|
|States|Date|_(Dt-1)/GSDP - (Dt-5)/GSDP_<br>|_(Dt+5)/GSDP - (Dt)/GSDP_|
|**Western Australia**|2000|-2.20%|-2.48%|
|**Victoria**|2000|-9.93%|-0.87%|
|**Queensland**|1999|-2.50%|-1.40%|
|**Northern Territory**|2001|-4.69%|-5.39%|
|**New South Wales**|2005|-1.69%|-0.32%|

Note: To eliminate the impact of the recent financial crisis on our data set, our data stop at the first half of 2008.

Source: Australia Bureau of Statistics

## **Table A3.2: Brazil**

|||Pre-FRL<br>|Post-FRL|
|---|---|---|---|
||Date|_(Dt-1)/GDP - (Dt-5)/GDP_<br>|_(Dt+5)/GDP - (Dt)/GDP_|
|**Sovereign Debt**|2000|15.13%|2.39%|
|**Subsovereign Debt**||4.99%|1.31%|

Source: Instituto de Pesquisa Econômica Aplicada (IPEA)

## **Table A3.3: Canada**

|||<br>Pre-FRL<br> <br>|Post-FRL<br>|
|---|---|---|---|
|Provinces|Date|<br>_(Dt-1)/GSDP - (Dt-5)/GSDP_|_(Dt+5)/GDP - (Dt)/GSDP_|
|**Alberta**|1999|<br>-13.16%|-10.65%|
|**British Columbia**|2000|12.82%|-5.04%|
|**Nova Scotia**|2000|2.41%|-12.48%|
|**Ontario**|2004|-3.97%|-2.74%|
|**Newfoundland and Labrador**|2004|-23.81%|-26.54%|
|**New Brunswick**|2006|-6.04%|-0.26%|

Notes: 1) Pre-FRL data of Alberta only date back 4 years before the enactment of FRL. 2) To eliminate the impact of the recent financial crisis on our data set, our data stop at first half of 2008.

Source: Statistics Canada.
# **1. Introduction**

Concerns about land fragmentation, i.e., the fact that the cultivators’ land is distributed among many parcels or fragments, often of very small size, as a constraint to agricultural productivity have long been prominent in the policy debate, especially in land-scarce environments. Practices of equal inheritance among siblings or kin in the presence of high population growth or land reforms that awarded many parcels of different types imply that households may be involuntarily endowed with large numbers of parcels and fragmented holdings. Illiquid land markets and high transaction costs may then prevent them from consolidating fragments to attain larger holdings and adopt ‘modern’ practices of cultivation. Thus, it is often argued that public action to solve the underlying collective action problems and help move towards a pattern of land holding that is more viable economically would be desirable.

This narrative seems at odds with evidence in the literature from many non-mechanized settings where having a large number of diverse parcels may be used to exploit micro-variation in soil quality or climate and thus minimize exposure to production risk. As long as labor costs are modest or work is performed by family workers whose shadow wage may be below the market wage, the need to physically travel between spatially dispersed parcels may also be modest. This could mean that fragmentation brings benefits (due to risk diversification) as well as costs (due to the higher labor requirements for moving between parcels) and that the balance between these will depend on the specific environment, in particular the opportunity cost of labor, the level and potential for mechanization, levels of production risk, and availability of insurance. And, while fragmentation may limit the scope for mechanization, especially if it results in parcel sizes (or shapes) below the minimum at which use of mechanical equipment such as large ploughs or harvesters makes sense, prevailing factor price ratios may imply that this is not an economically desirable option in any event.

The fact that consolidation has been widely promoted even in low-wage environments suggests that empirical investigation paying greater attention to both costs and potential benefits from fragmentation is desirable. We use Rwandan data to contribute to this discourse. Information on whether or not production on a parcel was affected by exogenous shocks such as pest or insect attacks, droughts, or floods is used to explore for presence of risk diversification benefits associated with a more fragmented pattern of land holding. GPS information on altitude and location for each of a household’s parcels, projected on a detailed digital elevation model (DEM) of the country, allows us to compute travel times between parcels or the homestead taking account of differences in altitude which, in Rwanda’s hilly terrain, are not negligible. Travel time between all parcels thus calculated as well as different measures of fragmentation is included in a yield or frontier production function to explore impacts of fragmentation on output and the efficiency of agricultural production.

2
WPS3745

# **Earnings Mobility and Measurement Error:** ∗ **A Pseudo-Panel Approach**

Francisca Antman Department of Economics, Stanford University

## David J. Mckenzie†

Development Research Group, World Bank

### **Abstract**

The degree of mobility in incomes is often seen as an important measure of the equality of opportunity in a society and of the flexibility and freedom of its labor market. However, estimation of mobility using panel data is biased by the presence of measurement error and non-random attrition from the panel. This paper shows that dynamic pseudo-panel methods can be used to consistently estimate measures of absolute and conditional mobility in the presence of nonclassical measurement errors. These methods are applied to data on earnings from a Mexican quarterly rotating panel. Absolute mobility in earnings is found to be very low in Mexico, suggesting that the high level of inequality found in the cross-section will persist over time. However, the paper finds conditional mobility to be high, so that households are able to recover quickly from earnings shocks. These findings suggest a role for policies which address underlying inequalities in earnings opportunities.

JEL classification: O12, D31, C81 Keywords: income mobility, dynamic pseudo panel; measurement error.

World Bank Policy Research Working Paper 3745, October 2005 _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._

> ∗ We thank the Stanford Center for International Development (SCID) for research funding; and Aart Kraay and participants at the PACDEC conference for helpful comments.

> †Email: dmckenzie@worldbank.org
While the software is free to download at `http://wits.worldbank.org/witsweb/default.aspx` , access to some or all of the databases may be limited or fee-based for some users. However, the two databases used in this paper—COMTRADE and TRAINS—can be freely accessed through the home pages of the publishing agencies, although the author has not attempted downloading the required data in this way and therefore cannot guarantee their on-line availability.

The GDP and population data<sup>47</sup> were obtained from the World Development Indicators database of the World Bank. This database was accessed by the author through an internal World Bank server, but it is also available on CD-ROM at subscribing libraries. Alternatively, the CD-ROM can be purchased from the World Bank bookstore, either in person or on-line. If the user queries the data by code rather than by name, the corresponding codes for GDP and population are _NY.GDP.MKTP.CD_ and _SP.POP.TOTL_ .

The CEPII distance and dummy variable data ( `dist_cepii.xls` ) is freely available for download at `http://www.cepii.fr/anglaisgraph/bdd/distances.htm` .

# **F.2 Data transformation**

This section provides the STATA code used to create the final dataset from the raw data components of the previous section.

- `Datamanage file for the gravity model in Essay 1`

```
*Fileconsistsof3mainparts
*Part1--preparethetradeandtariffdatabase
*Part2--addauxillaryvariables
```

- `Part 3 -- define variables for regression`

``` clear setmemory500m setmoreoff ``` ```
*****Part1**********************************************************************************
``` ```
*Transformtariffdata
insheetusingV:\Trade\tariff.txt,clear ``` ``` dropreporter renamecountryalphacodepartner1 collapsetariff,by(partner1trfline)fast sortpartner1trfline saveV:\Trade\temp,replace ```

- `Transform trade data`

- `insheet using V:\Trade\trade.txt, clear`

> 47The population data were used to calculate GDP per capita.

76
Pollc,Pnnlng, and Research Mcoonomlc Adjustment and Growth If develop;ng countries follow the same paths industrialized countries have followed, saving for retirement will initially become more important Ps the population growth rate declines.

years of high rep ,ductive rates reaches adulthood, the proportion of working-age population rises sharply. Then, as baby boomers retire and die off, it declines toward the steady-state level.

To calculate the potential importance of lifecycle saving (saving for retirement), Webb and Zia set up a simulation model that translates demographic projections into savings-rate projections. Modeling explicitly the behavior of each cohort of households separates the effects of changing population shares of children and retirees. These shares behave differently and have different effects on saving as the population growth rate changes.

Webb and Zia simulated aggregate rates for life-cycle savings for Brazil, China, Korea, Mexico, Nigeria, Pakistan, and Turkey.

The savings rates increase ' *r 6 percentage points when the last baby boomers enter the work force and begin to save after their children leave home. The effect on life-cycle saving is dramatic; the effect on total savings rates, which are often three or four times as high, is not.

Baseline World Bank population projections assume that by the middle of the twenty-first century, if not sooner, the net reproductive rate of women in every country will decline to 1.0, a level that will cventually lead to a stable population. As the last cohort of those bom in the Simulated life-cycle savings rates peak at an absolute 10 percent or less in all cases. The pattems in these projections seem robust with regard to assumptions about productivity growth, interest rates, and age-specific participation in the labor forcc.

This paper is a product of the Macroeconomic Adjustment and Growth Division, Country Economics Department. Copies are avaiiable free from the World Bank, 1818 H Street NW, Washington DC 20433. Please contact Emily Khine, room N 1 1- 067, extension 61765 (27 pages with chains and tables) The PPR Working Paper Series disseminates the findings of work under way in the Bank's Policy, Planning, and Research I Complex. An objective of the series is to get these findings out quickly, even if presentations are less than fully polished. I The findings, interpretations, and conclusions in these papers do not necessarily represent official policy of the Bank.

|

Produced at the PPR Dissemination Center
Kwang-Ha (1981) concerning the Korean electric power industry, and by Jung Suh (1982) describing the Korean petrochemical industry. Hybrid Programing Models are not a specific model type but rather various apprraches for combining dIfierent model methodologies in a single framework or for constructing large-scale multi-commodity models. In particular, ai the modeling process has become more sophisticated, analysts have begun to borrow skills from one another, so that the methodologies which have emerged are more difficult to classify. A glance at several recent model anthologies such as Lev (1983), Lev et al. (1984) and Quirk et al. (1982) confirms the extent to which such integration has become widespread. This phenomenon has arisen not only because of the need to integrate economic and engineering considerations, but also because of the interrelationships that exist between the commodity sector and the maroeconomic performance of national economies. For example, it is not uncommon for the demand side of an energy model to be constructed econometrically, while the supply side might be principally engineering in character. In such cases the output of several different models might be needed to provide a comprehensive analyis of a particular energy problem.

The most comprehensive effort to develop a methodology for constructing hybrid models is the "combined" energy model approach of Hogan and Weyant (1983). A theoretical as well as a computational method is employed to reach equilibrium solutions with a combined set of models. Each set of the processes or submodels are plriced within an optimization framework with the inputs of each process being the outputs of others. AU processes are operated simultaneously to achieve the greatest value of some objective function. The framework is organized in a way that promotes a consistent theory, natural data organization, modular design, decentralized 16
earlier graphs. In column 2, we add a second crisis-2008 dummy to measure the impact of the early stage of the crisis. We find it also significant, but much lower in magnitude: the dummy for 2009 has a magnitude of 0.77, while dummy for 2008 has a magnitude of 0.25. This confirms our visual observation that the impact of the crisis was much more pronounced in 2009.

When we split the sample for high versus low and middle income countries (columns 3 and 4 report the sample of high income countries and columns 5 and 6 report the sample of low and middle income countries) we find that the magnitude of the trend variable is almost twice as large in the sample of high income countries. In other words, before the crisis hit, new firm creation was more dynamic in higher income countries. We also observe that the magnitude of the effect of the crisis is larger in the high income sample, i.e. the coefficient on the crisis-2009 dummy in the high income sample (column 4) is 1.2, which is about twice as large as the coefficient for the sample of low and middle income countries (column 6). Thus, higher income countries have suffered more pronounced declines (relative to trend) in new business registration as a result of the crisis.

# **_4.4 Heterogeneous Effects of the Crisis_**

Here we further investigate whether the crisis had a differential effect on different groups of countries. While above we observed the crisis to be more severe in higher income countries, here we investigate whether high income is a proxy for other important country characteristic. To do this we modify Model 3 by adding the interactions of the crisis variables with pre-crisis country level characteristics: Entry Densityit =  i  Crisist +  Crisist * Xi+  Trendt +  it (4) 19