rafmacalaba/datause-encoder-data huggingface dataset:
**Figure 2. Public Sector Reforms as a Prerequisite for Development Policy Loans, 1990** − **2011**

<!-- Start of picture text --> 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011<br>PSM prior actions Non-PSM prior actions<br>100<br>80<br>60<br>40<br>Share of PSM prior actions in total prior actions<br>20<br>0<br><!-- End of picture text --> _Source:_ World Bank DPL Prior Actions Database.

_Note_ : “Prior actions” as reported here comprise both “prior actions” and “prior actions for future tranches,” drawing on the DPL Prior Actions database as available on the World Bank’s Web site. Consistent with the definition of PSM projects employed in this review, prior actions were identified as “PSM prior actions” if they were coded with theme codes 25 to 30 or sector codes “BC,” “BH,” or “BZ.” But large aid flows can also undermine PSM project performance. First, it may be wrong to assume that aid dependence necessarily strengthens donor bargaining power. If politicians in aid-dependent countries can expect that aid will continue flowing regardless of what they do, the threat of cutting aid loses credibility. Despite poor reform progress, donors may hesitate to cut aid exactly because the client country is needy. Or disparate, often competing donors may fail to coordinate in cutting aid. Second, even where implemented, reforms may not have lasting value; as Andrews (2009) argues, donor pressures may motivate governments to “mimic” the institutions donors would like to see—rather than actually improving government performance.<sup>11</sup> Meanwhile, aid rents, similar to resource rents, can weaken the incentive to reform because they undermine government dependence on citizens’ tax payments—and, thus, government accountability.

# **3.3 Country Context: Programmatic Political Parties**

There are strong arguments that Bank PSM projects are more likely to succeed in countries with programmatic political parties (research question 1). First, programmatic parties provide a vehicle for voters to hold politicians to account when an administration fails to deliver. Second, they can help solve politicians’ collective action problems (see Aldrich 1995), providing the discipline that encourages them

> 11 Andrews predicts that PSM reforms driven by “isomorphic mimicry” are likely to affect the visible, central, and de jure aspects of PSM institutions that are easy to observe by donors—even as they fail to affect the invisible, decentralized, and de facto aspects that may matter most to citizens.

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Hence this paper both contributes new empirical results from these so-far rarely utilized household surveys,<sup>5</sup> and presents a new angle regarding the causes of inequality and potential consequences of gender and/or race/ethnicity-related anti-discrimination policy measures.

Below we first present the baseline inequality measures for the four countries. We also present conventional Blinder-Oaxaca decompositions to indicate how much of earnings differences by race/ethnicity/gender is related to differences in characteristics between the groups and how much is related to differences in treatment.<sup>6</sup> We then describe and implement an extension to the Blinder-Oaxaca methodology, developed by Bourguignon _et al._ (1998) and implemented in Bourguignon _et al._ (2002). Herein we consider how various characteristics are generated and simulate these processes before simulating or decomposing earnings. For example, under the assumption that educational attainment is generated differently by race/ethnicity/gender group, we allow education to be generated for the worse-off group by the process associated with the better-off group, and then use predicted education in place of actual education in simulating earnings for the worse-off group. To our knowledge, we are the first to use this technique to consider within-country differences between race/ethnicity/gender groups.<sup>7</sup> We compare our actual earnings inequality measures to inequality measures calculated using the simulated earnings data for the worse-off group. We show that this simulation has little effect on overall inequality in the majority of cases. Instead, within-group inequality persists and drives the over-all inequality. We show that this finding holds up for per capita household earnings measures as well as for individual earnings, so that household structure, and the income sharing that may occur within households, does not mitigate this result. In the conclusion, we consider what implications our findings have regarding the efficacy of antidiscrimination policy and affirmative action policies in reducing overall earnings inequality.

> 5 See Székely and Hilgert (2007) for a discussion of the problems with using LAC household surveys.

> 6 This is the standard methodology used to understand wage differentials; when applied to LAC data, studies typically find that the majority of the wage gap between either gender or racial categories is due to differences in characteristics—see Garcia-Aracil and Winter (2006) on Ecuador, Hall and Patrinos (2006) for a range of countries, Patrinos (1997) on Guatemala, MacIsaac and Patrinos (1995) on Peru.

> 7 This statement holds as of the date of our original working paper, August 2003.

2
countries while movement along the “intensive margin” seems to be mayor driver of exports in developing countries (Besedes and Prusa 2007, Felbermayr and Kohler 2006, Helpman, Melitz, and Rubinstein 2007, Hummels and Klenow 2005, Romalis 2007, Schott 2004, Venables and Evenett 2002).

# 8 Conclusions

In this paper, we analyze the micro-dynamics and decisions of multi-product exporters at the most disaggregated level. Relying on a unique dataset covering most of Mexican industrial output and thousands of products, we study the responses and behaviors of multi-product exporters in a period of profound reforms and integration with the US economy. We present a set of novel stylised facts that we hope will help to move forward the theoretical efforts to understand how multi-product heterogenous firms respond to reforms and globalization.

Our principal results can be summarized as follows. First, we confirm the existence of a substantial degree of churning at product level in response to declining trade costs. Second, the evidence we present support the hypothesis that the decision to expand and drop products is not random as firms appear to focus around their “core products”. Third, we observe that new exporters tend to “start small” in terms of both values and number of exported products. Fourth, we show that even if extensive margin played a role in determining the Mexican export boom, intensive margin was the main driver of this boom. Finally, we illustrate that introduction of new export variety is preceded by a surge in investment.

These findings confirm the importance of the current efforts to “unbundle” the firm and move from firm-level analysis to the more disaggregated firm-product level. They may also be useful to policy makers who try to devise effective policies aimed at stimulating export response in developing countries. Finally in line with the recent literature initiated by Hausmann, Hwang, and Rodrik (2007) stressing the link between export structure and growth, we think that these findings, by contributing to understand more in details the micro-dynamics underpinning export responses, can help to understand more in general the determinants of growth.

32
exchange rate appreciated, often dramatically following stabilization policies that fixed the nominal exchange rate and liberalized capital markets.<sup>1</sup> Loosely extending Calvo and Vegh’s (1994) typology, two types of explanations have emerged, those relying on backward-looking price and wage behavior (Rodriguez 1982, Dornbusch 1982, Edward and Cox- Edwards 1987, Calvo and Vegh 1994)<sup>2</sup> and those focusing on “real” phenomena arising from credibility problems (Calvo 1986, Calvo and Vegh 1993) wealth effects do either to falling inflation or expected productivity effects (Helpman and Razin 1987 Schmidt Hebbel 1988, Conley and Maloney 1995) or removing inflationary distortions (De Gregorio, Guidotti, and Vegh 1998, Roldos 1997, Uribe 1997). Central to the Chilean post-mortems of the early 1980s, this dichotomy between “inertial” (Dornbusch and Werner 1995, Edwards 1996) vs “real” (Carstens and Gil-Diaz 1996) explanations remained salient in the discussions of the Mexican peso appreciation of the early 1990s, and Rebelo and Vegh’s (1995) efforts to nest and evaluate competing theories of post-stabilization behavior.

The nature of the labor market data we work with here offers the potential to inform these debates. First, the informal self-employed are concentrated in nontradables: Argentina 87%, Brazil 92%, Chile 86%, Colombia 87%, Mexico 83%. Second, almost by definition, their incomes are less affected by official regulations. These two characteristics make them ideal for analyzing exchange rate movements in the context of a small economy model, and the relative movement of relative informal/formal wages and sectors sizes and help identify the presence of formal sector rigidities, and inertial forces in exchange rate movements.

As an example, returning to the canonical Chilean case, figure 1, shows that in the 1960s and early 1970s, relative sector sizes and relative incomes moved oppositely, suggesting that under the progressive Christian Democratic government and later under the Socialist government of Salvador Allende, nominal rigidities in formal sector wage

> 1 The exchange rate is defined as the price of non-tradables relative to tradables Pn/Pt  which can be shown to map into the more standard exchange rate adjusted ratio of price indices EP*/P under most conditions. The real exchange rates for Argentina, Brazil, Colombia and Mexico are displayed in Figure 1 in the Appendix A.

> 2 It should be noted that  Calvo and Vegh  show that backward looking price behavior can explain the stylized facts only if the intra-temporal  elasticity of substitution between traded and non traded goods is smaller than the intertemporal rate elasticity of substitution which they find implausible.

3
Policy Research Working Paper 10022

# **Abstract**

Understanding the conditions under which displaced persons become actively engaged in social and political life is critical to building durable solutions to displacement. To do so, this paper analyzes original surveys that sample IDPs and similarly at-risk but not displaced populations in Iraq (2019), the Philippines (2010), and Uganda (2007 and 2010). Variation in the type and degree of engagement across contexts suggest that the relationship between displacement and empowerment is mediated by contextual factors. To better understand the mechanisms and grapple with the non-random nature of displacement, the analysis explores temporal variation in Uganda, where the relationships change over time within the same case, and use matching models in the Philippines and Iraq to explore whether differences in the displacement experience (urban v. rural, camp based versus non-camp-based displacement) influence levels of engagement. Displacement experience is positively associated with some manifestations of empowerment compared to control groups, but inconsistently across contexts. Finally, the paper explores heterogeneity among IDPs within cases based on the context of their dis-placement, finding a consistent negative association between camp-based displacement and perceptions of empowerment. The results have important implications for humanitarian policy in contexts of forced displacement.

This paper is a product of the Social Sustainability and Inclusion Global Practice. 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://www.worldbank.org/prwp. The authors may be contacted at pvinck@hsph.harvard.edu.

_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
Finding that gold mining leads to the emergence of urban-like activity does not, by itself, guarantee that the embryonic town will survive once the gold deposits are exhausted. There are indeed many examples of towns that were abandoned in this manner – so called ghost towns. The critical test of whether proto-urbanization is taking place due to gold mining is whether the embryonic town survives – and thrives – after gold mining stops. Only then can we conclude that gold mining can be a catalyst for town formation.

# **3 Data**

To test our theoretical predictions, we select a country with rapid population and economic growth, Ghana, and a time-period during which international gold prices increased and much entry took place in gold mining, i.e., the period between 2000 and 2010. We start by briefly describing the gold mining sector in Ghana. We then detail the data sources we use to study proto-urbanization.

## **3.1 Gold Mining in Ghana**

During colonial times, Ghana was known as the Gold Coast. Gold mining dates back a long time in the pre-colonial era. The Ashanti kingdom, ruled from its historic capital Kumasi, controlled mining activities in many parts of the kingdom. At the end of the 19th century, French and British entrepreneurs obtained concessions and introduced modern, imported machinery to the industry (Taylor 2006). Mining was largely nationalized after independence until liberalization in the early 1990s. In the last two decades, the Ghanaian government has gradually reduced its stake in existing mining companies, and has awarded concessions to new prospective entrants, mostly foreign companies.

Gold mining is heavily concentrated in the southwest of the country, mostly between the cities of Sekondi/Takoradi on the coast, and Kumasi in the interior of the country. The maps in Figure 1 and Figure 2 show the spatial distribution of mines and cities in 2000 and 2010, respectively. The location of mines is determined by the geology. The vast majority of open pit and underground mines lie along the Ashanti Gold Belt, a geological formation that stretches from Sekondi/Takoradi to the East of Kumasi (Carranza _et al._ 2009). Other mines are located 8
potentially rich relationship between the operation of the financial system and the intergenerational persistence of relative incomes.

# **3 Evidence**

The empirical evidence on finance and inequality is highly varied, including the use of computable general equilibrium models, regressions based on natural experiments, microeconomic analyses using firm- and household-level surveys, as well as cross-country regressions. Researchers focus on both the microeconomic mechanisms linking finance and economic opportunity, and macroeconomic assessments of an economy’s distribution of income. For example, while some studies investigate the impact of finance on savings behavior, schooling, and investment returns, others take a more reduced-form approach and assess the association between finance and the Gini coefficient of income inequality. Studies also differ in the methodologies employed, the extent to which they identify causal relationships, and the empirical proxies they use to capture inequality and access to finance.

Three tentative conclusions emerge from the evidence. First, the indirect effects of finance on economic opportunity matters. While the bulk of theoretical and empirical research emphasizes the direct use of financial services by the poor, this is not the only channel linking finance and opportunity. Second, each methodological approach has weaknesses. Thus, results that emerge from many different econometric strategies with imperfectly correlated statistical and data problems should be greeted with greater confidence than findings based on only one approach. Finally, although theory provides ambiguous predictions about the finance-inequality relationship, the evidence suggests that better functioning financial systems disproportionately help the poor.

# **_3.1 Impact on Households_**

# **3.1.1 General equilibrium models**

General equilibrium models represent a natural bridge between theory and evidence. Notably, Robert Townsend, with various co-authors, develops, estimates, and calibrates general equilibrium models to analyze the impact of financial development on growth, income inequality, and household welfare, typically drawing on surveys of Thai households, stretching 20
_(iv) Weakest._ Dwellings with the weakest foundations – starting with mud, followed by wood, then cement, and finally pillars – see their market values set equal to zero, until matching the proportion of houses destroyed in the locality. The random assignment described above is used for the last group of dwellings affected. The last allocation rule is the preferred one, with microsimulations based on the other three rules used to assess the robustness of the results. The allocation allows estimating the damage 0h 1h 0 experienced by each individual household, while the subsequent steps in the ii h iterative process described above predict the loss 1 0 1�. For ease of interpretation, these �KK −KK �pp ii ii two components of the cost from the disaster in its aftermath can be expressed as a share of total KK �pp −pp household expenditure, or as a fraction of the country’s GDP (table 2).

**Table 2: Aggregate disaster cost resulting from the microsimulations**

||Damage|Loss|Total|
|---|---|---|---|
|Percent of household expenditure|31.4|7.3|38.7|
|Percent of GDP|22.8|6.5|29.3|

The overall cost of the Gorkha earthquakes, as estimated using approach proposed in this paper, was very significant: almost 40 percent of annual household expenditures, and close to 30 percent of the country’s GDP. While damage accounted for the largest share of this cost, losses still represented about a fifth of the total, suggesting that a narrow focus on physical destruction may lead to substantially underestimate the cost of disasters. Results are similar when relying on the other three allocation rules for the destruction of housing at the local level.

The proposed approach also allows to generate geographically disaggregated estimates of disaster costs. The results show that they are very heavily concentrated in a limited number of districts, especially those around the epicenters, where almost all housing was destroyed (figure 3). In relative terms, losses matter less in these locations, where only a few dwellings were left standing. On the other hand, losses are significant in the Kathmandu valley, which is further away from the epicenters. This varying mix of damages and losses provides further evidence that narrowly focusing on physical destruction can be misleading.

# **9. Comparison with standard estimates**

For the 14 districts most affected by the disaster, the cost assessment obtained using the approach proposed in this paper can be compared to that estimated from the PDNA. Overall, the results are within the same order of magnitude. However, discrepancies are significant at the district level. Clearly, they do not arise from the physical destruction of housing, given that the approach used in this paper simply allocates that physical destruction across households, without modifying the total. They rather stem from the way dwellings are valued, both before and after the disaster.

14
Wagstaff, Adam, Caryn Bredenkamp, and Leander Buisman. 2014. “Progress on Global Health Goals: Are the Poor Being Left Behind?” _World Bank Research Observer_ 29(2): 137-162.

Wagstaff, Adam and Naoko Watanabe. 2000. “Socioeconomic Inequalities in Child Malnutrition in the Developing World.” Policy Research Working Paper 2434, World Bank.

Walker, Susan, Theodore Wachs, Julie Gardner, Betsy Lozoff, Gail Wasserman, Ernesto Pollitt, and Julie Carter. 2007. “Child Development: Risk Factors for Adverse Outcomes in Developing Countries.” _Lancet_ 369 (9556): 145–57.

World Bank. 2012. _World Development Report 2012: Gender Equality and Development._ Washington, DC Zere, Eyob, and Diane McIntyre. 2003. “Inequities in Under-five Child Malnutrition in South Africa.” _International Journal for Equity in Health_ 2 (1): 1.

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important concern by the highest share of the respondents (30 percent, Figure 5). “Unpredictable and extreme weather that harms agricultural production” was third on both lists.<sup>14</sup>

**Figure 5: Tajikistan: Potential climate change impacts of greatest concern (% respondents)**

- (a) Cited as potential impact of concern (percentage of total respondents)

<!-- Start of picture text --> Increase in natural disasters (e.g. floods, fires, mudslides, etc.) 78<br>Extreme hot/cold seasons that are harmful for health 69<br>Unpredictable and extreme weather that harms agricultural<br>59<br>production<br>Decline in fresh water availability for drinking 53<br>Decline in fresh water availability for irrigation 44<br>0 20 40 60 80<br>Percent of respondents<br><!-- End of picture text -->

- (b) Cited as potential impact of greatest concern (totals sum to 100 percent)

<!-- Start of picture text --> 7<br>30 Extreme hot/cold seasons that are harmful for health<br>18<br>Increase in natural disasters (e.g. floods, fires,<br>mudslides, etc.)<br>Unpredictable and extreme weather that harms<br>agricultural production<br>Decline in fresh water availability for drinking<br>Decline in fresh water availability for irrigation<br>20<br>25<br><!-- End of picture text -->

**Source:** Authors calculations based on P-LITS 2 data.

> 14 Respondents reporting themselves as being fairly/very well informed about the main consequences of CC were more likely to select natural disasters and increased damage to agriculture (and less likely to select less water for drinking and irrigation) compared to those reporting themselves as not at all/not very well informed about the main consequences of CC

11
45 24. J. Mincer "Unemployment Effects of Minimum Wages," Jogurnl o Political Economy, 84:4, part. 2 (1976); See also G. Starr, Minimnum Wage Eiz.ng. Geneva, Switzerland: ILO, 1981; S. Rottenberg, The Economics of Minimum Wages, Washington, DC: American Enterprise Institute, 1981. Simon Rotten berg observed that "the price of self-employed labor can be lower than the price of waged employed labor," due to minimum wage legislation, trade unions, or community conscience, with the consequence that "it will frequently be worth while to hire, in self-employed ways, persons who will not be hired for wages." See "note on Economic Progress arnd Occupation Distribution," Review of Economics and Statistics, 1953, _pp._ 168-170. Thus, Rottenberg explains why the service sector (i.e. self-employed) is relatively larger in low income countries than expected on the basis of Clark's empirical generalizations (See Note 4).

# 25. T. P. Schultz (Note 2.)