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23
hidden information problems, it cannot overcome the moral hazard problem: whereas the efficient firms will work hard due to the high-incentives contract, the inefficient firms, due to the low incentives for the good-insurance contract, will not work as hard as when the government has perfect information.

The above analysis offer testable implications for MRS status and its associated incentive components, namely pay sensitivity. The theory implies that efficient firms will choose MRS with a high pay sensitivity, while inefficient ones will choose either a low pay sensitivity or not to adopt MRS. We call this the _self-selection hypothesis._ _Initernal Labor Incentives, Firm Size and Capital Intensity_ When the government decides if the manager should be granted the rights to control a firm's internal incentives, it will take into account the information structure underlying a firm's size and its capital intensity. Due to the inseparability of team members' productivity, employees enjoy a certain amount of discretion that may run counter to the objectives of the government.'<sup>7</sup> To align the incentives of the employees with its goals, the government can choose two types of incentives: allow managers to monitor (rewards based on input) or use pay sensitivity (rewards based on output).

The government would dictate that, employees in more capital-intensive SOEs be more closely monitored (i.e., depend more on managerial wage discretion) and less ma,tivated by pay sensitivity so that the danger of equipment abuse in the presence of pay sensitivity would be mitigated. Pay sensitivity based on current profitability can be especially harmful. That is, a firm's current profit can simply be boosted by underinvesting and over-utilizing machines which may reduce future capital stock (or its growth), therefore, hurting the long run objective of the government. Monitoring em;ployees in capital-intensive firms are more attuned to the longer term goals of the

> 17 Alchian, A. and Demsetz, H. "Production, Information Costs, and Economic Organization." _The American Economic Review,_ Vol. 62, No. 5 (December 1972).

11
meaning that in a few short years they have added nearly 180 jobs, more than tenfold the raw increase by firms that are born as micro.

We find that the relationship between size and productivity is positive and significant in our Ghana ES sample, and it is mostly driven by the upper part of the firm size distribution. While statistically significant, though, the magnitude of the correlation is small, implying a limited economic significance: that is, a 10 percent increase in labor productivity is only associated with a 0.4 percent higher firm size. When large firms are removed from the sample, the correlation between firm size and productivity is even weaker, albeit still significant. Quantile regression analysis confirms this finding and the wide dispersion of productivity across firm size. Overall, the analysis of the correlation between productivity and firm size in Ghana suggests an efficient allocation of labor among large firms but not across micro, small and medium firms: more productive firms employ more people and pay higher wages. However, the analysis points to potential market segmentations. Large firms demonstrate this relationship more clearly than do smaller firm categories. Larger firms are also those that started large at inception; though smaller firms do tend to grow at a faster rate, it is very unlikely that those small firms scale to a much larger size over their lifetime.

Findings suggest that there are potential productivity gains among MSMEs and that a vibrant firm life cycle is often missing among them. Tackling the challenges faced by MSMEs is critical to identify the potential policy initiatives to foster additional job creation through higher productivity, as well as promoting shared prosperity by focusing on disadvantaged sectors and regions. Desirable outcomes in policies would be to encourage growth opportunities through access to markets and improved links between small and young firms with large, mature and exporting firms. This in turn would encourage both technology transfers as well as opportunities to access larger markets for starters and small firms.

The paper is organized as follows: Section II gives a brief literature review; Section III discusses the data source and illustrates where the jobs in the formal private sector are by age of the firm, size, location and sector; section IV presents the results of determinants of firm size, job creation and average wage as well as discusses the correlation between firm size and productivity; and section V concludes.

# **II. Literature Review**

A keen interest has been given to the topic of what types of firms are the predominant employers in the private sector, and which types, in turn, are the main contributors to employment growth. Research attempting to answer the latter question has been fairly consistent: in general at lower income levels, small and medium-sized enterprises (SMEs) are the main employers (Ayyagari et al 2014; Aga et al 2015), while larger firms tend to account for the major share at higher income levels (Haltiwanger et al 2013).

5
# **Box 6: Summary of Findings of the Budgetary Dimension**

|**STRENGTHS**|**CHALLENGES**|
|---|---|
|The insurance system is the main funding source<br>of HIV/AIDS care services (both personal and<br>collective) for the whole population.|Lack of differentiated budgets for HIV/AIDS (funds<br>are part of broader SRH programs).<br>Lack of a system of financial accounting that|
|Despite its complexity, the mechanism is well<br>stipulated and regulated.|makes it possible to track the flow of money in<br>either the budgetary flow or the expenditure flow<br>for the HIV/AIDS response.|
|The sustainability of the HIV/AIDS response is||
|dependent upon the financial sustainability of the<br>insurance system.|It cannot be determined conclusively whether any<br>specific increase or reduction of funds is needed.|
|The existence of a single funding source avoids<br>problems of overlapping and/or under-financing.|It cannot be determined conclusively whether the<br>budgeted money is devoted to the expected<br>services,or expenditures match budgets.|

**Source:** Técnicas de Salud. 2011.

# **3. Service Delivery Dimension**

Efficiency in delivering services to respond to the HIV/AIDS epidemic is achieved when an adequate network of high-quality HIV/AIDS services—suited to meet the challenges of the epidemic—provides effective care to the entire population and, in particular, to the people with HIV/AIDS in Colombia. From the opposite angle, the HIV/AIDS response would be inefficient if: Prospective services in existing plans and programs have not been set up.

- Services are running, but lacking in quality (e.g., lack of adherence to clinical protocols).

- Services are running, but necessary components and resources are not adequately provided (e.g., staff unavailable, antiretroviral shortages).

- People do not have access to existing services.

# **_(a) Coverage_**

There is overall consensus that the level of coverage has increased in recent years and that the quality of services has improved. According to UNGASS 2010, coverage increased from 86.46% in 2007 to 89.36% in 2008. The number of persons affiliated with the contributive regime in 2008 was 17,234,265 (38.77% of the population); the subsidized regime had 22,485,211 affiliated persons (50.59% of the population).

43
DIALOGIC READING AND STORYBOOK EVALUATION IN KENYA 31

# **Future Directions**

Our storybook and parent education intervention is immediately applicable to about 4 million Luo-speakers in Kenya, and if translated to other mother tongues, could benefit up to 6 million children ages 2 to 6 years old in Kenya (Kenya National Bureau of Statistics, 2010). This intervention has the potential to reach approximately 40 million children in Sub-Saharan Africa (UNICEF, 2017), as a lack of children’s storybooks and high rates of caregiver illiteracy are not specific to Kenya, and our publishing partner is active in six countries in the region. The scripted and manualized modified dialogic reading training could be successfully delivered by trained laypersons, and being PowerPoint based, is easily portable. A larger scale study of the intervention with a longer follow-up could yield a definitive picture of the scalability and costeffectiveness of this intervention.

# **Conclusions**

Investing in children early in their development can have high returns over the life cycle, because early childhood is a period of rapid growth and development (Campbell et al., 2014). Our study suggests two important conclusions. First, a well-designed parent-child book-sharing training program can be implemented in a high-poverty setting with low literacy among caregivers, with positive effects on caregivers’ reading interactions with their children. Second, children as young as two years old are able to engage with and benefit from local-language, contextually-appropriate children’s storybooks. Simple storybooks are also engaging for older children, who appear to become very familiar with their content – suggesting regular and sustained use.
**<u>Annex Table 1. Defining a person as having a disability in the covered surveys</u>**

||_Type of_|||
|---|---|---|---|
|_Country and year _|_survey_|_Definition used in survey_|_Question from survey instrument_|
|Burundi 2000|MICS2|Presence of a physical handicap (missing upper<br>or lower limbs, or other body part).|<br>Specific wording not available.|
|Cambodia 1999|SES|Amputation of one or more limbs; inability to<br>use one or more limbs; blind; deaf; mute;<br>mentally disturbed; permanent disfigurement;<br>other.|“Does X have a disability?”; “If<br>‘yes’, what type of disability does<br>X have?” [with pre-coded<br>answers]; “What was the cause of<br>the disability?” [with pre-coded<br>answers].|
|Cambodia 2000|DHS|Physical impairment.|“Is there a person who usually lives<br>in your household who has any<br>type of physical impairment?”;<br>“Please give the name of each<br>individual who has a physical<br>impairment”; For each individual,<br>then ask: “Has X been physically<br>impaired since birth, or was X’s<br>impairment due to an accident?”<br>[with pre-coded answers].|
|Indonesia 2003|SES|Blind; deaf; mute; physical disability; mental<br>disability.|“Have a disability?”. If yes: “Type<br>of disability” [with pre-coded<br>answers]; “Cause of disability”<br>[with pre-coded answers].|
|Jamaica 1998|LSMS|Physical or mental disability.|“Is X physically or mentally<br>disabled?”|
|Jamaica 2000|LSMS|Sight; hearing; speech; physical (legs and<br>arms); multiple disability; mental retardation.|“Is X physically or mentally<br>disabled?” [with pre-coded answers<br>that include types of disabilities];<br>“If yes, when did this disability<br>occur?” [with pre-coded answers<br>such as “since birth,” “In child<br>under 5 years,” ...].|
|Mongolia 2000|MICS2|Difficulty seeing; difficulty hearing.|Specific wording not available.|
|Myanmar 2000|MICS2|Visual problem; hearing problem.|Specific wording not available.|
|Romania 1995|LSMS|Amputation of limb(s); Paralysis of limb(s);<br>ankylosis of limb(s) or column; physical<br>deformation(s); unilateral or bilateral cecity;<br>deaf; mute; epilepsy; mental retardation; menta<br>disorder.|l<br>“Do you suffer from a handicap?”;<br>If yes: “Type of handicap” [with<br>pre-coded answers].|
|Sierra Leone 2000|MICS2|Blindness; crippled; lost limbs; deafness; mute.|Specific wording not available.|

17
intensity as measured by tons per million birr of final demand. Kerosene, petrol and fertilizer are a second set of product groups with significant carbon intensity.

**Table 3.1: Carbon Intensity by Group of Products**

|**Product group**|**Carbon intensity (tone of CO2) per millions of birr of final**<br>**demand**|
|---|---|
|**Crops and vegetables**|21.7328|
|**Livestock**|1231.5690|
|**Forestry**|15.8061|
|**Firewood**|1937.6923|
|**Fishery**|9.6860|
|**Coal**|1725.8067|
|**Other mining**|6.4570|
|**Food processing**|183.0464|
|**Textile and leather**|43.9511|
|**Wood and paper products**|2.6070|
|**Fuels (petroleum other than Kerosene)**|196.6678|
|**Kerosene**|262.0189|
|**Chemicals**|7.3888|
|**Fertilizer**|183.9924|
|**Non-metal minerals**|23.8183|
|**Metals and metal products**|20.5485|
|**Machinery and Equipment**|2.1693|
|**Vehicles**|2.3315|
|**Other manufacturing**|4.3117|
|**Electricity**|33.4582|
|**Water**|36.4595|
|**Construction and real estate**|12.4329|
|**Trade**|2.7021|
|**Transport**|47.5188|
|**Hotel**|106.0756|
|**Communication**|11.4304|
|**Financial and business services**|0.6253|
|**Public**<br>**administration,**<br>**education,**<br>**health, and other services**|12.6620|

_Source: Authors’ calculation based on the 2010/11 Ethiopian Social Accounting Matrix_ 8
Roser, M. and others (2020). “Coronavirus Pandemic: Our World in Data,” Updated daily. https://ourworldindata.org/coronavirus Schellekens, P. and D. Sourrouille (2020). “The Unreal Dichotomy in COVID-19 Mortality between High-Income and Developing Countries,” The Brookings Institution: Future Development. May 5 https://www.brookings.edu/blog/future-development/2020/05/05/the-unreal-dichotomy-incovid-19-mortality-between-high-income-and-developing-countries/ Soneji S. and others (2020). “Population-Level Mortality Rates from Novel Coronavirus (COVID19) in South Korea,” Medrxiv.

Spanish Ministry of Health (2020). “Informe no 28. Situación de COVID-19 en España a 4 de Mayo de 2020,” May 4.

Subbaraman, N. (2020). “Why Daily Death Tolls Have Become Unusually Important in Understanding the Coronavirus Pandemic,” Nature. April 9. https://www.nature.com/articles/d41586-020-01008-1 Verity, R. and others (2020). “Estimates of the Severity of Coronavirus Disease 2019: A ModelBased Analysis,” The Lancet Infectious Diseases 2020. March 30.

World Bank (2016) “Global Monitoring Report 2015/2016 Development Goals in An Era of Demographic Change,” World Bank.

World Health Organization (2016a). “ICD-10 International Statistical Classification of Diseases and Related Health Problems. Fifth Edition,” World Health Organization.

World Health Organization (2016b). “Global Report on Diabetes,” World Health Organization.

World Health Organization (2018a). “WHO Methods and Data Sources for Country Level Causes of Death 2000-2016,” World Health Organization. March.

World Health Organization (2018b). “Global Health Estimates 2016: Deaths by Cause, Age, Sex, by Country and by Region, 2000-2016,” World Health Organization.

World Health Organization (2019). “Hypertension: Fact Sheet,” September.

World Health Organization (2020a). “International Guidelines for Certification and Classification (Coding) of COVID as a Cause of Death,” April.

World Health Organization (2020b). “Bacille Calmette-Guérin (BCG) Vaccination and COVID-19. Scientific Brief,” April 12. https://www.who.int/news-room/commentaries/detail/bacillecalmette-gu%C3%A9rin-(bcg)-vaccination-and-covid-19 World Health Organization (2020c). “Climate Change and COVID-19,” Q&A. April 22. https://www.who.int/news-room/q-a-detail/q-a-on-climate-change-and-covid-19 Worldometer (2020). “Coronavirus Countries Where COVID-19 Has Spread,” Worldometer. Updated daily. Accessed May 27.

Wu, Z. and J. McGoogan (2020). “Characteristics of and Important Lessons from the Coronavirus Disease 2019 (COVID-19) Outbreak in China Summary of a Report of 72 314 Cases From the 27
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Table 5: Average Annual Household Income in 1999: Central City, Tokyo, Greater Tokyo, National Capital Region and Japan

||Central City<br>(23 wards)|(a) Tokyo<br>Metropolis|(b) Greater<br>Tokyo|National Capital<br>Region|Japan|
|---|---|---|---|---|---|
||||(a)+3Pref.*|(b)+ 4 Pref.*||
|Annual Income***||||||
|(1,000 yen)|6,502|6,592|6,860|6,849|6,494|

*3 prefectures include Kanagawa, Saitama and Chiba around Tokyo. **4 prefectures include Gunma, Tochigi, Ibaraki and Yamanashi around greater Tokyo.

*** Based on total households (including single person households) Source: Statistics Bureau, Kenmin Keizai (Economic Conditions of Prefectures).

Table 6: TMG’s Corporate Income Tax Revenues by Industry, 2001

||Taxable<br>Income<br> (1 millionyen)|Percent<br>Shares|
|---|---|---|
|Total|8,620,822|100|
|Manufacturing|2,075,887|24.0|
|Wholesale, retail trade|1,910,211|22.1|
|Services|1,808,722|20.9|
|Transport, telecommunication|979,798|11.4|
|Real estate|554,525|6.4|
|Finance|372,216|4.3|
|Construction|326,022|3.8|
|Others|612,078|7.1|

Source: Tokyo Metropolitan Government, Bureau of Taxation.

Table 7: Percent Shares of Industrial R&D investment by Industry and Universities & Public Research Institutes, 1999

||Industry|Universities, Public<br>Institutes & Others|Total National<br>Spending on R&D|Government’s<br>Assistance to Industry<br>R&D inGDP|
|---|---|---|---|---|
|Japan|73.1|26.9|100|<br>0.07|
|USA|71.6|28.4|100|0.27|
|Germany|66.2|33.8|100|<br>0.135|
|UK|53.9|46.1|100|0.135|
|France|53.4|46.6|100|<br>0.135|

Source: OECD, Basic Science and Technology Statistics.

79
# **Sampling**

The sampling methodology was developed based on geographical and socio-economic information about the neighborhoods, residences and dwellers. The first step in the sampling process was to select a group of potential neighborhoods. The following criteria were applied for the selection:

- Low and middle HDI<sup>9</sup> (Human Development Indicator, developed by UNDP)

- Average population of 20,000 people

- Geographical location  (North, East and West of Fortaleza)

- Presence of violence reduction groups, such as MH2OCE

The neighborhoods selected were Autran Nunes, Edson Queiroz, and Pirambú. The second step was to select a representative sample of households.<sup>10</sup> For this purpose, detailed maps of the neighborhoods were obtained from the municipal government ( _Secretaria de Infrastrutura da Prefeitura)_ . The final step was to define the sample size to interview and the sequence of interviews. Each neighborhood had around of 4,500 houses and around 500 questionnaires were applied in each of the neighborhoods. As a result, the sample contains about every ninth household in each of the three neighborhoods.

# **Field work**

Prior to the general application of the survey, pilot interviews were conducted in order to test the questionnaire as well as its feasibility, appropriateness of the language, and timing during the day to carry out interviews. The pilot took place on June 16-17, 2003. One of the main findings of the pilot was that applying questionnaires only in the morning, due to safety reasons, would bias the survey results, limiting the profile of the majority of the respondents to be either students or unemployed. To reduce this bias, it was decided to send the team twice a day, in the morning and

> 9 This information was supplied by the Secretariat of Planning of the municipal government of Fortaleza  ( _Secretaria de Planejamento e Orçamento da Prefeitura de Fortaleza)._

> 10 We defined household as  any group of persons, not necessarily related by blood or marriage, occupying the same structure and sharing household resources, such as food and bedding.

7