rafmacalaba/datause-encoder-data huggingface dataset:
Testing the induced innovation
            hypothesis in South African agriculture (an error correction approach)
The authors investigate whether factor
            prices matter in agricultural production and in the
            selection of production technology. Each stage of the
            analysis corroborates the inducement hypothesis, which
            implies that factor prices do matter in agricultural
            production and in the selection of production technology.
            The empirical results also suggest that observed rates and
            biases of technological change are influenced by average
            farm size, by spending on research and extension, and by
            favorable tax and interest-rate policies. In South Africa,
            the authors contend, more attention should be focused on the
            technological needs of small-scale farmers. The lobbying
            power of the large commercial farmers, combined with
            policies followed under apartheid, must have influenced the
            allocation of research and development funds between labor-
            and land-saving technical change. This will have distorted
            the technological bias toward labor saving technical change,
            which is hardly appropriate for a labor-surplus economy in
            which small farmers in the former homelands face a chronic
            scarcity of land. These results show that factor prices do
            matter in agricultural production and the selection of
            production technology. And there seems to be merit to the
            World Bank's usual policy prescription - structural
            adjustment and market liberalization - for economies in
            which prices are controlled and distorted. They investigate
            the role of factor prices by applying cointegration
            techniques to a model of induced innovation based on the
            two-stage constant elasticity of substitution production
            function. This approach results in direct tests of the
            inducement hypothesis, which are applied to data for South
            African agriculture for the period 1947-92. They check the
            time series properties of the variables, establish
            cointegration, and construct an error correction model (ECM)
            that allows factor substitution to be separated from
            technological change. Finally, they subject the ECM
            formulation to tests of causality, which show that the
            factor price ratios induce the factor saving biases of
            technological change.
International commodity control :
            retrospect and prospect
International commodity agreements
            (ICAs) fit uneasily in a world in which markets are becoming
            globalized and increasingly competitive. Development policy
            - both as preached by international agencies and as
            practiced by typically democratically elected and
            nonsocialist governments in the major producing countries -
            emphasizes productive efficiency, product quality, and
            effective marketing. This is a long way from the ideology
            that gave central place to supply restrictions operating
            through central marketing boards and quota allocations. In
            today's less centralized, more competitive world, the
            winners and losers from commodity stabilization are more
            evenly distributed across producing and consuming countries.
            Commodity policy is no longer a matter of redistribution
            from consumers to producers. This institutional change has
            been reinforced by the widespread belief - evidenced, for
            example, by the collapse of the international tin and coffee
            agreements - that commodity market stabilization through
            international agreements cannot succeed. In earlier decades,
            the belief that stabilization could and would improve the
            position of commodity producers provided the impetus for
            resolving some of the problems that intervention threw up.
            Since the collapse of the tin market in 1985, the belief
            that commodity market stabilization cannot work has
            undermined producers' willingness to try to resolve
            difficulties within existing ICAs and has reinforced the
            suspicion of consumer governments that these agreements were
            in no one's interests. In the current climate,
            encouraging competitive markets, state interventions are
            seen as requiring clear justification in terms of market
            failure. The existence of active futures markets in all of
            the industries that have commodity agreements makes
            justification along these lines problematic. But the
            "commodity problem" has not disappeared, and
            producers may look for other mechanisms to raise prices from
            often very low levels in industries experiencing excess
            capacity. Developed country governments may be forced to
            decide whether they prefer to see markets controlled by
            producer cartels (where they will lack representation) or
            under the auspices of international commodity agreements.
Political regimes, trade, and labor
            policies in developing countries
What, if any, is the link between labor
            market policies that benefit insiders - for example,
            regulations guaranteeing high minimum wages and strict job
            security - and political regimes.  Is it true that in a
            democracy outsiders vote and impose limits on what insiders
            can achieve, whereas in a dictatorship the government need
            worry only about insiders who have real power?  Or are
            democratic governments more likely to succumb to trade union
            pressure and use labor policies to give them special
            privileges?  To test these competing hypotheses, the authors
            designed a two-sector political economy model that
            demonstrates that labor market distortions depend directly
            on the trade regime: the more open the trade regime, the
            fewer distortions in the labor market.  They use
            cross-country regressions to test the relationship between
            political and civil liberties and trade and labor policies.
            Using data for 90 developing countries, they apply existing
            indices of openness and political freedom and two different
            constructed measures of labor market distortion.  Their
            conclusions, based on the regression results: authoritarian
            systems that repress labor are more likely than democratic
            systems to adopt inefficient labor policies inimical to development.
Foreign direct investment, other
            capital flows, and current account deficits : what causes what
This paper is part of a larger effort to
            study the determinants and impact of foreign direct
            investment.  The authors examine flows of foreign direct
            investment to 46 developing countries to test whether such
            flows are autonomous or accommodating vis-a-vis the current
            account and other capital flows.  Using Granger-casualty
            tests, they find that: 1) requirements to surrender exports
            proceeds to the monetary authorities and the existence of
            special exchange rates for some capital account transactions
            reduce the probability that foreign direct investment is
            independent; 2) the more liberal a country's foreign
            exchange system, the more foreign direct investment is
            likely to be independent or exogenous; and 3) foreign direct
            investment is associated with a larger increase in capital
            formation when it is independent than when it is
            Granger-caused by other capital flows.
Do we face a global "capital shortage"
The author of this paper assesses the
            medium- to long-term outlook for global demand and supply of
            capital.  He reaches the following conclusions: 1) the
            demand for investment funds in developing countries will
            remain strong, but most increased demand will likely be met
            by domestic savings.  Investment's share in GDP will
            probably rise in these countries, but so will saving's
            share, so their net claim on industrial countries'
            savings is likely to remain small.  Of course, savings will
            not rise automatically.  It is essential that policies,
            institution, and the economic environment be conducive to
            saving; 2) financial liberalization and integration of
            international capital markets will continue to give
            developing countries as a group improved access to private
            foreign capital.  But whether specific countries attract and
            sustain such inflows will depend on their economic prospects
            and policies, including conditions that promote domestic
            saving and investment.  Investments needs in developing
            countries are great, but "effective" demand for
            foreign capital will remain limited by the countries'
            perceived creditworthiness and viability; 3) most low-income
            countries will continue to depend mainly on official capital
            for some time.  But official capital will likely be
            increasingly scarce, so these countries must identify their
            domestic resource mobilization and accelerate the policy
            reform needed to attract private investment; 4) the critical
            factor in alleviating pressure on global interest rates will
            be progress on fiscal consolidation in industrial countries,
            especially the reform of social security systems.  Net
            capital flows from industrial to developing countries are
            much smaller than the budget deficits in industrial
            countries; and 5) international capital markets will tend to
            remain tight in the coming decade, but a severe global
            capital squeeze and a big increase in global real interest
            rates are unlikely if industrial countries continue fiscal
            consolidation.  Without such consolidation, global real
            interest rates could rise well above already high recent
            levels of about 4 percent, with adverse consequences for all countries.
Sustainability of private capital
            flows to developing countries : Is a generalized reversal likely
Since 1989, private capital flows to a
            select group of developing countries have increased sharply,
            but developments in 1994 have caused concern about the
            sustainability of those flows.  Several highly indebted
            developing countries that are implementing reform are
            concerned that a generalized reversal - similar to episodes
            of capital flight in the early 1980s - might disrupt their
            economies and threaten economic reform.  Because the surge
            in private capital flows coincided with a period of low
            international interest rates and intensive policy reform in
            developing countries, debate has been active about whether
            the surge is driven mainly by domestic (pull) or external
            (push) factors.  Under the pull hypothesis, successful
            domestic policies are the key to ensuring sustainable
            capital inflows; under the push hypothesis, an increase in
            international interest rates would cause a reversal of those
            flows (back to the industrial world).  Using a partial
            adjustment model in which both domestic and external
            variables are defined, the authors explain why private
            capital flows to some developing countries but not to others
            (using panel data for 1986-93 for 22 countries).  They argue
            that a generalized reversal is unlikely in countries that
            maintain a fundamentally sound macroeconomic environment.
            In fact, their empirical results show that domestic factors
            such as domestic savings and investment ratios significantly
            affected the recent surge in capital inflows.  Further, they
            suggest that countries that have not received significant
            foreign capital - including countries in sub-Saharan Africa
            - could begin to if they implemented structural reforms that
            allow them to export, save, and invest at higher rates.
            Reducing their foreign debt (which might call for a
            continuation of recent debt reduction operations) could also
            help attract foreign private investors.
The World Trade Organization, the
            European Union, and the Arab World : trade policy priorities
            and pitfalls
The countries of the Middle East and
            North Africa (MENA) have lost the geographic advantage they
            used to have because of their proximity to the European
            Union at a time when Eastern Europe was effectively closed
            to open exchange with the West. The Central and Eastern
            European countries are beginning to exploit their own
            proximity, together with relatively low wages and
            significant stocks of human capital, and are formidable
            competitors with MENA. To compete, the MENA countries must
            implement more far-reaching liberalization, privatization,
            and deregulation. It has been a basic tenet in MENA
            countries that economic reform must be gradual to avoid
            causing social disruption. This has often meant little
            effort publicizing reform and mobilizing political support.
            Partial and slow reform has led to uncertainty in firms and
            households and a lack of credibility. The slower the pace of
            reform and the less comprehensive its scope, the greater the
            gap between MENA's performance and the rest of the
            world is likely to become. Without a significant private
            sector supply response and inward foreign direct investment,
            political support for reform will be limited, and a vicious
            circle may result. The creation of the World Trade
            Organization (WTO) and the offer of the European Union to
            establish a Euro-Mediterranean Economic Area provide
            possible institutional frameworks to make a gradual reform
            strategy more credible. Full participation in the WTO could
            move the trade regime closer to "good practices,"
            improve trade institutions, help lock in trade reform, make
            trade policy implementation more transparent, diminish
            bureaucratic red tape, and force firms to go through
            GATT-sanctioned mechanisms for temporary safeguard
            protection. An agreement with the European Union to
            establish a free trade and investment area could offset some
            of the WTO's regulatory and administrative loopholes,
            could (by providing financial transfers) overcome resistance
            to reform, and could ensure investors that MENA governments
            are committed to far-reaching integration with the European
            Union. But neither option is a panacea. Both should be
            pursued simultaneously.
Default risk and the effective
            duration of bonds
Basis risk is the risk attributable to
            uncertain movements in the spread between yields associated
            with a particular financial instrument or class of
            instruments, and a reference interest rate over time.  There
            are seven types of basis risk: Yields on 1) Long-term versus
            short-term financial instruments, 2) Domestic currency
            versus foreign currencies, 3) Liquid versus illiquid
            investments, 4) Bonds with higher or lower sensitivity to
            changes in interest rate volatility, 5) Taxable versus
            tax-free instruments, 6) Spot versus futures contracts and
            7) Default-free versus non-default-free securities.  Basis
            risk makes it difficult for the fixed-income portfolio
            manager to measure the portfolio's exposure to interest
            rate risk, heightens the anxiety of traders and arbitrageurs
            who are hedging their investments, and compounds the
            financial institution's problem of matching assets and
            liabilities.  Much attention has been paid to the first type
            of basis risk.  In recent years, attention has turned toward
            understanding the relation between credit risk and duration.
            The authors focus on that, emphasizing the importance of
            taking credit risk into account when computing measures of
            duration.  The consensus of all work in this area is that
            credit risk shortens the effective duration of corporate
            bonds.  The authors estimate how much durations shorten
            because of credit risk, basing their estimates on observable
            data and easily estimated bond pricing parameters.
The World Bank primer on reinsurance
Reinsurance is a mechanism the insurance
            industry uses to spread the risk it assumes from
            policyholders.  Through reinsurance, the industry's
            losses are absorbed and distributed among a group of
            companies so that no single company is overburdened with the
            financial responsibility of offering coverage to its
            policyholders.  Catastrophes, unexpected liabilities, and a
            series of large losses that might be too great for an
            individual insurer to absorb can be handled through
            reinsurance.  Without it, most insurers would be able to
            cover only the safest of ventures, leaving many risky but
            worthwhile ventures without coverage.  The authors present a
            primer of reinsurance concepts, explaining such terms as
            ceding company, primary carrier, direct underwriter,
            cession, retrocessions, ceding commission, and surplus
            relief reinsurance.  There are separate sections on: 1) The
            purposes of reinsurance (for example, underwriting capacity,
            earnings stability, reserve requirement reduction, and
            mechanism for existing business), 2) Methods of cession for
            reinsurance contracts (treaty, facultative, and automatic
            facultative), 3) Types of reinsurance contracts
            (proportional, nonproportional, hybrid, and retrocessions),
            4) Prices and usage of reinsurance contracts, 5) The
            economics of risk transfer, 6) The characteristics of
            reinsurance risk, 7) The reinsurance market and 8)
            Reinsurance regulation.
Small and medium-size enterprises in
            economic development : possiblities for research and policy
The World Bank's most important
            long-term advantage in promoting development, says the
            author, may lie in opportunities to address related
            obstacles simultaneously. It could mount concurrent efforts
            to address the problems of small and medium-size enterprises
            in a particular sector, region, or economy, for example. It
            could address the conditions of founding new firms,
            providing finance or technical assistance, developing mutual
            support institutions, resolving disputes, and perhaps
            reducing counterproductive government interventions. Were
            the Bank to follow such a coordinated approach, programs
            could be designed to generate data to illuminate the impacts
            and interactions of various elements of policy. These data
            could be exploited, then, in research designs, or even the
            design of management information systems, shaped by program
            evaluation. The author proposes four general issues for
            research (plus a series of topics for each issue). (1) Can
            Bank initiatives involving small and medium-size enterprises
            in developing countries facilitate the entry of these
            enterprises into similar learning relationships with other
            firms - foreign firms, larger firms in their own countries,
            or each other? (2) The economic significance of high
            "turbulence" (entry and exit rates) in small-firm
            populations is poorly understood. The fact of high
            turbulence is well-documented in industrial countries; it is
            not for developing countries, but available data suggest a
            broadly similar pattern. Are high failure rates for small
            businesses symptomatic of an important shortcoming in the
            system of economic organization itself? Or should the unit
            of analysis be the enterprise, the entrepreneur, or the
            entrepreneur's family? (3) Is the apparent trend
            favoring a larger economic role for smaller production units
            autonomous rather than induced by other changes? Does it
            depend on general operating factors such as the declining
            costs of communication and computation? (4) The rate of
            learning by a small firm may depend on the nature of its
            transacting partner. Certain multinational enterprises make
            good teachers, for example, but certain local labor markets
            or markets for consumer goods and services may not be
            well-positioned for relevant learning. They may learn well
            how to adjust to local circumstances but not to the
            international diffusion of technology and ways of organizing
            (the main source of hope for developing countries). Perhaps
            Bank policy should be more concerned with transaction patterns.