rafmacalaba/datause-encoder-data huggingface dataset:
Aggregating governance indicators
In recent years the growing interest of
            academics and policymakers in governance has been reflected
            in the proliferation of cross-country indices measuring
            various aspects of governance. The authors explain how a
            simple variant of an unobserved components model can be used
            to combine the information from these different sources into
            aggregate governance indicators. The main advantage of this
            method us that it allows quantification of the precision of
            both individual sources of governance data and
            country-specific aggregate governance indicators. The
            authors illustrate the methodology by constructing aggregate
            indicators of bureaucratic quality, rule of law, and graft
            for a sample of 160 countries. Although these aggregate
            governance indicators are more informative about the level
            of governance than any single indicator, the standard errors
            associated with estimates of governance are still large
            relative to the units in which governance is measured. In
            light of these margins of error, it is misleading to offer
            very precise rankings of countries according to their level
            of governance: small differences in country rankings are
            unlikely to be statistically - let alone practically -
            significant. Nevertheless, these aggregate governance
            indicators are useful because they allow countries to be
            sorted into broad groupings according to levels of
            governance, and they can be used to study the causes and
            consequences of governance in a much larger sample of
            countries than previously used (see for example the
            companion paper by the authors, "Governance
            matters", Policy Research Working Paper no. 2196).
Can no antitrust policy be better
            than some antitrust policy
The author examines how the market
            structure is likely to evolve where there is multistage
            oligopolistic production - and what the implications of this
            are for antitrust policy. The author treats the decision to
            merge across or within stages of production as endogenous.
            He shows that when firms at a particular stage of production
            are relatively dominant, simultaneous merger decision are
            conducive to competitive vertically integrated outcomes,
            while sequential decisions are not. The persistence of
            non-integrated market structures may be explained by the
            existence of equally dominant firms that make merger
            decisions sequentially. The credible threat of retaliatory
            merger may deter both socially desirable and undesirable
            forms of merger. What implications does the author's
            findings have for antitrust policymakers? For one thing,
            partial antitrust policy may lead to less competitive market
            structures than the total absence of such policy, because
            policy barriers to horizontal mergers only at a particular
            stage of production eliminate the deterrent effect of
            retaliatory merger. For example, if the two stages of
            production are located in countries with different antitrust
            legislation, a policy that protects consumers from domestic
            mergers may ultimately hurt them by rendering foreign
            mergers more attractive. When the equilibrium market
            structure does not contain socially undesirable mergers,
            there is no need for antitrust (or competition) policy.
            Moreover, there may sometimes be a case for the government
            actually providing supplementary incentives to encourage
            particular forms of merger - as, for instance, when the
            threat of retaliatory merger deters socially desirable
            vertical mergers.
Financial sector inefficiencies and
            coordination failures : implications for crisis management
The authors analyze the implications for
            crisis management of inefficient financial intermediation in
            a country (such as Indonesia or the Republic of Korea) where
            firms are highly indebted. They base their analysis on a
            model in which firms rely on bank credit to finance their
            working capital needs and loan contracts entail high state
            verification and enforcement costs for lenders. They find
            that higher volatility of output, lower productivity, or
            higher costs for contract enforcement and verification may
            shift the economy to the inefficient portion of the debt
            Laffer curve - with potentially sizable losses in employment
            and output. What implications does this have for the policy
            debate on crisis management in East Asia? Debt reduction, in
            addition to debt rescheduling, may be required to reduce
            employment and output losses in the presence of
            inefficiencies in the financial sector. In practice this may
            be difficult to coordinate among a large group of creditors
            because of the free-riding problem: Each creditor has an
            incentive to refrain from offering debt relief on its own
            claims and wait for others to do so, thereby raising the
            expected value of its own claims.
Fiscal adjustment and contingent
            government liabilities : case studies of the Czech Republic
            and Macedonia
To control the expansion of government
            contingent liabilities and reduce fiscal vulnerability, one
            must be able to identify and measure them. The authors
            discuss how this may be done and demonstrate how the
            assessment of fiscal adjustment may change substantially
            when a broader picture of government liabilities is
            included. They base their analysis on experience in
            analyzing fiscal adjustment in the Czech Republic and
            Macedonia. Their work demonstrates the importance of
            including contingent liabilities when analyzing fiscal
            sustainability. To the extent that explicit expenditures are
            shifted off-budget or replaced by guarantees, the achieved
            improvement in fiscal balances is overstated. For the Czech
            Republic, adjustment may have been overstated by some 3 to 4
            percent of annual GDP. A stabilization program accompanied
            by a build-up of contingent liabilities, particularly state
            guarantees and obligations to cover liabilities emerging
            from directed credit, may not be sustainable. In Macedonia,
            the present fiscal equilibrium may be temporary because the
            stock of existing contingent liabilities could add 2 to 4
            percent of GDP to future deficits. And methods used to
            reduce the "traditional" deficit are unlikely to
            be sustainable without further modification. The authors
            conclude that governments: 1) must find better ways to
            identify and evaluate contingent liabilities arising from
            the banking system, nonbanking financial institutions,
            public enterprises, or the contingent and direct liabilities
            of subnational governments; 2) need to better manage their
            risks--for example, building adequate reserve funds and
            hedging risk, where possible; and 3) should examine the
            implications of the bias toward adding contingent
            liabilities and develop administrative reform as part of
            analyzing budget management.
Bonds and bridges : social and poverty
Using the lens of social
            capital-especially bridging or cross-cutting ties that cut
            across social groups and between social groups and
            government-provides new insights into policy design.
            Solidarity within social groups creates ties (bonding social
            capital) that bring people and resources together. In
            unequal societies, ties that cut across groups (bridging
            social capital) are essential for social cohesion and for
            poverty reduction. The nature of interaction between state
            and society is characterized as complementarity and
            substitution. When states are functional, the informal and
            formal work well together-for example, government support or
            community-based development. When states become
            dysfunctional, the informal institutions become a substitute
            and are reduced to serving a defensive or survival function.
            To move toward economic and social well-being, states must
            support inclusive development. Investments in the
            organizational capacity of the poor are critical.
            Interventions are also required to foster bridging ties
            across social groups-ethnic, religious, caste, or racial
            groups. Such interventions can stem from the state, private
            sector, or civil society and include: Changes in rules to
            include groups previously excluded from formal systems of
            finance, education, and governance, at all levels. Political
            pluralism and citizenship rights. Fairness before the law
            for all social groups together. Infrastructure that eases
            communication. Education, media, and public information
            policies that reinforce norms and values of tolerance and diversity.
Privatization and regulation of the
            seaport industry
With containerized shipping, maritime
            transport has changed profoundly. Among other things, it has
            shifted from labor-intensive to more capital-intensive
            activities, including larger specialized ships that require
            substantial investments in port infrastructure and
            equipment. Integrated transport chains have reduced
            transport costs so much that a shipper may find a distant
            port cheaper than a closer one. Modern ports must be
            competitive on times and prices for their services. Seaports
            must be integrated within logistical chains to serve their
            many functions. An efficient seaport requires
            infrastructure, superstructure, equipment, adequate
            connections to other modes of transport, a well-motivated
            management, and qualified employees. The public sector has
            been an important port organizer in the past, but private
            participation in port operations and infrastructure could
            make ports significantly more competitive. The authors
            provide an overview of changes in maritime activity, discuss
            concession contracts (a key instrument of privatization),
            and analyze how regulatory mechanisms affect such factors as
            seaport tariffs, port congestion, port safety, the quality
            of cargo handling, and relevant indicators of performance,
            finances, and factor productivity. They describe how an
            optimal seaport system should allocate tasks between the
            various institutions involved, including the port authority.
            The degree of a seaport's decentralization, they
            conclude, depends on a country size, the number of ports it
            has, and its legal tradition. Among several national
            governments in Latin America--Argentina, Brazil, Colombia,
            Mexico, and Venezuela--there is an evident trend toward
            decentralization and greater autonomy for port authorities.
The integration of transition
            economies into the world trading system
The author analyzes current trade
            policies and challenges faced by the transition economies -
            especially countries in the former soviet Union - as they
            are integrated into the world trading system. With few
            exceptions, transition economies in Central and Eastern
            Europe, including the Baltics, have been well integrated
            into the multilateral trading system. Their trade regimes
            differ - and the main challenges they face involve their
            integration into the European Union. Integration into the
            multilateral trading system, including progress toward
            membership in the World Trade Organization (WTO), varies
            significantly among the other countries of the former Soviet
            Union. Armenia, Georgia, the Kyrgyz Republic, and Moldova
            have adopted relatively liberal trade regimes and are either
            already members of the WTO or are close to it. These four
            countries need to strengthen the capacity of broad
            market-based (especially trade-related) institutions,
            including customs, the financial sector, and institutions to
            facilitate trade. The momentum for market and trade reform
            appears to have stalled in some of the larger countries of
            the former Soviet Union: Kazakhstan, Russia, and Ukraine.
            Their trade regimes are not especially restrictive, but weak
            operations in fundamental market institutions inhibit their
            effective integration into the world trading system. These
            problems, together with persistent protective pressures,
            inhibit progress and accession to the WTO. The remaining
            countries in Central Asia, as well as Belarus, have far to
            go in introducing market-oriented reforms and institutions,
            and the kind of trade liberalization needed for integration
            into international trade. The countries of the former Soviet
            Union must make most of the reform and adjustment effort,
            but WTO members must make changes as well - especially the
            United States and the European Union. Both need to review
            their policies toward non-market economies on antidumping
            practices and (in the European Union) on safeguards.
            Countries where market decisions prevail should not be
            subjected to non-transparent and arbitrary procedures. In
            particular, countries that have been judged to be
            "market" economies in the process of gaining
            access to the WTO should be excluded from procedures applied
            for antidumping and safeguard measures in non-market economies.
Prospective deficits and the asian
            currency crisis
The authors argue that the recent Asian
            currency crisis was caused by large prospective fiscal
            deficits associated with implicit bailout guarantees to
            failing banking systems. They articulate this view using a
            simple dynamic general equilibrium model, whose key feature
            is that a speculative attack is inevitable once the present
            value of future government deficit rises. This is true
            regardless of the government's foreign reserves
            position or the initial level of its debt. The government
            cannot prevent a speculative attack but it can affect its
            timing. The longer the delay, the higher inflation will be
            under flexible exchange rates. The authors present empirical
            evidence in support of the two key assumptions of their
            model: 1) Large losses in the banking sector were associated
            with large increases in Asian governments' prospective
            deficits. 2) The public knew that the banks were in trouble
            before the currency crisis.
Nonfarm income, inequality, and land
            in Rural Egypt
The author uses household-level data
            from a nationally representative survey to analyze the
            impact of nonfarm income on income inequality in rural
            Egypt. After pinpointing the importance of nonfarm income to
            the rural poor, the author decomposes total rural income
            among five sources, nonfarm, agricultural, livestock,
            rental, and transfer. He shows that while nonfarm income
            represents the most important inequality-reducing source of
            income, agricultural income represents the most important
            inequality-increasing source. A 1 percent marginal increase
            in nonfarm income will cause the Gini coefficient of overall
            income to fall by 12.8 percent. But a 1 percent marginal
            increase in agricultural income will cause the Gini
            coefficient to rise by 15.8 percent. The reason for this
            difference has to do with land, which is distributed very
            unevenly in this study. Regression analysis of the
            determinants of income shows that land ownership is
            positively and statistically related to the receipt of
            agricultural income but has no statistical relationship to
            the receipt of nonfarm income. This leads the author to
            three conclusions: 1) If policymakers are interested in
            reducing poverty and improving income distribution in rural
            Egypt, they should focus on nonfarm income - which not only
            accounts for almost 60 percent of total income for the rural
            poor but also favorably affects income distribution. 2)
            Nonfarm income is an inequality-reducing source of income in
            a land-scarce setting such as rural Egypt because inadequate
            land "pushes" poorer households out of agriculture
            and into the nonfarm sector. 3) Agricultural income
            contributes most to rural income inequality because it is
            highly correlated with land ownership and with total rural income.
The distributional consequences of
            monetary policy : evidence from Malaysia
The author provides a descriptive
            analysis of credit and monetary policies in Malaysia and
            investigates the distributional consequences of monetary
            policy there by focusing on small and medium-size industries
            and large manufacturing firms. The author suggests that
            "payoff" or "default" risk - as captured
            by the spread between safe and risky debt - is still well
            above its pre-crisis level, underscoring the increased
            agency costs of external finance. The decline in lending
            activity in the first half of 1998 can be attributed to the
            reduced supply of bank credit relative to demand. Empirical
            results from vector autoregression on analysis demonstrates
            that monetary tightening disproportionately affects small
            and medium-sized enterprises. Moreover, monetary shocks
            contribute substantially more to small and medium-size
            firms' variance of production (71 percent) than to that
            of large manufacturing firms (30 percent). These findings
            corroborate the notion that small and medium-size industries
            face greater market imperfection, which in turn magnify the
            effects of a given policy shift. Policymakers should weigh
            the distributional consequences of policy actions and should
            consider measures to alleviate the disproportionate impact
            that market imperfections have on small and medium-size
            industries. Measures to alleviate information asymmetry in
            credit markets - including the promotion of cooperative or
            mutual guarantee schemes for small and medium-size
            enterprises -- are one useful option. Groups of firms in
            Southern Europe have made wide use of mutual guarantee
            schemes - usually within a specific industry - to provide a
            privately organized "insurance system" for lending
            banks that allows the banks to rely less on the assets of
            individual companies within the group in making loan
            decisions. The pooling effects of such a system would reduce
            the risk to the bank of default and would give members of
            the society an incentive to reveal information to the
            society that they might hesitate to give to the bank.
Wage and productivity gaps -
            evidence from Ghana
The author uses a unique data set
            (combining information about individual workers with
            information about the firms employing them) to jointly
            estimate production functions and wage equations. This
            approach allows her not only to assess the marginal impact
            on wages of demographic and other characteristics but also
            to compare how these variables affect productivity among
            various groups of workers. Among her findings: 1) Female
            employees are paid less than male employees, but this
            negative wage premium does not reflect commensurately lower
            productivity. 2) Employees' experience is reflected
            equally in wages and in productivity differentials over the
            worker's life cycle. Wages and productivity both
            increase, but at a decreasing rate. 3) The more training and
            education workers have, the higher their wages and the
            greater their productivity. 4) Productivity differences can
            be demonstrated for five levels of education completed. The
            productivity gap is greater than the wage gap. 5) Returns to
            education are similar across gender, sector, and level of
            unionization, but they are lower for unskilled workers than
            for skilled workers. 6) Training supplied by outside
            providers (as opposed to in-house training) is associated
            with higher wages but appears to have no (immediate) impact
            on productivity. 7) Trade union members' wages are in
            line with productivity. Both wages and productivity are
            higher for union members than for non-union members.
Seeking votes - the political
            economy of expenditures by the Peruvian Social Fund
            (FONCODES), 1991-95
President Alberto Fujimori created the
            Peruvian social Fund (FONCODES) in 1991 with the stated
            objectives of generating employment, helping to alleviate
            poverty, and improving access to social services. The author
            uses province-level data on monthly expenditures,
            socio-economic indicators, and electoral outcomes to analyze
            political influences on the timing and geographic
            distribution of FONCODES expenditures between 1991 and 1995.
            He finds that: 1) FONCODES expenditures increased
            significantly before elections. 2) FONCODES projects were
            directed at poor provinces, as well as provinces in which
            the marginal political impact of expenditures was likely to
            be greatest. The results are robust to many specifications
            and controls. The Peruvian data thus support predictions
            made in the literature on political business cycle as well
            the literature on political influences on the allocation of
            discretionary funds.