rafmacalaba/datause-encoder-data huggingface dataset:
- [13] Eaton, J., Kortum, S., and Kramarz, F., 2011. An Anatomy of International Trade: Evidence from French Firms. Econometrica 79(5), 1453-1498.

- [14] Eaton, J., Kortum, S., Neiman, B., and Romalis, J., 2011. Trade and the Global Recession. NBER Working Paper No. 16666.

- [15] Efron, B., Tibshirani, R. J., 1994. An Introduction to the Bootstrap, Monographs of Statistics and Applied Probability, 57, New York: Chapman & Hall/CRC.

- [16] Foster, L., Haltiwanger, J., and Syverson, C., 2008. Reallocation, Firm Turnover, and Ef...ciency: Selection on Productivity or Pro...tability? American Economic Review 98(1), 394-425.

- [17] Foster, L., Haltiwanger, J., and Syverson, C., (2012): The Slow Growth of New Plants: Learning About Demand?, NBER Working Paper No. 17853.

- [18] Gajewski, G., Riley, A., 2006. Bangladesh Export Trade Practices and their E¤ect on the Competitiveness of the Garment Industry. USAID case study.

- [19] di Giovanni, J., Levchenko, A., 2013. Firm Entry, Trade, and Welfare in Zipf’s World. Journal of International Economics 89(2), 283-296.

- [20] Helpman, E., Melitz, M. J., and Rubinstein, Y., 2004. Trading Partners and Trading Volumes. The Quarterly Journal of Economics 123 (2), 441-487.

- [21] Horowitz, J. L., 1996. Comments on ’Bootstrapping Time Series Models.’Econometric Reviews 15, 165-168.

- [22] Horowitz, J. L., 2001. The Bootstrap and Hypothesis Tests in Econometrics. Journal of Econometrics 100, 37-40.

- [23] Hummels, D., 2007. Transportation Costs and International Trade in the Second Era of Globalization. Journal of Economic Perspectives 21(3): 131-154.

- [24] Irarrazabal, A., Moxnes, A., and Opromolla, L.D., 2012. The Tip of the Iceberg: A Quantitative Framework for Estimating Trade Costs, forthcoming in of Economics and Statistics.

45
# **Annexes**

# **Annex Table A1: Variables Definitions and Data Sources**

|**Variable**|**Explanation**|**Time**<br>**Frame**|**Source**|
|---|---|---|---|
|**Dependent Variables**||||
|export|Exports of goods and services as a share of GDP (%)|1964-2013|WDI|
|netexport|Trade balance – the difference between exports and<br>imports as a share of GDP (%)|1964-2013|WDI|
|manufacturing_share|Manufacturing value added as a share ofGDP(%)|1964-2013|WDI|
|**Financial Variables**||||
|totalcredit|Total credit to the private nonfinancial sector as a share of<br>GDP (%) (= hhcredit + nfccredit)|1964-2013|BIS|
|hhcredit|Total credit to households from all sectors as a share of<br>GDP (%)|1964-2013|BIS|
|nfccredit|Total credit to nonfinancial corporations from all sectors<br>as a share ofGDP(%)|1964-2013|BIS|
|**Instrumental Variables**||||
|Legal origin: legor_uk,<br>legor_fr, legor_ge,<br>legor_sc|Legal origin of the company law or commercial code of<br>the country. There are five categories: (1) English<br>Common Law, (2) French Commercial Code, (3) German<br>Commercial Code, (4) Scandinavian Commercial Code,<br>(5) Socialist/ Communist Laws.|dummy|La Porta et al<br>(1999)|
|Religion:<br>religion_protestant,<br>religion_catholic,<br>religion_muslim|Percentage of the population of country that belonged to<br>the three most widely spread religions in the world in<br>1980. There are four categories: (1) Roman Catholic, (2)<br>Protestant, (3)Muslim, (4) Other.|dummy|La Porta et al<br>(1999)|
|**Control Variables**||||
|ln_initialgdppc|Log of GDP per capita in a previous period (thousand US$ at constant 2010 prices)|1964-2013|WDI|
|financialopenness|Total foreign assets plus total foreign liabilities of the<br>country as a share of GDP (%)|1970-2011|Lane and<br>Milesi-Ferretti<br>(2007)|
|tradeopenness|Total exports plus total imports of goods and services as a<br>share of GDP (%)|1964-2013|WDI|
|enrolment|Gross secondary school enrolment rate (%)|1964-2013|WDI|
|fdi|Foreign direct investment, net inflows as a share of GDP<br>(%)|1964-2013|WDI|
|ln_population|Log of total population (thousands)|1964-2013|WDI|
|tot|Net barter terms of trade index (2000=100)|||
|exchangerate|Real effective exchange rate index (2010=100)|1964-2013|WDI|
|financialcrisis|The ratio of the years with banking crises to total number<br>of years in the period|1970-2011|Laeven and<br>Valencia (2012)|
|commodityexporter|=1 if the country is classified as commodity exporter by<br>WEO October 2011,=0 if otherwise.|dummy|WEO|

21
**_Aggregate measures._** The top row of Table 4, panel (a), reproduces our past estimates (from Chen and Ravallion, 2007) of the aggregate headcount indices using the $1.08 line at 1993 PPP for 1981-2005 at three-year intervals.<sup>36</sup> We then give our new estimates for the same reference years using the 2005 PPPs and for the range of lines from $1.00 to $2.50 in 2005 prices. Table 5 gives the corresponding counts of the number of poor. We calculate the global aggregates under the assumption that the countries without surveys have the poverty rate of their region.  The bulk of the following discussion will focus on the $1.25 line, though we test the robustness of our qualitative poverty comparisons to that choice.

Our new global poverty count is appreciable higher than our past estimates suggested. Both the $1.25 and $1.45 lines indicate a substantially higher poverty count in 2005 than obtained using our old $1.08 line in 1993 prices; 1.7 billion people are found to live below the $1.45 line, and 1.4 billion live below the $1.25 line. Focusing on the $1.25 line, we find that 25% of the developing world’s population in 2005 is poor, versus 17% using the old line at 1993 PPP—representing an extra 400 million people living in poverty.37 It is notable that the conclusion that the global poverty count has risen is also confirmed if one does not update the old 1993 poverty line. Using the $1.08 line for 2005 one obtains an aggregate poverty rate of 19% (1026 million people) for 2005. The 2005 line that gives the same headcount index for 2005 as the $1.08 line at 1993 PPP turns out to lower, at $1.03 a day. While the adjustment for US inflation clearly gives a poverty line for 2005 that is “too high,” the 2005 line must exceed the 1993 line to have comparable purchasing power. So the qualitative result that the new ICP round implies a higher global poverty count is robust.

Holding constant the real value in the US of the 1993 poverty line of $1.08 per day, but revising the PPPs, the poverty rate for the developing world in 2005 rises from 17% to 32% (the latter figure corresponds to the $1.45 line). However, this does not allow for the fact that the same PPP revisions mean that the $US value of the poverty line at PPP was also overestimated. This effect brings the poverty rate down from 32% to 25%, giving the net increase of 8% points.

> 36 We have updated the 2004 estimate in Chen and Ravallion (2007) to 2005 consistently with the data sued in that paper.

> 37 Note that the difference between the 25% and 17% numbers reflects other updates to the data base, besides the new PPPs. When we use the new data base for 2005 to estimate the poverty rate based on the 1993 PPPs we get a slightly higher figure, namely 17.6% (957.4 million people).

22
In an important and influential article, SST (2006) emphasized the potential econometric problems resulting from a combination of heteroscedastic residuals and zero trade flows. Using Monte Carlo simulations, they showed that traditional estimators may yield severely-biased parameter estimates and identified the Poisson Pseudo Maximum Likelihood (PPML) estimator as the preferred estimator for dealing with these problems. The data sets used for the main experiments in their 2006 paper included no zeros (SST 2011, p220), suggesting that their important findings about the bias and variance of standard estimators arise from the combination of nonlinearity and heteroscedasticity highlighted in the paper, rather than from success in dealing with the presence of zero observations. While their paper included some experiments with zeros generated by rounding errors, a process quite different from economic processes generating zeros such as those assumed when applying limited-dependent variable estimators.

The tractable and apparently robust PPML estimator proposed by SST is now widely used in estimation of gravity models (see, for example, Shepherd 2010; Anderson and Yotov 2012). SST show why the normal equations used to solve the PPML estimator should make it more robust than OLS-based estimators when the function is nonlinear and the errors are heteroscedastic, and show using Monte Carlo simulations that its coefficients are much less subject to bias in this situation. Based on their evidence, the case for the PPML estimator seems extremely strong for analysis of nonlinear relationships in models where zero values are infrequent.<sup>3</sup> However, because the tests in their 2006 paper were based on samples containing no zero values, the results obtained cannot be expected to provide a reliable guide to the robustness of the PPML estimator in the presence of economically-determined zero values.

Perhaps a more fundamental problem for reliance on the PPML estimator applied to censored samples (including the zeros) is that the move from the traditional, discrete version of the Poisson distribution to the continuous needed for the gravity equation removes the ability to have positive probability mass at the limit observation (Ilienko 2013, p2). While a discrete version of the Poisson distribution could adequately capture the presence of large shares of limit observations of the type identified by Tobin (1958), the

> 3 Heteroscedasticity in nonlinear models with relatively few zero observations arises in many important applications such as consumption, investment and money demand systems; and representative models for consumer demand, firm costs and profits. The results of SST (2006) appear to deserve much more attention for estimation in this context.

4
Policy Research Working Paper 7522

# **Abstract**

Using a data set covering about 277,000 firms across 79 countries over the period 2004–11, this paper examines the evolution of firms’ capital structure during the global financial crisis and its aftermath in 2010–11. The study finds that firm leverage and debt maturity declined in advanced economies and developing countries, even in countries that did not experience a crisis. The deleveraging and maturity reduction were particularly significant for privately held firms, including small and medium enterprises. For small and medium-size enterprises, these effects were larger in countries with less efficient legal systems, weaker information-sharing mechanisms, shallower banking systems, and more restrictions on bank entry. In contrast, there is weaker evidence of a significant decline of leverage and debt maturity among firms listed on a stock exchange, which are typically much larger than other firms and likely benefit from the “spare tire” of easier access to capital market financing.

This paper is a product of the Development Research Group. 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://econ.worldbank.org. The authors may be contacted at ademirguckunt@ worldbank.org, mmartinezperia@worldbank.org, and ttressel@worldbank.org.

_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
oriented policy. A key lesson though is that such a profile can be constructed from' significantly less information than that available in the CILSS. In that sense, we conclude that the CILSS is truly too rich a data base if the objective is measuring levels of living and poverty. Since it is not costless to collect and mine information, a thorough review is needed of the Living Standards Survey questionnaire. Given how much analysis has been undertaken with the data, it should not be too difficult to identify and eliminate these lines of quesnoning which are not or are only rarely used.

In the context of basic needs, we need to refer to the community module which was appended to the CILSS in order to provide information on the supply of health, education and other facilities. Unfortunately, it displayed some of the same problems<sup>as</sup> the price data, namely a large amount of missing items in the filled-out questionnaires due to the fact that the data collection and processing was insufficiently integrated with the rest of the survey. This has limited the use of this information by researchers (Glewwe, 1991, is a notable exception). Nevertheless, community-level data<sup>are</sup> potentially very valuable for the analysis of the basic needs dimensions of welfare (see Demery, Ferroni & Grootaert, forthcoming). Future surveys should treat the collection of this type of data with the same care and priority as the household level data.

**11**
capital controls(Erten, Korinek and Ocampo(2020) provides a nice summary of this literature) by incorporating signaling through and learning from such credit regulations. Academic and policy consensus prior to the global financial crisis(GFC) viewed restrictions to free financial flows across countries as almost undesirable as restrictions on free trade. The policy consensus has shifted in the wake of the GFC (see Ostry et al. (2010) and IMF Strategy, Policy and Review department (2011)), and the recent academic literature is now focused on better understanding the proper role of capital controls. A number of papers, including Mendoza (2010), Korinek and Jeanne (2010), Bianchi (2011), Korinek (2011), Jeanne (2012), Brunnermeier and Sannikov (2014), Heathcoate and Perri (2016), among others, explore the role of macro-prudential interventions or restrictions on capital flows by introducing an externality of people not considering the effect of their actions on borrowing capacity. My paper builds on Bianchi (2011) and Bianchi, Mendoza and Liu (2016). In the former, uncertainties regarding economic fundamentals are present, but the representative agent does not attempt to reduce it. In the latter, the agent receives a noisy but useful signal about fundamentals to learn from. However, the signal is an exogenous state variable and hence the agent’s information set does not change with respect to policy actions. My paper differs from both of these papers: the agent learns from policy actions and hence her information set changes with respect to policy.

Second, this paper also contributes to the empirical literature on capital controls. Instead of focusing on the efficacy (Edison and Rehinhart (2001), Forbes (2007), Edwards and Rigobon (2009), Magud, Reinhart and Rogoff (2011), Klein(2012), Forbes et al. (2015), Ben Zeev (2017), to name only a few) or unintended consequences ((Miniane and Rogers (2004), Forbes et al. (2016) among others)) of capital controls, I attempt to identify the empirical relationship between capital control announcements and expectations of fundamentals by looking at high-frequency survey data and by employing a nowcasting model, an empirical methodology new to this literature. Moreover, my model provides possible explanations for some empirical findings in this literature, such as these in Klein (2012) and Forbes et al. (2015).

Last but not least, this paper joins several earlier papers to explore signaling of and learning about fundamentals through macroeconomic policies in general. Most 4
Evidence from Canadian child benefit expansions. _Am Econ Rev_ 99 (2): 128-132.

- Molina-Millan, Teresa, Tania Barham, Karen Macours, John A Maluccio, and Marco Stampini. 2016. Long-Term Impacts of Conditional Cash Transfers in Latin America: Review of the Evidence Inter-American Development Bank Technical Note No. IDB-N-923.

- Molyneux, Maxine, With Nicola Jones, and Fiona Samuels. 2016. Can Cash Transfer Programmes Have ‘Transformative’ Effects? _The Journal of Development Studies_ 52 (8): 1087-1098.

- Munshi, Kaivan D and Mark R Rosenzweig. 2006. Traditional institutions meet the modern world: Caste, gender and schooling choice in a globalizing economy. _American Economic Review_ 96 (4): 1225-1252.

- National Statistical Office and ICF Macro. 2005. Malawi Demographic and Health Survey 2010

- Naudeau, Sophie, Rifat Hasan, and Anne Bakilana. 2015. Adolescent Girls in Zambia: Introduction and Overview. Policy Brief: Zambia:

http://elibrary.worldbank.org/doi/abs/10.1596/24597.

- Oster, Emily and Bryce Millett Steinberg. 2013. Do IT service centers promote school enrollment? Evidence from India. _Journal of Development Economics_ 104:123-135.

- Ozier, Owen W. 2015. The impact of secondary schooling in Kenya: a regression discontinuity analysis. _World Bank Policy Research Working Paper_ , no. 7384.

- Saavedra, Juan E and Sandra Garcia. 2013. Educational impacts and cost-effectiveness of conditional cash transfer programs in developing countries: A meta-analysis. _CESR Working Paper_ , no. 2013-007.

- Thomas, Duncan, John Strauss, and Maria-Helena Henriques. 1991. How does mother's education affect child height? _Journal of Human Resources_ 26 (2): 183-211.

- Woerner, Wolfgang, Bacy Fleitlich-Bilyk, Rhonda Martinussen, Janet Fletcher, Giulietta Cucchiaro, Paulo Dalgalarrondo, Mariko Lui, and Rosemary Tannock. 2004. The Strengths and Difficulties Questionnaire overseas: evaluations and applications of the SDQ beyond Europe. _European Child and Adolescent Psychiatry_ 13 (2): ii47-ii54.

- Zomba City Assembly. 2009. Zomba district socio economic profile 2009-2012.

41
In the one experimental study we are aware of, Fafchamps and Woodruff (2014) run a small business plan competition in Ghana, in which winners are selected to receive individualized training, but not cash. They find no significant impact of this individualized training on firm growth. This paper builds on this literature through experimental evaluation of a much larger sample, with substantial prizes, detailed surveys, and a longer time period for tracking winners.

Finally this paper adds to a literature on how to generate entrepreneurship in developing countries, and in particular the role of capital in alleviating constraints.<sup>8</sup> The vast majority of this work has focused on microenterprises, typically with no employees, with the emphasis on starting such businesses and growing the incomes of their owners. This is the case with work testing small grants of US$100 to US$200 to existing businesses (e.g. De Mel et al, 2008; McKenzie and Woodruff, 2008; Fafchamps et al, 2014; Karlan et al, 2014), ultra-poor programs providing grants and training to get very poor people to start businesses (e.g. Banerjee et al, 2011; Bandiera et al, 2013), and business training programs for microenterprises (reviewed in McKenzie and Woodruff, 2014). Blattman et al. (2014) considers a program in Uganda where groups received grants of approximately US$382 per member, and finds this generates increases in skilled self-employment and in incomes for the recipients, but only minor increases in employment in these firms.<sup>9</sup> The grants studied here of almost US$50,000 per recipient are more than 100 times as large as the grants in these earlier studies. In the absence of market failures and frictions on the use of this capital, theory would predict that these grants would merely supplement the incomes of the business owners, without changing their production decisions. Even with credit constraints, there is a question as to whether diminishing returns to capital results in grants of this size being far more than is needed to move businesses to their efficient size. The results in this paper show that the business plan competition is successful in identifying entrepreneurs with the potential to use these large amounts of capital, and that with this capital, they are able to generate enterprises that hire employees and exhibit rapid growth. I estimate a real return to capital of approximately 1.5

> 8 Capital has also been found to be an important constraint to innovation for firms in developed countries (see Howell, 2015).

> 9 The grants to the 39 winners in the business plan competition of Fafchamps and Quinn (2015) were US$1000, and over a 6 month horizon the winners were more likely to start firms and had higher profits than the runners-up and third place getters.

5
Policy Research Working Paper 8094

# **Abstract**

This study uses novel household survey data that are representative of Bangladesh’s large cities, and of slum and nonslum areas within the cities, to investigate the effects of demographic and socioeconomic factors on early child growth in 2013. The study also decomposes the difference in mean child growth between slum and nonslum areas in 2013, and the increase in mean child growth in slum and nonslum areas from 2006 to 2013. Mother’s education attainment and household wealth largely explain the cross-sectional difference and intertemporal change in child growth. Although positive in some cases, the effects of maternal and child health services, and potential health-protective household amenities, differ by the type of health facility, household amenity, and urban area. The results suggest that a focus on nutrition-sensitive programs for slum residents and the urban poor is appropriate.

This paper is a product of the South Asia Region and the Health, Nutrition, and Population 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://econ.worldbank.org. The corresponding author may be contacted at draju2@worldbank.org.

_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