Showing papers by "World Bank published in 1987"
TL;DR: In this article, the authors look at the technological development of the newly industrializing countries to draw some important lessons for firms and governments in other developing countries, and they make the best economic sense to combine foreign and local technological elements.
500 citations
TL;DR: In this paper, the impact of land ownership security on farm investment and land improvements is discussed, and it is shown that ownership security enhances capital formation by providing better incentives and improved access to credit.
Abstract: The article discusses the impact of land ownership security on farm investment and land improvements. Ownership security enhances capital formation by providing better incentives and improved access to credit. Data from three provinces in Thailand are used to support theoretical propositions and estimate the impact of ownership security. Econometric analysis shows that in two provinces, ownership security induces significantly higher capital/land ratios. In a third province, with a well-developed, informal credit market, ownership security is less important and the impact on capital formation is less significant. Land-improving investments are shown to be significantly affected by ownership security.
321 citations
TL;DR: A review of the principal policy-related issues for which the professions of ecology and economics provide conflicting prescriptions is given in this paper, with emphasis on the work of the World Bank, although the issues raised are relevant to a broad range of organizations.
225 citations
TL;DR: In this article, a methodology is proposed that allows the use of expenditure and quantity data from household surveys to estimate a system of demand equations including freely estimated own-and cross-price elasticities.
224 citations
TL;DR: In this paper, the authors analyzed the links between oil prices, deficits, inflation, and real exchange rate appreciation in Nigeria and Indonesia and concluded that with the exception of cuts in the deficit since 1984, Nigerian policy following the boom has not been conducive to adjustment to the current period of low oil prices and high real interest rates.
Abstract: Nigeria and Indonesia provide an interesting contrast with regard to performance and policy during and after the oil boom. Roughly a decade after the first oil shock, Nigeria is faced with several economic problems including a serious decline in its agricultural sector and a deteriorating external debt situation. While some decline in the nonoil traded goods sector reflects efficient adjustment to the oil boom, policy with regard to public expenditure, exchange rates, pricing, and the trade regime could exacerbate such decline and impede readjustment as the boom subsides. The links between oil prices, deficits, inflation, and real exchange rate appreciation are analyzed and Nigerian and Indonesian fiscal and exchange rate and agricultural and foreign borrowing strategies are compared. It is concluded that with the exception of cuts in the deficit since 1984, Nigerian policy following the boom has not been conducive to adjustment to the current period of low oil prices and high real interest rates. Corrective measures and policy options are discussed.
155 citations
TL;DR: Tax evasion is a function of inter alia the marginal tax rate only if the probability of being caught is defined as the probability that a tax evading individual has undeclared income and tax evasion introduces uncertainty which causes a utility loss as mentioned in this paper.
Abstract: This paper discusses tax evasion. Specifically, the viewpoint that tax evasion benefits society is questioned and proven not to be entirely true. A simple model of tax evasion is presented and it is concluded that: 1) tax evasion is a function of inter alia the marginal tax rate only if the probability of being caught is a function of undeclared income; and 2) that tax evasion introduces uncertainty which causes a utility loss. An example is presented showing that the excess burden of tax evasion and the income tax are sometimes additive. Therefore, ignoring the excess burden of tax evasion will usually lead to underestimation of the total excess burden of a tax.
155 citations
TL;DR: In this article, the authors focus on the implicit behavioral assumption leading to the existence of the closure problem in applied general equilibrium models, and they use a simple temporary equilibrium to make explicit the microeconomic behavior underlying these types of models.
132 citations
TL;DR: In this article, the authors analyzed the effect of price and various public inputs on the aggregate agricultural supply in 58 countries for the period 1969-1978 and found that the shifters as a group account for most of the variations in supply in the within-country and between-country analysis.
130 citations
TL;DR: The results indicate that travel time plays an important role in rationing health care, and that medical care demand for poorer individuals is substantially more travel time elastic than for richer individuals.
127 citations
TL;DR: In this article, the impact of land ownership security on farmers' input use and output value is discussed, and the results confirm that the provision of secure ownership in LDCs can increase productivity significantly.
Abstract: The article discusses the impact of land ownership security on farmers’ input use and output value. Economic theory suggests that farmers with secure legal ownership will have more incentives and better ability to invest, due to a lower perceived risk and a favourable access to institutional credit. This leads to higher variable inputs use and higher output per unit of land. The article uses farm level data from three provinces in Thailand to test the above propositions. The data pertain to samples of squatters, who lack secure legal ownership, as contrasted with legally titled farmers. The results confirm that the provision of secure ownership in LDCs can increase productivity significantly.
113 citations
TL;DR: The problem connected with rural-urban migration could then be of two different types: (1) private response to migration could be due to non-economic factors (city lights), excessive because of gambling instincts; or a desperate act after being pushed out from traditional rural activities due to population growth.
Abstract: Migration is a response of individuals to better opportunities, and should in principle increase economic welfare unambiguously. The problem connected with rural-urban migration could then be of two different types: (1) private response to migration could be due to non-economic factors (\"city lights\", etc.); excessive because of gambling instincts; or a desperate act after being pushed out from traditional rural activities due to population growth; (2) social returns to migration may be less than private returns because the distribution of non-labor factors between rural and urban location (which involve labor migration) is less than optimum; or because the distributional consequences of migration are not necessarily equalizing. This essay has been written to bring the available evidence to focus on some of these issues. It is unrealistic to assume that definite answers can be given when the literature, although substantial, covers only a fraction of prevalent rural-urban migration streams. The purpose is the limited one of discussing a sample of the research which has tried to tackle these questions. Section 1 gives an overview of the scale of rural-urban migration in LDCs, and considers the hypothesis of over-urbanization. Section 2 is a selective review of the literature on the determinants of migration, with particular emphasis on the relative importance of economic and non-economic factors. Section 3 takes a closer look at the discussion of urban labor markets in the literature and the
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TL;DR: In this paper, a stochastic two-country rational expectations model with sticky prices and possible excess capacity is developed to examine international spillover effects on output of monetary disturbances, and the main result is that spill-over effects of monetary policy may be either positive or negative, depending upon whether the intertemporal elasticity of substitution in consumption exceeds the intrate temporal elasticity.
Abstract: A stochastic two-country neoclassical rational expectations model with sticky prices -- optimally set by monopolistically competitive firms -- and possible excess capacity is developed to examine international spillover effects on output of monetary disturbances. The Mundell-Fleming model predicts that monetary expansion at home leads to recession abroad. In contrast, our main result is that spillover effects of monetary policy may be either positive or negative, depending upon whether the intertemporal elasticity of substitution in consumption exceeds the intratemporal elasticity of substitution. The model in addition is used to determine nominal and real interest rates, exchange rates, and other asset prices.
TL;DR: In this paper, the authors present an analytical model of the sites and services paradigm, summarizes recent research on housing demand, and compares planning assumptions used in World Bank sites and service projects with empirical evidence on willingness to pay for housing.
Abstract: Sites and services projects represent a major innovation in shelter policy in developing countries and have been sponsored by international aid agencies for somewhat more than a decade. Such government projects deliver a package of shelter-related services, the standards of which depend on the ability and willingness to pay of intended beneficiaries. Typically, such projects represent a sharp break with pre-existing government shelter policies in that they attempt, in principle, to focus directly on lower-income groups and to deliver shelter and services with small or no subsidies. This article : i) describes the background of the sites and services concept; ii) reviews recent evaluations of sites and services projects; iii) presents an analytical model of the sites and services paradigm; iv) summarizes recent research on housing demand; v) reviews planning assumptions used in World Bank sites and services projects; vi) compares these assumptions with empirical evidence on willingness to pay for housing; and vii) examines project experience in light of contrasts between actual planning assumptions and empirical research on demand for shelter. The article concludes with suggestions for ways to improve the project design process and reform housing sector policies to increase the efficacy of the sites and services paradigm.
TL;DR: In this article, the authors investigate whether CFA Zone countries had different GNP growth rates from selected "comparator" countries during 1960-1982 and found that CFA countries grew significantly faster than comparator Sub-Saharan African countries but usually slower, and often significantly so, than the whole sample of developing countries.
TL;DR: In this article, a comparison between patterns of growth in Japanese and U.S. industries during the period 1960-1979 is presented, showing that Japanese annual growth rates of productivity were substantially higher than those in the United States.
Abstract: This article presents a comparison between patterns of growth in Japanese and U.S. industries during the period 1960–1979. During the period of rapid economic growth in Japan 1960–1970 annual growth rates of productivity in Japan were substantially higher than those in the United States. Since 1970, productivity growth rates have decreased in the Japanese economy and interindustry variation in productivity performance has increased dramatically. For 9 of 30 industries included in the study the productivity gap between Japan and the United States closed during the period 1960–1979. For 19 industries there remain some significant differences in productivity levels in 1979. J. Japan. Int. Econ. , March 1987 1 (1), pp. 1–30. Harvard University, Cambridge, MA; Keio University, Tokyo, Japan; and The World Bank, Washington, D.C.
TL;DR: In this paper, the authors consider the response of the CFA Franc Zone, Cameroom, Cote d'Ivoire, and Senegal to commodity and oil price shocks of the 1970s in light of this and other institutional constraints.
Abstract: As members of the CFA Franc Zone, Cameroom, Cote d'Ivoire, and Senegal cannot use the nominal exchange rate as a tool of macroeconomic adjustment. This article considers these countries' responses to the commodity and oil price shocks of the 1970s in light of this and other institutional constraints. Using a two sector model, it shows that there exist instruments that, in principle, permit the real exchange rate depreciation necessary for adjusting to macroeconomic imbalances. The authors interpret the very different adjustment experiences of the three countries (despite their common economic structure and institutional setting) in terms of different uses of these instruments. Alternative assumptions about the labour market leave the qualitative nature of the results unaltered. Statistical analysis of data from the three countries confirms the model's linking of the current account and real exchange rate with the instruments of adjustment.
TL;DR: In this article, the authors argue that the two-tier system has resulted in the demise of the direct role of mandatory planning in the allocation of industrial goods, and that the inherent dynamic tendencies of the system are leading to a continual increase in the share of the market over time.
TL;DR: In this paper, the effect of the Training and Visit (T&V) system of agricultural extension on farm productivity was investigated in two adjacent areas in northwest India, one with T&V extension and one with an older system.
Abstract: The paper presents the results from a study of the effect of the Training and Visit (T&V) System of agricultural extension on farm productivity. Two adjacent areas in northwest India, one with T&V extension and one with an older system, are compared, utilizing farm-level data. Econometric analysis demonstrates that the T&V area had a wheat yield advantage of 9.33% after four years of T&V extension. The baseline yield differential was calculated as 3.01%. The gain attributable to T&V is shown to imply a return of at least 15% to the incremental investment in extension with high probability.
01 Jan 1987
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TL;DR: In this paper, the authors investigated the relation between tariff changes, terms of trade changes and the equilibrium real exchange rate for a small open economy and showed that the traditional wisdom that a tariff hike will always result in a real appreciation, while a terms-of-trade worsening will generate an equilibrium real depreciation, is incorrect.
Abstract: In this paper we investigate the relation between tariff changes, terms of trade changes and the equilibrium real exchange rate For this purpose we use two models of a small open economy: (1) a three goods version of the Ricardo-Viner model; and (2) a three goods model with full intersectoral factor mobility We show that, in general, it is not possible to know how the equilibrium real exchange rate will respond to these two disturbances Moreover, we show that the traditional wisdom that establishes that a tariff hike will always result in a real appreciation, while a terms of trade worsening will generate an equilibrium real depreciation, is incorrect
TL;DR: In this paper, the authors compared the path of consumer price rises with data for the incidence of political change and the frequency of military regimes from 1946 to 1984 for the following countries: Argentina, Brazil, Chile, Colombia, Mexico, Peru, Uruguay and Venezuela.
Abstract: The path of consumer price rises is compared with data for the incidence of political change and the frequency of military regimes from 1946 to 1984 for the following countries: Argentina, Brazil, Chile, Colombia, Mexico, Peru, Uruguay and Venezuela. A highly significant connection between the frequency of military government and the level of inflation is found. This appears to be due to two other significant results: (i) The military regimes are relatively unstable ones. (ii) Inflation normally turns upwards under civilian and downwards under military regimes, i.e., the military regimes are relatively strong in fighting inflation. Finally, it is demonstrated that few regimes survive a spell of hyperinflation.
TL;DR: For example, the Economic Development Institute of the World Bank would be interested in assisting the officials in the Ministry of Education to think through some of the policy options in the field of examinations and standardized testing.
TL;DR: In this paper, the authors report on research conducted at the World Bank to increase understanding of developing country housing markets; in particular, of housing demand behavior, and emphasize the importance of accounting for the impact of income and relative prices on housing demand.
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Abstract: The analysis focuses on the government budget constraint and the resolution of inconsistent implications of different policy instruments under that constraint. We show how, under floating exchange rates, external shocks or internal structural reforms may cause jumps in inflation and the exchange rate through their impact on the government budget. In order to achieve a sustainable reduction in inflation an exchange rate freeze or crawling peg is shown to require restrictions not only on domestic credit, but also on the rate of increase in interest-bearing public debt. We endogenize regime collapse by introducing rational speculation against the central bank, and show that if an exchange rate freeze collapses, post-collapse inflation will exceed the rate prevailing before the freeze started.
TL;DR: The dispute between developed and developing countries over the inclusion of services in the Uruguay Round of trade negotiations reflects critical differences in perspective on substantive issues as mentioned in this paper, and these substantive divisions arise from the differences between services and goods in matters such as regulation and the requirement in many instances offreedom to move productive factors across national boundaries.
Abstract: The dispute between developed and developing countries over the inclusion of services in the Uruguay Round of trade negotiations reflects critical differences in perspective on substantive issues. In particular, these substantive divisions arise from the differences between services and goods in matters such as regulation and the requirement in many instances offreedom to move productive factors across national boundaries-for example, the "right to establish" that would permit the provider of services to get to the user. In addition, developing countries see the developed countries as seeking concessions on service trade in exchange for removal of the latter's existing and potential barriers on trade in goods, rather than establishing quid pro quos within the service compact itself. Developing countries have possible export advantages in the service sector and have much to gain by joining actively in negotiating a services compact that permits them to exploit these advantages.
TL;DR: In this article, the authors present evidence on differences between public and private schools in Colombia and Tanzania on a number of indicators like cognitive achievement, unit cost and labor market outcomes, and conclude that in both countries, statistically controlling for student ability and socioeconomic background, private school students outperform their public school counterparts on academic achievement.
TL;DR: In this article, the authors examined the use of fiscal policies to sustain the effects of a nominal devaluation on the real exchange rate and showed that the magnitude of the change in the nominal exchange rate depends not only on the size of the devaluation and the degree of fiscal adjustment but also on the means by which the fiscal deficit is reduced.
Abstract: This article examines the use of fiscal policies to sustain the effects of a nominal devaluation on the real exchange rate. It is shown that the magnitude of the change in the real exchange rate depends not only on the size of the devaluation and the degree of fiscal adjustment but also on the means by which the fiscal deficit is reduced. The change in the nominal exchange rate necessary to maintain the depreciation of the real exchange rate will depend on whether the fiscal deficit is eliminated by increasing taxes or by reducing government expenditures on traded and nontraded goods. The required depreciation of the domestic currency will be larger if the fiscal deficit is reduced by increasing taxes than it will be if the deficit is cut by lowering government expenditures. Further, the depreciation would be smaller if the cuts in expenditure fell on traded rather than nontraded goods. This result implies that the authorities must ensure consistency between exchange rate action and policies to reduce fiscal imbalances in order to achieve a desired level of the real exchange rate necessary to attain balance of payments equilibrium. The real exchange rate represents a key relative price in the economy and policies to change it are often the centerpiece of adjustment programs designed to improve international competitiveness and shift resources toward the production of tradable goods. Consequently, it is critical for policymakers to have some idea of the magnitude and time path of the likely response of the real exchange rate to nominal exchange rate action. It is a well-accepted proposition, however, that a nominal devaluation will only have a transitory effect on the real exchange rate. In the long run domestic wages and prices will rise by the full amount of the devaluation and the real exchange rate will return to its original level. To alter the real exchange rate on a permanent basis, therefore, devaluation has to be supplemented by policies that restrain the increase in domestic factor costs that results from a devaluation. Generally speaking, the effects of a devaluation on the real exchange rate can
TL;DR: In this paper, a framework based on the vintage production model is proposed, which links the producer's short-run and long-run decisions, and the empirical applications to tea production in Kenya, India and Sri Lanka illustrate the diversity of mechanisms determining the supply responses.
TL;DR: For example, the authors states that "we are always willing to be trade partners, but never trade patsies" and "We are always ready to be a trade partner, but not a patsy".
Abstract: ‘We are always willing to be trade partners, but never trade patsies’— President Ronald Reagan, State of the Union Message, Washington, 1987
TL;DR: The results underline the importance of obtaining better epidemiological baseline data and information on project effectiveness if the potential usefulness of the healthy days of life approach to project evaluation is to be fully realized.