World Institute for Development Economics Research

About: World Institute for Development Economics Research is a facility organization based out in Helsinki, Finland. It is known for research contribution in the topics: Poverty & Population. The organization has 110 authors who have published 525 publications receiving 17316 citations.

Aid Disaggregation and the Public Sector in Aid-Recipient Economies: Some Evidence from Cote D’Ivoire

Abstract: The present paper examines the impact of different aid types, namely project aid, program aid, technical assistance, and food aid on the fiscal sector of the aid-recipient economy by using time-series data for Cote d’Ivoire over the period 1975–99. Our empirical results show that when a single value (or aggregated) for aid is used, foreign aid is fully consumed in the case of Cote d’Ivoire. However, results obtained under the assumption of aid heterogeneity clearly suggest that the government responds differently according to the nature of the aid inflows. Our approach tries to illuminate the response of the aid-recipient government to different categories of foreign aid inflows and the empirical findings clearly demonstrate the importance of the aid disaggregation approach for delving deeper into aid effectiveness issues.

Trade Expansion of China and India: Threat or Opportunity?

Abstract: By exploring the export performances and specialisation patterns of China and India, we assess their trade competitiveness and complementarity vis-a-vis each other as well as with the rest of the world. Our analysis indicates that (a) India faces tough competition from China in the third markets especially in clothing, textiles and leather products; (b) there is a moderate potential for expanding trade between the two countries; (c) China poses a challenge for the East Asian economies, the US, and most European countries especially in medium-technology industries; (d) India appears to be a competitor mainly for its neighbouring South Asian countries; (e) complementarity exists between the imports of China and India, and the exports of the US, some European states and East Asian countries, especially Japan, Korea, Malaysia, Singapore and Thailand, implying opportunities for trade expansion; and finally (f) the export structure of China is changing with the exports of skill-intensive and high-technology products increasing and those of labour-intensive products decreasing gradually. This suggests that challenges created by China in traditional labour-intensive products might reduce in the long run.

Finance in Conflict and Reconstruction

Abstract: The relationship between an economy's financial sector and the occurrence and resolution of conflict may at first sight appear tenuous. Banking systems, financial regulation and currency arrangements do not appear to be relevant in understanding why nations collapse or why people kill each other. However, the linkages between the financial sector and issues of conflict are closer than one might expect. Narrow development—development that fails to reduce poverty and which exacerbates initial inequalities—is an important cause of conflict (but, needless to say, not the only one). Narrow development must be financed—and it is financed in ways that increase poverty and inequality and raise a society's propensity to violent conflict. During conflict, finance (both internal and external) can be decisive in determining who wins, as well as the duration of war.

Ethnic Heterogeneity and Public Goods Provision in Zambia: Further Evidence of a Subnational ‘Diversity Dividend’

Abstract: The hypothesis that ethnic diversity has a negative impact on public goods provision is widely accepted. Notably, most work on this issue fails to distinguish adequately between national versus subnational governance. We find that subnational empirical evidence in particular is inconclusive, and speak to this gap with new analysis at the Zambian district level. Results lend strong support to an emerging body of work challenging the ‘diversity debit’ hypothesis: we find no clear evidence of a negative impact but instead a robust positive association with key welfare outcomes. Contra the conventional wisdom, future work should explore mechanisms underlying the ‘diversity dividend’ now suggested in multiple subnational analyses.

Macro-Micro Feedback Links of Water Management in South Africa: CGE Analyses of Selected Policy Regimes

Abstract: The pressure on an already stressed water situation in South Africa is predicted to increase significantly under climate change, plans for large industrial expansion, observed rapid urbanization, and government programs to provide access to water to millions of previously excluded people. The present study employed a general equilibrium approach to examine the economy-wide impacts of selected macro and water related policy reforms on water use and allocation, rural livelihoods, and the economy at large. The analyses reveal that implicit crop-level water quotas reduce the amount of irrigated land allocated to higher-value horticultural crops and create higher shadow rents for production of lower-value, water-intensive field crops, such as sugarcane and fodder. Accordingly, liberalizing local water allocation in irrigation agriculture is found to work in favor of higher-value crops, and expand agricultural production and exports and farm employment. Allowing for water trade between irrigation and non-agricultural uses fueled by higher competition for water from industrial expansion and urbanization leads to greater water shadow prices for irrigation water with reduced income and employment benefits to rural households and higher gains for non-agricultural households. The analyses show difficult tradeoffs between general economic gains and higher water prices, making irrigation subsidies difficult to justify.