Showing papers in "Journal of International Development in 2019"

Gender, Microcredit and Poverty Alleviation in a Developing Country: The Case of Women Entrepreneurs in Pakistan

Abstract: The paper explores the impact of financial exclusion on financial and human poverty amongst women in Pakistan. The findings suggest that persistent financial exclusion, gender discrimination, and conservative religious values adversely impact women’s empowerment. There is an inverse correlation between the size of microcredit and women’s financial poverty, which is not the case for human poverty. Larger families experienced higher rates of poverty reduction than smaller families. The study offers evidence, and supports theories on the impact of microcredit upon poverty alleviation. These findings inform policy makers, women entrepreneurs, and microfinance institutions.

Corporate Social Responsibility in Nigeria and Rural Youths in Sustainable Traditional Industries Livelihood in Oil Producing Communities

Abstract: Since the first oil well was drilled in Nigeria, traditional economies have suffered neglect, and rural youths do not see a future for themselves in traditional industries livelihood (TIL). We examine the impact of corporate social responsibility (CSR) of multinational oil companies (MOCs) on youths’ participation in TIL. A total of 1200 youths were sampled across the rural Niger Delta. Results from the use of a logit model indicate a significant relationship between CSR and TIL. The findings suggest increased general memorandum of understanding (GMoU) interventions in canoe-carving, pottery-making, cloth-weaving, mat-making, and basket-weaving to revive the traditional economic activities in Nigeria.

Corruption and Economic Growth: Some New Empirical Evidence from a Global Sample

Abstract: This paper assesses the impact of corruption control and regulation quality on growth across countries over the period 1996 through 2015. After dealing with the possible endogeneity problem through the dynamic panel data models, our findings are suggestive of the positive effects of corruption control. Thus, our analysis tends to support the ‘sand the wheels' view at the aggregate level as well as for lower and lower–middle‐income countries. Similar results are also obtained for regulation quality. However, contrary to the theoretical arguments, the joint effect of regulation and corruption does not seem to be significant empirically for countries from any of the income groups. Evidence is also indicative of a positive effect on trade across countries from all income groups. Although our results failed to support the natural resource curse hypothesis, countries with efficient institutions and low level of corruption are not seen to experience any resource curse. Finally, policy implications of these findings are brought out. © 2019 John Wiley & Sons, Ltd.

Tax Reform and Public Revenue Instability in Developing Countries: Does the Volatility of Development Aid Matter?

Abstract: This paper examines the relationship between tax transition reform, development aid volatility, and public revenue instability in developing countries. Empirical findings show that tax reform exerts a negative effect on tax revenue instability, and the magnitude of this negative effect diminishes as the degree of development aid volatility increases. Specifically, beyond a certain level of development aid volatility, tax reform enhances tax revenue instability. Overall, these findings suggest that higher development aid flows to developing countries should be accompanied by a lower aid volatility so as to ensure that tax reform would generate lower tax revenue instability in recipient countries. © 2019 John Wiley & Sons, Ltd.

Rethinking research partnerships: Evidence and the politics of participation in research partnerships for international development

Abstract: This article responds to the drive for research partnerships between academics and practitioners, arguing that while potential benefits are clear, these are frequently not actualized resulting in partnerships that are ineffectual or worse, exacerbate damaging or inequitable assumptions and practices. In order to understand/improve partnerships, a systematic analysis of the interrelationship between what counts as evidence and dynamics of participation is proposed. Drawing on data from a seminar series and iterative analysis of seven case studies of partnerships between Higher Education Institutions and International Non-Governmental Organisations the article concludes by suggesting substantial shifts in the theory and practice of partnerships.

What Interactions between Financial Globalization and Instability?—Growth in Developing Countries

Abstract: This paper tests the effects of the impact of financial globalization on economic growth, examining its interaction with financial instability for a sample of 72 developing countries over the period 1972–2011, using dynamic panel estimator ‘two‐step Generalized Method of Moments’ (two‐step system GMM) The main results of the paper are the following: (i) financial instability and indebtedness‐globalization decrease growth; (ii) financial globalization and investment‐globalization increase growth; (iii) indebtedness‐globalization increases the effect of financial instability on growth; (iv) investment‐globalization decreases the effect of financial instability on growth; and (vi) financial globalization decreases the effect of financial instability on growth These results are robust in a set of tests consisting of the insertion of alternative variables of financial instability, the inclusion of new control variables, inter alia an indicator of banking crises, using different time periods, and changing of the composition of the sample © 2018 John Wiley & Sons, Ltd

Forecasting the Probability of Recessions in South Africa: the Role of Decomposed Term Spread and Economic Policy Uncertainty

Abstract: This paper extends the vast literature forecasting the probability of recession by including the different components of the term spread, namely the expectation and the term premium components obtained from a fractional integration approach. We also augment these with the economic policy uncertainty index. We use 10 specifications of the probit prediction model and quarterly data from South Africa covering the period 1990:1 to 2012:1 for analyses. Our out-of-sample results show that the model that incorporates the expectation component of the yield spread in addition to economic policy uncertainty provides the best forecast of recession in South Africa. All three recession periods in our sample were accurately dictated by the prediction models and the best forecast occurred at the four quarters ahead horizon. These results were also robust to the full sample prediction

Natural Disaster Damages and Their Link to Coping Strategy Choices: Field Survey Findings from Post‐Earthquake Nepal

Abstract: The 7.8 magnitude earthquake that struck Nepal on 25 April 2015, was the worst natural disaster to hit Nepal since 1900. This article reports field survey findings on earthquake damages and ex‐post coping responses adopted by rural households in Sindhupalchowk, Nepal. Subsequently, we conduct empirical analyses to illustrate how earthquake damages influence ex‐post coping strategy choices and potentially limit paths to post‐disaster recovery. The goal of this empirical demonstration is to underscore the need to cater post‐disaster policies in developing countries in ways that expand households' post‐disaster coping strategy choices through market and non‐market mechanisms. © 2018 John Wiley & Sons, Ltd.

Trade Openness, Economic Growth and the Global Financial Crisis of 2007–2009 in Latin America

Abstract: This paper examines the relationship between bilateral trade openness and per capita gross domestic product for 15 Latin American countries during the financial crisis of 2008. It is employed an augmented gravity model of trade for the pre‐crisis, during‐crisis and post‐crisis periods (2004–2006, 2007–2009 and 2010–2012, respectively). Geographical characteristics and democracy rates of countries are used to instrument for average bilateral trade volumes. Different measures of trade openness are tested, and mixed results are identified. First, a slightly positive relationship between trade openness and growth is found when considering only Latin American countries. Second, after removing outliers and considering all importer countries, a negative relationship between the variables is found. © 2019 John Wiley & Sons, Ltd.

Dynamic Linkage Between Economic Growth and Human Development: Time Series Evidence from Nigeria

Abstract: A consensus among academics and policymakers holds that investing in human development not only improves lives, but also by itself promotes stellar economic growth We investigate these claims by estimating the two‐way causality between economic growth and human development in Nigeria over the period from 1961 to 2015 By employing three statistical frameworks (Gregory–Hansen Cointegration, Stock–Watson Dynamic Ordinary Least Square and Vector Error Correction Model), our estimates suggest the following First, economic growth and human development share a long run relationship, that is, they are cointegrated Second, despite the two variables sharing a long run relationship, only economic growth can exercise a positive effect on human development, and no evidence of reverse causality was observable Far importantly, we prescribe a policy recommendations from these findings © 2018 John Wiley & Sons, Ltd

Is Productivity Affected by Remittances? The Evidence from Morocco

Abstract: Empirical results yield mixed evidence of the effect of remittances on economic growth in countries of origin. This note assesses the potential impact of remittance instability on total factor productivity in Morocco. It uses a threshold vector autoregression model for the period 1975–2014. Remittances are used as a threshold variable. Results show that the response of total factor productivity to shock in remittances is positive and stronger when those remittances exceed the value of 5.132 per cent of GDP with the reverse effect when they are lower than the threshold value. Public authorities may enhance remittances to accelerate a country's development. © 2018 John Wiley & Sons, Ltd.

Assessing Inflation Convergence in the East African Community

Abstract: The paper investigates inflation convergence in five East African countries: Burundi, Kenya, Rwanda, Tanzania and Uganda, as they aspire to form a monetary union by 2024 under the umbrella of the East African Community (EAC). We find that inflation differentials in the five EAC countries are not persistent, implying that inflation rates in these countries have been converging. This convergence can be attributed to a similarity in terms of the nature of shocks affecting EAC countries as well as the crucial role of foreign factors as drivers of inflation in these countries since the early 1990s. © 2018 John Wiley & Sons, Ltd.

How Do High and Low Levels of Social Trust Affect the Long‐run Performance of Poor Economies?

Abstract: Poor countries with high levels of social trust are shown to experience a hump‐shaped pattern of long‐run growth. With social trust modelled as a human capital externality, a calibrated two‐sector model replicates the observed hump‐shaped growth path. The simulation results imply that a hypothetical poor economy with a high level of social trust, when beginning at a relative income level of 16 per cent, may need about 160 years to reach 50 per cent of the income level of the leading countries. For a hypothetical poor country with a low level of social trust, the process of catching up may only begin after more than 150 years of relative stagnation. © 2018 John Wiley & Sons, Ltd.

Does Public Health Insurance Increase Maternal Health Care Utilization in Egypt

Abstract: This paper assesses the impact of the national health insurance on the utilization of maternal health care services in Egypt using propensity score matching. The results suggest that health insurance has a strong and robust positive impact on most of the maternal health care indicators. © 2019 John Wiley & Sons, Ltd.

Do Adult Equivalence Scales Matter in Poverty Estimates? A Northern Ghana Case Study and Simulation

Abstract: We test the sensitivity of per capita expenditures to several methods of per adult equivalent expenditures to control for economies of scale and household composition. Simulation analysis determines the indifference point between per capita expenditures and per adult equivalent measures in order to identify the factors contributing to the dominance of one measure over another. Results indicate that overall poverty and inequality measures in northern Ghana are highly sensitive to the use of equivalence scales. Poverty measures for children and the elderly and in urban and rural areas are also sensitive to equivalence scales. © 2018 John Wiley & Sons, Ltd.

Does Shorter Postnatal Hospital Stay Lead to Postdischarge Complications? An Instrumental Variables Approach

Abstract: We exploit the difference in means of postnatal hospital stays between beneficiary mothers of Janani Suraksha Yojana (JSY) and control mothers to estimate causal effects of postnatal hospital stay (PHS) on post-discharge complications (PDCs) of a mother and her newborn. We argue that JSY increases the demand for institutional deliveries in those hospitals, which are assigned by the government to provide such services to the JSY recipients. Given the limited supply of beds, health professionals, and other facilities, an excess demand for institutional deliveries in those hospitals force JSY recipients to stay shorter after births compared to nonrecipients of JSY who are free to deliver in any hospital. Thus, the dummy for JSY becomes a suitable instrument for PHS. Using instrumental variables (IV) regressions, we find that PHS has statistically significant negative causal effects on half of the available PDCs in the data, including abdominal pain, vaginal discharge, convulsion and severe headache of a mother, and fever or cold of the newborn. JEL Classification: C31, C36, I10, I18

Cursed by Oil? Rural Threats, Agricultural Policy Changes and the Impact of Oil on Indonesia's and Nigeria's Rural Development

Abstract: This paper aims to re‐examine the linkages between oil and agricultural development. While Indonesia and Nigeria faced similar adjustment problems after the oil boom of 1974, their food production performance showed significant differences. I find that threats from rural forces matter. Rural threats forced the Indonesian government to pursue agricultural policy reforms and use oil revenue to support these reforms. In contrast, the absence of rural threats gave leeway for Nigerian elites to use oil money to reproduce their interests in infrastructural and industrial development at the expense of peasant producers. © 2018 John Wiley & Sons, Ltd.

Risk Aversion and Diversification Strategies

Abstract: Diversifying agricultural assets and income sources is a critical strategy employed by the poor to meet their critical needs, mitigate risks and respond to shocks. Relative to non‐poor households, poor households are more likely to face constraints to asset ownership, which may impact their ability to improve their welfare. This paper uses primary data collected from the Guatemalan Highlands, including an experiment to elicit risk preferences, to describe the association between risk preferences and a household's agricultural assets and income diversification using a model that controls for fixed effects at the community level. The findings suggest limited evidence that higher risk aversion is positively related to asset ownership. While one might expect risk averse individuals to diversify their household's sources of income, the results from this study suggest only limited evidence of this occurring in Highland Guatemala. © 2019 John Wiley & Sons, Ltd.

Accuracy of Targeting Under the Rural Employment Guarantee Programme: A Comparison Between West Bengal and Rest of India

Abstract: One major success indicator of any welfare programme is accuracy of targeting of the benefits to the intended population. Using data from 2009–2010 and 2011–2012, this paper assesses targeting in terms of participation of the poorer households in Mahatma Gandhi National Rural Employment Guarantee Act in the Indian state of West Bengal and compares it with rest of the country. Although implementation of the programme in the state has been poor, the targeting performance is found to be fair in comparison to other parts. The findings lay emphasis on improvement in other dimensions of the programme to realise the optimal benefits. © 2018 John Wiley & Sons, Ltd.

The Impact of Cash Transfer Programmes on Youth and Adult Labour Supply: Evidence from Lesotho and the Philippines

Abstract: This study analyses the effect of cash transfers, aimed to increase children's human capital, on youth and adult labour supply. We provide novel results from the evaluation of two programmes: the conditional cash transfer Pantawid in the Philippines and the unconditional cash transfer Child Grant Programme in Lesotho. The transfers did not discourage youth and adult work. However, marginal adjustments emerged: the Child Grant Programme decreased youth and adult occasional work, representing the last resort to cope with income vulnerability; the Pantawid did not influence youth work but increase adult wage work, with a reduction of family work, indicating that the transfer decreased transaction costs associated with labour market access. © 2018 John Wiley & Sons, Ltd.