Showing papers on "Developing country published in 1992"

Outward-Oriented Developing Economies Really Do Grow More Rapidly: Evidence from 95 LDCs, 1976-1985

Abstract: The long run trade orientation of an economy is measured in this article by an index which measures the extent to which the real exchange rate is distorted away from its free trade level by the trade regime The technique for estimating a cross country index of real exchange rate distortion uses the international comparison of prices prepared by Robert Summers and Alan Heston Resource endowment constitutes the norm and real overvaluation or undervaluation relative to this norm reveals whether incentives are directed to the domestic or international market The index is constructed based on data for GDP/capita average price level in US dollars 1976-85 and GDP growth rate/capita 1976-85 Other sections are devoted the comparison of the procedure for 117 countries between 1976-85 and an examination of the empirical relationship between outward orientation and economic growth and sensitivity analysis The results indicate that Latin America generally was overvalued by 33% relative to Asia and Africa was overvalued by 86% The real exchange rate distortion index supports the view that Asian countries are more outward oriented Asian economies have lower price levels which reflect relatively modest protection and incentives oriented to external markets Latin American countries with moderately high price level and African countries with very high price levels reflect strong protection and incentives directed to production for the domestic market An alternative specification which eliminates the dummy variables for Africa yields similar results with slightly lower magnitude; ie overvaluation is 60% instead of 86% for Africa and Latin America is overvalued by 39% instead of 33% over Asia A table is provided which indicates by country the distortion and variability of the real exchange rate the GDP growth the 1976 GDP/capita and the investment rate Another finding was that there is a significant negative relationship between distortion of the real exchange rate and growth of GDP/capita after controlling for the effects of real exchange rate variability and investment level with both the original specification and the alternative The growth rate/capita of Latin American and African countries would increase 15-21% with a shift to move outward oriented trade policies This gain as well as devaluation of the real exchange reate trade liberalization and maintenance of a stable real exchange rate would contribute to positive growth rates In the analysis of the poorest 24 countries the result was that only rate distortion and not variability and investment rate explained the growth rate The gain for Ghana for example of adopting the trade policies and exchange rate of Bangladesh would be 5% to its growth

Trade Policy and the Third World Metropolis

Abstract: Many of the world's largest cities are now in developing countries. We develop a simple theoretical model, inspired by the case of Mexico, that explains the existence of such giant cities as a consequence of the strong forward and backward linkages that arise when manufacturing tries to serve a small domestic market. The model implies that these linkages are much weaker when the economy is open to international trade -- in other words, the giant Third World metropolis is an unintended by-product of import-substitution policies, and will tend to shrink as developing countries liberalize.

Informal economic activity

Abstract: Introduction: What is informal activity? Part 1 The household sector: women's wages - unpaid household work and the national income accounts subsistence economics - the household in developing countries. Part 2 The informal sector: the informal sector - aid to development or barrier to modernization?, a safety valve for urban growth? Part 3 The irregular sector: the irregular sector - what is it and why does it matter? macroeconomic analysis of the irregular sector - how big is it, who is involved, how and where? perks, fiddles, fraud and the irregular sector the irregular sector in developing countries. Part 4 The criminal sector: organized crime in the developed countries crime in the developing countries.

Effects of Consumer Preferences for Foreign Sourced Products

Abstract: When deciding on overseas production locations, the manager must take into account not only resource and cost benefits, but the effect that country of origin may have on consumer evaluations. An experiment conducted by a telephone survey procedure examined country of origin perceptions of twelve countries and eight products, using both perceived quality and choice measures. As hypothesized, preferences were found to be more product specific for industrialized than less developed countries. In addition, hypotheses that performance risk and brand moderate the effects of country were upheld under most conditions.

Economic development, environmental regulation, and the international migration of toxic industrial pollution : 1960-88

Abstract: Several previous studies have asked whether environmental controls imposed in the industrial economies are diverting investments in pollution-intensive activities off-shore. Broadly, these studies conclude that direct investment does not appear to be stimulated by such regulations, partly because the cost of emission controls is generally a tiny fraction of operating costs. Yet direct investment reflects only part of what may be happening to world production patterns. Technology transfers may occur with no simultaneous direct investments, and production may readily shift toward a different global distribution without either direct investment or technology transfer. The authors attempt a general test of the displacement hypothesis, developing time series estimates of manufacturing pollution intensity for a large sample of developed and developing countries between 1960 and 1988. Among their conclusions: As a result of shifts in industrial composition, total manufacturing emissions relative to GDP grow faster than GDP at lower levels of per capita income and slower than GDP at higher levels of income. This happens because manufacturing has a declining share of GDP at higher income levels, not because of any shift toward a cleaner mix of manufacturing activities. The more rapidly growing high-income countries have actually enjoyed negative growth in toxic intensity of their manufacturing mix. Stricter regulation of pollution-intensive production in the OECD countries appears to have led to significant locational displacement, with consequent acceleration of industrial pollution intensity in developing countries. The poorest economies seem to have the highest growth in toxic intensity. One cannot, of course, be certain of the causal connection. Pollution intensity has grown most rapidly in developing economies that are relatively closed to world market forces. Relatively closed, fast-growing economies experienced rapid structural transitions toward greater toxic intensity. The opposite seems to have been true for more open economies.

The state of world rural poverty: an inquiry into its causes and consequences

Abstract: Poverty is spreading. There are now as many people living in absolute poverty - almost a billion in the rural Third World alone - as lived on the entire planet only a century ago. Yet poverty continues to be shrouded in mystery. Consider that: Four-fifths of the world's poor live in rural areas; About 340 million people worldwide are currently chronically ill from malnutrition; Over 500 million do not get enough calories to do a full day's labor; At a time when enough grain is being produced to provide everyone in the world with twice the daily minimum caloric requirements, global hunger is at an all-time high; Half again as many rural women - almost 600 million - live in absolute poverty today as did 20 years. In an effort to call special attention to this urgent problem, the International Fund for Agricultural Development (IFAD), a United Nations agency that has approved more than 300 development programs in almost 100 countries and is considered the world's foremost authority on issues of rural poverty, and New York University Press are proud to be present The State of World Rural Poverty. In the tradition of the World Development Report and World Resources, The State of World Rural Poverty, offers the first comprehensive look at the economic conditions and prospects of the world's rural poor. Certain to become the definitive source of data and analysis as well as an invaluable policy guide to issues involving development and poverty in underdeveloped nations, this volume incorporates research from all over the world.

Tourism and the Less Developed Countries

Abstract: International Tourism and the Less Developed Countries: the Background Tourism to Less Developed Countries: the Social Consequences Political Instability and Tourism in the Third World The Structure of International Tourism and Tourism Development in Kenya Sex Tourism in South-East Asia Japan and South-East Asia: the International Division of Labour and Leisure Tourism in Latin America: Perspectives from Mexico and Costa Rica Tourism Development in Cuba The Politics of Tour Guiding: Israeli and Palestinian Guides in Israel and the Occupied Territories Life in the Informat Sector: Street Guides in Kandy, Sri Lanka Tradition, Modernity and Tourism in Swaziland.

Household Income and its Distribution in China

Abstract: The distribution of income in China has been a subject of great interest to economists and others both inside and outside the country. Scholars have wanted to know whether a socialist strategy of development has resulted in an egalitarian society and, more generally, how the distribution of income in China compares with that in other developing countries that have relied more on market forces. Policy makers have wanted to know, especially after the economic reforms introduced since 1978, whether the institutional transformations and policy interventions ameliorated or aggravated existing inequalities. Unfortunately it has not been possible to address these questions systematically because of inadequate statistical information. There were few estimates of the distribution of income in China and the available estimates were fragmentary and unreliable.

The plundering of agriculture in developing countries.

Abstract: The findings and policy implications presented in this paper are based on The World Bank Comparative Study of Agricultural Pricing Policies in Developing Countries, which examined agricultural pricing interventions in eighteen developing countries during 1960-- 85, as well as on the evolution since 1985. The results of the study have been published in a five-volume series, The Political Economy of Agricultural Pricing Policy (Baltimore, Md.: Johns Hopkins University Press), edited by Anne O. Krueger, Maurice Schiff, and Alberto Valdes. This paper draws on the findings of volume 4, A Synthesis of the Economics in Developing Countries, by Maurice Schiff and Alberto Valdes. Research on development strategies and trade regimes in developing countries since the early 1970s has consistently found that countries that have adopted outward-oriented strategies have been more successful than countries that sought to build their industrial sector through inward-oriented strategies of import substitution (Little, Scitovsky, and Scott 1970; Balassa 1971; Bhagwati 1978; and Krueger 1978, 1983). But none of these comparative studies explicitly examined agriculture or looked systematically at the impact of trade or other types of indirect intervention on agricultural incentives. The World Bank research reported here fills these gaps by assessing the effects on agriculture of both direct and indirect price interventions during twenty-five years (1960-1985) in eighteen representative developing countries, using a common conceptual framework and methodology. The research developed measures of the impact of direct and indirect price policy interventions on relative prices within agriculture and between agriculture and the rest of the economy. These measures were then used to estimate the effects of price interventions on agricultural production, consumption, foreign exchange earnings, the budget, income transfers between agriculture and the rest of the economy, and income distribution.

Policy instruments for pollution control in developing countries

Abstract: What are appropriate strategies for protecting the environment in developing countries that also seek to promote growth and reduce poverty? This article reviews the literature on cost-effective intervention, comparing regulatory and fiscal instruments that can be attuned to the purpose of reducing pollution. The authors look at what happens when developing country ingredients are introduced into the standard policy problem, and show how indirect instruments can be effective when monitoring and enforcement are costly. They discuss distributive concerns for two reasons: the effect on the poor may need particular consideration for equity reasons, and the effect on groups with vested interests can determine whether reforms are likely to stand or fall.

Why are developing countries privatization

Abstract: This article tests alternative hypotheses about why developing countries are pursuing privatization, a policy that gained considerable popularity in the 1980s. Univariate and multivariate analysis indicate that privatization was more likely to be pursued by countries with high budget deficits, high foreign debt, and high dependence on international agencies like the World Bank and the IMF. In regions such as Latin America and Asia, the trend was also more likely in countries (a) that seemed to have “overused” state enterprises in the past, and (b) those in which the private sector had grown faster than average and was thus more ready to assume tasks once assigned to state enterprises. In Africa, however, the policy may have been imposed by external agencies on countries that were not necessarily ripe for privatization. For multinational firms, the international opportunities created by privatization are likely to be greater in the 1990s than in the 1980s.

Male Bias in Structural Adjustment

Abstract: The last decade has been marked by a contrast between rising awareness of the importance of women’s contribution to the economy and continued deterioration of the world economy. Encouraged by the UN Decade for Women, many governments have set up Women’s Bureaux, or Departments for Women’s Affairs. Women’s groups across the world have campaigned for proper recognition of women’s work both as producers of goods and services, and as reproducers of human resources; and for access to the resources women require to improve the productivity of their efforts. There have been some successes in opening up new activities to women through special training programmes; and in enhancing women’s income earning opportunities through projects with women’s components, or specifically directed to women. Much of the energy of Women’s Bureaux in developing countries has been directed towards women’s projects, often in partnership with aid agency officials who have special responsibility for women and development. In market economy developed countries, much of the emphasis has been on introducing new equal opportunities legislation and enabling women to fight their cases through the courts.

Devaluation Controversies in the Developing Countries: Lessons From the Bretton Woods Era

Abstract: This paper uses historical data from the Bretton Woods era to analyze the effectiveness of devaluation-based adjustment programs in the developing countries. Forty eight major devaluations undertaken between 1954 and 1971 are investigated in detail in an effort to understand the circumstances leading to these adjustment programs, as well as their degree of effectiveness. An important aspect of the analysis is the distinction between devaluations undertaken within the context of IMF programs, and devaluations implemented independently. We find out that, in general, countries with lower income per capita and deeper economic problems tended to seek IMF support with greater frequency. Also, our analysis indicates that countries with left-wing leaning governments were less likely to embark on IMF programs. With respect to the effectiveness of these devaluation programs, our findings support the notion that devaluations accompanied by restrictive and consistent macroeconomic policies are an efficient and powerful adjustment tool. Our historical investigation also shows that, in general, countries that embarked on IMF stand-by programs tended to perform better than countries that adjusted on their own.

A two-part sample selection model of British bilateral foreign aid allocation

Abstract: The allocation of British bilateral foreign aid among developing countries is simultaneously modelled, focusing on allocations during the period 1980–87. Two aid allocation decisions are analysed using a variant of the Lee-Maddala econometric model. The first decision concerns the determination of developing country eligibility for aid, while the second concerns the amount of aid eligible countries are allocated. Given the implied two-part decision-making process, sample selection techniques are employed. It is hypothesized that British bilateral aid eligibility and amount decisions are based on Bristain's humanitarian, commercial and political interests in developing countries. Results obtained indicate that these decisions are generally consistent with each of these interests, especially those relating to the political importance of Commonwealth members.

A review of environmental health impacts in developing country cities

Abstract: The World Bank is currently assessing the relative health impacts of physical environment problems in urban areas of developing countries in order to better guide its urban policy and investment decisions. As a contribution, this report reviews and summarizes available literature on health in the urban areas of developing countries. It discusses associations between health and problems of the material environment. The objectives of the report are: (1) to produce a classification of environmental variables relevant to urban health in developing countries; (2) to propose an analytical framework for relating environmental variables to health; (3) to review intra-urban differentials in mortality, morbidity and causes of death in developing countries, with particular reference to vulnerable groups; (4) to review literature that attempts to link casually urban environmental conditions to health in developing countries; and (5) to propose future related research.

Health and the environment in the 1990s.

Abstract: Expectation of life at birth provides a simple measure of the state of health of a country. Differences in the expectation are examined in the United States over time and between males and females and Whites and non-Whites, and worldwide between market and nonmarket developed countries, and between developed and developing countries. The principal factors responsible for the trends and the current differences are changes in the social and physical environment, in personal behavior, and in medical care, and their relative importance is assessed. It is concluded that, at present, the principal environmental hazards worldwide are those associated with poverty of individuals within the market economies and of communities in the developing countries and that in the future, they will be the effects of overpopulation and the production of greenhouse gases.

The reproductive revolution: new survey findings.

Abstract: Data from the Demographic and Health Surveys and the Family Planning Surveys are used to review fertility trends in developing countries since the 1960s. Consideration is given to fertility patterns and preference; contraceptive use knowledge and availability; estimates of unmet needs for family planning services; trends in marriage age; infant and child mortality; and antenatal and child health care. Future fertility patterns are also projected. An appendix provides information on the status of the surveys in each participating country as of December 1992.

Socioeconomic inequalities in childhood mortality: the 1970s to the 1980s.

Abstract: The last three decades have witnessed substantial reductions in childhood mortality in most developing nations. Despite this encouraging picture, analysis of WFS and DHS survey data shows that socioeconomic disparities in survival chances have not narrowed between the 1970s and 1980s, and in some cases, have widened. Changes in mother’s education and father’s occupation contributed only modestly to secular declines in mortality. In most countries studied, no more than 20 per cent of the national trend could be accounted for by compositional improvements. The median contributions of improvements in mother’s education and father’s occupation were ten and eight per cent, respectively. The last three decades have witnessed substantial reductions in childhood mortality in most developing countries. The record of socioeconomic progress has been less even. Nevertheless today’s mothers are more likely than the mothers of the previous generation to be educated, to be living in an urban setting and to be married to a man with a non-manual occupation. We also know, particularly from extensive analysis of WFS data, that the survival chances of children vary widely between socioeconomic strata, with the educational attainment of the mother being a particularly strong predictor. From this perspective, two important questions arise. Are socioeconomic disparities in child survival widening or narrowing? And to what extent can mortality decline be attributed to changes in the socioeconomic composition of populations? Answers to these and other questions relating to changes in the age pattern of mortality are sought by a joint analysis of WFS and DHS survey data for 15 developing countries that have participated in both survey programs. We make no pretence that these countries are representative of the developing world or of particular regions, but their number and geographical spread are sufficient to permit tentative generalizations. Life-table measures of mortality for five-year calendar periods are produced at the national level and for socioeconomic subgroups. This approach permits an unusually long historical dimension to the study of trends. It also encounters severe problems of data consistency between the WFS and DHS which are assessed in the first substantive section of the paper. In a few countries, the two sets of estimates are incompatible. These cases are dropped from the analysis. In the majority of cases, however, they match well and may be regarded (with caution) as a single continuous historical record.

Trade Policy, Industrialization, and Development: New Perspectives

Abstract: This book investigates the ways in which the characteristics of a developing country's domestic industrial sector - for example, oligopolistic markets, the position of foreign enterprises, and the acquisition of modern technologies - affect its chances of industrializing far enough to engage in substantial export trade. Particular attention is devoted to the real-world imperfections frequently overlooked by orthodox economists. Case studies are included of, for example, Brazilian civil aircraft, Korean semi-conductors, and the automobile industry in a number of developing countries. The volume contributes to a better appreciation of the actual problems and constraints of industrialization and growth in developing countries and points the way to useful further lines of research.

Aid, the public sector and the market in less developed countries: A return to the scene of the crime

Abstract: The paper returns to the question of what is the correct structural form for the relationship between aid, other financial flows, and economic growth rates, using a crosssection approach and – for the first time – data for the entire 1980s as well as the 1960s and 1970s. For the 1980s the aggregate partial regression coefficient of aid on growth emerges, for the first time, as positive and (just) significant, although this result does not survive the partitioning of the sample into sub-groups. It remains obvious that the effect of aid on growth is country-specific, and in the later part of the paper we test a new approach under which aid effectiveness passes through a cycle, first increasing and then diminishing as a country's stage of economic development alters. If this approach is accepted (and the initial results, with an informal test, are promising) the overall crosssection relationship between aid and growth, abstracting from other influences, will be neutral in most periods.