Latent advantage,complex challenges: Industrial policy and Chinese linkages in Ethiopia's leather sector

Industrial policy is back on the African policy agenda, with a number of countries following new strategies for rapid industrialization. None have done so more eagerly than Ethiopia. The present paper draws on Justin Yifu Lin's framework of New Structural Economics to assess Ethiopia's industrial policies and engagement in the leather industry. Making use of two rounds of semi-structured interviews (2012 and 2015) with all of the foreign firms and more than a dozen local firms in the leather sector, as well as other key stakeholders, it examines seven steps the government took to build the industrial policy: Create a high-level focus on the sector; make strategic use of international development partners; attract a “lead goose” (Chinese) in the footwear sector; build government capacity to support the sector; strengthen business associations; “shock-to-shape” upgrading; improve input supply. Ultimately, while government interventions have led to improvements across several steps of the value chain, the paper identifies a number of factors that have prevented the country from fully realizing a latent comparative advantage in the leather sector.     

Trade,Job Destruction and Job Creation in European Manufacturing

This paper examines the effects of international trade with the newly industrialized Asian economies on the labor markets of Germany, France, Italy and the United Kingdom. The analysis confirms that, despite the growing importance of this trade, the problems of the European labor market can hardly be explained by the increase in imports of manufactures from the Nies. While job destruction appears completely independent from the trade flows with the emerging Asian economies, the evidence on job creation is less clear cut. In two cases imports appear to have depressed employment dynamics, but in another exports turn out to have stimulated it. The most striking evidence is on sector-specific features and individual characteristics, such as sector of (last) employment, sex and education: these variables appear to be much more important than trade in explaining individuals' positions in the labor market.     

Openness, Investment and Growth

In the empirical growth literature both investment and opennessto international trade have been identified as important determinantsof growth. These relationships appear to be robust in a numberof specifications. However, Sachs and Warner claim that opennessis such an important determinant of investment that the coefficienton investment will be insignificant in growth regressions, whichalready account for openness. I re-examine this result and canonly support it if I use their model specification and estimationmethod. I suggest that their ordinary least squares estimationsuffers from both endogeneity and omitted variable bias. Usingpanel data analysis, I show that ignoring unobserved country-specificeffects and endogeneity problems cause investment to be insignificant.Estimating the model with the Blundell and Bond system generalmethod of moments estimator, which allows me to address theomitted variable as well as the endogeneity bias, I find thatinvestment is significant in the Sachs–Warner model despitecontrolling for openness. Thus, my regressions confirm thatopenness has a significant, positive effect on income. However,this variable is not so important that it drives investmentout of the model. My re-examination of the Sachs–Warnermodel shows that results from single cross-country growth regressionscan be misleading when unobserved country-specific effects andendogeneity problems are ignored.     

Aid and Poverty in Africa: Do Well‐being Measures Understate the Progress?

Abstract: In the last 15 years international aid donors to Africa have shifted their focus dramatically toward health and education; the share of social sector support in total aid rose from 33 per cent to 60 per cent from 1990–94 to 2000–2004 alone. If this aid has been effective, it is unlikely to be captured in GDP or income poverty figures. This paper uses the Demographic and Health Survey at multiple points in time to explore changes in well‐being in ten sub‐Saharan African countries. It compares the evolution of both assets and health which are considered as the two main dimensions of well‐being. These dimensions are simultaneously estimated using the structural equation models with latent variables that have been developed in the psychometric literature. The comparisons of well‐being across time in each country are based on the stochastic dominance analysis. The main results suggest that assets and health have improved during the last two decades in most of these countries. A decline in assets is observed for three countries while health deteriorates in two countries. The reduced poverty appears to be explained less by the aid than other factors in most cases.     

论金融控股公司演进路径:社会抉择与制度设计

金融控股公司作为现代金融业最重要的经营组织形式,在金融危机中表现出巨大抗风险能力。后金融危机时代,金融业并没有出现上世纪大萧条的分业经营,许多业务单一的金融机构开始了新一轮大规模的兼并与重组,一大批新金融航母开始出现。实际上,金融业经营模式作为一种金融制度安排,它与宏观经济、技术进步等经济环境密切相关,是在一定经济条件下社会抉择的结果。本文通过金融控股公司演进路径的梳理,重新认识到政府干预与自由市场之间选择的重要性,可以对我国金融业改革提供一个新的思路。     

Counting the Invisible Workforce: The Case of Homebased Workers

This paper illustrates the limitations of offical statistics on the informal sector with the case of homebased women workers: this is, women who work from their homes as own-account producers or subcontract workers. After noting that official statistics in most countries do not classify homebased subcontract work as such, the authors review the available data on both types of homebased work. The available evidence suggests that homebased work is an important source of employment throughout the world, especially for women, and that homebased workers comprise a significant share of the workforce in key export industries. The evidence also shows that the informal sector often has direct ties to the formal sector and is growth-promoting. The case of homebased workers, the authors conclude, illustrates the need for improved informal sector statistics as well as a better understanding of the impact of policies on the informal sector and the contribution of the informal sector to national economies.     

东莞民营企业融资问题探讨

民营企业融资困难是影响其发展的主要原因之一。其中既有外部因素,也有民营企业自身管理存在的问题。解决民营企业融资困难需要政府在政策、法规上的支持,需要金融部门的机制创新,开拓更多的金融服务领域,更需要民营企业自身加强管理,提高资信程度。     

Determinants of energy use in the informal food sector

Although enterprises in the informal food sector require energy to transform, cook and process food, energy-use patterns in this sector are not well understood by policymakers and the local-level authorities who regulate their trading activities. This paper reviews relevant literature and presents empirical data collected in Rwanda, Senegal and South Africa on the use of traditional and modern energy sources by informal food sector operators. Our sample includes male- and female-operated enterprises in the urban centres of three African countries where the informal food sector is important, not only for providing the convenience of affordable and readily prepared meals, but also as a source of income for women and men in developing countries. Multiple fuel-use and energy-stacking strategies are common among informal food enterprises and policy needs to acknowledge this if it is to intervene in ways that will benefit both enterprises and regulators.     

Understanding the Growth of African Financial Markets*

Abstract: This paper examines empirically the determinants of financial market development in Africa with an emphasis on banking systems and stock markets. The results show that income level, creditor rights protection, financial repression, and political risk are the main determinants of banking sector development in Africa, and that stock market liquidity, domestic savings, banking sector development, and political risk are the main determinants of stock market development. We also find that liberalizing the capital account promotes financial market development only in countries with high incomes, well‐developed institutions, or both. The powerful impacts of political risk on both banking sector and stock market development suggest that resolution of political risk may be important to the development of African financial markets.     

Mighty oaks from little acorns: Can microenterprise serve as the seedbed of industrialization?

How can microenterprises foster the development of an industrial sector featuring a dynamic medium or large enterprise sector? We propose two possible mechanisms, graduation of microenterprises and savings by microentrepreneurs. We examine the barriers to both mechanisms and reexamine policies designed to aid the sector. Projects aimed at the enterprise level are not likely to remove barriers to firms graduating or saving. Changes in macro policy may have a positive effect. Reforms of the legal and regulatory environment may be very important, and should be rethought with the mechanisms of the seedbed role specifically in mind.     

Technology,Trade Sensitivity,and Labor Displacement

This study examines the relationship between international trade, technology, and exposure to job displacement, using data on displaced workers as well as those at risk of job dislocation, for the two-year sample periods 1986-1987 and 1990-1991. Workers employed in manufacturing industries with elevated import penetration or high shares of R&D personnel appear to have increased rates of job loss. However, the risk of job loss is materially reduced when a relatively high proportion of employees report working with computers. The opposing effects on displacement probabilities of R&D employment intensity and computer-use carry over to the nonmanufacturing sector.     

Does antidumping stimulate FDI? Evidence from Japanese firms in the UK

Does Antidumping Stimulate FDI? Evidence from Japanese Firms in the UK. — This paper explores which factors influence the number of Japanese firms in the UK and the level of employment and fixed assets in those firms, at a highly disaggregated sector level. We are interested in whether trade policy has had a role to play in the entry and expansion of Japanese firms. The results give some support to the hypothesis that antidumping action has acted as an incentive for Japanese direct investment in the UK. However, it has a relatively modest effect —antidumping cases can explain a maximum of 8 per cent of the expansion in employment by existing Japanese firms in the UK, while they appear to have no influence on the arrival of new firms.     

Determinants of Technological Diffusion in Mexican Manufacturing: A Plant-Level Analysis

Production function estimates serve to measure and compare the productive efficiency of a large panel of Mexican manufacturing firms during a period of trade liberalization (1984–90). Foreign capital is found to have a positive influence on productive efficiency at the plant level but, contrarily to crossindustry studies, it does not lead to significant spillovers at the sector level. Enlarging the analysis, it is found that technological diffusion is favored by the size of the plant and by agglomeration economies, while its correlation with international trade exposure does not appear to be robust.     

Beer Taxation and Alcohol-Related Traffic Fatalities

Most studies of alcohol-related traffic fatalities find beer taxes to be an important policy variable. This is surprising since beer taxes only have a small impact on consumption and heavy drinkers are the least responsive to prices. This study shows that the tax relationship is not robust across data periods and that it reflects missing variable biases. While lack of control for law enforcement effort does not appear to bias tax coefficients, failure to include determinants of alcohol consumption other than taxes and drinking age and/or factors that simultaneously determine drinking behavior and political support for alcohol taxes apparently do.     

Labor Market Dynamics and Structural Change: Evidence from China

Structural change theories usually assume agents are homogeneous. However, because of demand‐side or supply‐side heterogeneities, the probability of switching among sectors differs across people. This paper reveals these differences through restoring a long‐period, individual‐level panel dataset from China's Urban Household Survey for 1986–2009. We find that both for people who started working for the first time and those who switched jobs, the sector choice depends on personal characteristics. In particular, women and people with higher educational attainment or a previous white‐collar job are more likely to join the tertiary sector and less likely to join the primary sector. These effects are substantial even if the macroeconomic variables used in conventional structural change theories are controlled. They are also robust in various periods and at more detailed industry levels. Our research suggests that it is important to pay greater attention to the labor composition when making policy related to economic structural change.     

BANKING SECTOR CONTROLS AND FINANCIAL DEEPENING: A STRUCTURAL ERROR CORRECTION MODEL FOR TUNISIA

The aim of this paper is to investigate empirically the effects of several types of banking sector controls on financial deepening in Tunisia. The hypotheses addressed in this study are discussed within the general framework of the McKinnon/Shaw approach and the monopoly bank model. A structural error correction model in Ericsson's (1995) sense has been specified and used to estimate the effects of financial repression in Tunisia over the period 1961–2000. The main empirical finding suggests that, in the long and short terms, financial repression has had significant and negative effects on financial development, independently of its well‐known influence via the level of the real interest rate. This finding shows a contrast with the prevalence of financial market imperfections, but it is consistent with traditional literature on financial liberalization. In addition, this paper shows that financial deepening and per capita income are jointly determined since they both appear not to be weakly exogenous with each other.     

Transatlantic trade and investment partnership: sectoral and macroeconomic perspectives for Germany,the EU and the US

The EU and the US have started negotiations on a Transatlantic Trade and Investment Partnership Agreement (TTIP) which could bring a considerable increase of exports and output as well as changes in the composition of output and employment. Thus export simulation studies in combination with input output analysis and employment analysis is useful. In the analysis presented the focus is mainly on sectoral output and employment effects where the key sectors are the automotive sector, chemical industry, information and communication technology production, pharmaceuticals and machinery and equipment. Backward sector links are analysed and found to be quite important in the automotive sector, the chemical industry, the machinery and equipment sector in both Germany and the US; in Germany also in ICT production. However, most of the observed sectors have weak forward linkage. Input output analysis is also used to identify employment effects in various sectors: the pure employment effect of a 20 % export expansion in Germany amounts to about 800 000 new jobs. Looking only at the US and German perspective turns out to be misleading—the high imports of intermediate inputs of German firms from EU partner countries suggests that a comparison EU-US is analytically required for some key issues and that considering the effects on EU partners is also useful. There is a host of key policy issues, including the issue of extended sustainability reporting.     

Shifting the growth path to achieve employment intensive growth in South Africa

‘Employment intensive growth’ has become a centrepiece of government policy and implies that at any given level of growth, the economy needs to become more labour absorbing. State intervention (or the lack of it) is examined in two areas that are important for employment – agriculture and manufacturing. In the case of agriculture, it is argued that declining and ineffective state support has accelerated the rationalisation of commercial agriculture and failed to regenerate agriculture in the former Bantustans. With regard to the manufacturing sector, we argue that since 1994 the government has set a multiplicity of objectives but, de facto, there has been a surprising level of continuity in the overly generous assistance for heavy, capital-intensive industry. This paper argues that the negative impact of previous ‘distortions’ requires much more than a levelling of the playing field via market-based reforms. Pro-employment policies have to be placed at the centre of the policy agenda.     

AN ASSESSMENT OF THE ASSET MANAGEMENT COMPANY MODEL IN THE REFORM OF INDONESIA'S BANKING SECTOR

Lack of satisfactory progress with reform of the banking sector may imply that the chosen remedies were unworkable in the Indonesian context. These remedies, suggested by the international community, appear not to have taken proper account of the commercial and political ramifications of the new institutions and mechanisms that were to be put in place. Of key importance is the practical difficulty of finding suitable buyers for banks and assets taken over by the new bank restructuring agency. Almost the entire corporate sector was in distress as a result of the crisis, while foreign buyers were reluctant to commit themselves given an inadequate legal system as well as significant nationalistic opposition to the sale of corporate assets to foreign entities. This article discusses reasons for the failure to achieve several principal objectives of the reforms, and canvasses alternative approaches that might be more successful.     

杠杆率的持续性与溢出效应:基于四部门的实证研究

文章采用TVP-VAR模型系统考察了我国非金融企业部门、金融部门、居民部门、政府部门四部门杠杆分别对总产出和资产价格波动的时变影响，从产出效应和潜在风险两方面实证检验了各部门杠杆率的可持续性。研究发现：杠杆率过快增长会加重资产价格波动，使金融不稳定性上升，削弱杠杆率对产出增长的促进作用。当前，非金融企业部门、政府部门、居民部门杠杆对产出仍有较显著的正向影响，而金融部门杠杆上升对产出的正向影响最小，对资产价格波动的正向影响最大。进一步，文章实证研究了杠杆率变动在部门间的信息溢出，发现政府部门加杠杆将显著推升全社会杠杆率，金融部门杠杆率上升对非金融企业部门杠杆有挤出作用，居民部门杠杆则可以分担部分非金融企业和政府部门的过剩杠杆。因此，当前应优先调控金融部门杠杆，减少资金在金融体系内空转套利，其他三个部门则应保持杠杆率总量的平稳。研究结论对于宏观金融稳定和结构性去杠杆政策的实施有重要的实践意义。