Trade liberalization,technology, relative factor supplies and the relative wage: evidence from the South

There is much controversy about the role that trade liberalization, technological change and relative factor supplies have played in bringing about changes in the relative wage of the unskilled workers. Much of the empirical work on this issue has focused on the industrial countries and paid little attention to developing countries. To fill this gap, this study develops a special data set to examine the relative wage behaviour of a large number of developing countries. An empirical model based on the theory is used to test different explanations of the relative wage change. As predicted by the technology explanation, the empirical analysis in the study finds a significant negative link between the relative wage of unskilled workers and the technology index. The analysis, however, does not find a significant role for labour supplies or trade liberalization in determining the relative wage of unskilled–skilled workers.     

Impact of MGNREGA on the livelihood security of rural poor in India: a study using national sample survey data

This paper studies the impact of the Mahatma Gandhi National Rural Employment Guarantee Scheme (MGNREGA) at the all-India level utilizing nationally representative data from the national sample survey (NSS). We propose an alternative methodology for the proper identification of target households in the baseline period using a secondary data source such as the NSS. The programme is assessed in terms of whether it has been successful in ensuring livelihood security for beneficiary households. The study found that the increase in spending capacity of non-beneficiary households was greater than MGNREGA beneficiary households. Moreover, the overall growth trend in spending capacity over time had a greater effect in improving the livelihood security of the target households than the estimated effect of the programme.     

Economic Deregulation and Trade Liberalization in Kenya,Tanzania and Uganda: Growth and Poverty

With economic growth as a principal target, Kenya, Tanzania and Uganda have implemented deregulation and trade liberalization policies. By tracing the trends in major economic aggregates, the progress of these economies is reviewed. While acknowledging the conceptual arguments supporting the measures adopted, constraints in both the international economy and domestically have resulted in disappointing outcomes. International trade rules and practices, particularly in the agricultural sector, have worked against all three countries. Moreover, their domestic economies lack crucial resources. The results suggest that it may be a long time before the deregulation policies lead to a reduction in poverty.     

Lone Mothers: What is to be done?

This Dialogue presents the views of four authors, from the US, the UK, and Norway, on the best policies to help lone mothers. Lone mothers face an inevitable dilemma in allocating their time between earning income and caring for their children. The low-earning capacity of women in an unequal labor market exacerbates the problem, causing material hardship for many lone mothers and their families. The policy solutions proposed lie along a spectrum, ranging from those that seek to enable all lone mothers to take employment to those that aim to let mothers choose whether to take employment or care for their children themselves. Other policies discussed concern ways to value and support caregiving, improve the low-wage labor market for women, and provide a set of income supports that would both boost income and provide time to care for children.     

Rising Food Prices and Household Welfare: Evidence from Brazil in 2008

Food price inflation in Brazil in the 12 months to June 2008 was 18%, whereas overall inflation was 7%. Using spatially disaggregated monthly data on consumer prices and two different household surveys, we estimate the welfare consequences of these food price increases, and their distribution across households. Because Brazil is a large food producer, with a predominantly wage‐earning agricultural labour force, our estimates include general equilibrium effects on market and transfer incomes, as well as the standard estimates of changes in consumer surplus. Although the expenditure (or consumer surplus) effects were large, negative and markedly regressive everywhere, estimates of the market‐income effect were positive and progressive, particularly in rural areas. Because of this effect on the rural poor, and of the partial protection afforded by increases in two large social assistance benefits, the overall impact of higher food prices in Brazil was U‐shaped, with middle‐income groups suffering larger proportional losses than the very poor. Nevertheless, as Brazil is 80% urban, higher food prices still led to a greater incidence and depth of poverty at the national level.