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11. Sensitivity of Loan Size to Lending Rates

Author:
Samuel Kobina Annim
Publication Date:
01-2011
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper examines the combined effect of interest rates and poverty levels of microfinance clients on loan size. Cross section data on 2,691 clients and non-clients households from Ghana is used to test the hypothesis of loan price inelasticity. Quantile regression and variants of least squares methods that explore endogeneity are employed. We find the expected inverse relationship only for the 20th to 40th quantile range. The semi-elasticity of loan amount responsiveness to a unit change in interest rate is more than proportionate and significant for the poorest group only. Market segmentation based on poverty level is suggested in targeting and sustaining microfinance clients.
Topic:
Development, Economics, Markets, Poverty, and Foreign Aid
Political Geography:
Africa

12. Aid Supplies Over Time: Accounting for Heterogeneity, Trends, and Dynamics

Author:
Sam Jones
Publication Date:
01-2011
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The recent financial crisis has rekindled interest in the foreign aid supply behaviour of bilateral donors. Using the latest data covering the period 1960-2009, this paper examines how such behaviour is related to domestic factors. Based on a simple empirical model, a distinction is made between long-run supply trends and short-run dynamics, which motivates use of error correction methods. Panel econometric techniques are employed that are consistent in the presence of parameter heterogeneity and cross-section dependence. Results support the error correction framework, but point to very substantial heterogeneity between countries. There is also good evidence that donor behaviour continues to evolve over time. As such, past trends in aid supplies are unlikely to provide a good guide to those of the future.
Topic:
Development, Bilateral Relations, Foreign Aid, and Financial Crisis

13. Latin American Urban Development into the 21st Century

Author:
Ravi Kanbur, Dennis Rodgers, and Jo Beall
Publication Date:
01-2011
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper argues for a more systemic engagement with Latin American cities, contending it is necessary to reconsider their unity in order to nuance the 'fractured cities' perspective that has widely come to epitomise the contemporary urban moment in the region. It begins by offering an overview of regional urban development trends, before exploring how the underlying imaginary of the city has critically shifted over the past half century. Focusing in particular on the way that slums and shantytowns have been conceived, it traces how the predominant conception of the Latin American city moved from a notion of unity to a perception of fragmentation, highlighting how this had critically negative ramifications for urban development agendas, and concludes with a call for a renewed vision of Latin American urban life.
Topic:
Development, Poverty, and Urbanization
Political Geography:
Latin America

14. The Impact of Foreign Direct Investment on Developing Countries' Terms of Trade

Author:
Konstantin M. Wacker
Publication Date:
01-2011
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper first shows that important economic arguments in favor of the Prebisch- Singer hypothesis of falling terms of trade of developing countries have implicitly relied on the role of multinational corporations and foreign direct investment. As of yet, the relationship between the latter and terms of trade has not been empirically investigated. In order to start closing this gap in research, data on 111 developing countries between 1980 and 2008 is analyzed using panel data methods. The empirical results suggest that there is no reason to believe multinationals' activities were responsible for a possible decrease of the developing countries' net barter terms of trade. On the contrary, foreign direct investment seems to play a positive role for developing countries' terms of trade.
Topic:
Development, Economics, International Trade and Finance, and Foreign Direct Investment

15. Are Electoral Coalitions Harmful for Democratic Consolidation in Africa?

Author:
Danielle Resnick
Publication Date:
02-2011
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Electoral coalitions are becoming increasingly popular among opposition parties in Africa because they offer many advantages with respect to reducing party fragmentation and increasing incumbent turnovers. At the same time, however, they are often comprised of parties that are defined predominantly by their leaders' personalities and exhibit little differentiation in terms of their policy orientation. Based on a dataset spanning all opposition coalitions since 2000 in Africa's electoral democracies, this paper demonstrates not only that coalitions rarely defeat incumbents but also that they are only competitive when major opposition parties are involved. More significantly, the paper highlights that in many countries, a sizeable share of total electoral volatility is due to fluctuations in voting for opposition parties that have belonged to coalitions. The paper argues that such volatility reflects the inability of coalition members to build loyal constituency bases over time, which is critical for party development and broader consolidation.
Topic:
Democratization, Development, and Politics
Political Geography:
Africa

16. Determinants of Industrial Embeddedness: Evidence from African Manufacturing Firms

Author:
Abdelrasaq Na-Allah
Publication Date:
02-2011
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Recent developments in policy initiatives as well as some current practical events have combined to put the spotlight on the issue of industrial embeddedness in sub-Saharan Africa. Though extant research documents some stylized facts, as determinants of its manifestations, their relevance to realities in the sub-continent, have until now been overlooked. Yet, it is difficult to ignore the fact that its constituent economies possess some peculiar attributes with potentially significant implications for embeddedness behaviour. Using data for the country of Lesotho, a probit model is estimated to ascertain the veracity of some of the widely acclaimed explanatory factors. We find, as we argue, that among all, the issue of supply potentials appears the most important.
Topic:
Development and Industrial Policy
Political Geography:
Africa

17. Does Lack of Innovation and Absorptive Capacity Retard Economic Growth in Africa?

Author:
Steve Onyeiwu
Publication Date:
03-2011
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper reviews the innovative capabilities and absorptive capacities of African countries, and investigates whether they have played significant roles in the region's slow and episodic economic growth. Results from cross-country regressions covering 31 Sub-Saharan African countries suggest that growth in Africa is not simply a question of capital accumulation, fertility rates, aid dependency, and stable macroeconomic environment. It is also about strengthening the capacity of African countries to assimilate and effectively use knowledge and technology. Contrary to the views held by many analysts, the growth of African economies does not depend so much on their ability to innovate, but rather on their capacity to absorb and effectively use new technologies. Beyond technological issues, the paper confirms the stylized facts that the size of the government and political stability are important for the growth performance of African countries.
Topic:
Development, Economics, and Science and Technology
Political Geography:
Africa

18. Globalization Crises, Trade, and Development in Vietnam

Author:
Philip Abbott and Finn Tarp
Publication Date:
03-2011
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Vietnam has been among the most successful East Asian economies, especially in weathering the external shocks of recent globalization crises—the 1997-98 Asian financial crisis and the 2008-09 great recession, financial crisis and collapse of global trade. Its success contradicts its characterization as an example of export-led growth and highlights the role of the state, particularly in maintaining and influencing investment. Examination of economic performance and policy responses shows rising dependence on foreign finance around each crisis, and actions by the government to counteract that dependence and bolster the domestic economy while continuing to restructure the economy toward greater emphasis on the private sector. Growth, employment and poverty alleviation have been maintained at the expense of renewed inflation, larger budget deficits, and currency depreciation. The 'stop-go' nature of present …
Topic:
Development, Economics, Globalization, and International Trade and Finance
Political Geography:
Asia

19. Research Capacity Development for Environmental Management in Cambodia: Outlining a Multi-Sector Approach

Author:
Kei Otsuki and Shimako Takahashi
Publication Date:
02-2011
Content Type:
Policy Brief
Institution:
United Nations University
Abstract:
Research capacity development at the higher education level in order to improve environmental planning and management has been considered invaluable in ensuring the sustainable development of developing countries. In least developed countries (LDCs), such as Cambodia, people are especially vulnerable to environmental changes and advanced knowledge is urgently needed to enhance their socio-ecological resilience; however, governments lack both the financial and human resources needed to ensure adequate academic infrastructure for knowledge generation and dissemination. Furthermore, the international aid community has rarely placed emphasis on investing in higher education in developing countries; instead, producing basically skilled labourers through primary and secondary education was considered more effective in bringing return on investment and enhancing economic development. Neither national nor international development agendas have so far resulted in a substantial commitment to research capacity development of academic institutions in LDCs.
Topic:
Development, Education, and Environment
Political Geography:
Cambodia and Southeast Asia

20. Innovation and Entrepreneurship in Developing Countries

Author:
Wim Naudé, Adam Szirmai, and Micheline Goedhuys
Publication Date:
01-2011
Content Type:
Policy Brief
Institution:
United Nations University
Abstract:
Nobody can be left in any doubt as to the importance of innovation for prosperity upon reading that “people living in the first decade of the twentieth century did not know modern dental and medical equipment, penicillin, bypass operations, safe births, control of genetically transmitted diseases, personal computers, compact discs, television sets, automobiles, opportunities for fast and cheap worldwide travel, affordable universities, central heating, air conditioning . . . technological change has transformed the quality of our lives.”
Topic:
Development, Economics, Globalization, and Markets