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31. Regional Inequality, Industry Agglomeration and Foreign Trade: The Case of China

Author:
Yin Ge
Publication Date:
09-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
How do foreign trade and foreign direct investment affect regional inequality? Foreign trade and investment may affect internal economic geography, and the resulting industry agglomeration may contribute to regional inequality. This paper provides empirical evidence supporting this linkage. The results indicate that the increasing regional inequality in China has been accompanied by an increase in the degree of regional specialization and industry agglomeration. Foreign trade and foreign investment are closely related to industry agglomeration in China. Industries dependent on foreign trade and FDI are more likely to locate in regions with easy access to foreign markets, and exporting industries have a higher degree of agglomeration.
Topic:
Economics, Industrial Policy, and International Trade and Finance
Political Geography:
China and Asia

32. The Determinants of Loan Contracts to Business Firms: Empirical Evidence from a Private Bank in Vietnam

Author:
Robert Lensink and Pham Thi Thu Trà
Publication Date:
08-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper deals with loan contracting from a private bank in Vietnam. We focus on the main loan contract features that the bank uses in lending to business firms, namely loan maturity, collateral and loan interest rate. Based upon the simultaneous equation model of Dennis et al. (2000) and the bank's loan contracting policies, we examine the possible interdependency of the three different loan contract terms. Also, we try to determine which firm characteristics and exogenous factors are relevant for loan contracts. We find strong interdependencies between these contract terms with significant bi-directional relationships between collateral and loan maturity, loan rate and loan maturity, and a uni-directional relationship between loan rate and collateral. The conflicting signs within the collateral–loan maturity relationship and the loan interest rate–loan maturity relationship can be explained by our hypothesis that the choice for a certain loan maturity is primarily determined by borrowers' behaviors, whereas the loan rate and the collateral requirements are primarily determined by banks policies. In addition, our results support the relevance of firm quality, agency costs of debt and relationship lending in loan contract design.
Topic:
Economics and International Trade and Finance
Political Geography:
Vietnam and Southeast Asia

33. Financial Sector Development and Growth: The Chinese Experience

Author:
Mingming Zhou and Iftekhar Hasan
Publication Date:
08-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper documents the financial and institutional developments of China during the past two decades, when China was successfully transformed from a rigid centralplanning economy to a dynamic market economy following its unique path. We empirically examine the relationship between financial development and economic growth in China by employing a panel sample covering 31 Chinese provinces during the important transition period 1986-2002. Our evidence suggests that the development of financial markets, institutions, and instruments have been robustly associated with economic growth in China.
Topic:
Development, Economics, and International Trade and Finance
Political Geography:
China and Asia

34. Excess Credit and the South Korean Crisis

Author:
Bassam A. Fattouh and Panicos O. Demetriades
Publication Date:
08-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
We provide a novel empirical analysis of the South Korean credit market that reveals large volumes of excess credit since the late 1970s, indicating that a sizeable proportion of total credit was being used to refinance unprofitable projects. Our findings are consistent with theoretical literature that suggests that soft budget constraints and overborrowing were significant factors behind the Korean financial crisis of 1997-98.
Topic:
Economics, International Trade and Finance, and Markets
Political Geography:
Asia, South Korea, and Korea

35. The Political Economy of Taxation and Tax Reform in Developing Countries

Author:
Jonathan Di John
Publication Date:
07-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Taxation provides one of the principal lenses in measuring state capacity, state formation and power relations in a society. This paper critically examines three main approaches (economic, administrative and political economy) to understanding taxation. It also examines differences in tax composition across middle-income developing regions and finds that Latin American economies tax upper income groups much less than in East Asia and Eastern Europe, and explores the political economy and policy implications of these differences. The paper also examines issues of tax reform in low income/post-war economies and explores the problem that capital flight poses for less developed countries.
Topic:
Development, International Trade and Finance, Political Economy, and Third World
Political Geography:
Eastern Europe, East Asia, and Latin America

36. Food Security in the South Pacific Island Countries with Special Reference to the Fiji Islands

Author:
K.L. Sharma
Publication Date:
06-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper analyses the status of food security in selected South Pacific Island countries, namely Cook Islands, Fiji Islands, Papua New Guinea, Samoa, Solomon Islands, Tonga, and Vanuatu at the national and household levels during the period 1991-2002. Due to narrow resource base and production conditions, Pacific Islands concentrate on a few primary commodities for production and exports. During recent years import dependency for food items has increased mainly due to a decline in per capita food production and a rapid rate of rural-urban migration. Currently, export earnings can finance food imports but earnings could fall short of the requirements needed after the expiry of some commodity preferential price agreements with importing countries. National food security is dependent on the continuation of subsistence farming and tapping ocean resources in conjunction with the on-going commercial farming of those crops in which Pacific Islands have a comparative advantage. Increased productivity is crucial for improving agricultural performance through government investment in rural infrastructure, agricultural research and extension, irrigation and appropriate price incentives. This would also help alleviate poverty for improvement in economic accessibility of food by households. There is also a need to design appropriate disaster risk management programmes to minimize any adverse effects on the food supply.
Topic:
Economics, Human Welfare, and International Trade and Finance
Political Geography:
Australia/Pacific, Solomon Islands, Papua, Guinea, Cook Islands, Samoa, Tonga, Vanuatu, and Fiji

37. The Gender Dimensions of Post-Conflict Reconstruction: The Challenges in Development Aid

Author:
Elaine Zuckerman and Marcia E. Greenberg
Publication Date:
06-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
Based on analysing World Bank and other donor post-conflict reconstruction (PCR) loans and grants from rights-based, macroeconomic and microeconomic perspectives, we conclude that few PCR projects identify or address gender discrimination issues. Bank PCR investments hardly reflect Bank research recognizing that gender inequality increases the likelihood of conflict and gender equality is central to development and peace. Our conceptual framework examining women's programmes, gender mainstreaming, and gender roles in transforming violent into peaceful societies, leads to recommending that PCR projects systematically address gender issues and promote gender equality to make peace work.
Topic:
Development, Gender Issues, Humanitarian Aid, and International Trade and Finance

38. Does the WTO Agreement on Agriculture Endanger Food Security in Sub-Saharan Africa?

Author:
Samuel K. Gayi
Publication Date:
06-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
The paper examines the state of food security in Sub-Saharan Africa (SSA), based on an analysis of a selection of indicators of food security and nutritional wellbeing during the period 1990-2002 within the context of the WTO Agreement on Agriculture. It argues that it may be advisable for those SSA countries with both static and dynamic comparative advantage in agriculture to pursue policies towards 'food self-sufficiency' as a means to attaining food security, considering their large rural farming population, at least until such time that international trade in agriculture is fully integrated into the WTO disciplines. This is particularly relevant in view of the fact that high agricultural protectionism in the north currently distorts price signals and thus the opportunity costs of allocating factors of production in these economies. The SSA countries that lack comparative advantage in agriculture may want to aim for a 'food self-reliance' strategy to attain food security.
Topic:
Agriculture, Human Welfare, and International Trade and Finance

39. Trade, Migration, and Poverty Reduction in the Globalizing Economy: The Case of the Philippines

Author:
Jonna P. Estudillo and Yasuyuki Sawada
Publication Date:
06-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper investigates how the two types of globalization—i.e., integration of international trade and emigration—affected poverty reduction in the Philippines. Using the Family Income and Expenditure Surveys from 1985 to 2000, we found that both nontransfer and transfer incomes decreased poverty significantly but transfer income exerted greater impact. External openness reduced poverty significantly before the Asian currency crises but its impact had been reversed since. The effect of land reform in inducing transfer income from abroad was significant only in the 1990s. Yet, the ultra poor were bypassed in the land reform-credit-emigration-transfer nexus.
Topic:
Development, Globalization, International Trade and Finance, and Migration

40. Trade Liberalization, Environment and Poverty: A Developing Country Perspective

Author:
M.S. Quresh
Publication Date:
04-2006
Content Type:
Working Paper
Institution:
United Nations University
Abstract:
This paper revisits the pollution haven hypothesis in the context of Pakistan by offering a systematic analysis of its trade and production patterns. Using bilateral trade statistics from 1975-2003, we test the hypotheses that Pakistan's net exports of pollutionintensive products have increased to the OECD countries. We also investigate if the stringency of environmental governance in the importing countries plays a role in determining Pakistan's exports of pollution-intensive products. The results reveal that there has been a change in the composition of output and exports towards pollutionintensive manufacturing that parallels the opening of the economy. Overall, the findings appear to be in favour of the pollution haven hypothesis and call for effective environmental policy response for poverty alleviation and sustainable development.
Topic:
Development, International Trade and Finance, and Poverty
Political Geography:
Pakistan and Asia