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1911. Commodity Price Volatility and World Market Integration since 1700

Author:
David S. Jacks, Kevin H. O'Rourke, and Jeffrey G. Williamson
Publication Date:
02-2009
Content Type:
Working Paper
Institution:
Weatherhead Center for International Affairs, Harvard University
Abstract:
Poor countries are more volatile than rich countries, and we know this volatility impedes their growth. We also know that commodity price volatility is a key source of those shocks. This paper explores commodity and manufactures price over the past three centuries to answer three questions: Has commodity price volatility increased over time? The answer is no: there is little evidence of trend since 1700. Have commodities always shown greater price volatility than manufactures? The answer is yes. Higher commodity price volatility is not the modern product of asymmetric industrial organizations - oligopolistic manufacturing versus competitive commodity markets - that only appeared with the industrial revolution. It was a fact of life deep into the 18th century. Does world market integration breed more or less commodity price volatility? The answer is less. Three centuries of history shows unambiguously that economic isolation caused by war or autarkic policy has been associated with much greater commodity price volatility, while world market integration associated with peace and pro-global policy has been associated with less commodity price volatility. Given specialization and comparative advantage, globalization has been good for growth in poor countries at least by diminishing price volatility. But comparative advantage has never been constant. Globalization increased poor country specialization in commodities when the world went open after the early 19th century; but it did not do so after the 1970s as the Third World shifted to labor-intensive manufactures. Whether price volatility or specialization dominates terms of trade and thus aggregate volatility in poor countries is thus conditional on the century.
Topic:
Economics, Globalization, and Monetary Policy
Political Geography:
Africa, South Asia, and Latin America

1912. Vanishing Third World Emigrants?

Author:
Jeffrey G. Williamson and Timothy J. Hatton
Publication Date:
02-2009
Content Type:
Working Paper
Institution:
Weatherhead Center for International Affairs, Harvard University
Abstract:
This paper documents a stylized fact not well appreciated in the literature. The Third World has been undergoing an emigration life cycle since the 1960s, and, except for Africa, emigration rates have been level or even declining since a peak in the late 1980s the early 1990s. The current economic crisis will serve only to accelerate those trends. The paper estimates the economic and demographic fundamentals driving these Third World emigration life cycles to the United States since 1970-the income gap between the US and the sending country, the education gap between the US and the sending country, the poverty trap, the size of the cohort at risk, and migrant stock dynamics. It then projects the life cycle up to 2024. The projections imply that pressure on Third World emigration over the next two decades will not increase. It also suggests that future US immigrants will be blacker and fewer will speak Spanish.
Topic:
Demographics, Economics, Migration, and Third World
Political Geography:
Africa and United States

1913. The Political Economy of Heterogeneous Development: Quantile Effects of Income and Education

Author:
Marcus Alexander, Matthew Harding, and Carlos Lamarche
Publication Date:
01-2009
Content Type:
Working Paper
Institution:
Weatherhead Center for International Affairs, Harvard University
Abstract:
Does development lead to the establishment of more democratic institutions? The key to the puzzle, we argue, is the previously unrecognized fact that based on quantitative regime scores, countries over the past 50 years have clustered into two separate, very distinct, yet equally-common stages of political development—authoritarian states with low levels of freedom on one side an d democracies with liberal institutions on the other side of a bimodal distribution of political regimes. We develop a new empirical strategy—exploiting exogenous world economic factors and introducing new panel data estimators—that allows for the first time to estimate the effects of development as well as unobserved country effects in driving democracy at these different stages of political development. We find that income and education have the least effect on democracy when authoritarian regimes are consolidated and that only country effects, possibly accounting for institutional legacies, can lead to political development. Ironically, it is in highly democratic and wealthiest of nations that income and education start to play a role; however greater wealth and better educated citizenry can both help and hurt democracy depending again on what the country's institutional legacies are. Far from accepting the notion that much of the developing world is cursed by unchanging and poor long-run institutions, policy-makers should take note that with democratization we also see country-specific factors that in turn condition the difference income and education make for democracy.
Topic:
Democratization, Development, Economics, Political Economy, and Third World
Political Geography:
Africa, United States, China, Asia, and Germany

1914. The Successful Ghana Election of 2008 – a Convenient Myth? Ethnicity in Ghana's Elections Revisited

Author:
Dirk Kohnert, Heinz Jockers, and Paul Nugent
Publication Date:
09-2009
Content Type:
Working Paper
Institution:
Weatherhead Center for International Affairs, Harvard University
Abstract:
Ghana's 2008 elections have been hailed by national and international observers as a model for Africa. This perception has prevailed despite persistent concerns about “ethnic block voting” and electoral fraud. Electoral malpractice and vote rigging along ethnic lines in Ghana's virtual two‐party system could regain decisive importance as a “third force” that could tip the balance in future, possibly coming to represent an even more important factor than the smaller opposition parties. Unfortunate diplomatic and technocratic biases in election monitoring, combined with a reluctance on the part of the responsible authorities to investigate irregularities in what appears to be a long history of fraudulent “ethnic block voting”, amounts to a dangerous time bomb of unresolved conflict which could explode in future elections.
Topic:
Corruption and Democratization
Political Geography:
Africa and Ghana

1915. Facing Homegrown Radicalization

Author:
Myriam Benraad
Publication Date:
09-2009
Content Type:
Policy Brief
Institution:
The Washington Institute for Near East Policy
Abstract:
Last month, Kamal Hassan, a Somali-American living in Minnesota, pled guilty to training and fighting with al-Shabab, an al-Qaeda-linked terrorist group in Somalia. In July, two other Somali-Americans in Minnesota pled guilty to similar charges, with the FBI continuing to investigate more than a dozen others who may have traveled from the United States to Somalia. The FBI also recently arrested seven individuals in North Carolina on terrorism-related charges, including one who had spent time in Afghan training camps. These and other recent events have raised new concerns in the United States about the threat of homegrown radicalization.
Topic:
Security, Crime, Terrorism, and Armed Struggle
Political Geography:
Afghanistan, Africa, Europe, Washington, and North Carolina

1916. Blood Oil in the Niger Delta

Author:
Judith Burdin Asuni
Publication Date:
08-2009
Content Type:
Working Paper
Institution:
United States Institute of Peace
Abstract:
The trade in stolen oil, or “blood oil,” poses an immense challenge to the Nigerian state, harming its economy and fueling a long-running insurgency in the Niger Delta. It also undermines security in the Gulf of Guinea and adds to instability on world energy markets. The exact amount of oil stolen per day in the Niger Delta is unknown, but it is somewhere between 30,000 and 300,000 barrels. The loss to the Nigerian economy from illegal oil bunkering between 2003 and 2008 totals approximately US$100 billion. It is time for the international community to become more proactive in helping Nigeria address this complex issue. Efforts to control blood oil must be accompanied by actions against corruption, illegal arms importation, and money laundering. The enabling environment for illegal oil bunkering includes high levels of unemployed youth, armed ethnic militias, ineffective and corrupt law enforcement officials, protective government officials and politicians, corrupt oil company staff, established international markets for stolen oil, and the overall context of endemic corruption. The three types of illegal oil bunkering include small-scale pilfering for the local market, large-scale tapping of pipelines to fill large tankers for export, and excess lifting of crude oil beyond the licensed amount. The complexity of players in the illegal oil bunkering business, including local youth, members of the Nigerian military and political class, and foreign ship owners, makes it difficult to tackle the problem unilaterally. Previous attempts by the Nigerian government and international community to address illegal oil bunkering have had limited success in reducing the flow of blood oil. The problem of blood oil needs to be addressed multilaterally. Within the international community, the United States is uniquely positioned to take a leadership role in helping to dry up blood oil and address other issues in the Niger Delta.
Topic:
Conflict Resolution, Political Violence, Markets, Oil, and Armed Struggle
Political Geography:
Africa, United States, Nigeria, and Guinea

1917. Scenarios for Sudan: Avoiding Political Violence Through 2011

Author:
Alan Schwartz
Publication Date:
08-2009
Content Type:
Working Paper
Institution:
United States Institute of Peace
Abstract:
Absent a change in current trends, further political violence in Sudan will be hard to avoid. Lack of governance capacity in the South and failure to resolve key issues between the North and South are important factors that can lead to political violence surrounding the referendum, slated for 2011, on whether the South secedes or remains part of a united Sudan. The parties need a shared sense of confidence about post-2011 futures. The North should be encouraged to cooperate in the referendum process and accept the outcome. The Government of Southern Sudan (GOSS) should devote more energy and resources to governance and service delivery rather than building military capability. The international community needs an assistance strategy focused on enhancing the GOSS's capacity to deliver services through local governments. The United States and the international community should pressure and assist the parties to promptly pass referendum legislation and address fundamental issues (e.g., oil and boundaries) before the referendum.
Topic:
Conflict Resolution, Political Violence, Genocide, Human Rights, and Armed Struggle
Political Geography:
Africa, United States, Sudan, and Arabia

1918. Strategies for Growth and Poverty Reduction: Has Tanzania's Second PRSP Influenced Implementation?

Author:
Dennis Rweyemamu
Publication Date:
09-2009
Content Type:
Working Paper
Institution:
Danish Institute for International Studies
Abstract:
Tanzania's current growth and poverty reduction strategies are contained in its second PRSP. This document, and the processes leading to its formulation, has helped to mobilize donor funds. However, the content of the PRSP is largely irrelevant for implementation, and has contributed little to better inter-sectoral linkages and synergies both of which were its main purposes. The immediate reasons for this irrelevancy include a participatory planning process not aligned with the domestic political process and with no budget constraints which led to a shopping list of un-prioritized initiatives; an implementation machinery around the budget process which in practice does not ensure that resources are allocated in line with the document's priorities; and limited understanding and/ or acceptance across the spectrum of government institutions and political leadership that the PRSP is the overall strategic guiding document.
Topic:
Development, Economics, Poverty, and Foreign Aid
Political Geography:
Africa and Tanzania

1919. The New Poverty Agenda in Uganda

Author:
Anne Mette Kjaer and Fred Muhumuza
Publication Date:
09-2009
Content Type:
Working Paper
Institution:
Danish Institute for International Studies
Abstract:
This paper explores the poverty agenda in Uganda, its drivers and its effects. We show that transforming the economy by increasing productivity was initially considered more important than to reduce poverty through redistributive policies. However, as a consequence of the 1996 elections a consensus on poverty eradication through health and education emerged. The Poverty Eradication Action Plan (PEAP) had a shopping list nature and it is therefore difficult to establish whether it was implemented. Growth and poverty reduction during the PEAP period was mainly due to a continuation of macro-economic policies that were introduced prior to the PEAP. Around the multi-party elections in 2006, policy priorities changed towards more focus on agricultural production, agro-business and infrastructure. The government now has a two-edged focus: poverty reduction through economic transformation and poverty reduction through social services. However, there is also a political agenda about remaining in power which threatens to undermine the results achieved so far.
Topic:
Education, Health, and Poverty
Political Geography:
Uganda and Africa

1920. The new 'New Poverty Agenda' in Ghana: what impact?

Author:
Lindsay Whitfield
Publication Date:
09-2009
Content Type:
Working Paper
Institution:
Danish Institute for International Studies
Abstract:
This paper describes and explains the impact of the international-driven 'New Poverty Agenda' in Ghana, focusing on the impact of the Poverty Reduction Strategy Papers (PRSPs) adopted by the New Patriotic Party government in power from 2001 until 2008. The paper argues that the New Poverty Agenda has had some impacts, but not they have been limited and not necessarily helpful in achieving long term poverty reduction. The PRSP was seen by the government in Ghana as necessary to secure debt relief and donor resources, and the strategies produced by the government contained broad objectives rather than concrete strategies on how to achieve those objectives and thus had little impact on government actions. The paper discusses what was actually implemented under the NPP government and the factors influencing those actions. It highlights the constraints Ghanaian governments face in pursuing economic transformation within contemporary domestic and international contexts.
Topic:
Economics, Government, and Poverty
Political Geography:
Africa