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2942. The Citizens' Guide to Transportation Reauthorization
- Author:
- Randal O'Toole
- Publication Date:
- 12-2009
- Content Type:
- Policy Brief
- Institution:
- The Cato Institute
- Abstract:
- Sometime in 2010 or 2011, Congress expects to decide how to spend the $250 billion or more of federal gas taxes and other highway user fees that will be collected over the next six years. The process of doing so is called surface transportation reauthorization. A major point of contention in this law is how much of our transportation system should be centrally planned and how much should be built and operated in response to the needs of actual transportation users.
- Topic:
- Economics and Infrastructure
- Political Geography:
- United States
2943. How the Asia Pacific Can Drive the Global Recovery
- Author:
- Peter A. Petri
- Publication Date:
- 11-2009
- Content Type:
- Working Paper
- Institution:
- East-West Center
- Abstract:
- The transition to a new, sustained global growth path is still precarious and will require concerted policy actions by many countries. Leadership by the G-20 will be essential for coordinating the global effort. But due to the central importance of the Asia Pacific in the world economy, regional institutions such as ASEAN+3, ASEAN+6, and APEC could also play large roles in the next phase of the recovery.
- Topic:
- Economics and Financial Crisis
- Political Geography:
- Israel and Asia
2944. Crossing Borders, Changing Landscapes: Land-Use Dynamics in the Golden Triangle
- Author:
- Jefferson Fox
- Publication Date:
- 11-2009
- Content Type:
- Working Paper
- Institution:
- The Cato Institute
- Abstract:
- Over the last half-century, public policy has affected land-use practices across the borders linking China, Thailand, and Laos. Political and economic reforms have facilitated labor mobility and a shift in agricultural practices away from staple grains and toward a diverse array of cash crops, rubber being one of the foremost. China has promoted the conversion of forests to rubber agroforestry in southern Yunnan—profitable for farmers, but a concern in terms of biodiversity and long-term viability. In Thailand, the response is at the other end of the spectrum as the government's concerns about land-use practices and watershed management have led to policies that dramatically constrain land-use practices and limit tenure rights. In Laos the future is not yet clear. Government policies provide weak support for both private land ownership and protected areas. In a global environment where national policy has such a dramatic effect on land use and land cover, the factors behind land-use change merit close examination.
- Topic:
- Agriculture and Economics
- Political Geography:
- China, Asia, Thailand, Southeast Asia, and Laos
2945. Aid, Dutch Disease, and Manufacturing Growth
- Author:
- Arvind Subramanian and Raghuram G. Rajan
- Publication Date:
- 12-2009
- Content Type:
- Working Paper
- Institution:
- Center for Global Development
- Abstract:
- We examine the effects of aid on the growth of manufacturing, using a methodology that exploits the variation within countries and across manufacturing sectors, and corrects for possible reverse causality. We find that aid inflows have systematic adverse effects on a country\'s competitiveness, as reflected in the lower relative growth rate of exportable industries. We provide some evidence suggesting that the channel for these effects is the real exchange rate appreciation caused by aid inflows. We conjecture that this may explain, in part, why it is hard to find robust evidence that foreign aid helps countries grow.
- Topic:
- Development, Economics, and Foreign Aid
- Political Geography:
- Washington
2946. Will World Bank and IMF Lending Lead to HIPC IV? Debt Deja-Vu All Over Again
- Author:
- Benjamin Leo
- Publication Date:
- 11-2009
- Content Type:
- Working Paper
- Institution:
- Center for Global Development
- Abstract:
- Four years ago, the G-7 pushed through an unprecedented initiative forcing the international financial institutions to cancel 100 percent of their outstanding debt claims on the world's poorest countries. Through the Multilateral Debt Relief Initiative (MDRI), these heavily indebted poor countries (HIPCs) stand to receive up to $60 billion in debt relief over time. Moreover, the World Bank, African Development Bank, and IMF shareholders approved a new debt sustainability framework to govern future lending decisions and prevent the need for yet another round of systemic debt relief. All parties emerged from these landmark agreements confident that the dragon of unsustainable debt finally had been slain. However, several unsettling trends raise serious questions about the finality of these actions. First, World Bank and AfDB lending disbursement volumes to these very same HIPC countries remain very high, and nearly the same as compared to pre-MDRI. Emergency IMF lending in response to the global economic crisis has compounded the situation. Second, IMF and World Bank growth projections for HIPCs remain overly rosy compared to actual and historical performance. Our new dataset of IMF growth projections suggests a structural optimism of at least one percentage point per year. Third, HIPCs continue to experience significant volatility in country performance measures that has a direct impact on their ability to carry debt sustainably. Taken together, these findings suggest that donor countries should re-examine the issue of debt sustainability in low-income countries and the system for determining the appropriate grant/loan mix. The upcoming IDA and AfDF replenishment negotiations present a timely opportunity to do so. Absent assertive and corrective action, the international community may be faced with the prospect of a HIPC IV agreement in the not too distant future.
- Topic:
- Development, Economics, and Foreign Aid
- Political Geography:
- Latin America
2947. Is Newer Better? Penn World Table Revisions and Their Impact on Growth Estimates
- Author:
- Arvind Subramanian, Simon Johnson, William Larson, and Chris Papageorgiou
- Publication Date:
- 11-2009
- Content Type:
- Working Paper
- Institution:
- Center for Global Development
- Abstract:
- This paper sheds light on two problems in the Penn World Table (PWT) GDP estimates. First, we show that these estimates vary substantially across different versions of the PWT despite being derived from very similar underlying data and using almost identical methodologies; that this variability is systematic; and that it is intrinsic to the methodology deployed by the PWT to estimate growth rates. Moreover, this variability matters for the cross-country growth literature. While growth studies that use low-frequency data remain robust to data revisions, studies that use annual data are less robust. Second, the PWT methodology leads to GDP estimates that are not valued at purchasing power parity (PPP) prices. This is surprising because the raison d'être of the PWT is to adjust national estimates of GDP by valuing output at common international (PPP) prices so that the resulting PPP-adjusted estimates of GDP are comparable across countries. We propose an approach to address these two problems of variability and valuation.
- Topic:
- Development, Economics, International Political Economy, International Trade and Finance, and International Affairs
2948. Can Global De-Carbonization Inhibit Developing-Country Industrialization?
- Author:
- Arvind Subramanian, Aaditya Mattoo, Dominique van der Mensbrugghe, and Jianwu He
- Publication Date:
- 11-2009
- Content Type:
- Working Paper
- Institution:
- Center for Global Development
- Abstract:
- Most economic analyses of climate change have focused on the aggregate impact on countries of mitigation actions. We depart first in disaggregating the impact by sector, focusing particularly on manufacturing output and exports because of the potential growth consequences. Second, we decompose the impact of an agreement on emissions reductions into three components: the change in the price of carbon due to each country's emission cuts per se; the further change in this price due to emissions tradability; and the changes due to any international transfers (private and public). Manufacturing output and exports in low carbon intensity countries such as Brazil are not adversely affected. In contrast, in high carbon intensity countries, such as China and India, even a modest agreement depresses manufacturing output by 6-7 percent and manufacturing exports by 9-11 percent. The increase in the carbon price induced by emissions tradability hurts manufacturing output most while the Dutch disease effects of transfers hurt exports most. If the growth costs of these structural changes are judged to be substantial, the current policy consensus, which favors emissions tradability (on efficiency grounds) supplemented with financial transfers (on equity grounds), needs re-consideration.
- Topic:
- Climate Change, Development, and Economics
- Political Geography:
- China, India, and Brazil
2949. The Cross-Border Financial Impact of Violence
- Author:
- Mohamad M. Al-Ississ
- Publication Date:
- 11-2009
- Content Type:
- Working Paper
- Institution:
- Belfer Center for Science and International Affairs, Harvard University
- Abstract:
- This paper argues that violent events have two economic effects: a direct loss from the destruction of physical and human capital, and a reallocation of financial and economic resources. It documents the positive cross-border impact that follows violent events as a result of this reallocation. Thus, it reconciles the two existing perspectives in the literature on whether violence has a small or large economic effect. Our results show that, in globally integrated markets, the substitution of financial and economic activities away from afflicted countries magnifies their losses. This study evaluates certain factors affecting the impact of violence in non-event countries. Geographic distance from the event country is not monotonic in its effect on the valuation of equities of other countries. Also, the safer a non-event country is perceived to be relative to the event country, the greater the positive impact on its financial market. Finally, event countries with deeper financial markets are less susceptible to capital reallocation following an event.
- Topic:
- Conflict Resolution, Political Violence, and Economics
2950. The Blueprint: A History of Dubai's Spatial Development Through Oil Discovery
- Author:
- Stephen J. Ramos
- Publication Date:
- 11-2009
- Content Type:
- Working Paper
- Institution:
- Belfer Center for Science and International Affairs, Harvard University
- Abstract:
- To understand Dubai's modern history since its founding in 1833, one must go further back in time to explore the regional history that frames its foundation. European powers, beginning with the Venetians, and, then subsequently, the Portuguese, the Dutch, and finally the British, were interested in the Gulf region as a means to secure trade routes to and from the Indian Subcontinent and points eastward. This meant that from the fifteenth century through the late nineteenth century, if trade routes could move uninterrupted through the Gulf region, European powers were not involved in the societal affairs of settlements as a traditionally colonial ruling class, nor did European merchants bother to extensively explore trade within the region, believing that it required more effort than either the climate or the local economies were worth. The region's local tribes were divided among the maritime coastal groups and those that were nomadic and land-bound, and conflict among these groups occurred in parallel with the larger European conflicts also playing out in the region. The intersection of the two came with the increase in piracy, which, in very basic terms, represented a kind of cultural disagreement on trade customs. The Europeans felt that they were unjustly looted and local groups simply sought to protect themselves from foreign incursion while taking what they believed was their share. Historians still debate this issue today, but in relation to Dubai, the piracy of the times serves as an example of how looser understandings of the licit and illicit, particularly in terms of trade, could be capitalized upon as business venture. The smuggling of gold, weapons, and other goods throughout Dubai's history may have been seen as illicit from perspectives outside Dubai's ports, but the merchant-friendly environments of these ports and the adherence to local autonomy allowed them to trade freely.
- Topic:
- Economics, International Trade and Finance, and Oil
- Political Geography:
- Europe, India, Arabia, and Dubai