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192. Household Financial Assets in the Process of Development
- Author:
- Patrick Honohan
- Publication Date:
- 08-2006
- Content Type:
- Working Paper
- Institution:
- United Nations University
- Abstract:
- Systematic information on household financial asset holdings in developing countries is very sparse; we review some available data and current policy debates. Although financial asset holdings by households are highly concentrated, deeper financial systems are correlated with improved income distribution. For low-income countries, the relevant question for poor households is not how much financial assets they have, but whether they have any access to financial products at all. Building on and synthesizing disparate data collection efforts by others, we produce new estimates of access percentages for over 150 countries. Across countries, access is negatively correlated with poverty rates, but the correlation is not a robust one, thus the supposed anti-poverty potential of financial access remains econometrically elusive. Despite policy focus on the value of credit instruments, it is deposit products that tend to be the first to be used as prosperity increases, before more sophisticated savings products and borrowing.
- Topic:
- Civil Society, Development, Economics, and Poverty
193. Financial Development, Growth, and Regional Disparity in Post-Reform China
- Author:
- Zhicheng Liang
- Publication Date:
- 08-2006
- Content Type:
- Working Paper
- Institution:
- United Nations University
- Abstract:
- Deepening financial development and rapid economic growth in China have been accompanied by widening income disparity between the coastal and inland regions. In this paper, by employing panel dataset for 29 Chinese provinces over the period of 1990-2001 and applying the generalized method of moment (GMM) techniques, we examine the impacts of financial development on China's growth performance. Our empirical results show that financial development significantly promotes economic growth in coastal regions but not in the inland regions; the weak finance-growth nexus in inland provinces may aggravate China's regional disparities.
- Topic:
- Conflict Resolution, Development, and Economics
- Political Geography:
- China and Asia
194. Spatial Convergence in China: 1952-99
- Author:
- Geoffrey J.D. Hewings, Dong Guo, and Patricio Aroca
- Publication Date:
- 08-2006
- Content Type:
- Working Paper
- Institution:
- United Nations University
- Abstract:
- The purpose of this paper is to examine the convergence process in China by taking into account the spatial interaction between factors. The paper shows that there has been a dramatic increase in the spatial dependence of China's per capita GDP in the last 20 years. The consequence of space plays an important role, which is reflected in the influence of a neighbour's condition on the mobility of a province's income distribution from one category to another. The dynamics of the process showed evidence that China's distribution has gone from one of convergence to stratification, and from stratification to polarization.
- Topic:
- Demographics, Development, and Economics
- Political Geography:
- China and Asia
195. Measuring Food Security Using Respondents' Perception of Food Consumption Adequacy
- Author:
- Benjamin Davis, Kathleen Beegle, Gero Caretto, and Mauro Migotto
- Publication Date:
- 08-2006
- Content Type:
- Working Paper
- Institution:
- United Nations University
- Abstract:
- Food security is a complex and multi-dimensional phenomenon. As such, its measurement may entail and benefit from the combination of both 'qualitative-subjective' and 'quantitative-objective' indicators. Yet, the evidence on the external validity of subjective-type information is scarce, especially using representative household surveys. The aim of this paper is to compare information on self-perceived food consumption adequacy from the subjective modules of household surveys with standard quantitative indicators, namely calorie consumption, dietary diversity and anthropometry. Datasets from four countries are analysed: Albania, Indonesia, Madagascar and Nepal. Simple descriptive statistics, correlation coefficients, contingency tables and multivariate regression show that the 'subjective' indicator is at best poorly correlated with standard quantitative indicators. The paper concludes that while subjective food adequacy indicators may provide insight on the vulnerability dimension of food insecurity, they are too blunt an indicator for food insecurity targeting. An effort towards developing improved subjective food security modules that are contextually sensitive should go hand in hand with research into how to improve household survey data for food security measurement along other dimensions of the phenomenon, particularly calorie consumption.
- Topic:
- Human Welfare
- Political Geography:
- Africa, Europe, Indonesia, Asia, Nepal, Albania, and Madagascar
196. Institutional Analysis of Financial Market Fragmentation in Sub-Saharan Africa: A Risk-Cost Configuration Approach
- Author:
- Machiko Nissanke and Ernest Aryeetey
- Publication Date:
- 08-2006
- Content Type:
- Working Paper
- Institution:
- United Nations University
- Abstract:
- The paper examines the source of financial market fragmentation in sub-Saharan Africa in the framework of institutional economics. Based on fieldwork data from Ghana, Malawi, Nigeria, and Tanzania, it analyses financial risk management, the transaction costs for loan screening and monitoring, and contract enforcement. It shows how, faced with various institutional constraints, the range of clientele selected by formal and informal lenders becomes both narrow and at the extreme market-ends. It evaluates the prevailing state of managing risks for market structure, and binding institutional constraints for market transformation and deepening in sub-Saharan Africa.
- Topic:
- Development, Economics, and Markets
- Political Geography:
- Africa, Tanzania, Nigeria, Ghana, and Malawi
197. 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
198. 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
199. 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
200. International Mobility of Researchers and Scientists: Policy Options for Turning a Drain into a Gain
- Author:
- Lauritz B. Holm-Nielsen and Kristian Thorn
- Publication Date:
- 08-2006
- Content Type:
- Working Paper
- Institution:
- United Nations University
- Abstract:
- High demand for researchers and scientists has led to an increase in skilled migration in recent years. The paper focuses on improving our understanding of the push and pull factors affecting the migration decisions of researchers and scientists from developing countries and discusses policy options for maximizing the potential gains associated with international mobility of advanced human capital. Evidence suggests that a reasonable salary level should be guaranteed but that return decisions of researchers and scientists are primarily shaped by factors such as the quality of the research environment, professional reward structures and access to state-of-the-art equipment.
- Topic:
- International Relations, Education, Migration, and Science and Technology