03. Journals

2,963 items available

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http://hdl.handle.net/10986/2210

These are journal articles published in World Bank journals as well as externally by World Bank authors.

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Now showing 1 - 10 of 38

Women in Paid Employment: A Role for Public Policies and Social Norms in Guatemala

(Taylor and Francis, 2023-05-03) Almeida, Rita K. ; Viollaz , Mariana

With only 32% of women in the labor market, Guatemala has one of the lowest rates of female labor force participation (FLFP) in the Latin America and Caribbean region and in the world. We explore information from different micro data sets, including the most recent population censuses (2002 and 2018) to assess the drivers of recent progress. Between 2002 and 2018, FLFP increased from an average of 26% to 32% nationwide. This increase was partly explained by increases in the school attainment of women, reduction in fertility and the country’s structural transformation towards services. However, a large part of the increase remains unexplained. Exploring 2018 data, we show that social norms, attitudes towards women and public policies are important determinants of FLFP. The analysis suggests that, taken together, these factors can all become an important source of increased participation of women in the labor market moving forward.
Explaining Differences in the Returns to R&D in Argentina: The Role of Contextual Factors

(Taylor and Francis, 2022-01-31) Arza, Valeria ; Cirera, Xavier ; López, Emanuel ; Colonna, Agustina

Argentinean firms’ investments in R&D are well below its regional peers. One potential explanation for this fact is the existence of low and heterogeneous returns for these investments. This paper uses novel microdata to estimate the returns to R&D and analyse the role of contextual factors in shaping its heterogeneity. The findings confirm that returns are indeed heterogeneous and depend on some important factors related to the market context, such as measures of uncertainty; and the knowledge context, such as knowledge spillovers. Acknowledging that heterogeneity of returns depends on firms’ context is crucial for designing innovation policies to boost private R&D returns.
Borrower Leakage from Costly Screening: Evidence from SME Lending in Peru

(Elsevier, 2021-11) Arraiz, Irani ; Bruhn, Miriam ; Roth, Benjamin N. ; Ruiz-Ortega, Claudia ; Stucchi, Rodolfo

We provide evidence that commercial lenders in Peru suffer leakages in their loan approval process. Leveraging a discontinuity in the loan approval process of a large bank, we find that receiving a loan approval from the bank causes loan applicants to receive offers from other financial institutions as well. Competing lenders captured almost three quarters of the new loans to previously financially excluded borrowers. Importantly, many of these borrowers never took a loan from our partner bank, even after our partner bank approved them. Lenders may therefore underinvest in screening new borrowers and expanding financial inclusion, as their competitors reap some of the benefit. Our results highlight that information spillovers between lenders may operate outside of credit registries.
Prioritizing Job Creation without Undermining Public Works Construction among Road Improvement Projects in Rural Nicaragua

(Taylor and Francis, 2021-04-20) Garz, Seth ; Perova, Elizaveta

We evaluate the impacts of a road rehabilitation workfare project in Nicaragua. Our results reveal that the substitution of labour-intensive manual paving of dirt roads for commercial paving technology did not undermine the primary goal of increasing access to a paved road, which grew by 16.4 percentage points. The project did not increase overall employment, but was associated with an increase in working as a labourer; though, we do not find specific substitution away from agriculture or self-employment as identified in other work. We also find impacts on education and health, extending similar findings from African and Asian regions.
Persistent Misallocation and the Returns to Education in Mexico

(Published by Oxford University Press on behalf of the World Bank, 2020-06) Levy, Santiago ; López-Calva, Luis F.

Over the last two decades, Mexico has experienced macroeconomic stability, an open trade regime, and substantial progress in education. Yet average workers’ earnings have stagnated, and earnings of those with higher schooling have fallen, compressing the earnings distribution and lowering the returns to education. This paper argues that distortions that misallocate resources toward less-productive firms explain these phenomena, because these firms are less intensive in well-educated workers compared with more-productive ones. It shows that while the relative supply of workers with more years of schooling has increased, misallocation of resources toward less-productive firms has persisted. These two trends have generated a widening mismatch between the supply of, and the demand for, educated workers. The paper breaks down worker earnings into observable and unobservable firm and individual worker characteristics, and computes a counterfactual earnings distribution in the absence of misallocation. The main finding is that in the absence of misallocation average earnings would be higher, and that earnings differentials across schooling levels would widen, raising the returns to education. A no-misallocation path is constructed for the wage premium. Depending on parameter values, this path is found to be rising or constant, in contrast to the observed downward path. The paper concludes arguing that the persistence of misallocation impedes Mexico from taking full advantage of its investments in the education of its workforce.
Informed Trading in Business Groups

(Published by Oxford University Press on behalf of the World Bank, 2020-06) Pedraza, Alvaro

Business groups, which are collections of legally independent companies with a significant amount of common ownership, dominate private sector activity in developing countries. This paper studies information flows within these groups by examining the trading performance of institutional investors in firms that belong to the same group. Using a novel dataset with complete transaction records in Colombia, this paper estimates the difference in returns between trades of asset managers in group-affiliated companies and trades of non-affiliated managers in the same stocks during the same period. The data show that affiliated managers display superior timing ability and that their trades outperform those of non-affiliated managers by 0.85 percent per month. The evidence suggests that institutional investors with group affiliation access information that is only available to members of the group. In order to limit the use of private information, financial authorities might need to expand their disclosure rules to monitor the trades of group-affiliated investors.
Gender, Informal Employment and Trade Liberalization in Mexico

(Published by Oxford University Press on behalf of the World Bank, 2020-06) Yahmed, Sarra Ben ; Bombarda, Pamela

This paper studies how import liberalization affects formal employment across gender. The theory offers a mechanism to explain how male and female formal employment shares can respond differently to trade liberalization through labor reallocation across tradable and nontradable sectors. Using Mexican data over the period 1993–2001, we find that Mexican tariff cuts increase the probability of working formally for both men and women within four-digit manufacturing industries. The formalization of jobs within tradable sectors is driven by large firms. Constructing a regional tariff measure, we find that regional exposure to import liberalization increases the probability of working formally in the manufacturing sector for both men and women, and especially for men. However in the service sectors, the probability of working formally decreases for low-skilled women.
The Political Economy of Multidimensional Child Poverty Measurement: A Comparative Analysis of Mexico and Uganda

(Taylor and Francis, 2020-03-11) Cuesta, Jose ; Biggeri, Mario ; Hernandez-Licona, Gonzalo ; Aparicio, Ricardo ; Guillen-Fernandez, Yedith

As part of the 2030 Agenda, much effort has been exerted in comparing multidimensional child poverty measures both technically and conceptually. Yet, few countries have adopted and used any of these measures in policymaking. This paper explores the reasons for this absence from a political economy perspective. It develops an innovative political economy framework for poverty measurement and a hypothesis whereby a country will only produce and use reliable and sustainable multidimensional child poverty (MDCP) measures if and only if three conditions coalesce: consensus, capacity and polity. We explore this framework with two relevant case studies, Mexico and Uganda. Both countries satisfy the capacity condition required to measure MDCP but only Mexico satisfies the other two conditions. Our proposed political economy framework is normatively relevant because it identifies the conditions that need to change across multiple contexts before the effective adoption and use of an MDCP measure becomes more likely.
Can Wage Subsidies Boost Employment in the Wake of an Economic Crisis? Evidence from Mexico

(Taylor and Francis, 2020-01-31) Bruhn, Miriam

This paper measures the employment effect of a program in Mexico that granted firms wage subsidies during the recent economic crisis. I use monthly administrative data at the industry level, along with Euclidean distance matching to construct groups of eligible and ineligible durable goods manufacturing industries that display statistically identical preprogram trends in employment. Difference-in-difference results show a positive but not statistically significant effect of the wage subsidies on employment during the program’s eight-month duration. The size of the effect increases to 18 per cent after the program ended and the results indicate that employment after the program recovered faster in eligible industries than in ineligible industries. Additional analysis suggests that the program did not incentivize firms to retain workers with job-specific skills as originally intended. Instead, the payment of subsidy funds, which only happened towards the end of the program, seems to have provided liquidity for hiring back workers.
Minimum Age Regulation and Child Labor: New Evidence from Brazil

(Published by Oxford University Press on behalf of the World Bank, 2019-12-19) Bargain, Olivier ; Boutin, Delphine

This study presents new evidence on the effects of minimum age regulations obtained from a natural experiment. In 1998, a constitutional reform in Brazil changed the minimum working age from 14 to 16. The reform was the legislative counterpart of a broad set of measures taken by a government strongly committed to eliminating child labor. This article investigates the role of the minimum working age in this context. The setting allows for improvements upon past approaches based on comparing employment rates of children at different ages. A discontinuity in treatment is exploited, namely the fact that only children who turned 14 after the enactment date (mid-December 1998) are banned from work. According to regression discontinuity and difference-in-discontinuity designs, the null hypothesis of no overall effect of the ban cannot be rejected. Throughout the methods and specifications, an employment effect in a confidence interval of [−0.06,0.03] (in percentage points) is found. A detailed heterogeneity analysis is performed and provides suggestive evidence of diminishing child labor trends in regions characterized by higher labor inspection intensity, which is interpreted as a trace of there being a law. However, contrary to what has been claimed in recent studies, the law seems not to have produced sizeable effects overall, at least in the short run. Power calculations and extensive sensitivity checks support these conclusions.