Li, Yue

Person:
Li, Yue

Office of the Chief Economist for South Asia Region, The World Bank

Author Name Variants

Li, Yue

Fields of Specialization

International economics, Urban economics, Firm dynamics, Investment climate

Departments

Office of the Chief Economist for South Asia Region, The World Bank

Last updated:October 6, 2025

Biography

Yue Li is an Economist in the Office of the Chief Economist for the South Asia Region. She joined the World Bank as a Young Professional in 2010. Yue has co-authored Addressing Inequality in South Asia, a report of the South Asia Development Matters series. She was a co-author of the 2013 World Development Report on Jobs, serving as the focal person on productivity issues, and a co-author of the Trade chapter of the World Bank report Golden Growth: Restoring the Lustre of the European Economic Model. Prior to joining the South Asia Region, she also worked on the country teams of Tanzania and Ethiopia, and in the East Asia and Pacific Region of the World Bank. Yue’s research focuses on international economics, urban economics, firm dynamics and the investment climate. Her research has led to academic publications, among others in the Journal of International Economics. Yue holds a Ph.D. in Economics from Rutgers University, Master's degrees in Economics and Political Science from Syracuse University. Her Bachelor's degree is from Peking University, in China, the country where she grew up.

URI

https://hdl.handle.net/10986/38803

Full item page

Publication Search Results

Now showing1 - 10 of 14

FDI, Market Power, and Markups: Evidence from Vietnam
(World Bank, Washington, DC, 2022-04) Kuo, Ryan; Li, Yue; Pinzon Latorre, Mauricio; Albertson, Mark
To date, the impact of foreign direct investment on market power and consumer welfare in developing countries has been relatively understudied. Utilizing a firm survey dataset from Vietnam, this paper first calculates firm-level markups for manufacturing firms and then analyzes the impact of foreign direct investment and foreign ownership on firm markups. Overall, the findings show that increases in the presence of foreign firms in a given industry are associated with decreases in markups in that industry, despite foreign firms individually charging higher markups on average than their domestic competitors. The findings further show that while the markups of both foreign- and domestic-owned private firms tend to decrease with greater foreign direct investment, state-owned enterprises may be relatively insulated from foreign direct investment driven competitive pressures. These results are robust to the inclusion or exclusion of potential outliers and the potential non-random selection of firms acquired by foreign investors.
The Employment Effect of Place-Based Policies: Evidence from India
(World Bank, Washington, DC, 2020-11) Sinha Roy, Sutirtha; Li, Yue
Many governments in developing countries have pursued policies targeting specific geographic areas over the past several decades. However, only a few have rigorously evaluated the causal impact of these interventions. This paper examines the effectiveness of a prominent place-based policy in India: the centrally sponsored New Industrial Policy for the state of Uttarakhand. Using georeferenced economic census data, the analysis applies a boundary discontinuity research design and zones in on the unique border between Uttarakhand and Uttar Pradesh, two states that were officially one before the implementation of the New Industrial Policy. The findings show that there was a significant and abrupt increase in employment at the town and village level when crossing the state border from Uttar Pradesh to Uttarakhand after the full implementation of the New Industrial Policy. The conclusion even holds for firms within the same sector. The increase is mainly due to larger firm sizes and expansions into new industries. A main component of the New Industrial Policy was excise tax incentives for certain industries. The paper finds that the increase in cross-border employment is higher for sectors receiving excise tax incentives than others. Additionally, exploring spillovers between industries, the paper shows that, controlling for the direct effects, the sectors with labor requirements similar to those receiving excise tax incentives also experience an increase in employment. Finally, the growth in the number of firms in Uttar Pradesh close to the border remained stable before and after the New Industrial Policy, which suggests the results are not fully driven by firms relocating from Uttar Pradesh to Uttarakhand.
Toward Great Dhaka: A New Urban Development Paradigm Eastward
(Washington, DC: World Bank, 2018-07-03) Bird, Julia; Li, Yue; Rahman, Hossain Zillur; Rama, Martin; Venables, Anthony J.
A unique strategic opportunity beckons Bangladesh. Dhaka, the economic powerhouse of the country, stands on the cusp of a dramatic transformation that could make it much more prosperous and livable. Today, Dhaka is prone to flooding, congestion, and messiness, to a point that is clogging its growth. But toward its east, where two major highway corridors will one day intersect, is a vast expanse of largely rural land. And much of it is within 6 kilometers of the most valuable parts of the city. The time to make the most of this eastward opportunity is now. Many parts of East Dhaka are already being developed in a haphazard way at an alarmingly rapid pace. Private developers are buying land and filling it with sand so they can build and sell new houses and apartments. Canals and ponds are disappearing, and the few narrow roads crossing the area are being encroached by construction. This spontaneous development could soon make East Dhaka look like the messy western part of the city, and retrofitting it later will be more difficult and costlier than properly planning and developing it now. Toward Great Dhaka: A New Urban Development Paradigm Eastward seeks to analyze how the opportunity of East Dhaka could be realized. Using state-of-the-art modeling techniques, the study simulates population, housing, economic activity, and commuting times across the 266 unions that constitute Greater Dhaka. It does so under various scenarios for the development of East Dhaka, but always assessing the implications for the entire city. The simulations suggest that pursuing a strategic approach to the development of East Dhaka would make Greater Dhaka a much more productive and livable city than continuing with business as usual. Based on current trends, Greater Dhaka would have a population of 25 million in 2035 and an income per capita of US$8,000 at 2015 prices. However, embracing a strategic approach would add 5 million people to the city. And, it would be a more productive city, with nearly 1.8 million more jobs and an income per capita of more than US$9,200 at 2015 prices, enough to put Dhaka on the map of global cities.
Identifying Urban Areas by Combining Human Judgment and Machine Learning: An Application to India
(World Bank, Washington, DC, 2020-02) Galdo, Virgilio; Li, Yue; Rama, Martin
This paper proposes a methodology for identifying urban areas that combines subjective assessments with machine learning, and applies it to India, a country where several studies see the official urbanization rate as an under-estimate. For a representative sample of cities, towns and villages, as administratively defined, human judgment of Google images is used to determine whether they are urban or rural in practice. Judgments are collected across four groups of assessors, differing in their familiarity with India and with urban issues, following two different protocols. The judgment-based classification is then combined with data from the population census and from satellite imagery to predict the urban status of the sample. The Logit model, and LASSO and random forests methods, are applied. These approaches are then used to decide whether each of the out-of-sample administrative units in India is urban or rural in practice. The analysis does not find that India is substantially more urban than officially claimed. However, there are important differences at more disaggregated levels, with “other towns” and “census towns” being more rural, and some southern states more urban, than is officially claimed. The consistency of human judgment across assessors and protocols, the easy availability of crowd-sourcing, and the stability of predictions across approaches, suggest that the proposed methodology is a promising avenue for studying urban issues.
Identifying Urban Areas by Combining Data from the Ground and from Outer Space: An Application to India
(World Bank, Washington, DC, 2018-10) Galdo, Virgilio; Li, Yue; Rama, Martin
This paper develops a tractable method to identify urban areas and applies it to India, where urbanization is messy. Google Earth images are assessed subjectively to determine whether a stratified large sample of Indian cities, towns and villages, as officially defined, are urban or rural in practice. Based on these assessments, a regression analysis combines two sources of information—data from georeferenced population censuses and data from satellite imagery—to identify the correlates of units in the sample being urban. The resulting model is used to predict whether the other units in the country are urban or rural in practice. Contrary to frequent claims, India is not substantially more urban than implied by census data. And the speed of urbanization is only marginally higher than official statistics suggest. But a considerable number of locations are misclassified in the midrange between villages and state capitals. The results confirm the value of combining subjective assessments with data from these different sources.
States Diverge, Cities Converge: Drivers of Local Growth Catch-up in India
(World Bank, Washington, DC, 2018-12) Zhao, Qinghua; Li, Yue; Rama, Martin
This paper takes a fresh look at growth convergence in India, combining insights from macroeconomics and urban economics. It departs from the existing literature in three ways. First, the paper assesses growth patterns across districts and across places below the district level instead of taking the state as the unit of analysis. Second, it relies on household expenditures per capita, instead of gross domestic product per capita, to measure living standards. And third, it uses a Bayesian model averaging approach to identify the key drivers of local growth, instead of the classical econometric approach. The paper finds absolute convergence in living standards across districts and places below the district level, with locations in the gray area between rural and urban growing fastest. In assessing conditional convergence, it finds that geography is a strong predictor of local growth, but population density is not. Market access, electrification and transport infrastructure matter, but irrigation and housing investments do not. The quality of state-level governance has a significant impact on local growth, but variations in city governance are only mildly relevant. The share of medium and large firms plays a role, but the sectoral structure of economic activity does not. And the coverage of primary education is an important predictor of subsequent growth, but not that of other levels of education. Strong convergence at the local level can be reconciled with lack of convergence at the state level if low-income states fail to generate enough locations with the "right" characteristics.
Business Environment, Economic Agglomeration and Job Creation around the World
(Taylor and Francis, 2016-01-30) Clarke, George; Li, Yue; Xu, Lixin Colin
This article looks at how economic agglomeration and the business environment affect job creation. The results suggest that economic agglomeration is strongly linked to job growth. Modern telecommunications, access to export markets, concentration of economic activity in large cities and capacity agglomeration, in particular, are important. In contrast, many areas of the business environment, including corruption, macroeconomic stability and infrastructure are not robustly linked to job growth. The main exception to this is that areas of the business environment directly related to labour markets are more consistently linked to job growth than other areas of the business environment.
Firm Dynamics, Productivity Growth, and Job Creation in Developing Countries: The Role of Micro- and Small Enterprises
(Oxford University Press on behalf of the World Bank, 2015-02) Rama, Martín; Li, Yue
The conventional wisdom on firm dynamics, productivity growth, and job creation in developing countries is based on data that, by design, excludes a vast number of micro- and small enterprises, many of which are informal. Some may not view this exclusion as an issue, on the grounds that the omitted economic units reflect survivorship rather than entrepreneurship. However, the thresholds that determine the truncation of the data are relatively arbitrary, and the firms that are typically excluded are associated with a large share of total employment. This paper assesses the ways in which the conventional wisdom on developing countries would change if micro- and small enterprises were taken into account in the analyses. The assessment shows that micro- and small enterprises account for a greater share of gross job creation and destruction than acknowledged by the conventional wisdom. It also reveals a greater dispersion of firm productivity, a weaker correlation between firm productivity and firm size, and a smaller contribution of within-firm productivity gains to aggregate productivity growth. This assessment points to new directions in the data and research efforts needed to understand the role of micro- and small enterprises and to identify policies with the potential to foster job creation and aggregate productivity growth in developing countries.
Households or Locations?: Cities, Catchment Areas and Prosperity in India
(World Bank, Washington, DC, 2015-11) Li, Yue; Rama, Martin
Policy makers in developing countries, including India, are increasingly sensitive to the links between spatial transformation and economic development. However, the empirical knowledge available on those links is most often insufficient to guide policy decisions. There is no shortage of case studies on urban agglomerations of different sorts, or of benchmarking exercises for states and districts, but more systematic evidence is scarce. To help address this gap, this paper combines insights from poverty analysis and urban economics, and develops a methodology to assess spatial performance with a high degree of granularity. This methodology is applied to India, where individual household survey records are mapped to “places” (both rural and urban) below the district level. The analysis disentangles the contributions household characteristics and locations make to labor earnings, proxied by nominal household expenditure per capita. The paper shows that one-third of the variation in predicted labor earnings is explained by the locations where households reside and by the interaction between these locations and household characteristics such as education. In parallel, this methodology provides a workable metric to describe spatial productivity patterns across India. The paper shows that there is a gradation of spatial performance across places, rather than a clear rural-urban divide. It also finds that distance matters: places with higher productivity are close to each other, but some spread their prosperity over much broader areas than others. Using the spatial distribution of this metric across India, the paper further classifies places at below-district level into four tiers: top locations, their catchment areas, average locations, and bottom locations. The analysis finds that some small cities are among the top locations, while some large cities are not. It also finds that top locations and their catchment areas include many high-performing rural places, and are not necessarily more unequal than average locations. Preliminary analysis reveals that these top locations and their catchment areas display characteristics that are generally believed to drive agglomeration economies and contribute to faster productivity growth.
Addressing Inequality in South Asia
(World Bank Group, Washington, DC, 2015) Mitra, Pradeep K.; Rama, Martin; Newman, John Lincoln; Béteille, Tara; Li, Yue
Inequality in South Asia appears to be moderate when looking at standard indicators such as the Gini index, which are based on consumption expenditures per capita. But other pieces of evidence reveal enormous gaps, from extravagant wealth at one end to lack of access to the most basic services at the other. Which prompts the question: How bad is inequality in South Asia? And why would that matter? This book takes a comprehensive look at the extent, nature, and drivers of inequality in this very dynamic region of the world. It discusses how some dimensions of inequality, such as high returns to investments in human capital, contribute to economic growth while others, such as high payoffs to rent-seeking or broken aspirations, undermine it. Drawing upon a variety of data sources, it disentangles the contribution that opportunity in young age, mobility in adult years, and support throughout life make to inequality at any point in time. Equally important, the book sheds light on the prospects of escaping disadvantage over time. The analysis shows that South Asia performs poorly in terms of opportunity. Access to basic services is partial at best, and can be traced to characteristics at birth, including gender, location, and caste. Conversely, the region has had a robust performance in terms of geographical and occupational mobility despite its cluttered urbanization and widespread informality. Migration and jobs have served disadvantaged groups better than the rest, highlighting the importance of the urbanization and private sector development agendas. Support falls somewhere in between. Poverty alleviation programs are pervasive. But the mobilization of public resources is limited and much of it is wasted in regressive subsidies, while inter-government transfers do not do enough to mitigate spatial inequalities.