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Relative Returns to Policy Reform : Evidence from Controlled Cross-Country Regressions

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dc.contributor.authorde Castro, Alexandre Samy
dc.contributor.authorGoldin, Ian
dc.contributor.authorPereira da Silva, Luiz A.
dc.date.accessioned2014-08-01T19:41:11Z
dc.date.available2014-08-01T19:41:11Z
dc.date.issued2002-10
dc.description.abstractThe authors aim at contributing to understand the dispersion of returns from policy reforms using cross-country regressions. The authors compare the "before reform" with "after reform" GDP growth outcome of countries that undertook import-liberalization and fiscal policy reforms. They survey a large sample (about 54) of developing countries over the period 1980-99. The benefits of openness to trade and fiscal prudence have been extensively identified in the growth literature, but the evidence from simple cross-section analysis can sometimes be inconclusive and remains vulnerable to criticism on estimation techniques, such as identification, endogeneity, multi-colinearity, and the quality of the data. The authors use a different analytical framework that establishes additional controls. First, they construct a counterfactual control group. These are countries that-under specific thresholds-did not introduce policy reforms under scrutiny. Second, the authors also try to use the most appropriate variable of policy reform, for example, exogenous changes in import-tariffs instead of the endogenous sum of all trade flows. Third, the authors try to base the before-after reform comparison on the most accurate date for the beginning of a policy reform period (instead of comparing averages over fixed intervals of time). Once these controls are set, they explain the difference between average GDP growth rates during the country-specific post and the pre-reform periods, relative to the average GDP growth of the relevant control group. The explanatory variables in the regressions include the standard growth-regression controls. The results are the following: 1) With a better measurement and timing of the policy reforms, the growth effect (the "returns on reform") is generally smaller than in previous papers. 2) There is evidence of contingent relationships between policy and growth, corresponding to the country's size, its export profile, and its governance. 2) Within the group of policy reformers, some countries have exhibited a relatively weaker growth response. Overall, the findings suggest that more accurate measurement and definition of the timing of reforms does not strengthen the significance of the effects of reforms on GDP growth. In fact, the effects are weaker than indicated in most cross-section studies. This suggests that the policy implications to be derived from these relationships should be treated with even more caution than previously thought.en
dc.identifierhttp://documents.worldbank.org/curated/en/2002/10/2032622/relative-returns-policy-reform-evidence-controlled-cross-country-regressions
dc.identifier.doi10.1596/1813-9450-2898
dc.identifier.urihttps://hdl.handle.net/10986/19222
dc.languageEnglish
dc.publisherWorld Bank
dc.relation.ispartofseriesPolicy Research Working Paper; No. 2898
dc.rightsCC BY 3.0 IGO
dc.rights.urihttp://creativecommons.org/licenses/by/3.0/igo/
dc.subjectAGRICULTURAL EXPORTS
dc.subjectAGRICULTURAL PRODUCTS
dc.subjectAGRICULTURE
dc.subjectANDEAN PACT
dc.subjectANTIDUMPING
dc.subjectAVERAGE GROWTH
dc.subjectAVERAGE GROWTH RATE
dc.subjectAVERAGE TARIFF
dc.subjectAVERAGE TARIFF RATE
dc.subjectAVERAGE TARIFF RATES
dc.subjectAVERAGE TARIFFS
dc.subjectAVERAGE TRADE
dc.subjectBALANCE OF PAYMENTS
dc.subjectBALANCE OF PAYMENTS CRISIS
dc.subjectBARRIERS TO IMPORTS
dc.subjectBLACK MARKET
dc.subjectBLACK MARKET PREMIUM
dc.subjectCAPITAL ACCOUNT
dc.subjectCAPITAL ACCUMULATION
dc.subjectCAPITAL STOCK
dc.subjectCD
dc.subjectCOMPARATIVE ADVANTAGE
dc.subjectCOMPLEX TASK
dc.subjectCONCESSIONS
dc.subjectCONSUMPTION EXPENDITURES
dc.subjectCOUNTRY CHARACTERISTICS
dc.subjectCOUNTRY REGRESSIONS
dc.subjectCOUNTRY SIZE
dc.subjectCROSS- COUNTRY ANALYSIS
dc.subjectCROSS- COUNTRY VARIATION
dc.subjectCROSS-COUNTRY ANALYSIS
dc.subjectCROSS-COUNTRY REGRESSIONS
dc.subjectCURRENCY
dc.subjectCUSTOMS
dc.subjectCUSTOMS UNION
dc.subjectDATA AVAILABILITY
dc.subjectDEBT
dc.subjectDEVELOPED COUNTRIES
dc.subjectDEVELOPING COUNTRIES
dc.subjectDEVELOPMENT ECONOMICS
dc.subjectDEVELOPMENT INDICATORS
dc.subjectECONOMIC GROWTH
dc.subjectECONOMIC POLICY
dc.subjectEMPIRICAL EVIDENCE
dc.subjectEQUATIONS
dc.subjectESTIMATED COEFFICIENTS
dc.subjectESTIMATION METHOD
dc.subjectESTIMATION TECHNIQUES
dc.subjectEXCHANGE RATE
dc.subjectEXOGENOUS SHOCK
dc.subjectEXOGENOUS SHOCKS
dc.subjectEXPENDITURES
dc.subjectEXPLANATORY VARIABLES
dc.subjectEXPORT SHARES
dc.subjectEXPORTERS
dc.subjectEXPORTS
dc.subjectEXTERNAL DEBT
dc.subjectEXTERNAL SHOCKS
dc.subjectFACTORS OF PRODUCTION
dc.subjectFINANCIAL LIBERALIZATION
dc.subjectGDP
dc.subjectGDP PER CAPITA
dc.subjectGLOBAL TRADE
dc.subjectGROWTH EFFECT
dc.subjectGROWTH LITERATURE
dc.subjectGROWTH PERFORMANCE
dc.subjectGROWTH RATE
dc.subjectGROWTH RATES
dc.subjectGROWTH REGRESSIONS
dc.subjectHIGH INCOME COUNTRIES
dc.subjectHIGH TARIFFS
dc.subjectHUMAN CAPITAL
dc.subjectIDIOSYNCRATIC SHOCKS
dc.subjectIMPORT DUTIES
dc.subjectIMPORT LIBERALIZATION
dc.subjectIMPORT TARIFFS
dc.subjectINCOME
dc.subjectINCREASE GROWTH
dc.subjectINCREASING MARKET ACCESS
dc.subjectINFLATION
dc.subjectINVESTMENT RATE
dc.subjectINVESTMENT RATES
dc.subjectLAGGED GROWTH
dc.subjectLONG- RUN GROWTH
dc.subjectMACRO POLICY
dc.subjectMACROECONOMIC CONDITIONS
dc.subjectMACROECONOMIC POLICY
dc.subjectMARGINAL COST
dc.subjectMARGINAL EFFECT
dc.subjectMARGINAL EFFECTS
dc.subjectMARKET ACCESS
dc.subjectNEGATIVE EFFECT
dc.subjectNEGATIVE IMPACT
dc.subjectNON-TARIFF BARRIERS
dc.subjectOPEN ECONOMIES
dc.subjectOPENNESS
dc.subjectOPENNESS TO IMPORTS
dc.subjectPOLICY ANALYSIS
dc.subjectPOLICY IMPLICATIONS
dc.subjectPOLICY INSTRUMENTS
dc.subjectPOLICY REFORM
dc.subjectPOLICY REFORMS
dc.subjectPOLICY RESEARCH
dc.subjectPOLICY VARIABLES
dc.subjectPRIMARY EDUCATION
dc.subjectPRIMARY PRODUCTS
dc.subjectPRODUCTION FUNCTION
dc.subjectPRODUCTIVITY
dc.subjectPUBLIC INVESTMENT
dc.subjectPUBLIC POLICIES
dc.subjectQUOTAS
dc.subjectREAL INTEREST RATES
dc.subjectREDUCED FORM EQUATION
dc.subjectREGIONAL TRADE
dc.subjectREGIONAL TRADE BLOCS
dc.subjectREGIONAL TRADE SHARES
dc.subjectREGULATORY FRAMEWORK
dc.subjectSAVINGS
dc.subjectSIGNIFICANT REDUCTION
dc.subjectSTANDARD DEVIATION
dc.subjectSTANDARD GROWTH DETERMINANTS
dc.subjectTARIFF BARRIERS
dc.subjectTARIFF RATE
dc.subjectTARIFF RATES
dc.subjectTARIFF REDUCTION
dc.subjectTAX REVENUES
dc.subjectTAX SYSTEM
dc.subjectTERMS OF TRADE
dc.subjectTERMS OF TRADE SHOCKS
dc.subjectTOTAL FACTOR PRODUCTIVITY
dc.subjectTRADE BARRIERS
dc.subjectTRADE BLOC
dc.subjectTRADE BLOCS
dc.subjectTRADE CONTROL MEASURES
dc.subjectTRADE DIVERSION
dc.subjectTRADE DIVERSION EFFECT
dc.subjectTRADE FLOW
dc.subjectTRADE FLOWS
dc.subjectTRADE INTENSITY
dc.subjectTRADE LIBERALIZATION
dc.subjectTRADE OPENNESS
dc.subjectTRADE POLICIES
dc.subjectTRADE POLICY
dc.subjectTRADE POLICY REVIEW
dc.subjectTRADE POLICY VARIABLES
dc.subjectTRADE REFORM
dc.subjectTRADE REGIME
dc.subjectTRADE RESTRICTIONS
dc.subjectTRADE SHARE
dc.subjectTRADE TAXES
dc.subjectUNDERESTIMATES
dc.subjectURUGUAY ROUND
dc.subjectWORLD TRADE
dc.subjectWTO
dc.subjectPOLICY REFORM
dc.subjectCROSS-COUNTRY EXPERIENCE
dc.subjectGROSS DOMESTIC PRODUCT
dc.subjectGROWTH PATTERNS
dc.subjectIMPORT LIBERALIZATION
dc.subjectFISCAL POLICY
dc.subjectPRUDENTIAL REGULATIONS
dc.subjectVARIABILITY
dc.subjectIMPORT TARIFFS
dc.subjectTRADE FINANCE
dc.subjectREGRESSIVE TAXES
dc.subjectGOVERNANCE CAPACITY
dc.titleRelative Returns to Policy Reform : Evidence from Controlled Cross-Country Regressionsen
dspace.entity.typePublication
okr.crossref.titleRelative Returns to Policy Reform: Evidence from Controlled Cross-Country Regressions
okr.date.doiregistration2025-04-10T07:19:48.242635Z
okr.doctypePublications & Research::Policy Research Working Paper
okr.doctypePublications & Research
okr.docurlhttp://documents.worldbank.org/curated/en/2002/10/2032622/relative-returns-policy-reform-evidence-controlled-cross-country-regressions
okr.globalpracticePoverty
okr.globalpracticeTrade and Competitiveness
okr.globalpracticeHealth, Nutrition, and Population
okr.guid652671468739486082
okr.identifier.doi10.1596/1813-9450-2898
okr.identifier.externaldocumentum000094946_02101904244924
okr.identifier.internaldocumentum2032622
okr.identifier.reportWPS2898
okr.language.supporteden
okr.pdfurlhttp://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2002/11/01/000094946_02101904244924/Rendered/PDF/multi0page.pdfen
okr.sectorPublic Administration, Law, and Justice :: Central government administration
okr.topicHealth, Nutrition and Population::Public Health Promotion
okr.topicInternational Economics and Trade::Trade and Regional Integration
okr.topicHealth Monitoring and Evaluation
okr.topicInternational Economics and Trade::Trade Policy
okr.topicInternational Economics and Trade::Free Trade
okr.topicEconomic Theory and Research
okr.topicPoverty Reduction::Achieving Shared Growth
okr.topicEnvironmental Economics and Policies
okr.unitOffice of the Senior Vice President and Chief Economist, Development Economics
okr.volume1
relation.isSeriesOfPublication26e071dc-b0bf-409c-b982-df2970295c87
relation.isSeriesOfPublication.latestForDiscovery26e071dc-b0bf-409c-b982-df2970295c87
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