This paper uses detailed information on the latitude and longitude of conflict events in Sub-Saharan African countries to study the impact of external income shocks on the likelihood of violence. We consider a number of external demand shocks faced by the countries or the regions within countries - temporary shocks such as changes in the world demand for agricultural commodities, and longer-lasting events such as financial crises in the partner countries - and combine these with information reflecting the natural level of trade openness of the location. We find that (i) the incidence, intensity and onset of conflicts are generally negatively and significantly correlated with income variations at the local level; (ii) this relationship is significantly weaker for the most remote locations, i.e those located away from the main seaports,(iii) at the country-level, these shocks have an insignificant impact on the overall probability of conflict outbreak, but do affect the probability that conflicts start in the most opened regions. Altogether, our results therefore suggest that external income shocks are important determinants of the intensity and geography of conflicts, and provide support in favor of the opportunity cost theories of war.
This paper develops a model of optimizing behavior of asylum seekers whose objective is to reach an advanced country. Their personal characteristics and the challenges anticipated along the way determine whether they try to reach the ultimate destination with the aid of human smugglers or by applying for resettlement with the United Nations High Commissioner for Refugees (UNHCR). In the current policy environment, individuals who are relatively young, skilled, wealthy, and have access to credit from the family network are found to have a strong incentive to choose the undocumented migration option.
The objective of this paper is to discuss and compare the role that different constituencies play in US and EU procedures for merger control. We describe the main constituencies (both internal and external) involved in merger control in both jurisdictions and discuss how a typical merger case would be handled under these procedures. At each stage, we consider how the procedure unfolds, which parties are involved, and how they can affect the procedure. Our discussion reveals a very different ecology. EU and US procedures differ in terms of their basic design and in terms of the procedures that are naturally associated with these alternative designs. On the one hand, there is a single investigator and decision maker operating under a symmetric mandate in the EU and on the other hand, an investigation and settlement operating under the threat of a court decision in case of challenge only in the US. The EU has developed numerous procedures and has granted extensive rights to the parties in the context of these procedures in order to provide some guarantee that the Commission’s role as investigator and decision maker at first instance is not abused. By contrast, the US procedures appear to be rather informal, the balance in the investigation and evaluation of the merger being provided by the credible threat of a court decision. With a strong federal government that has extensive competences for regulation, merger control on competition grounds is subject to the additional public interest test of regulators in the US. Such additional control is weak in the EU, which has more limited competences for regulation. In addition, both the executive and the legislative powers are more fully developed at the federal level in the US. Both the executive power and the legislative seem to be in position to wield greater influence on enforcement in the US than is the case in the EU.
We use a large sample of export transactions from customs files across six developing countries and several years to explore the extent of pricing to market and volume responses to exchange-rate variations in the East African Community (EAC), a customs union, and a control group of exporters from developing countries outside the region. We find that, relative to the control group, EAC exporters seem to have a stronger ability to price to market on the CU market, suggesting the existence of market power. This market power does not seem to relate to usual proxies for firm size, but is more marked for manufactured products. We also find that the supply (volume) response to exchange-rate variations is more subdued for EAC exporters than for the control group, suggesting the existence of supply constraints.
This paper summarizes the main findings of the literature on the relationship between financial and economic development (the known knowns), points to directions for future research (the knowns unknowns), and then speculates on the third Rumsfeldian category. The known knowns section organizes the empirical literature on finance and growth into three strands : (1) the traditional literature which established the link between finance and growth; (2)the new literature which qualified some of the results of the traditional literature; and (3)the new-new literature which focuses on alternative measures of financial development and on the dark side of finance. The known unknowns section focuses on causality, on the channels through which finance affects growth, and on the dark side of finance. The unknown unknowns section discusses a topic on which we may know less than what we think we know.
A guest-worker program can be a very flexible and convenient way of meeting labor shortages in a host country, assuming that the migrants obeythe rules. This paper investigates the conditions under which guest workers have sufficient incentives for voluntary return to their country of origin when their work permits expire. The analysis is conducted in the context of a lenient enforcement regime that avoids deportations of undocumented aliens. It relies instead on eligibility criteria and pricing instruments, such as partial withholding of salary and an exit tax for those who overstay, to provide adequate incentives for voluntary return at the end of the contract period.
This paper studies the relationship between sovereign spreads and the interaction between debt composition and debt levels in advanced and emerging market countries. It finds that in emerging market countries there is a significant correlation between spreads and debt levels. This correlation, however, is not statistically significant in countries where most public debt is denominated in local currency. In advanced economies, the magnitude of the correlation between debt levels and spreads is about one fifth of the corresponding correlation for emerging market economies. In Eurozone countries, however, the correlation between spreads and debt ratios is similar to that of emerging market countries. The paper also shows that the financial crisis amplified the relationship between spreads and debt levels within the Eurozone but had no effect on the relationship between spreads and debt in standalone countries. Finally, the paper shows that the relationship between debt levels and spreads is amplified by the presence of large net foreign liabilities. This amplifying effect of net foreign liabilities is larger in the Eurozone than in standalone advanced economies. The paper concludes that debt composition matters and corroborates the original sin hypothesis that, rather than being a mere reflection of institutional weaknesses, the presence of foreign currency debt increases financial fragility and leads to suboptimal macroeconomic policies.
In this paper, we estimate the impact on local household livelihoods of the Natural Forest Protection Programme (NFPP), the largest logging ban programme in the world that aims to protect watershed and conserve natural forests. In doing so we use a series of policy evaluation micro-econometric techniques to assess the impacts of the NFPP on two interrelated facets of household livelihoods, namely income and off farm labour supply. We find that the NFPP has had a negative impact on incomes from timber harvesting but has actually had a positive impact on total household incomes from all sources. Further, we find that off farm labour supply has increased more rapidly in NFPP areas than non-NFPP areas. This result is strongest for employment outside the village. On the basis of these results policy implications for household livelihoods are drawn.
