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5221. Trade in the Small-and Micro-Enterprise Sector in Kenya and other Countries in Eastern and Southern Africa

Author:
Poul Ove Pedersen
Publication Date:
04-2005
Content Type:
Working Paper
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
Since the famous ILO report on the informal sector in Kenya was published in 1972 the smallscale enterprises have been recognised to play an important role in the Kenyan economy as in other African countries. However, although often more than half of all the small enterprises are traders. Most small enterprise policies have focussed almost entirely on the small scale producers. The small-scale traders have generally been seen as unproductive activities with no positive role to play in development, a sign of poverty, although they are responsible for a large share of the national distribution system. The paper attempts to look at this paradox and investigate the role of the small scale traders in the small enterprise sector and in the development process.
Topic:
Development, Economics, and Third World
Political Geography:
Kenya and Africa

5222. The Development of the Informal Small-Enterprise Sector in Eastern and Southern Africa: From Import Substitution to Structural Adjustment

Author:
Poul Ove Pedersen
Publication Date:
04-2005
Content Type:
Working Paper
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
In spite of its growing importance in the African economies, the informal, small-enterprise sector still plays a dubious and little understood role in development. Due to lack of data it is often treated as if it was unrelated to the rest of the economy. However, a number og large surveys carried out in a number of African countries indicate that structure and development of the small-enterprise sector vary greatly both from country to country and over time, depending in a complex way on the national differences in socio-economic structures and policies.
Topic:
Development, Economics, and Industrial Policy
Political Geography:
Africa

5223. Development of African Freight Transport - the Case of Kenya

Author:
Patrick O. Alila, Meleckidzedeck Khayesi, Walter Odhiambo, and Poul Ove Pederson
Publication Date:
02-2005
Content Type:
Working Paper
Institution:
Danish Institute for International Studies (DIIS)
Abstract:
The Kenyan transport system is still to a large extent structured by physical infrastructure, legislation and institutions developed during the colonial period, and by import-substitution policies which during the first decades after independence to a large extent allowed the transport system to deteriorate. However, since the late 1980s the structural adjustment policies have led to a renewed interest both from the government and the donors in developing the transport infrastructure. At the same time trade liberalisation, deregulation of domestic trade and privatisation of the parastatals have since the mid-1990s led to a reshaping of both trade and transport which is still ongoing. The so-called logistical revolution, which since the early 1970s has revolutionised transport in the industrialised and industrialising world, has with a delay of two decades also reached Africa. This is resulting in much closer integration of transport into production and trade which tend to shift the focus away from the physical transport infrastructure to the institutional structures and organisations which support and exploit the infrastructures. This paper tries to describe the resulting transformation of the Kenyan transport system.
Topic:
Development, Economics, and Human Welfare
Political Geography:
Kenya and Africa

5224. Growth in the Exclusion of Employer Health Premiums

Author:
Adam Carasso
Publication Date:
06-2005
Content Type:
Working Paper
Institution:
Urban Institute
Abstract:
The single largest tax expenditure in the federal budget is the employer exclusion of contributions for medical insurance premiums and medical care from employee income taxes. In fiscal year 2005, the Office of Management and Budget estimates this exclusion is worth $112 billion. If the payroll tax exclusion component were also counted here, the total would be significantly higher. (For details, please see Len Burman, Cori Uccello, Laura Wheaton, and Deborah Kobes, ''Tax Incentives for Health Insurance,'' Discussion Paper No. 12, Washington, DC: The Urban-Brookings Tax Policy Center, May 2003.)
Topic:
Economics, Human Rights, and Human Welfare
Political Geography:
United States

5225. Extension of Saving and Investment Incentives

Author:
Eric Toder
Publication Date:
06-2005
Content Type:
Working Paper
Institution:
Urban Institute
Abstract:
Thank you for inviting me to testify today at this hearing on extension of the incentives for savings and investment that are scheduled to expire in the next few years. Major tax incentives enacted in 2001 and 2003 that are scheduled to expire and that the Congress may consider renewing include the special lower tax rates for capital gains and dividend income enacted in 2003, and the increase in the annual deduction amount for qualified section 179 property, the savers credit, and the above the line deduction for qualified post-secondary education expenses, all enacted in 2001. The education deduction and the increase in the section 179 deduction expire at the end of this year, the savers credit expires at the end of 2006, and the lower tax rates for capital gains and dividends expire at end of 2008.
Topic:
Development, Economics, Education, and Government

5226. The Aspect of Culture in Promoting Social Inclusion in the European Union: Is the Open Method of Co-ordination (OMC) Working for Ethnic Minorities?

Author:
Tove H. Malloy
Publication Date:
09-2005
Content Type:
Policy Brief
Institution:
European Centre for Minority Issues
Abstract:
In the context of making the European economic area competitive while reaching certain social and economic goals, the 2000 European Council at Lisbon initiated an ambitious implementation scheme on its Social Agenda introducing the Open Method of Co-ordination (OMC) as an instrument to streamline and optimize Community and Member States’ policies. The OMC method is a ‘soft governance’ approach aimed at generating real political commitment and different types of norms, procedural as well as substantive, through a highly institutionalized process of information sharing, deliberation, monitoring and learning.1 The method was first introduced in the area of employment and has been followed by an OMC on Social Inclusion (OMC/Incl.). Other focus areas are social protection/pensions and health care. The OMC on employment has recently undergone a first evaluation, and the Commission is preparing to subject the OMC/Incl. to its first evaluation.2 No OMC focuses specifically on minority inclusion but the OMC/Incl. has developed into one of the key areas of European Union (EU) policy implementation that addresses the socioeconomic exclusion of members of ethnic and Roma/Sinti minorities.
Topic:
Economics, Regional Cooperation, Minorities, European Union, and Social Services
Political Geography:
Europe

5227. Slow Passthrough Around the World: A New Import for Developing Countries?

Author:
Jeffrey Frankel, David Parsley, and Shang-Jin Wei
Publication Date:
02-2005
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
Developing countries traditionally experience passthrough of exchange rate changes that is greater and more rapid than high-income countries experience. This is true equally of the determination of prices of imported goods, prices of local competitors’ products, and the general CPI. But developing countries in the 1990s experienced a rapid downward trend in the degree of passthrough and speed of adjustment, more so than did high-income countries. As a consequence, slow and incomplete passthrough is no longer exclusively a luxury of industrial countries. Using a new data set -- prices of eight narrowly defined brand commodities, observed in 76 countries -- we find empirical support for some of the factors that have been hypothesized in the literature, but not for others. Significant determinants of the passthrough coefficient include per capita incomes, bilateral distance, tariffs, country size, wages, long-term inflation, and long-term exchange rate variability. Some of these factors changed during the 1990s. Part (and only part) of the downward trend in passthrough to imported goods prices, and in turn to competitors’ prices and the CPI, can be explained by changes in the monetary environment – including a fall in long-term inflation. Real wages work to reduce passthrough to competitors’ prices and the CPI, confirming the hypothesized role of distribution and retail costs in pricing to market. Rising distribution costs, due perhaps to the Balassa-Samuelson-Baumol effect, could contribute to the decline in the passthrough coefficient in some developing countries.
Topic:
Economics, Markets, Developing World, Tariffs, Exchange Rate Policy, and Inflation
Political Geography:
Global Focus

5228. Contractionary Currency Crashes In Developing Countries

Author:
Jeffrey Frankel
Publication Date:
02-2005
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
To update a famous old statistic: a political leader in a developing country is twice as likely to lose office in the 6 months following a currency crash as otherwise. This difference, which is highly significant statistically, holds regardless whether the devaluation takes place in the context of an IMF program. Why are devaluations so costly? Many of the currency crises of the last ten years have been associated with output loss. Is this, as alleged, because of excessive reliance on raising the interest rate as a policy response? More likely it is because of contractionary effects of devaluation. There are various possible contractionary effects of devaluation, but it is appropriate that the balance sheet effect receives the most emphasis. Passthrough from exchange rate changes to import prices in developing countries is not the problem: this coefficient fell in the 1990s, as a look at some narrowly defined products shows. Rather, balance sheets are the problem. How can countries mitigate the fall in output resulting from the balance sheet effect in crises? In the shorter term, adjusting promptly after inflows cease is better than procrastinating by shifting to short-term dollar debt, which raises the costliness of the devaluation when it finally comes. In the longer term, greater openness to trade reduces vulnerability to both sudden stops and currency crashes.
Topic:
Debt, Economics, Developing World, Exchange Rate Policy, Currency, and Devaluation
Political Geography:
Global Focus

5229. Why is Mobility in India so Low? Social Insurance, Inequality, and Growth

Author:
Kaivan Munshi and Mark Rosenzweig
Publication Date:
07-2005
Content Type:
Working Paper
Institution:
The John F. Kennedy School of Government at Harvard University
Abstract:
This paper examines the hypothesis that the persistence of low spatial and marital mobility in rural India, despite increased growth rates and rising inequality in recent years, is due to the existence of sub-caste networks that provide mutual insurance to their members. Unique panel data providing information on caste loans and sub-caste identification are used to show that households that out-marry or migrate lose the services of these networks, which dampens mobility when alternative sources of insurance or finance of comparable quality are unavailable. At the aggregate level, the networks appear to have coped successfully with the rising inequality within sub-castes that accompanied the Green Revolution. Indeed, this increase in inequality lowered overall mobility, which was low to begin with, even further. The results suggest that caste networks will continue to smooth consumption in rural India for the foreseeable future, as they have for centuries.
Topic:
Economics, Inequality, Economic Growth, Mobility, and Insurance
Political Geography:
South Asia and India

5230. Trends in Competitive Balance: Is there Evidence for Growing Imbalance in Professional Sport Leagues?

Author:
Arne Feddersen and Wolfgang Maennig
Publication Date:
01-2005
Content Type:
Working Paper
Institution:
Chair for Economic Policy, University of Hamburg
Abstract:
The concept of competitive balance is a central aspect in the literature of sports economics. A popular argumentation of sport functionaries is that dominance of one or a few teams could lead to unequal incomes for the clubs, restrictions in the clubs’ ability to improve sporting performance and ultimately to a loss of attractiveness and loss of income for the league. Following this line of reasoning and alleging a negative trend in competitive sports functionaries often try to implement regulations in team sport leagues. The aim of this paper is to analyze for eight different leagues if there is such a trend existing. For an empirical test for trends in competitive balance of four European soccer leagues (ENG, ESP, GER, ITA) and four US Major Leagues (MLB, NBA, NFL, NHL), OLS regressions with a constant were carried out. For the entire observation period from 1969/70 to 2003/2004, of 48 trends ascertained, only 12 could be observed as being significantly positive (i.e. growing imbalance) with 19 significantly negative (i.e. growing balance). The remaining 17 trends were insignificantly different from zero.
Topic:
Economics, Sports, Soccer, Competitive Balance, and Sports Leagues
Political Geography:
Europe, Global Focus, and United States of America