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Supplier responses to Walmart's invasion in Mexico
No full textThis paper examines the effect of Walmart's entry into Mexico on Mexican manufacturers of consumer goods. Guided by firm interviews that suggested substantial heterogeneity across firms in how they responded to Walmart's entry, we develop a dynamic industry model in which firms decide whether to sell their products through Walmex (short for Walmart de Mexico), or use traditional retailers. Walmex provides access to a larger market, but it puts continuous pressure on its suppliers to improve their product's appeal, and it forces them to accept relatively low prices relative to product appeal. Simulations of the model show that the arrival of Walmex separates potential suppliers into two groups. Those with relatively high-appeal products choose Walmex as their retailer, whereas those with lower appeal products do not. For the industry as a whole, the model predicts that the associated market share reallocations, adjustments in innovative effort, and exit patterns increase productivity and the rate of innovation. These predictions accord well with the results from our firm interviews. The model's predictions are also supported by establishment-level panel data that characterize Mexican producers' domestic sales, investments, and productivity gains in states with differing levels of Walmex presence during the years 1994 to 2002
Labor market insecurity among the middle class: a cross-pressured group
No full textThe political relevance of labor market insecurity has been questioned because (a) insider-outsider divides were considered to be a divide within the low-skilled and politically less active working class and (b) labor market insecurity runs through the middle of the household. Outsiders might therefore align their preferences with those of insiders. This contribution provides, first, evidence that labor market insecurity extends well into the higher-skilled middle class, in particular to high-skilled young adults and high-skilled women. Second, the contribution sheds light on the “household question”, that is the question whether mixed households dampen the political relevance of labor market insecurity. If labor market insecurity is concentrated in specific social groups (young adults, women) that tend to cohabit with secure insiders, the political relevance of labor market insecurity might depend on whether or not outsiders align their preferences with those of the household. In this contribution, I discuss recent work on the relevance of the household in translating labor market divides into preferences divides presenting recent work that shows that the household does not render insider-outsider divides politically irrelevant. In sum, insider-outsider divides have all the potential to become politically relevant
Bureaucratic Structure, Regulatory Quality, and Entrepreneurship in a Comparative Perspective: Cross-Sectional and Panel Data Evidence
No full textThe article examines the effect of meritocratic recruitment and tenure protection in public bureaucracies on regulatory quality and business entry rates in a global sample. Utilizing a cross-country measure on the extent of meritocratic entry to bureaucracy and a time-series indicator of tenure protection, it subjects theoretical claims that these features improve the epistemic qualities of bureaucracies and also serve as a credible commitment device to empirical test. We find that, conditional on a number of economic, political, and legal factors, countries where bureaucracies are more insulated from day-to-day oversight by individual politicians through the institutional features under consideration tend to have both better regulation, specifically business regulation, and higher rates of business entry. Our findings suggest that bureaucratic structure has an indirect effect on entrepreneurship rates through better regulatory quality, but also exert a direct independent effect
Towards a comprehensive mapping of information on public procurement tendering and its actors across Europe
No full textThis report presents the results of a comprehensive mapping exercise of the scope and quality of public procurement and linked information in 35 European jurisdictions: 28 European Union member states, 6 EU neighbouring countries and the European Commission. Part I analyses the public procurement information hosted in national platforms and made available online for the average user. This analysis enables the classification and comparison of countries along a series of dimensions, such as the amount of historical data on individual tenders, the scope of tender documentation publicly available, the fragmentation of procurement information sources, and the degree of machine-readability of tender announcements, among several others. Parts II and III of the report complement the information on procurement processes and outcomes with information on the two main actors involved in these processes: bidders and buyers. In this context, part II maps existing relevant data on private companies and part III follows with data on the governmental units acting as contracting authorities in each of our 35 jurisdiction. Discussing information linked to public procurement tendering data goes beyond the description of this deliverable in the Description of Work
Jugend, Vorsorge, Finanzen
No full textDie vorliegende MetallRente Studie untersucht, welchen Einfluss sozialer Hintergrund, Geschlecht und Bildung auf Einstellungen und Handlungen junger Menschen haben, wenn es um die wichtigen Themen Finanzen und Vorsorge geht. Nach bisher drei Erhebungswellen in den Jahren 2010, 2013 und 2016 ist dies die vierte Auflage der bundesweit repräsentativen Jugendstudie „Jugend, Vorsorge, Finanzen“. 2 500 Jugendliche und junge Erwachsene im Alter von 17 bis 27 Jahren wurden befragt. Erneut wurden auch Gastautorinnen und Gaustautoren aus Wissenschaft, Institutionen und Wirtschaft eingeladen, die Befragungsergebnisse mit ihren Analysen und Kommentaren zu ergänzen. Wie bewältigen junge Menschen das Spannungsfeld von eigener Verantwortung und staatlicher Regulierung? Welche Veränderungen werden gebraucht für eine zukunftsfeste Alterssicherung, die zur Lebenswirklichkeit der jungen Menschen passt? Auch die vierte MetallRente Studie geht mit dem Anspruch ans Werk, nicht nur zu analysieren, sondern Schlussfolgerungen zu formulieren sowie Forderungen und Vorschläge zu adressieren
Determinants of Market Integration and Price Transmission in Indonesia
No full textThis paper investigates the determinants of price differences and market integration among Indonesian provinces, using data from retail cooking oil, rice and sugar markets during the period 1993-2007, and from wholesale maize and soybean markets during the period 1992-2006. The authors measure the degree of integration using co-integration techniques, and calculate average price differences. They use regression analysis to understand the drivers of price differences and market integration. For rice and sugar, they find wide market integration and low price differences, in the range of 5-12 percent. For maize, soybeans and cooking oil, they find less integration and higher price differences (16-22 percent). Integration across provinces is explained by the remoteness and quality of transport infrastructure of a province. Price differences across provinces respond to differences in provincial characteristics such as remoteness, transport infrastructure, output of the commodity, land productivity and income per capita
An analysis of pre-crisis Madagascar firm performance: Firm growth and productivity
No full textThis paper uses firm-level data to examine the performance of developing country firms, focusing in particular on Madagascar during its pre-crisis period from 2004 to 2007. We use three different analyses: i) a cross-country comparison of firm performance across a selection of comparator countries; ii) a panel analysis of Malagasy firms using two years of survey data; and iii) an analysis of Malagasy micro and informal firms, using data from two additional surveys on micro-enterprises. These are intended to highlight structural factors thought relevant to understanding developing country firm performance, and particularly Malagasy firm performance. The three analyses lead to the following findings. Most firm employment growth is by medium and large firms and not micro and small firms as developed country studies would predict. Higher firm growth rates are positively associated with single proprietorships and firms that import inputs while, counter-intuitively, having a university-educated manager and a high share of skilled employees are associated with lower growth rates. In terms of labor productivity there is an apparent inverted-U relationship between firm performance and firm size: productivity increases up to a certain large size before stagnating or declining.
As such, high productivity and firm growth relates to medium and large firms. Notable, productivity stagnates at a smaller firm size than growth rates, implying continuing growth without productivity growth. Our micro and informal sector firm analysis also suggests the presence of an inverted–U relation between size and productivity but at a vastly smaller scale. The evidence also suggests that informal firms have higher productivity than their formal counterparts. The results suggest two key policy messages. First, there is a need to tackle distortions and barriers to firm growth that hinder more productive firms from growing faster and unleashing their potential. Second, improvements in the business environment, in particular for micro and small firms will be fundamental to encouraging firms to operate in the formal sector and provide a basis for further firm expansion
The Impact of Power Sector Reforms in Developing Economies
No full textSince the 1990s, many developing countries have restructured their electric power industry. Policies such as breaking up, commercializing and privatizing utilities, allowing for independent power producers, installing independent regulators, and introducing competitive wholesale markets were meant to improve the industry’s efficiency and service quality. We exploit more than 30 years of data from over 100 countries to investigate the impact of power sector reforms on efficiency (represented by network losses) and access to electricity (represented by connection rates and residential power consumption). Crucially, reforms are likely to be endogenous with respect to sector performance: a crisis in electricity supply might well trigger reform efforts. We deal with endogeneity using reform activity in neighboring countries as an instrument. Our results suggest that reforms strongly and positively impact electricity access. According to our preferred specification, a full reform program would increase connection rates by 20 percentage points and per capita consumption by 62 percent: these are large effects that are stable across a range of robustness checks. Moreover, the effect of improving access is largest in South Asian countries. In contrast to previous studies, we do not find robust evidence to support the theory that reforms reduce network losses
Juncker’s Political Commission: Did it Work?
No full textThe ‘political Commission’ may be the defining idea of the Juncker Presidency. But did it work? This paper is devoted to analysing how the notion of a political Commission has framed the organization and policy-making of the Juncker Commission. The idea of the political Commission was to allow the Commission to streamline its agenda and focus on a narrower number of proposals. In the words of the 2018 State of the Union address: to be ‘bigger on the big things and smaller on the small things’. In reality, external constraints, and in particular the divergent preferences and electoral cycles of national governments, have frustrated this promise. The Commission’s confinement to a relatively narrow set of regulatory (rather than distributive) tools limits its ability to be politically responsive to the main challenges the Union currently faces. At the same time, the political Commission undermines some elements of the Commission’s regulatory legitimacy – for example, its promise to be a neutral arbiter in the enforcement of competition, internal market and rule of law norms. While the political Commission continues to be a normatively attractive idea, it has fitted poorly with the institutional and political constraints surrounding the Juncker Presidency. This carries implications for the next Commission and
the fate of the Spitzenkandidaten process