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    Essays on the cause and consequences of market distortions

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    In contrast to past literature on competitive bribery, the thesis demonstrates that competitive bribery for rents generated from market distortions is inefficient. However, self enriching policy makers have incentives for implementing these distortions in order to maximize the appropriation of rents. Their success in raising distortions is higher when the electoral process is easily manipulated. Thus distortions are higher and last longer in the absence of electoral accountability. Such distortions worsen the deprivation of human capabilities and functionings, as evidenced by worsening health outcomes among children in Zimbabwe after the policy changes since 2000. Market distortions are sub-optimal and attract bribery. Given arguments in the literature that competitive bribery is efficient, this thesis investigates whether this 'efficiency outcome' extends to bribery for rents generated from distortions. This analysis questions the generalization of the 'efficiency outcome' from models of competitive bribery. The thesis applies auction theory to demonstrate that a symmetric model of competitive bribery can produce an inefficient outcome. In particular, it shows that efficiency in competitive bribery models is sensitive to the source of rents. If the valuation of rents is misaligned to society's preferences, then competitive bribery produces an inefficient outcome. The generalization that competitive bribery is efficient is therefore misleading. This is illustrated using rents generated from market distortions hence the outcome confirms the inefficiency of bribery for rents generated from market distortions. Bribes for rents generated by market distortions accrue to office bearers. Therefore, self enriching policy makers find rent generating distortions attractive despite their negative impact on efficiency and social outcomes. These policy makers seek to extract maximum rents from distortions subject to constraints imposed by considerations for political survival. The political considerations are determined by the quality of electoral institutions. When electoral institutions are weak, incumbents can use electoral fraud to circumvent political pressure generated by the negative effects of high distortions. They maximize on financial rents by raising the level of distortions even when large welfare losses arise. Uni democratic regimes will therefore choose higher levels of distortions. They are less likely to adjust high distortions too. The thesis demonstrates this argument using a model of electoral accountability to compare distortions chosen by an incumbent with and without the possibility of electoral manipulation. The model shows that an incumbent chooses higher distortions when electoral manipulation is feasible. This theory is confirmed on exchange rate distortions in Sub-Saharan Africa. Dictatorships overvalue by between 22.4 and 26.6 percentage points more than complete democracies. These estimates are obtained from dynamic panel GMM estimation using data for non CFA Sub-Saharan countries. The quality of democracy is measured by the polity 2 score from the Polity IV data and exchange rate overvaluation by the black market to official exchange rate ratio. Further confirmation of the hypothesis comes from conditional logit estimation results. They show that undemocratic regimes are more likely to excessively overvalue the exchange rate than democratic regimes. This explains the persistence of excessive distortions in countries with weak institutions. Such distortions can not be wholly attributed to lobbying by special interest groups or to the political use of economic inefficiency as generally argued in the literature. Zimbabwe offers a practical example of distortions which are implemented or sustained for maximizing the appropriation of rents by the incumbent. The government stepped up its intervention in markets since 2000. The resulting distortions shifted command over resources and placed them in the hands of the elite while their intensity and persistence had devastating effects on the economy. Elections over this period have been accompanied by electoral intimidation and manipulation. Thus the incumbent government relied on electoral manipulation to continue the appropriation of rents from market distortions. Zimbabwe provides a good case study of the consequences of market distortions that are sustained to benefit the incumbent in the presence of weak democratic institutions. The thesis uses the 1999 and 2005/06 DHS data to make a comparative analysis of changes in social outcomes after the policy shift in Zimbabwe. This analysis sheds light on the social costs of market distortions that are sustained to benefit the incumbent. The average number of items consumed by under 5 year old children declined by 34%, mean height for age by 19% and mean weight for age by 16%. The biggest declines were on outcomes for children living in poor and middle class households. Children in richer households were the least affected. The significant negative coefficient of food consumption in the height and weight for age regressions show that food consumptions worsened child health outcomes. The decline in food consumption contributed to 37% and 57% decline in means of height and weight for age respectively. ii Wealth inequality in 2005/06 was 16% relatively higher than inequality in 1999. Wealth is measured by an asset index derived from principle component analysis and its inequality by the McKenzie 2005 index. Inequality in food consumption increased as evidenced by a change in the Kakwani concentration index for food consumption by 48% of the 1999 value. A decomposition of changes in health inequality shows that increased inequality in food consumption contributed to increased nutrition inequality by a magnitude of 11% and 6% of stunting and underweight concentration indices in 1999. These results indicate that market distortions worsened social outcomes in Zimbabwe. Yet the distortions persisted for almost a decade due to weak electoral accountability in that period. This shows that a weak intuitional environment which erodes electoral accountability promotes policies that are costly to society. Distortions that arise from such policies have an impact that extends beyond efficiency in allocation. They affect outcomes which are intrinsically important aspects of well-being. ii

    Is informality welfare-enhancing structural transformation ? evidence from Uganda

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    While Africa's recent decade of growth and poverty reduction performance has been lauded, concern has been expressed regarding the structure of this growth. In particular, questions have been raised about whether the growth is based on a commodities boom, or whether it is the beginning of a structural transformation that will lift workers from low-productivity jobs into higher-productivity ones. Macro evidence has suggested that the structural transformation has not started. But macro analysis misses the evidence that the process of transformation has started, because this process begins at the household level. Household livelihoods do not move from ones based on subsistence farming and household level economic activities into livelihoods based on individual wage and salary employment away from the household in one leap -- this process takes generations. The intermediate step is the productive informal sector. It is income gains at the household level in this sector that fuel productivity increases, savings, and investment in human capital in this sector. Ensuring that most households are able to diversify their livelihoods into the non-farm sector through productive informality not only increases growth, but also allows the majority of the population to share in the growth process. This paper illustrates this point with the case of Uganda which followed this path and experienced two decades of sustained growth and poverty reduction.Rural Poverty Reduction,Achieving Shared Growth,Labor Policies,Regional Economic Development,Economic Theory&Research

    Different Dreams, Same Bed : Collecting, Using, and Interpreting Employment Statistics in Sub-Saharan Africa--The Case of Uganda

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    Employment and earnings statistics are the key link between the size and structure of economic growth and the welfare of households, which is the ultimate goal of development policy, so it is important to monitor employment outcomes consistently. A cursory review of employment data for low-income Sub-Saharan African countries shows both large gaps and improbable variation within countries over time and among countries, suggesting that low quality data are routinely reported by national statistics offices. Unfortunately, policies are formed and projects developed and implemented on the basis of these statistics. Therefore, errors of measurement could be having profound implications on the strategic priorities and policies of a country. This paper explains the improbable results observed by using data from Uganda, where the labor module contains variation both within and across surveys, to show the sensitivity of employment outcomes to survey methodology. It finds that estimates of employment outcomes are unreliable if the questionnaire did not use screening questions, as labor force participation will be underestimated. Likewise, surveys that use a seven-day recall period underestimate or potentially misrepresent employment outcomes, owing to seasonality and multiple jobs. Common multivariate analysis applied on household survey data will be affected, as the errors in measurement in the dependent and independent variables will be correlated. Corrections to reduce measurement bias in existing data are tested with the survey data; none are found to be completely satisfactory. The paper concludes that there is a knowledge gap about employment outcomes in Sub-Saharan Africa that will continue unless collection techniques improve

    Education and Health Services in Kenya : Data for Results and Accountability

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    Although Kenya's vision 2030 highlights investment in human development, public spending on health and education in Africa has not guaranteed results. Closing the gap between promises, spending, and results depend on what service providers know and what they do: provider behavior is key. The Service Delivery Indicators (SDI) aim to provide critical information to improve accountability for health and education results. The survey was implemented by the Kenya Institute of Public Policy Research and Analysis (KIPPRA) and Kimetrica with quality assurance and oversight from the World Bank. The surveys provide a representative snapshot of the learning environment and key resources in both public and private schools, and the quality of health service delivery and the physical environment within which services are delivered in public and private (nonprofit) health facilities. Improvements in service quality in Kenya can be accelerated through focused investments on reforms to the incentive environments facing providers, and in the skills of providers to ensure that inputs and skills come together at the same time and at the same place. This will be critical to ensure that Kenya's gains in human development outcomes continue beyond 2015, bringing the country closer to achieving the promises set out in the vision 2030

    Service Delivery Indicators : Kenya

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    Without consistent and accurate information on the quality of services, it is difficult for citizens or politicians (the principal) to assess how service providers (the agent) are performing and to take corrective action. The service delivery indicators (SDI) provide a set of metrics to benchmark the performance of schools and health clinics in Africa. The indicators can be used to track progress within and across countries over time, and aim to enhance active monitoring of service delivery to increase public accountability and good governance. Ultimately, the goal of this effort is to help policymakers, citizens, service providers, donors, and other stakeholders enhance the quality of services and improve development outcomes. This report presents the findings from the implementation of the first SDI survey in Kenya. The production of health services requires three dimensions of service delivery: (i) the availability of key inputs such as drugs, equipment and infrastructure; (ii) providers who are skilled; and (iii) providers who exert the necessary effort in applying knowledge and skills. The SDI surveys allow for the assessment of how these elements come together to produce quality health services in the same place at the same time. This paper is structured as follows: section one gives introduction. Section two outlines the analytical underpinnings of the indicators and how they are categorized. Section three presents the methodology of the Kenya SDI education and health surveys. The results are presented and analyzed in section four and section five. The report concludes with a summary of the overall findings and some implications for Kenya

    Going Beyond Counting First Authors in Author Co-citation Analysis

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    The present study examines one of the fundamental aspects of author co-citation analysis (ACA) - the way co-citation counts are defined. Co-citation counting provides the data on which all subsequent statistical analyses and mappings are based, and we compare ACA results based on two different types of co-citation counting - the traditional type that only counts the first one among a cited work's authors on the one hand and a non-traditional type that takes into account the first 5 authors of a cited work on the other hand. Results indicate that the picture produced through this non-traditional author co-citation counting contains more coherent author groups and is therefore considerably clearer. However, this picture represents fewer specialties in the research field being studied than that produced through the traditional first-author co-citation counting when the same number of top-ranked authors is selected and analyzed. Reasons for these effects are discussed

    Variations on the Author

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    “Variations on the Author” discusses two of Eduardo Coutinho’s recent films (Um Dia na Vida, from 2010, and Últimas Conversas, posthumously released in 2015) and their contribution to the general question of documentary authorship. The director’s filmography is characterized by a consistent yet self-effacing form of authorial self-inscription: Coutinho often features as an interviewer that rather than express opinions propels discourses; an interviewer that is good at listening. This mode of self-inscription characterizes him as an author who is not expressive but who is nonetheless markedly present on the screen. In Um Dia na Vida, however, Coutinho is completely absent form the image, while Últimas Conversas, on the contrary, includes a confessional prologue that moves the director from the margins to the center of his films. This article examines the ways in which these works stand out in the filmography of a director who offers new insights into the notion of cinematic authorship

    Appropriate Similarity Measures for Author Cocitation Analysis

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    We provide a number of new insights into the methodological discussion about author cocitation analysis. We first argue that the use of the Pearson correlation for measuring the similarity between authors’ cocitation profiles is not very satisfactory. We then discuss what kind of similarity measures may be used as an alternative to the Pearson correlation. We consider three similarity measures in particular. One is the well-known cosine. The other two similarity measures have not been used before in the bibliometric literature. Finally, we show by means of an example that our findings have a high practical relevance.information science;Pearson correlation;cosine;similarity measure;author cocitation analysis
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