1,721,039 research outputs found
Why We Don't See Poverty Convergence: The Role of Macroeconomic Volatility
Full text linkMartin Ravallion ("Why Don't We See Poverty Convergence?" American Economic Review, 102(1): 504-23; 2012) presents evidence against the existence of poverty convergence in aggregate data despite the conditional convergence of per capita income levels and the close linkage between growth and poverty reduction in standard neoclassic growth theory and associated empirics. In this contribution we address this puzzle. After showing some evidence of regional convergence, we demonstrate that macroeconomic volatility prevents countries with a higher incidence of poverty from converging in poverty levels to those with less poverty on a global scale. Once volatility is controlled for, the relevant convergence parameter shows the expected negative sign and is robust to various estimation techniques and model specifications. Only if a country's volatility exceeds a relatively high threshold level, it no longer converges. Similarly, initial poverty only exercises a negative impact on mean (income) convergence in countries where macroeconomic volatility is high
Understanding the Income and Efficiency Gap in Latin America and the Caribbean
Full text linkThe countries of the Latin America and Caribbean region (LAC), like other emerging economies, have benefited from a decade of remarkable growth and some income per capita convergence towards the United States and other industrialized countries. However, even nearly ten years of solid growth in the first decade of the 21st century could not guarantee that LAC would move on to a sustained long-term income convergence path. In fact, despite this recent progress, LAC still faces a significant per capita income gap with the developed world. The papers in this volume contribute to the ongoing debate on the reasons for this persistent income gap and the potential drivers of convergence, and propose some broad avenues for reform. This volume presents new macro-, sectoral-, and micro-level evidence that: (i) differences in total factor productivity (TFP), or efficiency in using the production factors, such as physical and human capital, explain a large part of LAC's persistent income gap; and (ii) resource misallocation is the main factor behind LAC's large efficiency gap. At the same time, the findings of this volume indicate there is significant room for further economic growth gains from technology adoption and innovation more broadly. In fact, the quality of the available technology in LAC is low, and there is very little innovation. Although firms can use innovation to reach productivity at the global productivity frontier, weak institutions reduce incentives to innovate. This volume also proposes that the main priorities for improving resource allocation and the incentives to innovate include: (i) enhancing market competition in key network industries (transport, financial, telecommunications, logistics, communication and distribution services); (ii) increasing labor market flexibility (including skill-mismatches and social barriers); (iii) removing informational frictions (including complex tax regimes and credit rationing); (iv) strengthening property rights; and (v) improving the rule of law
There is poverty convergence
Full text linkMartin Ravallion ("Why Don't We See Poverty Convergence?" American Economic Review, 102(1): 504-23; 2012) presents evidence against the existence of convergence in global poverty rates despite convergence in household mean income levels and the close linkage between income growth and poverty reduction. We show that this finding is driven by a specification that demands more than simple convergence in poverty headcount rates and assumes a growth elasticity of poverty reduction, which is well-known to accelerate with low initial poverty levels. If we motivate the poverty convergence equation using an arguably superior growth semi-elasticity of poverty reduction, we find highly significant and robust evidence of convergence in absolute poverty headcount ratios and poverty gaps. Relatedly, we show that the results in Ravallion (2012) are driven by the special income growth and poverty dynamics in Central and Eastern European transition economies that started with low initial poverty rates and thus observed a high elasticity of poverty reduction. Once we control for their abnormal poverty dynamics, we again find robust evidence of global convergence in poverty, even in the original specification by Ravallion (2012).Series: Department of Economics Working Paper Serie
Pandemics and environmental performance in a globalized world
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When Do We See Poverty Convergence?*
Full text linkWe show why convergence in mean income levels and the negative relation between mean income growth and poverty changes need not lead to proportionate poverty convergence across countries. We propose an analytical framework that highlights that poverty convergence depends on the speed of income convergence relative to a complex interaction of initial inequality, mean income levels, and inequality dynamics. Our framework allows us to investigate poverty convergence, or the lack thereof, under different plausible dynamics of mean income and inequality
Empirical Aspects of Foreign Direct Investment and Economic Development
No full textIncreased capital flows in the form of foreign direct investment (FDI) and the growing relevance of multinational corporations are two characteristics of the most recent wave of globalization. This volume extensively discusses how these phenomena are interrelated, what determines FDI flows and which role macroeconomic information plays for the latter. It then empirically investigates what these foreign direct investments mean for economic development, especially for the export prices of developing countries and labor market outcomes
Understanding Latin America and the Caribbean’s Income Gap
No full textEven nearly ten years of solid growth
cannot guarantee long-term income convergence. The countries
of the Latin America and Caribbean region (LAC), like other
emerging economies, have benefited from a decade of
remarkable growth and some income per capita convergence
towards the United States and other industrialized
countries. Yet, despite this recent progress, LAC still
faces a significant per capita income gap with the developed
world. The studies in this volume contribute to the ongoing
debate on the reasons for this persistent income gap and the
potential drivers of convergence, and propose some broad
avenues for reform
Going Beyond Counting First Authors in Author Co-citation Analysis
Full text linkThe 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
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