Pinkston, Joshua C. "A Model of Asymmetric Employer Learning with Testable Implications." WP-365. Abstract: This paper develops and tests a unique model of asymmetric employer learning. The previous literature on asymmetric learning assumes that a worker’s employer is perfectly informed while outside firms possess only public information. This paper relaxes that assumption, allowing firms to profitably bid for employed workers under conditions that were not profitable in previous models. The model in this paper is the first in the literature to predict either wage growth without promotions or mobility between firms without firm- or match-specific productivity. The bidding through which firms compete for a worker produces a sequence of wages that converges to the current employer’s conditional expectation of the worker’s productivity. This convergence of wages allows the model to be tested using an extension of existing work on employer learning. Wage regressions estimated on a sample of men from the NLSY produce strong evidence of asymmetric learning. http://www.bls.gov/ore/orecatlg.htm
Hyson, Rosemary. "Differences in Intergenerational Mobility across the Earnings Distribution." WP-364. Abstract: There is a broad range of work which looks at the transmission of various outcomes—earnings, education, and poverty—between parents and children. If a society is concerned with ensuring equal opportunity for all its members, then it is important to understand the extent to which such outcomes are transmitted from one generation to the next. The degree to which outcomes are transmitted, however, is likely to be related to socioeconomic circumstances and may result in different degrees of intergenerational mobility across groups. In this paper, I examine whether or not the transmission of earnings from parents to children differs across the distribution of parent earnings. I examine non-linearities in the intergenerational earnings mobility using semi-parametric estimates of the relationship between father and children’s earnings. When I allow for a flexible, non-linear relationship between father’s and children’s earnings, it appears that parental earnings have the greatest effect in the middle of the distribution. Hypothesis tests indicate that the effect of father’s earnings is significantly greater for daughters and sons in the middle and upper portions of the distribution than for those at the bottom. http://www.bls.gov/ore/orecatlg.htm
Hank, Karsten, Michaela Kreyenfeld and C. Katharina Spieß. "Kinderbetreuung und Fertilität in Deutschland." WP-2003-002. Abstract: Eine zentrale Rolle in der aktuellen Diskussion um eine bessere Vereinbarkeit von Familie und Beruf spielt die Versorgung mit bedarfsgerechter Kinderbetreuung. Eine umfassendes Angebot an Betreuungsplätzen fördert jedoch nicht nur die Müttererwerbstätigkeit, sondern könnte sich auch positiv auf Fertilitätsentscheidungen auswirken. Im vorliegenden Beitrag untersuchen wir auf Basis von Daten des Sozio-oekonomischen Panels (SOEP) und der amtlichen Kinder- und Jugendhilfestatistik den Einfluß der regionalen Verfügbarkeit von Kinderbetreuung auf das Geburtenverhalten west- und ostdeutscher Frauen in den Jahren 1996 bis 2000. Zentrales Ergebnis unserer Analyse ist, dass in den östlichen Bundesländern die Verfügbarkeit institutioneller Kinderbetreuung den Übergang zum ersten Kind positiv beeinflußt, während sich in den westlichen Bundesländern allein die Verfügbarkeit informeller Betreuungsarrangements als statistisch signifikant erweist. Verantwortlich hierfür dürfte in erster Linie die unterschiedliche Ausgestaltung der Betreuungsinfrastruktur in Ost und West sein, was sich insbesondere bei der Versorgung im Krippen- und Hortbereich sowie bei der Verfügbarkeit von Ganztagsplätzen zeigt. http://www.demogr.mpg.de/?http://www.demogr.mpg.de/Publications/working.htm
Vikat, Andres, Elizabeth Thomson and Alexia Prskawetz. "Childrearing responsibility and stepfamily fertility in Finland and Austria." WP-2003-001. Abstract: We investigate the hypothesis that the propensity of a stepfamily couple to have a shared child is inversely related to the responsibility for rearing pre-union children. We compare effects of coresident pre-union children to those of nonresident, and effects of the woman’s children to those of the man’s. Our investigation is based on data from Finland and Austria, societies with different levels of public support for childrearing and different levels of gender equality. Shared children and stepchildren reduce the risk of a birth to a couple, and in line with a common finding in most stepfamily fertility studies, the reduction is larger for each shared child than for a stepchild. We found larger effects of coresident pre-union children than of nonresident children, and larger effects of a woman’s pre-union children than of a man’s. The differences were more pronounced in Austria where public support for childrearing and gender equality is lower than in Finland. Our study demonstrates that in addition to the number of pre-union children, coresidence and parentage of pre-union children also need to be considered in future fertility research. http://www.demogr.mpg.de/?http://www.demogr.mpg.de/Publications/working.htm
Chandra, Amitabh. "Is the Convergence of the Racial Wage Gap Illusory?" NBER Working Paper No.w9476. Abstract: I demonstrate that the literature on the racial wage gap has systematically overstated the gains made by African American men by ignoring their withdrawal from the labor force. Three sources of selection-bias are identified: imposing sample selection criteria based on labor supply, trimming wages on the basis of real-dollar cutoffs, and making inferences based on Current Population Survey (CPS) data whose truncated sampling design excludes the growing incarcerated population. To recover the counterfactual distribution of skill-prices for non-workers, I implement a quasi-bounds estimator that does not require the use of arbitrary exclusion restrictions for identification and find that: (1) Corrected estimates of the racial wage gap indicate a substantial role for the efficacy of the Civil Rights Act and related initiatives in affecting convergence in segregated states; ignoring selection causes estimates of convergence in the South as well as the within-cohort component of this change to be understated. (2) In contrast to the sharp convergence observed in standard wage series from 1970-90, selectivity corrected estimates indicate complete stagnation over this period with a divergence of 3.5 to 6 percentage points between 1980 and 1990. Almost half of this divergence is missed through the exclusion of the incarcerated population. The selective withdrawal hypothesis can explain 85 percent of the observed convergence between 1970 and 1990 and 40 percent of the 1960-90 convergence. (3) The disproportionate presence of highly skilled blacks in the armed forces (who are also excluded from CPS analysis) causes estimates of the racial gap to be overstated by 1 to 2 percentage points. (4) The relative increase in non-participation is a supply-side effect driven more by a massive increase in reservation wages for blacks at the bottom of the skill distribution, than by falling offer wages. (5) The significant gains made by black men during the 1960s and 1970s occured almost exclusively in the bottom offer wage decile, where significant numbers of black men were pushed out of the lowest white wage decile into higher quintiles. These gains constitute the primary location of black economic progress in the latter half of the 20th century. http://www.nber.org/new.html#latest
Lochner, Lance. "Individual Perceptions of the Criminal Justice System." NBER Working Paper No.w9474. Abstract: This paper empirically examines perceptions of the criminal justice system held by young males using longitudinal survey data from the recent National Longitudinal Survey of Youth 1997 Cohort and the National Youth Survey. While beliefs about the probability of an arrest are positively correlated with local official arrest rates, they are largely idiosyncratic and unresponsive to information about the arrests of other random individuals and local neighborhood conditions. There is little support, therefore, for the `broken windows' theory of Wilson and Kelling (1982). Yet, perceptions do respond to changes in an individual's own criminal and arrest history. Young males who engage in crime but are not arrested revise their perceived probability of arrest downward, while those who are arrested revise their probability upwards. Beliefs respond similarly to changes in a sibling's criminal and arrest history. The perceived probability of arrest is then linked to subsequent criminal behavior. Cross-sectionally, youth with a lower perceived probability of arrest are significantly more likely to engage in crime during subsequent periods. Following an arrest, individuals commit less crime, consistent with deterrence theory and the fact that their perceived probability of arrest increases. http://www.nber.org/new.html#latest
Card, David, Thomas Lemieux, and W. Craig Riddell. "Unionization and Wage Inequality: A Comparative Study of the U.S, the U.K., and Canada." NBER Working Paper No.w9473. Abstract: This paper presents a comparative analysis of the link between unionization and wage inequality in the U.S., the U.K., and Canada. Our main motivation is to see whether unionization can account for differences and trends in wage inequality in industrialized countries. We focus on the U.S., the U.K., and Canada because the institutional arrangements governing unionization and collective bargaining are relatively similar in these three countries. The three countries also share large non-union sectors that can be used as a comparison group for the union sector. Using comparable micro data for the last two decades, we find that unions have remarkably similar qualitative impacts in all three countries. In particular, unions tend to systematically reduce wage inequality among men, but have little impact on wage inequality for women. We conclude that unionization helps explain a sizable share of cross-country differences in male wage inequality among the three countries. We also conclude that de-unionization explains a substantial part of the growth in male wage inequality in the U.K. and the U.S. since the early 1980s. http://www.nber.org/new.html#latest
Grogger, Jeffrey. "Welfare Transitions in the 1990s: The Economy, Welfare Policy, and the EITC." NBER Working Paper No.w9472. Abstract: The rapid decline in the welfare caseload remains a subject of keen interest to both policymakers and researchers. In this paper, I use data from the Survey of Income and Program Participation spanning the period from 1986 to 1999 to analyze how the economy, welfare reform, the Earned Income Tax Credit, and other factors influenced welfare entries and exits, which in turn affect the caseload. I find that the decline in the welfare caseload resulted from both increases in exits and decreases in entries. Entries were most significantly affected by the economy, the decline in the real value of welfare benefits, and the expansion of the EITC. The EITC had substantial effects on initial entries onto welfare. Exits were most significantly affected by the economy and federal welfare reform. Federal reform had its greatest effects on longer-term spells of the type generally experienced by more disadvantaged recipients. Some out-of-sample predictions help explain the otherwise puzzling observation that, despite substantial increases in the unemployment rate since 2000, caseloads have remained roughly constant. http://www.nber.org/new.html#latest
Ruhm, Christopher J. "Healthy Living in Hard Times." NBER Working Paper No.w9468. Abstract: Using microdata for adults from the 1987-2000 years of the Behavioral Risk Factor Surveillance System, I show that smoking and height-adjusted weight decline during temporary economic downturns while leisure-time physical activity rises. The drop in tobacco use occurs disproportionately among heavy smokers, the fall in body weight among the severely obese, and the increase in exercise among those who were completely inactive. Declining work hours may provide one reason why behaviors become healthier when the economy weakens, possibly by increasing the non-market time available for lifestyle investments. Conversely, there is little evidence that reductions in income play an important role. The overall conclusion is that changes in behaviors supply one mechanism for the procyclical variation in mortality and morbidity observed in recent research. http://www.nber.org/new.html#latest
Sinai, Todd and Nicholas S. Souleles. "Owner-Occupied Housing as a Hedge Against Rent Risk." NBER Working Paper No.w9462. Abstract: Many people assume that the most significant risk in the housing market is that homeowners are exposed to fluctuations in house values. However, homeownership also provides a hedge against fluctuations in future rent payments. This paper finds that, even though house price risk endogenously increases with rent risk, the latter empirically dominates for most households so housing market risk actually increases homeownership rates and house prices. Further, the net effect of rent risk on the demand for homeownership increases with a household's expected length of stay in its home, as the cumulative rent volatility rises and the discounted house price risk falls. Using CPS data, the difference in the probability of homeownership between households with long and short expected lengths of stay is 2.9 to 5.4 percentage points greater in high rent variance places than low rent variance places. The sensitivity to rent risk is greatest for households that devote a larger share of their budgets to housing, and thus face a bigger gamble. Similarly, the elderly who live in high rent variance places are more likely to own their own homes, and their probability of homeownership falls faster with age (as their horizon shortens). This aversion to rent risk might help explain why older households do not consume much of their housing wealth. Finally, we find that house prices capitalize not only expected future rents, but also the associated rent risk premia. At the MSA level, a one standard deviation increase in rent variance increases the house price-to-rent ratio by 2 to 4 percent. http://www.nber.org/new.html#latest
Baker, Michael, Jonathan Gruber, and Kevin Milligan. "Simulating the Response to Reform of Canada's Income Security Programs." NBER Working Paper No.w9455. Abstract: We explore the fiscal implications of reforms to the Canadian retirement income system by decomposing the fiscal effect of reforms into two components. The mechanical effect captures the change in the government's budget assuming no behavioral response to the reform. The second component is the fiscal implication of the behavioral effect, which captures the influence of any induced changes in elderly labor supply on government budgets. We find that the behavioral response can account for up to half of the total impact of reform on government budgets. The behavioral response affects government budgets not only in the retirement income system but also through increased income, payroll, and consumption tax revenue on any induced labor market earnings among the elderly. We show that fully accounting for the behavioral response to reforms can change the cost estimates and distributive impact of retirement income reforms. http://www.nber.org/new.html#latest
Levitt, Steven D. "Testing Theories of Discrimination: Evidence from 'Weakest Link'" NBER Working Paper No.w9449. Abstract: In most settings, it is difficult to measure discrimination, and even more challenging to distinguish between competing theories of discrimination (taste-based versus information-based). Using contestant voting behavior on the television game show Weakest Link, one can in principle empirically address both of these questions. On the show, contestants answer questions and vote off other players, competing for a winner-take-all prize. In early rounds, strategic incentives encourage voting for the weakest competitors. In later rounds, the incentives reverse, and the strongest competitors become the logical target. Controlling for other observable characteristics including the number of correct answers thus far, both theories of discrimination predict that in early rounds, excess votes will be made against groups targeted for discrimination. In later rounds, however, taste-based models predict continued excess votes, whereas statistical discrimination predicts fewer votes against the target group. Empirically, I find some evidence of information-based discrimination towards Hispanics (i.e., other players perceive them as having low ability) and taste-based discrimination against older players (i.e., other players treat them with animus). There is little in the data to suggest discrimination against women and Blacks. http://www.nber.org/new.html#latest
Howell, Cameron and Sarah E. Turner. "Legacies in Black and White: The Racial Composition of the Legacy Pool." NBER Working Paper No.w9448. Abstract: Selective universities regularly employ policies that favor children of alumni (known as legacies') in undergraduate admissions. Since alumni from selective colleges and universities have, historically, been disproportionately white, admissions policies that favor legacies have disproportionately benefited white students. For this reason, legacy policies lead to additional costs in terms of reductions in racial diversity. As larger numbers of minority students graduate from colleges and universities and have children, however, the potential pool of legacy applicants will change markedly in racial composition. This analysis begins with a review of the history and objectives of the preference for children of alumni in undergraduate admissions. We then consider the specific case of the University of Virginia and employ demographic techniques to predict the racial composition of the pool of potential legacy applicants to the University. Significant changes in the racial composition of classes that graduated from the University of Virginia from the late 1960s through the 1970s foreshadow similar changes in the characteristics of alumni children maturing through the next two decades. http://www.nber.org/new.html#latest
Cutler, David, Edward Glaeser, and Jesse Shapiro. "Why Have Americans Become More Obese?" NBER Working Paper No.w9446. Abstract: Americans have become considerably more obese over the past 25 years. This increase is primarily the result of consuming more calories. The increase in food consumption is itself the result of technological innovations which made it possible for food to be mass prepared far from the point of consumption, and consumed with lower time costs of preparation and cleaning. Price changes are normally beneficial, but may not be if people have self-control problems. This applies to some population. http://www.nber.org/new.html#latest
Hamermesh, Daniel S. "Routine." NBER Working Paper No.w9440. Abstract: Routine - maintaining the same schedule from day to day - saves time. It is also boring and inherently undesirable. As such, the amount of routine a person engages in is partly an economic outcome, with variations in routine generated by variations in the price of time, household income and the ability to generate variety. Using time-budget data from Australia, Germany, the Netherlands and the United States, I show that men engage in more routine behavior than women, but only because they spend more time in (routine) market work. Other things equal, more educated people engage in less routine behavior, while higher household incomes enable people to purchase more temporal variety. Spouses' temporal routines are highly complementary. The positive income effects and impacts of schooling indicate yet another avenue by which standard measures of inequality understate total economic inequality. http://www.nber.org/new.html#latest
Jütting, Johannes. "Health Insurance for the Poor? Determinants of Participation in Community-Based Health Insurance Schemes in Rural Senegal ." Technical Papers No.204. Abstract: Poor people lack access to health care with a negative impact on their dignity, human capital formation and their risk-management options. Recently an emerging movement of community-based health insurance schemes has attracted the attention of policy makers and researchers as it seems that these schemes target the poor more efficiently. Taking the example of community-based health insurance schemes in rural Senegal this paper identifies the factors explaining participation in these schemes. Using household survey data of non-members and members, we found that household income, religion, village characteristics and the belonging to a certain ethnic group exert the strongest influence on the probability of participation. From these findings, it follows that i) although the schemes reach the 'poor' in general, the 'poorest of the poor' within the villages find it financially difficult to participate; ii) social exclusion due to religion or ethnic group might persist. Several options for designing the schemes in order to address these weaknesses are discussed. http://www.oecd.org/EN/documents/0,,EN-documents-0-nodirectorate-no-10-no-0,00.html
Adema, Willem, Donald Gray and Sigrun Kahl. "Social Assistance in Germany." Labour Market and Social Policy Occasional Paper No. 58. Abstract: This paper follows the framework developed in past OECD studies for analysis of social assistance programmes that aim to provide low-income clients with adequate financial support while simultaneously promoting their reintegration into labour market and, where necessary, mainstream society. Increasingly, jobless citizens in Germany rely on social assistance: a role for which the programme was never intended. Indeed, there are two other programmes that serve the unemployed in Germany, and this paper discusses social assistance in the context of its relationship to Unemployment Insurance and Assistance benefits. First, this study provides a concise overview of Germany’s public social system, and discusses federal relations inasmuch they have a bearing on the delivery of public assistance benefits. The study discusses the nature of benefits available to social assistance clients in general, and related support measures for particular client-groups, for example, lone parent families. The paper analyses the financial incentive to work embedded in the income support system and the wide array of labour market measures that are being used to assist clients in their efforts to find their way back into the labour market. The report also elaborates on the relationship between different public institutions (the Public Employment Service and the Social Assistance Offices) that are involved in the design and delivery of labour market reintegration policies. http://www.oecd.org/EN/documents/0,,EN-documents-0-nodirectorate-no-10-no-0,00.html
Black, Dan A. and Thomas J. Kniesner. "On the Measurement of Job Risk in Hedonic Wage Models." CPR Working Paper Series No. 49. Abstract: We examine the incidence, form, and research consequences of measurement error in measure of fatal injury risk in U.S. workplaces using both BLS and NIOSH data. We find evidence of substantial measurement errors in the fatality risk researchers attach to individual workers when estimating the implicit price of risk and the value of a statistical life. We first examine possible classical attenuation bias in the fatality risk coefficient. However, because we also find non-classical measurement error that differs across multiple risk measures and is not independent of other regressors, more complex statistical procedures than a standard instrumental variables estimator need be applied to obtain statistically improved estimates of wage-fatality risk tradeoffs. http://www-cpr.maxwell.syr.edu/cprwps/wpslst.htm
Poch, Bunnak. "Educational Attainment and Labor Force Participation of U.S. Immigrant Offspring from Southeast Asia." 2003-02. http://www.src.uchicago.edu/prc/publications.html
Levine, Judith A., Clifton Emery and Harold Pollack. "The Well-Being of Children Born to Teen Mothers: Multiple Approaches to Assessing the Causal Links." 2003-01. Abstract: Children born to early-childbearers display high prevalence of problem behaviors and poor academic performance. Previous research indicates that many adverse outcomes stem from poverty or other risk-factors, not from early childbearing per se. This paper uses linked maternal-child data from the 1979-98 National Longitudinal Survey of Youth to explore these questions in greater depth. Using the large sample size made possible through an expanded adolescent sample, we use three types of analyses to explore the causal impact of early-childbearing on subsequent child and adolescent outcomes. First, we run models using a variety of explicit controls for background factors. Second, we use a fixed-effect, cousin-comparison analysis to control for unobserved family characteristics that may influence child outcomes. Third, we examine outcomes among children born to women who had miscarriages during their teen years. Because teenagers who have miscarriages are in some ways similar to teens who carry infants to live birth, miscarriage data allows us to further scrutinize whether delayed childbearing is associated with improved outcomes. In all analyses, we find that teen childbearing plays only a small, if any, causal role in children’s performance on standardized tests, reported use of marijuana, or fighting. Pre-birth characteristics of teen mothers, birth order, and family size are more important factors in determining this set of outcomes. For other outcomes, namely grade repetition, early sexual initiation, and truancy, the fixed effects and miscarriage analyses produce differing results. Teen childbearing has no sizeable or statistically significant results for any of our outcomes in the miscarriage analysis. However, the fixed effects results suggest teen childbearing is associated with grade retention in school, school truancy, and possibly with early initiation of sexual activity. We interpret these differing results to suggest that teen mothers share more in common with other young women who conceive, but due to miscarriage, do not carry their pregnancies to term than they do with their own siblings who delay childbearing. It is these commonalities that appear to drive the zero-order association between early fertility and several negative behavioral consequences for off-spring. http://www.src.uchicago.edu/prc/publications.html
Yong, CAI and William Lavely. "The Effect of 'Missing Girls' on China’s Population Growth." 03-2. Abstract: The 2000 census of China counted approximately 12.8 million fewer females in the cohorts born between 1980 and 2000 than would be expected if China had experienced normal sex ratios at birth and the gender-neutral mortality rates derived from mainly European-based model life tables. However, this estimate of the "nominally missing" contains a substantial component of females who are alive but hidden in the population. Comparison of cohorts enumerated as small children in the 1990 census with the same cohorts enumerated 10 years later in the 2000 census reveals that fewer than a third of the girls missing in the first enumeration subsequently reappear in the second. This comparison informs our rough estimate that one-third of the nominally missing are "hidden" and two-thirds are truly absent from the population, which implies that the number of truly missing girls cohorts in born from 1980 to 2000 is approximately 8.5 million. The long-term influence of the missing on population size is considerable because the reproductive potential of the missing girls is also lost. Girls already missing can be expected to reduce China’s future population by 3.2 percent in 100 years. A more realistic—but still optimistic—scenario sees the missing girl phenomenon waning over the next two decades. This would imply that China’s population in 100 years would be 5.4 percent less than it would have been had the girls never gone missing. If missing rates should continue at 2000 levels for a century, population size would be reduced by 13.6 percent. http://csde.washington.edu/pubs/wps/
Holman, Darryl J., Michael A. Grimes, Eleanor Brindle, and Kathleen A. O’Connor. "Hormonal Correlates for the Initiation of Breastfeeding in Bangladeshi Women." 03-1. Abstract: Hormonal changes that occur prior to or during parturition are known to trigger early postpartum maternal behaviors in many mammals. In humans, little evidence has been found for hormonal mediation of early postpartum maternal behavior. In this paper, we investigate the effects of fetoplacental hormone concentrations in late pregnancy on a specific postpartum maternal behavior—the time from parturition to initiation of breastfeeding. A sample of 91 pregnant rural Bangladeshi women, enrolled in a nine-month prospective study, provided twice-weekly urine specimens and structured interviews. The subjects provided self-reports of time from parturition to initiation of breastfeeding. Specimens were assayed for urinary concentrations of human chorionic gonadotropin (hCG), pregnanediol-3a-glucuronide (PdG, a metabolite of progesterone), and urinary estrone conjugates (E1C). Parametric survival analysis was used to investigate the effects of hCG, PdG, and E1C concentrations and other covariates (mother’s age, parity, and child’s sex) on the duration from parturition to breastfeeding. Mother’s age, parity, the child’s sex, hCG, and PdG showed no association with the onset of breastfeeding. Urinary E1C was significantly associated with time to initiation of breastfeeding, explaining about 4% of the variation in the behavior. The relationship was positive so that higher prepartum concentrations of estradiol led to later times to initiation of breastfeeding. The direction of this relationship is opposite that found for many other species of mammals, but is consistent with some recent findings in primates. http://csde.washington.edu/pubs/wps/
Cancian, Maria, Robert Haveman, Daniel R. Meyer, and Barbara Wolfe. "The Employment, Earnings, and Income of Single Mothers in Wisconsin Who Left Cash Assistance: Comparisons among Three Cohorts." SR85. Abstract: We use administrative data from Wisconsin to compare employment, earnings, and income outcomes for welfare leavers under early AFDC reforms and under the later, more stringent TANF program. We consider outcomes for women leaving welfare in 1999, updating an earlier analysis of those who left welfare in 1995 and 1997. We find substantially higher rates of exit in the later periods. Later leavers are somewhat more likely to work, but their earnings are lower. We also make a pre-post comparison of individual employment and income experiences, examining a leaver’s outcomes during a calendar quarter of welfare receipt with these outcomes a year after leaving welfare. On average, substantial earnings growth is outweighed by declines in benefits, resulting in reduced total measured net income. The reductions in income from before to after exit are greater for those in the 1995 cohort relative to those in the 1997 and 1999 cohorts. http://www.ssc.wisc.edu/irp/sr/srlist.htm
Gragnolati, Michele and Alessandra Marini. "Health and Poverty in Guatemala." Working Paper No. 2966. Abstract: Unlike many other countries in Latin America, Guatemala is only at the beginning of the demographic and epidemiological transition. The population is young, is growing rapidly, and is still primarily rural. Guatemala is among the worst performers in terms of health outcomes in Latin America, with one of the highest infant mortality rates and one of the lowest life expectancies at birth. Major causes of death in Guatemala still include treatable and communicable diseases, such as diarrhea, pneumonia, cholera, malnutrition, and tuberculosis. A significant share of Guatemalans lack access to health care services. A combination of both supply- and demand-side constraints limit the ability of households to seek health care services in Guatemala, with supply-side constraints playing a more dominant role in rural areas than urban. Some progress has been made in reforming the health sector. Important steps have been taken on the institutional side, with health being one of the pilot ministries to decentralize financial management under the Integrated System for Health Care (SIAS program). Public spending has shifted toward preventive care, which is essential for treating the health problems faced by the poor. Despite these efforts, spending and health outcomes has not improved significantly. In addition, public spending on health is not well targeted. Overall public health spending benefits the highest quintiles disproportionately. By type of facility, public spending on hospitals is by far the most regressive. This paper-a product of the Human Development Sector Unit, Latin America and the Caribbean Region-is part of a larger effort in the region to study poverty and human development processes. http://econ.worldbank.org/resource.php?type=5
Auffret, Philippe. "High Consumption Volatility: The Impact of Natural Disasters?" Working Paper No. 2962. Abstract: A history of repeated external and domestic shocks has made economic insecurity a major concern across the Caribbean region. Of particular concern to all households, especially the poorest segments of the population, is the exposure to shocks that are generated by catastrophic events or natural disasters. Auffret shows that despite high consumption growth, the Caribbean region suffers from a high volatility of consumption that decreases household welfare. After presenting some empirical evidence that consumption volatility is higher in the Caribbean region than in the rest of the world, he makes some empirically testable inferences that help explain consumption volatility. The author develops a conceptual framework for analyzing the effects of catastrophic events on household and aggregate welfare. According to this framework, the volatility of consumption comes from production shocks that are transformed into consumption shocks mostly because of underdeveloped or ineffective risk-management mechanisms. Auffret conducts an empirical analysis of the impact of catastrophic events on 16 countries (6 from the Caribbean region and 10 from Latin America) from 1970–99 and shows that catastrophic events lead to a substantial decline in the growth of output, a substantial decline in the growth of investment, a more moderate decline in consumption growth (most of the decline is in private consumption, while public consumption declines moderately) and a worsening of the current account of the balance of payments. This paper—a product of the Economic Policy Sector Unit, Latin America and the Caribbean Region—is part of a larger effort in the region to assess the impact of catastrophic events on welfare. http://econ.worldbank.org/resource.php?type=5
Turk, Carrie and Rob Swinkels. "Strategic Planning for Poverty Reduction in Vietnam: Progress and Challenges for Meeting the Localized Millennium Development Goals." Working Paper No. 2961. Abstract: This paper discusses the progress that Vietnam has made toward meeting a core set of development goals that the government recently adopted as part of its Comprehensive Poverty Reduction and Growth Strategy (CPRGS). These goals are strongly related to the Millennium Development Goals (MDGs), but are adapted and expanded to reflect Vietnam’s national challenges and the government’s ambitious development plans. For each Vietnam Development Goal, the authors describe recent trends in relation to the trajectories implied by the MDGs, outline the intermediate targets identified by the government, and discuss the challenges involved in meeting these. Relative to other countries of similar per capita expenditures, Vietnam has made rapid progress in a number of key areas. Poverty has halved over the 1990s, enrollment rates in primary education have risen to 91 percent (although there is a quality problem), indicators of gender equity have been strengthened, child mortality has been reduced, maternal health has improved, and real progress has been made in combating malaria and other communicable diseases. In contrast, Vietnam scores worse than other comparable countries in the areas of child malnutrition, access to clean water, and combating HIV/AIDS. A number of important crosscutting issues emerge from this analysis that need to be addressed. One such challenge is improving equity, both in terms of ensuring that the benefits of growth are distributed evenly across the population and in terms of access to public services. This will involve addressing the affordability of education and curative health care for poor households. Improvements in public expenditure planning are needed to align resources better to stated desired outcomes and to link nationally-defined targets to subnational planning and budgeting processes. There is also a need to address capacity and data gaps which will be crucial for effective monitoring. This paper—a product of the Poverty Reduction and Economic Management Sector Unit, East Asia and Pacific Region—is part of a larger effort in the region to help governments move toward outcome-based planning for poverty reduction. http://econ.worldbank.org/resource.php?type=5
Dasgupta, Susmita, Uwe Deichmann, Craig Meisner, and David Wheeler. "The Poverty/Environment Nexus in Cambodia and Lao People’s Democratic Republic." Working Paper No. 2960. Abstract: Environmental degradation can inflict serious damage on poor people because their livelihoods often depend on natural resource use and their living conditions may offer little protection from air, water, and soil pollution. At the same time, poverty-constrained options may induce the poor to deplete resources and degrade the environment at rates that are incompatible with long-term sustainability. In such cases, degraded resources may precipitate a downward spiral, by further reducing the income and livelihoods of the poor. This “poverty/environment nexus” has become a major issue in the recent literature on sustainable development. In regions where the nexus is significant, jointly addressing problems of poverty and environmental degradation may be more cost-effective than addressing them separately. Empirical evidence on the prevalence and importance of the poverty/environment nexus is sparse because the requisite data are often difficult to obtain in developing countries. The authors use newly available spatial and survey data to investigate the spatial dimension of the nexus in Cambodia, and Lao People’s Democratic Republic. The data enable the authors to quantify several environmental problems at the district and provincial level. In a parallel exercise, they map the provincial distribution of poor households. Merging the geographic information on poverty and the environment, the authors search for the nexus using geo-referenced indicator maps and statistical analysis. The results suggest that the nexus is country-specific: geographical, historical, and institutional factors may all play important roles in determining the relative importance of poverty and environment links in different contexts. Joint implementation of poverty and environment strategies may be cost-effective for some environmental problems, but independent implementation may be preferable in many cases as well. Since the search has not revealed a common nexus, the authors conclude on a cautionary note. The evidence suggests that the nexus concept can provide a useful catalyst for country-specific work, but not a general formula for program design. This paper—a product of Infrastructure and Environment, Development Research Group—is part of a larger effort in the group to understand poverty/environment links in different contexts. http://econ.worldbank.org/resource.php?type=5
Rama, Martín. "Globalization and Workers in Developing Countries." Working Paper No. 2958. Abstract: Stories on the positive and negative effects of globalization on workers in developing countries abound. But a comprehensive picture is missing and many of the stories are ideologically charged. This paper reviews the academic literature on the subject, including several studies currently under way, and derives the implications for public policy. First, it deals with the effects of openness to trade, foreign direct investment, and financial crises on average wages. Second, it discusses the impact of exposure to world markets on the dispersion of wages by occupation, skill, and gender. Third, it describes the pattern of job destruction and job creation associated with globalization. Because these two processes are not synchronized, the fourth issue addressed is the impact on unemployment rates. Fifth, the paper reviews the labor market policies that can be used to offset the adverse effects of globalization on employment and labor earnings. Finally, it discusses how the international community could encourage developing countries to adopt sound labor market policies in the context of globalization. This paper—a product of Public Services, Development Research Group—is part of a larger effort in the group to assess the impact of labor market policies and institutions on economic performance. http://econ.worldbank.org/resource.php?type=5
Mistiaen, Johan and Martin Ravallion. "Survey Compliance and the Distribution of Income." Working Paper No. 2956. Abstract: While it is improbable that households with different incomes are equally likely to participate in sample surveys, the lack of data for nonrespondents has hindered efforts to correct for the bias in measures of poverty and inequality. Mistiaen and Ravallion demonstrate how the latent income effect on survey compliance can be estimated using readily available data on response rates across geographic areas. An application using the Current Population Survey for the United States indicates that compliance falls as income rises. Correcting for selective compliance appreciably increases mean income and inequality, but has only a small impact on poverty incidence up to commonly used poverty lines in the United States. This paper—a product of the Poverty Team, Development Research Group—is part of a larger effort in the group to develop better methods of measuring poverty and inequality from survey data. http://econ.worldbank.org/resource.php?type=5
Lindelow, Magnus and Adam Wagstaff. "Health Facility Surveys: An Introduction." Working Paper No. 2953. Abstract: Health facility surveys come in various guises. One dimension in which they vary is their motivation. Some seek to understand better links between households and providers. Others seek to understand better provider behavior and performance. Still others seek to understand the interrelationships between providers, while yet others seek to shed light on the linkages between government and providers. Health facility surveys differ too in the data they collect, in part due to the different motivations. Surveys also vary in the way they collect data, some relying on direct observation, some on record review, and some on interview. Some quality data are collected through clinical vignettes. Facility data have been put to a variety of uses, including planning and budgeting; monitoring, evaluation, and promoting accountability; and research. Lindelöw and Wagstaff review some of the literature under each heading and offer some conclusions regarding the current state of health facility surveys. This paper—a product of Public Services, Development Research Group—is a background paper prepared for the World Bank workshop on Health Facility Surveys, December 2001. http://econ.worldbank.org/resource.php?type=5
Murrugarra, Edmundo, Nazmul Chaudhury, and Jeffrey S. Hammer. "The Effects of a Fee-Waiver Program on Health Care Utilization among the Poor: Evidence from Armenia." Working Paper No. 2952. Abstract: This study examines the impact of a fee-waiver program for basic medical services on health care utilization in Armenia. Because of the reduction in public financing of health services and decentralization and increased privatization of health care provision, private out-of-pocket contributions are increasingly becoming a significant component of health costs in Armenia. To help poor families cope with this constraint, the Armenian government provided a free-of-charge basic package service to eligible individuals in vulnerable groups, such as the disabled and children from single parent households. Drawing on the 1996 and 1998–99 Armenia Integrated Survey of Living Standards (AISLS), which allows the identification of eligible individuals under this program, the authors estimate the impact of the fee-waiver program on utilization of health services, particularly among the poor. Across the two survey rounds utilization rates have indeed declined despite comparable levels of income, and this decline has occurred among both the poor and the rich, with average utilization falling by 12 percent between the two surveys. But families with four or more children, the largest beneficiary group under the “vulnerable population” program, have decreased their use of health care services in a disproportionate manner—21 percent reduction in use between the two survey rounds. This precipitous drop in health care use by this vulnerable group, despite being eligible for free medical services, suggests that the program was inadequate in stemming the decline in the use of health services. The authors further present evidence to suggest that the free-of-charge eligibility program acts more like an income transfer mechanism, particularly to disabled individuals. This paper—a joint product of Public Services, Development Research Group, and the Human Development Sector Unit, Europe and Central Asia Region—is part of a larger effort in the Bank to understand the impact of health sector reform on health care utilization and poverty. http://econ.worldbank.org/resource.php?type=5
Martin Ravallion, Martin and Dominique van de Walle. "Land Allocation in Vietnam’s Agrarian Transition." Working Paper No. 2951. Abstract: While liberalizing key factor markets is a crucial step in the transition from a socialist control-economy to a market economy, the process can be stalled by imperfect information, high transaction costs, and covert resistance from entrenched interests. Ravallion and van de Walle study land-market adjustment in the wake of Vietnam’s reforms aiming to establish a free market in land-use rights following de-collectivization. Inefficiencies in the initial administrative allocation are measured against an explicit counterfactual market solution. The authors’ tests using a farm-household panel data set spanning the reforms suggest that land allocation responded positively but slowly to the inefficiencies of the administrative allocation. They find no sign that the transition favored the land rich or that it was thwarted by the continuing power over land held by local officials. This paper—a joint product of the Poverty Team and the Public Services Team, Development Research Group—is part of a larger effort in the group to understand the welfare impacts of major policy reforms. http://econ.worldbank.org/resource.php?type=5
Cratty, Dorothyjean and Dominique van de Walle. "Is the Emerging Nonfarm Market Economy the Route Out of Poverty in Vietnam?" Working Paper No. 2950. Abstract: Are the household characteristics that are good for transition to a more diversified market-oriented development process in Vietnam also important for reducing poverty? Or are there tradeoffs? The determinants of both poverty incidence and participation in rural off-farm activities are modeled as functions of household and community characteristics using comprehensive national household surveys for 1993 and 1998. Despite some common causative factors, such as education and region of residence, the processes determining poverty and inhibiting diversification are clearly not the same. Participation in the emerging rural nonfarm market economy will be the route out of poverty for some, but certainly not all, of Vietnam’s poor. This paper—a product of Public Services, Development Research Group—is part of a larger effort in the group to understand how to reduce poverty. http://econ.worldbank.org/resource.php?type=5
Larson, Donald F., Rita Butzer, and Yair Mundlak. "Intersectoral Migration in Southeast Asia: Evidence from Indonesia, Thailand, and the Philippines." Working Paper No. 2949. Abstract: Using time series data spanning three decades, Butzer, Mundlak, and Larson examine the determinants of sectoral migration in Indonesia, Thailand and the Philippines. They employ a principal components algorithm to address problems associated with trended and intercorrelated explanatory variables. Migration rates in the three countries are low relative to other developing countries with the consequence of persistent intersectoral income differentials. Even so, the rate of migration has been responsive to income ratios in each country. The migration rates were also affected by the absorbing capacity of nonagriculture, as indicated by several measures. In contrast to other studies, policy variables consisting of indicators of physical and human capital had little impact on the migration rate separate from that captured by relative incomes. This paper—a product of Rural Development, Development Research Group—is part of a larger effort in the group to assess the role of the rural sector in economic growth. The study was partially funded by the Research Support Budget under the research project “Dynamism of Rural Sector Growth” (RPO 683-06). http://econ.worldbank.org/resource.php?type=5
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