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Firms, Markets, Labour

Institutional Diagnostic Synthesis (RA2)- Presentation

Outline of the presentation Objective, methodology and development of the project The synthesis volume and concluding chapters a) Identifying obstacles to development: economic perspective b) Identifying institutional obstacles: the role of politics c) Identifying institutional obstacles: state capacity and property…

Appraising institutional challenges in the early stages of development- Chapter 10: Conclusion

Two central lessons can be drawn from the foregoing analysis. First, many institutional failures are traceable to the way politics functions. Therefore, any diagnosis or understanding of the impediments to a country’s long-term development that overlooks the country’s political economy…

Chapter 9: Identifying institutional obstacles to structural transformation: state capacity and property rights

After having examined the role of politics (in last chapter) in spurring or slowing down structural transformation and development, we are now ready to probe the issue of state capacity. This will complete our discussion of the role of governance-related…

Chapter 8: Identifying institutional obstacles to structural transformation: the role of politics

In this chapter, the focus is on issues that involve politics. More specifically, we look at the role of political leadership and state autonomy in development. The institutions involved determine the quality of governance in a country, but they are…

Chapter 7: Identifying obstacles to structural transformation: an economic perspective

Whether in the four case study countries or in the successful development stories of South Korea and Taiwan at the time when they were at a comparable level of income per capita, the issue of development consists of providing the…

Appraising institutional challenges in the early stages of development: Introduction to part 3

This last part of the volume puts together the lessons learned from the in-depth case studies undertaken within the Institutional Diagnostic Programme (IDP), and the more cursory analysis of the success development stories of South Korea and Taiwan at about…

Chapter 6: Taiwan’s development miracle

There are several reasons why development scholars should be interested in the case of Taiwan. As one author has written: ‘It once had a single dominant party following the Leninist model; it now has a competitive multiparty system. It was…

Chapter 5: South Korea in the early days of its takeoff

‘What would have been the conclusion of an institutional diagnostic of the development potential of South Korea conducted in the mid- or late-1970s, at a time when the country was still a low-income country, at roughly the same income level…

Chapter 3: Case studies on Benin and Tanzania

There are several reasons why Benin is an interesting country to study, and some of them have no doubt contributed to making it an aid darling for many donors. First, although it is made up of an extraordinarily varied mosaic…

Appraising institutional challenges in the early stages of development: Introduction to part 2

At the core of the institutional diagnostic project is the idea that we can gain more knowledge about the role of institutions by undertaking in-depth country case studies than by carrying out broad quantitative exercises based on a large sample…

Chapter 2: Methodological framework for an institutional diagnostic

The preceding chapter defined the objective of the institutional diagnostics of each particular country and made explicit the concepts and analytical principles that need to be mobilised in order to conduct such an exercise. By providing a short description of…

Chapter 1: Institutions and institutional change: concepts and theories

The ‘institutions matter’ slogan appears today as a fundamental truth about development. Widely shared by the development community, including international organisations, it goes with the idea that the benefits of both market operations and state interventions are significantly conditioned by…

Appraising institutional challenges in the early stages of development

If there is absolutely no doubt that institutions matter for development, and for development policies and strategies in the first place, the crucial issue is knowing how they matter. After all, impressive economic development achievements have been observed despite the…

Acquisition, Management, and Efficiency in Rwanda’s Coffee Industry

Markets in low-income countries often display long tails of inefficient firms and signicant misallocation. This paper studies Rwandan coffee mills, an industry initially characterized by widespread inefficiencies that has recently seen a process of consolidation in which exporters have acquired…

Can Secular Media Create Religious Backlash? Evidence From Pakistan’s Media Liberalization- Working Paper

Islamic countries have increasingly been exposed to western culture, through the liberalization of their media markets and rise of transnational media networks. What is the consequence of this exposure on cultural and religious behavior, given potential clashes between western norms…

Hometown Networks, Private Entrepreneurship and Exporting in China

We document the following dissimilarity between patterns of selection into entrepreneurship and into exporting among Chinese entrepreneurs. Birth counties with higher population density (PD) exhibited higher levels and growth of entrepreneurship, but a lower fraction of active entrepreneurs were engaged…

Acquisitions, Management and Efficiency in Rwanda’s Coffee Industry

It is widely accepted that there are persistent performance differences (PPDs) among seemingly similar enterprises (Syverson, 2011). These differences are not only documented in developed markets (Syverson, 2004) but also in developing countries where they tend to be more pronounced…

Updating the state: information acquisition costs and public benefit delivery

In a field experiment spanning the entirety of two Indian states, we randomized bureaucrats’ access to a mobile phone based e-management platform for India’s flagship workfare program. We randomized which levels of the administrative hierarchy received access to the app,…

Policy brief: What prevents more small firms from purchasing professional business services?

The professional business services market of providers offering accounting, marketing, human resources, consulting, and legal services to other businesses is estimated to exceed US$5 trillion in annual revenue. However, few small firms in developing countries use these services. A recent…

Working paper: What prevents more small firms from using professional business services?

Why do more small firms in developing countries not use the market for professional business services like accounting, marketing, and human resource specialists? Two key reasons may be that firms lack information about the availability of these services, and that…

Business-to-business Information Sharing: Empirical Evidence from Lagos Trader Networks

Information barriers can prohibit trade. This paper empirically documents the existence of business-to-business information sharing between small firm traders in Lagos, Nigeria. Sharing information about availability of new products and styles is more common than sharing information about actual suppliers…

Promoting accountability in public projects: donors, audits, and rural electrification

Abstract: International donors and governments require contracting mechanisms that provide accountability in order to mitigate leakage and corruption in public infrastructure projects, especially when construction is outsourced to private sector contractors. This is an important goal because low-income countries spend…

Industrial clusters, networks and resilience in the covid-19 shock in China

This paper examines resilience of Chinese firms to the Covid-19 shock, and how it varied with a cluster index (measuring spatial agglomeration of firms in related industries) at the county level. Two data sources are used: entry flows of newly…

Bangladesh Institutional Diagnostic – Chapter 4

Bangladesh Institutional Diagnostic Chapter 4: The country institutional survey – experts’ opinions on institutions in Bangladesh Chapter Overview List of tables and figures Introduction The CIS in Bangladesh The survey: design of the questionnaire Execution of the survey Critical institutional…

Bangladesh Institutional Diagnostic – Chapter 6

Bangladesh Institutional Diagnostic Chapter 6: Political economy of private bank governance in Bangladesh Chapter Overview List of tables, figures, and boxes Introduction Review of literature on the banking sector of Bangladesh Banking sector in Bangladesh: Performance and challenges Structure of…

Bangladesh Institutional Diagnostic – Chapter 5

Bangladesh Institutional Diagnostic Chapter 5: Informal institutions, the RMG sector, and the present challenge of export diversification in Bangladesh Chapter Overview List of tables, figures, and boxes Introduction Review of the literature on export diversification Overview of the RMG and…

EDI Podcast: Joyce Sadka discusses labour law reform in Mexico

On 1 May 2019, Mexico passed a new labour law. This was seen by many as the most substantial labour law reform in Mexico in a century. In the lead up to the law reform, EDI-funded research led by Assistant…

Firms, Kinship and Economic Growth in the Kyrgyz Republic

In this research, we ask whether kinship networks help promote entrepreneurship or impede its development in the Kyrgyz Republic. We conducted a survey of firm managers/entrepreneurs about the nature of their business networks, what kinds of business and non-business resources…

Research Insight: Harnessing Kinship Ties to Foster Small Business Growth in the Kyrgyz Republic

The use of kinship networks by small business owners in the Kyrgyz Republic has both positive and negative effects on their companies’ profitability and revenue growth. In order to leverage these networks, technical advice to entrepreneurs should encourage discretion in…

Women’s Promotions and Intra-Household Bargaining: Evidence from Bangladesh

This paper investigates how women’s promotions in the workplace affect bargaining in the household. I exploit the design of a promotion programme for women in 27 Bangladeshi garment factories, by comparing women who were quasi-randomly selected for the programme to…

Benin – Benin’s Informal Trading with Nigeria

This publication is part of the Benin Institutional Diagnostic. Summary of contents: 1 Introduction 2 Historical economic relations between Benin and Nigeria 3 Causes of informal trade: Nigeria’s pervasive distortions incentivise smuggling 4 Magnitude of entrepôt trade between Benin and…

Benin – The Tax Effort in Benin: How Can Tax Gaps be Reduced?

This publication is part of the Benin Institutional Diagnostic. Abstract: Using a database providing information on tax revenue over the period 1980–2015, covering 42 sub-Saharan African (SSA) countries, we analyse the efforts by Benin to raise tax revenue, in regard…

Policy Brief: Community origins of industrial entrepreneurship

This EDI Policy Brief provides an accessible summary of key insights and findings that are presented in the EDI Working Paper on “Community Origins of Industrial Entrepreneurship in Pre-Independence India.” It derives from a case study on the role community networks in…

Community Origins of Industrial Entrepreneurship in Pre-Independence India

This EDI Working Paper derives from research undertaken in the Case Study on ‘Community networks and industrial entrepreneurship in India and China’ by Dilip Mookherjee et al. The authors argue that community networks played an important role in the emergence of…

Policy Brief: Community networks and private enterprise

This EDI Policy Brief provides an accessible summary of key insights and findings that are presented in the EDI Working Paper on “Community networks and the growth of private enterprise in China.” It derives from a case study on the…

Community networks and the growth of private enterprise in China

This paper identifies and quantifies the role played by birth-county-based community networks in the growth of private enterprise in China. We develop a network-based model that generates predictions for the dynamics of firm entry, concentration, and firm size across birth counties with varying…

Tanzania Institutional Diagnostic – Synthesis

Tanzania Institutional Diagnostic Chapter 8: Synthesis This chapter provides a synthesis of information and arguments developed in the first seven chapters of the Tanzania Institutional Diagnostic. Chapter outline Part 1.  The basic institutional constraints on Tanzanian development The main challenges…

Tanzania Institutional Diagnostic – Chapter 3

Tanzania Institutional Diagnostic Chapter 3: Politics and business Chapter outline Introduction Theoretical framework and methodology The early independence period: 1961–66 The situation at independence Origins of the position of Asians Development initiatives in early post-independence period Continued concern over social…

Tanzania Institutional Diagnostic – Chapter 1

Tanzania Institutional Diagnostic Chapter 1: Reflections on the political and economic development of Tanzania Chapter outline A short account of the political history of Tanzania The colonial era The German colonisation The British mandate on Tanganyika Independence Forging a nation: the…

What is bogus: Catching fraudulent firms in India

A presentation by Aprajit Mahajan (UC Berkeley), Shekhar Mittal (UC Berkeley) and Ofir Reich (formerly CEGA) This presentation was part of the convening event hosted by CEGA at the University of California, Berkeley, in August 2018. Read a summary of…

Performance-based incentives in multi-layered organisations

A presentation by Gianmarco León (with Erika Deserrano and Philipp Kastrau) This presentation was part of the convening event hosted by CEGA at the University of California, Berkeley, in August 2018. Read a summary of the event.

Improving the effectiveness of labor courts

“Improving the effectiveness of labor courts through information and conciliation” A presentation by Joyce Sadka, Enrique Seira and Chris Woodruff, Instituto Tecnológico Autónomo de México (ITAM) This presentation was part of the convening event hosted by CEGA at the University…

Policy Brief: Female Employment and Aspirations for Children

Female Employment and Aspirations for Children: Evidence from Bangladesh’s Garment Industry This EDI Policy Brief provides insight into gender roles and aspirations for children among a sample of families involved with the Bangladeshi garment industry. It is based upon an…

Justice for All? Assessing ‘What Works’ to Improve Women’s Access to Legal Services

A Policy Brief Prepared for the World Bank’s 2017 Law, Justice and Development Week October 2017. Economic inequalities divide men and women around the world. Women on average earn just 60-70% of what their male counterparts earn. They are less likely to participate…

Institutions and Development: An Overview of Case Studies

Institutions are commonly defined as the rules of the game that societies play which in shared understanding act as constraints on and guidelines for economic performance. This paper provides an overview of case studies from the two largest developing countries,…

Institutions, Growth Accelerations and Growth Collapses

A next step forward in examining economic growth and institutions is examining the frequency, timing and magnitude of “growth episodes”—discrete accelerations and de-celerations in medium to long run growth.  This will be challenging as to the extent that very long-run…

Institutions for Infrastructure in Developing Countries

The paper surveys the very heterogeneous economic literature on the scope and limits of efforts to match institutional constraints and needs, on the one hand, and infrastructure policy and project designs, on the other, to increase the odds of improving…

Institutions, Firm Financing and Growth

This paper reviews and synthesizes current knowledge on the role of institutions on firm financing and growth in developing countries. First, the paper presents stylized facts on the different institutional constraints under which firms in developing countries operate. Next, the…

Finance, Institutions and Development: Literature Survey and Research Agenda

This paper takes stock of and provides a critical review of several literatures, notably the theoretical and empirical work on finance and growth and studies on the determinants of financial development. These two literatures are linked as the sustainable expansion…

Firms, Workers and Labor Markets

This paper provides a selective review of evidence from labor markets in low-income countries. The aim is to synthesize this literature to consolidate what is known about the key drivers of worker outcomes (including those of micro-entrepreneurs), firm behavior, and the interaction between…

Technological change, Marxist contradictions and institutional revolutions: a historical perspective

The paper discusses Marx’s view on the relationship between technological change and institutional change as presented in the famous preface to A Contribution to the Critique of Political Economy.  What Marx meant by a contradiction between the base and the…

Trade Related Institutions and Development

The paper focuses on the role played by Trade Related Institutions (TRIs) in shaping trade flows and their development impact in low income countries and how these TRIs are shaped by international trade. Three types of TRIs are examined: i)…

Migration, Institutions and Development

This survey examines the relationship between community networks and migration. Adding networks to the Roy model, the workhorse model of migration in economics, is shown to reconcile key stylized facts on migration with the theory. This addition is supported by…

Spotlight on Formal and Informal Institutions

Louis Kasekende (Deputy Governor, Bank of Uganda) discusses the role of formal and informal institutions in the financial sector. He refers to recent EDI path-finding research papers to focus on the transition from informal to formal institutions and its effect…

Spotlight on Migration and Institutions

Kaivan Munshi (University of Cambridge) explores how labour movements and development are linked, and provides insight into the role of policy around this area. Watch the video below for his overview:

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