RECENT FINDINGS FROM PEP-SUPPORTED RESEARCHERS IN DEVELOPING COUNTRIES

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Kenya is experiencing high levels of rural-urban migration that lead to increased unemployment and poverty in urban areas. A team of local PEP researchers set out to evaluate how increases in minimum wages affect the Kenyan labor market, economy, and household incomes. The research team’s findings indicate that minimum wage increases often have a negative effect on poorer rural households but can slightly benefit urban households. The team’s findings suggest this effect contributes to increased rural-urban inequality in the country.
Find out more about the research methods, findings and policy recommendations in the following PEP publications:

In Ekiti State, Nigeria, the first locally-funded social security scheme for the elderly was implemented between 2012 and 2014. An unconditional, non-contributory pension scheme was targeted at elderly citizens of the State living in poor households and not receiving any pensions. In collaboration with the implementation agency, a team of local PEP researchers set out to examine the impact of the scheme on the well-being of the beneficiaries, focusing on quality of life and household vulnerability. Based on the first follow-up survey, the team’s analysis indicates that the cash transfer scheme improved the well-being of both the beneficiaries and their households.
Find out more about the research methods, findings and policy recommendations in the following PEP publications:

Microcredit has been a key component of Cambodia’s post-war reconstruction and rehabilitation. Proponents of microcredit argue that microfinance institutions (MFIs) enable rural populations to access financial services that would otherwise be unavailable. Critics of the system accuse MFIs of charging above-market interest rates and implementing profit-oriented repayment policies. A team of local PEP researchers set out to investigate the impact of microcredit borrowing on wellbeing in Cambodia. The research team’s findings indicate that access to credit significantly improves wellbeing outcomes for borrowing households in comparison with non-borrowing households.
Find out more about the research methods, findings and policy recommendations in the following PEP publications:

Research team: Vathana Roth  |  Bopharath Sry  |  Dorina Pon  |  Dalis Phann
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Cambodia is currently facing a skills shortage, creating a mismatch of skills between industry and the existing and future labor force. Recently, the Ministry of Education, Youth and Sport published the Education Strategy Plan, which includes increasing spending on education by about 53 million USD. A team of local PEP researchers set out to investigate the impact on the labor market and household welfare of increasing government spending on education. Their findings indicate that increased spending can improve household welfare and household income, particularly for the rural population. Find out more about the research methods, findings and policy recommendations in the following PEP publications:

Research team: Sothy Ear  |  Khiev Pirom  |  Sokcheng Sim  |  Sreymom Sum
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In Ethiopia the micro and small enterprise (MSE) sector is under-developed. Furthermore, many MSEs are run by women. Recently, the Ethiopian government designed policies to create employment opportunities for three million people through MSEs. A team of local PEP researchers therefore set out to investigate the potential contributions of the MSE sector to the Ethiopian economy. Their findings indicate that the MSE sector has the potential to support the Ethiopian economy in achieving its development goals and to reduce unemployment and poverty, the best results will be achieved by focusing efforts on high value-added industries and female-oriented MSEs, respectively. Find out more about the research methods, findings and policy recommendations in the following PEP publications:

Since 2006, Bolivia has experienced sustained growth that prompted the Bolivian government to implement several redistributive policies, including an annual increase to the minimum wage. However, over the last four years, these raises have been well above inflation and GDP growth rates. A team of local researchers set out to identify the potential effects of the minimum wage increases on wage and employment of different populations, as well as the effect on informality and self-employment levels. The team’s analysis indicates that the minimum wage policy has introduced biases into the labor market that negatively affect vulnerable workers, particularly women, in terms of wellbeing and employment conditions.
Find out more about the research methods, findings and policy recommendations in the following PEP publications:

Despite non-wage benefits - such as sick leave, maternity leave, and paid holiday - being guaranteed by law in Ghana, few people take advantage of them, particularly in the informal sector where noncompliance is high. A team of local PEP researchers set out to investigate the determinants for accessing non-wage benefits in the Ghanaian labor market, looking in particular at the role of trade unions. The team’s analysis indicates that union presence plays a significant role in promoting workers’ access to non-wage benefits. In particular, unions play an important role in improving employees’ awareness of their statutory entitlements. Find out more about the research methods, findings and policy recommendations in the following PEP publications:

In 2014, West African countries negotiated an economic partnership agreement (EPA) with the European Union, cutting tariffs on EU imports. At the start of 2015, the Economic Community of West African States (ECOWAS) adopted a common external tariff (CET) for imports from outside ECOWAS countries. A team of local PEP researchers set out to evaluate the effects of the EPA and CET on youth employment, wellbeing, and government revenues in Senegal (an ECOWAS country). Their analysis indicates that the CET would have a number of positive effects for Senegal, including improved household wellbeing and increased employment for young people and women. However, the EPA is likely to be detrimental to the Senegalese economy with GDP decreasing by almost 3.9% and leading to a deterioration in wellbeing. Find out more about the research methods, findings and policy recommendations in the following PEP publications:

Guatemala relies heavily on agriculture, both for food production and for employment. Unfortunately, agricultural production is vulnerable to adverse climate conditions and climate change scientists predict that extreme weather events are likely to become more common over the coming decades. A team of local PEP researchers set out to investigate the impact of climate change on agriculture and other social and economic factors as well as to provide a reliable indication of what will happen to food security if climate change causes reduced agricultural productivity or drought. Their analysis indicates that climate change poses a significant threat to food security in Guatemala, particularly due to the agricultural sector’s reliance on rain-fed irrigation systems. Find out more about the research methods, findings and policy recommendations in the following PEP publications:

China passed the Rural Land Contracting Law in 2002 aiming to promote investment, diversification and productivity through securing the land rights of farmers. A team of local PEP researchers set out to explore the impact of this policy on farmers’ labor market outcomes in rural China. Recognizing the importance of women’s steadily increasing participation rates in off-farm employment, the team took a particular look at how changes in land tenure policy contribute to explaining this trend. Their analysis incdicates that improved land rights security leads to increased overall employment, increased off-farm employment, and increased invidual income for both men and women. The positive effects are more significant for women.
Find out more about the research methods, findings and policy recommendations in the following PEP publications:

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Despite a significant improvement in school attendance Brazil continues to lag behind other Latin American countries in terms of educational outcomes. While full time school attendance is compulsory for children aged 6 to 14 in Brazil, the 2014 national household survey indicated that over three million children still divide their time between school and work. A team of local PEP researchers set out to measure the impact of child work on learning outcomes to better understand the consequences of children combining work and study. Their analysis indicates that working, both at home or in the labor market, is detrimental to children’s academic performance and that younger (5th grade) children experience a greater negative impact than older (9th grade) children when combining work and studies.
Find out more about the research methods, findings and policy recommendations in the following PEP publications:

High growth in India over recent years has widened the gap between the rich and the poor. The rural population, mainly dependent on seasonal agricultural work, is trapped in poverty and deprivation. The Mahatma Gandhi National Rural Employment Guarantee Act (MGNREGA) aims to address this issue by providing at least 100 days of guaranteed wage employment per financial year to members of rural households. A team of local researchers evaluates the impact of the MGNREGA, and potential adjustments to the program, on the Indian economy. Their findings indicate that withdrawing the program would decrease GDP, wages for semi-skilled labourers, the supply of unskilled labour, and household income. Similar outcomes are also found when 20% of MGNREGA spending is reallocated to education, health, or public administration. Find out more about the research methods, findings and policy recommendations in the following PEP publications:

Reports: Project webpage | Working paper | Policy brief 153More about the PEP-PAGE initiative
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People belonging to indigenous populations in rural areas of Bolivia are twice as likely as non-indigenous people to live in extreme poverty, furthermore indigenous women have the lowest literacy rate in the country. These factors contribute to Bolivia’s financial inclusion rate being significantly below average for Latin America. A team of local researchers set up an experiment to investigate whether gender and ethnicity could be source of credit access discrimination in Bolivia. The findings indicate that women are more likely to be accepted for a loan than men but that the granting decision is subjective and potentially vulnerable to prejudice.
Find out more about the research methods, findings and policy recommendations in the following PEP publications:

With three-quarters of the Ugandan population under the age of 30 and high levels of youth unemployment, the Governement of Uganda launched the Youth Venture Capital Fund to provide credit and mentoring for young entrepreneurs. The program has suffered from low uptake and high default rates. A team of local researchers investigates how entrepreneurial risk tolerence determines credit demand amongst young entrepreneurs, and the impact that credit counseling has on their borrowing decisions. The findings indicate that credit demand is closely linked to personal risk tolerance, and that while individuals who received credit counseling requested lower amounts of credit than those who did not, they displayed a better understanding of financial management that would allow them to pay back the loan. Find out more about the research methods, findings and policy recommendations in the following PEP publications:

High levels of child poverty pose a significant problem in Serbia. Currently there are two means-tested benefits that aim to reduce poverty: child allowance and monetary social assistance, but they do not take account of informal income. A team of local researchers investigates which potential policy reform is the most effective in reducing child poverty: a benefit strategy that takes into account revenues from informal work, or a work strategy to improve parental labor participation. The findings indicate that the benefit strategy would improve targeting and coverage, and could lead to a reduction in child poverty between 1.3 and 1.6 percentage points. Find out more about the research methods, findings and policy recommendations in the following PEP publications:

Reports: Project webpage | Working paper | Policy brief 150More about the PEP-PAGE initiative
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Youth unemployment levels in Macedonia are particularly high and pose a significant problem for the country. On average, it takes young people six years to find a stable job after finishing school. A team of local researchers investigates the causes of youth unemployment and how unemployment spells affect future employability and wages. The findings indicate that the longer a young person remains unemployed, the lower their chances of finding a job. The results also show that youth from low-income, low-education families are particularly at risk of being unemployed.
Find out more about the research methods, findings and policy recommendations in the following PEP publications:

Reports: Project webpage  |  Working paper  |  Policy brief 149  |  More about the PEP-PAGE initiative
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Since coming to power in 2007, the Government of Ecuador has revised the structure of minimum wages annually, aming to improve wages for the lowest paid and alleviate poverty. A team of local researchers investigates the impact of the minimum wage policy on real wages, hours worked, and employment rates among low-wage workers in Ecuador. The researchers find that the minimum wage increases have, indeed, helped to raise the wages of low-wage workers. However, the findings also indicate a possible policy compliance problem as increased hourly wages are linked to decreased hours worked by women.

Find out more about the research methods, findings and policy recommendations in the following PEP publications:

Reports: Project webpage  |  Working paper  |  Policy brief 148  |  More about the PEP-PAGE initiative
Research team: Sara Wong  |  Yael Negrete  |  Danny Veliz  |   Juan Jose Salcedo Cruz
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High levels of unemployment, particularly amongst youth, pose a significant problem in Mongolia. The Mongolian government has introduced active labor market policies to provide training and support for youth with the aim of reducing unemployment and alleviating poverty in the country. A team of local researchers investigates the effects of Vocational Training Programs (VTP) on earnings, job quality, and the likelihood and duration of youth employment in Mongolia’s capital city, Ulaanbaatar. The researchers find that VTP can be an efficient way to promote employment and increase income for youth in the short term. The VTP can also be even made more effective by providing trainees with general labor market information alongside the training, which was found to improve attendance.
Find out more about the research methods, findings and policy recommendations in the following PEP publications:

An increasing number of aid policies target women on the basis that bestowing greater decision-making power on women will have positive spillover effects on the wellbeing of the household and society at large. A team of local researchers investigates the role of information sharing in intra-household resource allocation in rural India to assess household bargaining power. The researchers find that while married couples in rural India tend to take household decisions together, providing information about a partner’s preferences will only influence the wife’s final decision. Women are also more likely to spend on nutrition than men.
Find out more about the research methods, findings and policy recommendations in the following PEP publications:

Labor force participation in India is low (56% of people aged 15+) and for women it is the lowest in the world (31%). Over the last 15 years, a number of government policies aimed to generate jobs by focusing on manufacturing. The National Manufacturing Policy (2011) aims to create 100 million new jobs by 2022. A team of local researchers investigates the impact of trade on employment in India in the manufacturing sector. The researchers find that increased exports also increase the demand for workers whereas increased imports lead to job losses. Furthermore, despite India’s cost advantage in labor-intensive production sectors the increased trade has been mainly in skill-intensive production sectors. Find out more about the research methods, findings and policy recommendations in the following PEP publications:

Despite many labor policies over the past twenty years, the youth unemployment rate in Macedonia remains very high (around 50%). The 2012 School-to-Work transition survey showed that nearly 35% of Macedonia’s youth in employment are either under or over qualified for their job. A team of local researchers investigates what impact the length of unemployment a person experiences has on how suited they are to their eventual position. The researchers find a tremendous discrepancy between the supply and demand in the labor market with many university graduates looking for work while most job creation is for positions requiring only secondary education.
Find out more about the research methods, findings and policy recommendations in the following PEP publications:

Macedonia receives an estimated 10% of its annual GDP in private cash remittances sent to help poor households. However, there is currently no government policy to channel this potential into productive use and the poverty rate remains high at 27%. Furthermore, only 9% of households receive formal government social assistance. A team of local researchers investigates the impact of cash remittances on health and poverty indicators and the impact a remittances voucher policy for social protection would have. The team uses a conditional mixed-process estimator and an ex-ante simulator to analyze data from the 2008 DotM Remittance Survey. The researchers find that remittances serve as an informal source of social protection in Macedonia and that a voucher system to formalize remittances as social protection would improve the population’s health while also reducing poverty, particularly amongst the most vulnerable groups.
Find out more about the research methods, findings and policy recommendations in the following PEP publications:

In Bangladesh, only 35% of women are part of the workforce. Microcredit programs aim to not only change this fact but also encourage entrepreneurship amongst women. A team of local researchers investigates the impact that microcredit currently has on female entrepreneurship in Bangladesh. They also compare the entrepreneurial status of women to that of men to find out how much gender influences entrepreneurship. The team uses an instrumental variables technique to analyse data from a 2010 national household survey. The researchers find that access to microcredit has a significant and positive impact on both male and female entrepreneurship, with men benefitting more, even when women are the recipients of the loans. Find out more about the research methods, findings and policy recommendations in the following PEP publications:

Reports: Project webpage and video | Working paper 2016-13Policy brief 139 | Slide presentation | More about the PEP-PAGE initiative
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This study aims to assess the impact of policies implemented by the government of Cameroon to reduce poverty and informality, as co-dependent phenomenon. The research team uses CGE modeling tools and techniques to simulate different policy scenarios and measure the effects on economic activity and welfare in the country. The results suggest that, in order to have significant impact on welfare, policies should focus on increasing the wages of workers, rather than formalizing their activities. Find out more through the following PEP publications (in French):

A boom in the Mongolian mining sector has meant significant growth for the country, but this concentrated success has also led to increased economic dependence on mining. The international price of metal ores is highly volatile and an economy dependent on mining is therefore vulnerable. A team of local researchers builds and uses a static CGE model of the Mongolian Economy, with data from various national surveys, to assess the economy’s vulnerability. The researchers find that rapid expansion in the coal sector may have many positive effects including increased GDP, exports and employment. On the other hand, they also find that a drop in the world price of metal ore may have various negative effects in the short run, including reduced employment and a decrease in GDP. Based on these results, the team makes several recommendations for policy to protect against vulnerabilities. Find out more about the research methods, findings and policy recommendations in the following PEP publications:

Reports: Project webpage and video | Working paper 2016-03Policy brief 138 | Slide presentation | More about the PEP-PAGE initiative
Research team: Ragchaasuren Galindev | Munkh-Ireedui Bayarjargal  |  Nasantogtokh Nyamdorj  |  Telmen Tur  |  Tsolmon Baatarzorig  |                                                     Tuvshintugs Batdelger 
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In this study, a team of local researchers investigates the impact of a microcredit scheme on the vulnerability to poverty and the empowerment of women and their households in rural Nigeria. In collaboration with the Amoye Microfinance Bank in Ikere, southwest Nigeria, the team uses administrative data from the bank and a follow-up survey to compare the beneficiaries and the non-beneficiaries of the microcredit scheme for women. Their analysis shows that the female beneficiaries were significantly more empowered than the non-beneficiaries, and that household vulnerability was also reduced. Based on these results, and the further analysis of the microcredit scheme design, the team outlines several recommendations to improve the success of future microcredit schemes. Find out more about the research methods, findings and policy recommendations in the following PEP publications:

A team of local researchers in Bolivia investigates whether, due to spillover effects, microcredit initiatives lift communities out of poverty and improve female empowerment. Using municipal-level census information and household survey data, the team developed a new method to compare municipalities with and without access to microfinance. The researchers find a significant reduction of unsatisfied basic needs poverty in municipalities with access to microfinance, as well as improved female empowerment through decision-making at the household level. Based on these results, the team makes several recommendations for the Bolivian Economic and Social Development Plan 2016-2020 and new Law of Financial Services No. 393, which aim to reduce poverty and promote Bolivia’s development. Find out more about the research methods, findings and policy recommendations in the following PEP publications:

Reports: Project webpage and video | Working paper 2016-06 | Policy brief 136 | Slide presentation | More about the PEP-PAGE initiative
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This study investigates the impact of a boom in the Colombian oil and mining sectors on employment type and intensity, as well as the potential effects of Dutch Disease. Using CGE modelling, the team shows that a sustained oil export boom would lead to Dutch Disease effects, but also to a shift in employment from informal (not paying taxes) to formal labour. The researchers also test the effectiveness of the government’s policy responses (to counteract the Dutch Disease effects), and outline several recommendations for policy that will provide a workforce ready to meet the future needs of the Colombian economy. Find out more about the research methods, findings, and policy recommendations in the following PEP publications:

This study investigates the impact of trade liberalization policy on the farm-nonfarm balance of labour in rural Vietnam. Using data from the detailed "Vietnam Living Standards Surveys", the researchers provide new empirical evidence of the relationship between the agricultural and non-agricultural sectors. The team finds evidence that the increased use of imported chemical fertilizers – due to trade liberalization  – has a direct impact on labour reallocation, including increased participation in agriculture and reduced participation in nonfarm activities. Based on these findings, the team outlines several recommendations for policy to improve productivity and to remain competitive in the international markets, as Vietnam joins the Trans-Pacific Partnership free trade agreement. Find out more about the research methods, findings and policy recommendations in the following PEP publications: 

This study investigates the effects of migration and remittances on labour market participation and human capital development in Senegal. Using econometric models to analyze data from a 2009 household survey of the World Bank on migration and remittances, a team of local researchers – selected for support under the PAGE initiative in 2014 – finds that households receiving remittances from migrant members are less likely to participate in the labour market. A tendency that may be explained as a form of parasitism generated by the additional income. On the other hand, despite lower levels of per capita expenditures (indicating their relative poverty), these households tend to spend more on education and health, than those without migrants. This would suggest that remittances contribute to improving human capital development in Senegal.  Based on these findings, the researchers conclude that the government should implement policies that create economic opportunities for households with migrants, to promote entrepreneurship and reallocate remittance flows towards more productive uses and investments. Find out more in the following PEP publications:

Selected for support under the PAGE initiative in 2013, a team of local researchers in the Central African Republic (CAR) aims to assess the economic impact of Chinese investments in various sectors of the cotton industry. Their findings show that such investments lead to an increase in production, which reduces sale prices, but without being paired with a matching increase in demand. According to the simulations’ results, the Chinese investment strategy must be oriented towards the textile industry, in order to create a downstream market for the cotton sector’s outputs and be most effective in terms of positive effects on the national economy. Indeed, the results show that the Chinese intervention and FDI in CAR contributes to improving the well-being of all economic agents, through a rise in real GDP and improvement of household standard living conditions. Find out more about the research methods, findings and ensued policy recommendations through the following PEP publications (in French):

In this project – selected for support under the PAGE initiative in 2014 – a team of local researchers in Niger analyzes public spending options from mineral and oil resources and their impact on the Nigerien economy. Using advanced methods of CGE modeling, the researchers find that, when appropriate investment policies are implemented, mineral and oil resources do not systematically generate Dutch disease effects. Generally speaking, in terms of investment policies, an increase in public spending has positive effects on employment in all sectors but, more specifically, investments targeted on road infrastructures will result directly in an increase in household income (by facilitating transport of goods and allowing greater energy availability). However, in the absence of well-targeted investment policies, the rise in mining and oil exports causes a loss of competitiveness in other sectors, thus affecting long-term economic growth. As the Government of Niger has identified the mineral and oil sector as the main driver of growth for the national economy, this study aims to provide decision-makers with reliable evidence and recommendations to assist in defining and implementing the National Strategy for Social and Economic Development. Find out more about the research methods, findings and ensued policy recommendations through the following PEP publications (in French):

Reports: Project webpage and video | Working paper 2016-09Policy brief 124 | Slide presentation | More about the PEP-PAGE initiative
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The objective of this study is to investigate the impact of remittances from international migration on the occupational choice and working hours of left-behind youth in Kyrgyzstan. Using second-wave data from the "Life in Kyrgyz Republic" survey, this team of local researchers – selected for support under the PAGE initiative in 2014 – find evidence that, in order to replace the labor of the migrant member, young people facing difficulties in finding jobs are more inclined to contribute to the household through daily chores or agricultural work, but also that this “occupational choice" is mainly influenced by gender differences and education level. Moreover, the study highlights that, although remittances do not promote unemployment nor generate dependency amongst left-behind, they are primarily used to finance current consumption expenditures rather than business or entrepreneurial activities. Based on these findings, the team outlines a series of recommendations for policies to focus on promoting the productive use of remittances and education for the youth in the Kyrgyz Republic. Find out more about the research methods, findings and ensued policy recommendations through the following PEP publications:

Selected for support under the second round (2014) of the PAGE initiative, a team of local researchers aims to understand the causes of increasing off-farm self-employment opportunities, and the effect on agriculture and food security in rural Niger. They find that some of the causes for farm households to participate in off-farm self-employment activities include changes in prices of agricultural inputs/outputs, as well as constraints on land size and cereal bank, suggesting the existence of linkages between the farm and the non-farm sectors. Other key determinants suggest that credit constraints, infrastructure and location are all entry barriers for farm households to engage in off farm self-employment activities in rural Niger. On the other hand, the researchers find that, although it leads to an increase in agricultural expenses (in purchased outputs and hired labor), engaging in such activities contributes to favoring food accessibility and decreasing food insecurity. Based on these findings, the team provides a series of recommendations to inform and encourage policies aimed at promoting rural entrepreneurship. Find out more about the research methods, findings and ensued policy recommendations through the following PEP publications:

Reports: Project webpage and video | Working paper 2016-08Policy brief 128 | Slide presentation | 
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In this study, a team of local researchers – selected for support under the PAGE initiative in 2014 – aim to assess the effects of financial frictions faced by female entrepreneurs on macroeconomic performance in Cameroon, using advanced techniques of CGE modeling. Their analysis shows that such frictions appear because, when borrowing from the banking sector, female entrepreneurs face restrictions related to collaterals. Their findings also suggest that, when the female sector (relatively more labor-intensive) is granted loans to the same extent as the male sector (more capital-intensive), it performs better in terms of value-added in GDP; meanwhile, both sectors have complementary roles in sustaining economic activity in the context of economic downturn. Based on these findings, the researchers submit a series of recommendations for policy, to both increase financial inclusion and enhance macroeconomic outcomes. Find out more about the research methods, findings and ensued policy recommendations through the following PEP publications:

Using firm-level data and a series of microeconomic analytical techniques, this team of local researchers - selected for support under the PAGE initiative in 2014 - seek to assess whether female entrepreneurs face discrimination in credit access in Senegal, and how it may affect firms’ performance. If the researchers find no evidence to support the common wisdom that women are discriminated in the credit market, their results however do not call for the abandonment of public policies aimed at promoting women’s access to credit and entrepreneurship, but rather suggest they be grounded on more robust footings such as managers’ education, firms’ ownership, sectoral activities with respect to capital intensity, and geographical locations. Find out more about the methods, findings and ensued policy recommendations from this study through the following PEP publications:

Supported under the first (2013) round of the PAGE initiative, this study analyzes the inter-relationships between entrepreneurial propensity, fear of failure (fof) and gender, using the Global Entrepreneurship Monitor (GEM) Adult Population Survey (APS). The results show that "fear of failure", higher among women, negatively affects entrepreneurial status while "skill perception" does the opposite. Policy implications of this research point to the importance of reducing the gender gap in entrepreneurship and, in order to encourage more females to be entrepreneurs, to the importance of implementing measures to improve their skill perception. Find out more about the research method, findings and ensued policy recommendations through the PEP publications below:

Reports: Project webpage and video | Working paper 2015-11 Policy brief 118 | Slide presentation | More about the PEP-PAGE initiative
Research team: Yousef Daoud | Ruba Shanti | Sana Kamal | Shaker Sarsour
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This team of local researchers - selected for support under the first round of the PAGE initiative, in 2013 - seeks to assess and analyze the relationship between the mobility of young people in the Democratic Republic of Congo (DRC) and their involvement in entrepreneurship. Despite the destruction of transport infrastructure during the long period of war, the DRC is characterized by high internal mobility that exceeds 20 %, particularly amongst the youth (aged 15 to 30). Attracted by opportunities in some regions of the country, these migrants are likely to move towards entrepreneurial activities in their new locations. Using data from the National 1-2-3 Survey, conducted in 2005 by the National Institute of Statistics of the Congo (INS) with over 10,000 individuals, the paper draws the profile of young internal migrants and highlights the determinants of the decision to migrate. It identifies preferred geographical destination of migrants, and establishes the link between the characteristics of young migrants and their commitment to entrepreneurial activity. Find out more about the outcomes of this analysis and related policy implications through the following PEP publications:

Reports: Project webpage and video  |  Working paper 2015-07  |  Policy brief 126  | Slide presentation | More about the PEP-PAGE initiative
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As it prepares for the establishment of the ASEAN Economic Community, by the end of 2015, trade liberalization and economic integration (both regional and international) have become top policy priorities for the Royal Government of Cambodia in recent years. The objective of this team of local researchers - selected for PEP support under the first round of the PAGE initiative - is to produce reliable evidence regarding the significance and actual effects of this trend on growth, employment and poverty reduction in the country, using CGE modeling and macro-micro simulation techniques. Their results show that tariff elimination leads to an expansion in production outputs and an increase in export/import volumes. Government policy for indirect tax-led revenue compensation results in the change of structural production output, favoring the manufacturing industry - versus agriculture and service sectors. However, in general, the gains in terms of welfare at the household level are small and, for some populations living in “remote” areas, the effects are in fact negative. Find out more through the publications below:

The objective of this project - selected for PEP support under the PAGE initiative in 2013 - is to examine the effects of emigration and remittances on welfare and productivity of left-behind housedholds in Cambodia, through a rigorous analysis of micro data from the 2009 Cambodia Socio-Economic Survey (CSES). While their results show that emigration and remittances have positive impact on poverty headcount (reduction of 2 to 5%) in Cambodia, the researchers also find that they can, in turn, generate a “dependency effect” among left-behind members, due to a decrease of 5 to 9% in hours worked by (employed) adults in the migrant-sending household, as well as a decrease in the total salary earnings. Find out more about the research method, finding and ensued policy implications through the following PEP publications:

Through a series of simulations conducted using a CGE model of their national economy, a team of local researchers in Burkina Faso - selected for support under the PAGE initiative in 2013 - has found that the increasing presence and relations of China in/with Burkina Faso should have a generally positive impact on growth, employment and welfare in the country. However, these relations should be overseen by policy makers so as to ensure that Chinese investments will be directed in areas/sectors of production that are most likely to generate positive effects for the whole of Burkina's economy and population. Find out more about the research methods, findings (and related policy implications) through the following PEP publications (IN FRENCH):

The objective of this study - selected for support under the PAGE initiative in 2013 - is to analyze the impact of public spending derived from oil and mining sector’s revenues, in Niger, on the country’s economic development, using CGE modeling and policy simulation techniques. The results show, on the one hand, that the increase in mining and oil revenue does not systematically lead to Dutch disease if government implements appropriate policies. On the other hand, the best policy option identified (through the researchers' simulations) as yielding the most benefits in terms fo economic growth, employment and household welfare (i.e. development) is to use these revenues to subsidize electricity consumption for the industrial sector. Find out more about the research method, findings and ensued policy recommendations through the PEP publications (IN FRENCH) below:

The aim of this PEP-supported project - selected for support under the first round of the PAGE initiative, in 2013 - is to analyse the characteristics of minimum wage and income transfer policies implemented in Argentina from 2001 to 2012, as well as to produce evidence regarding the consequences that modifications of these policies have had on the functioning of the labour market, with special emphasis on the informal sector. Among other things, the researchers have found that in Argentina, increasing the minimum wage level does not reduce employment, nor increase informality, and that conditional cash transfers do not reduce the economic participation of beneficiaries. To produce such evidence, the researchers have applied a series of microeconomic analytical techniques on data from the national Permanent Household Surveys, available since 2003 and for each year of the concerned period (i.e. until 2012). Find out more about their methods and findings through the following PEP publications:

Selected for support under the first round of the PEP-PAGE initiative, this project examines the effects of the choice of language for education (French, Arabic or bilingual) on self-employment and firms’ performance in Chad. Results fom the analysis show that young people who choose Arabic instead of French as educational language are more like to become entrepreneurs; however, such type of entrepreneurship is undertaken as a means for subsistence rather than profit-seeking activities. To produce such evidence, the team of researchers applied a recursive vicariate profit model (to tackle the endogeneity of education choice) on data from the third Chadian survey on consumption and the informal sector (ECOSIT III, 2011). Find out more through the following PEP publications:

Contrary to the results of other recent studies, this PEP-supported local research team - selected for support under the PEP initiative for "Policy Analysis on Growth and Employment" (PAGE), in 2013 - did not find evidence of significant discrimination against women in formal credit markets in Nigeria. However, results from their analysis show that micro/small enterprises are significantly more “credit-constrained” relative to medium enterprises. And the fact that women entrepreneurs are mostly involved in small and micro ventures suggests that access to formal credit is, nonetheless, a big constraint to the growth of women enterprises at that level in Nigeria. This analysis was conducted using data from the 2010 World Bank Investment Climate Survey, conducted among Nigerian enterprises (sample of 1590 firms). Find out more through the following PEP publications:

Selected for support under the PEP initiative for "Policy Analysis on Growth and Employment" (PAGE), in 2013, this project was led by a team of local researchers in Macedonia, who sought to explore whether remittances may be used to support the entrepreneurial activities of unemployed youth living in recipient households. Results from their analysis show, among other things, that youth living in households receiving remittances have 28% to 33% higher probability to establish their own business, than the non-youth non-receiving counterparts. This initiative emerges from two main observations: while low job creation and the persistently high youth unemployment rate (around 55%) are some of the most important socioeconomic problems in Macedonia, remittance inflows represent, in average, about 4% of the country's GDP - the usage made of these remittances by recipient households remain, however, largely unknown. Find out all about the research methods and findings through the following PEP publications:

There is general concern that the recent improvements in Cameroon’s economy, in terms of GDP growth (i.e.at the macro level), have not translated into the improvement of the population’s welfare, i.e. at the micro level. Such stagnation would be the result of the low productivity of labour, and underemployment of the country’s active population. In this study, a team of PEP Cameroonian researchers aimed to establish how the productivity of the (non-agricultural) informal sector may affect or contribute to improve welfare in Cameroon, while identifying the main determining factors of the sector’s productivity. Find out more about the researchers' findings and related policy recommendations through the following PEP publications:

This study investigates the role of public infrastructure investment on economic growth and poverty reduction in the Philippines. Using dynamic CGE modeling and microsimulation techniques, the researchers find that the positive supply side effects of higher public investment expenditure manifest over time, through higher capital accumulation and improved productivity. Their findings reveal that higher public infrastructure investment not only positively impacts real GDP, but also reduces poverty and inequality in the short and long run. Based on the simulations' results, the researchers also conclude that international financing is a better alternative than tax financing when considered in terms of such investments' ability to improve the economy’s physical infrastructure, in order to create job opportunities, improve productivity and complement its social protection measures.

One of the proposed policy options to address the issue of quality of education  (i.e. to improve school performance) in Kenya, has been the scaling up of a “contract teacher intervention”, previously introduced by an NGO in Western Kenya, where it had shown to have raised test scores for primary students. In 2008, a team of PEP-supported researchers in Kenya set out to realize a highly rigorous experimental evaluation to assess the potential success (or effectiveness) of scaling up such an intervention. While the authors have managed to demonstrate that extrapolating results from an NGO program to national government policy is not a valid option, the results show indeed that no matter how carefully and rigorously an intervention may be designed, the end results and effectiveness in reaching targets will just as largely depend on the nature of the program implementer, and the related institutional context or constraints. Find out more through the following publications

Since 1988, rural-to-urban migration has become an important social and economic phenomenon in China. Along with the rapid economic growth and urbanization, an increasing share of the country’s rural population has joined this internal movement or exodus, seeking for better life prospects in China’s booming cities. Despite its importance, however, this particular group of population (rural-urban migrants) is almost invisible in most Chinese official statistics. With support from PEP, a team of Chinese researchers set out to identify and study the levels and changes in wage inequality among Chinese rural-urban migrants, from 2002 to 2007. They managed to build a unique dataset that allowed them to document and analyze changing in wage inequality among both migrants and urban natives in this specific period. Based on the outcomes on their analysis, the researchers conclude with the recommendation that the government should undertake fundamental reform of the Household Registration (Hukou) System and its internal migration policy. Find out more about the research findings and outcomes that have led to such conclusion through the following PEP publications:

In this study, a team of local researchers in Pakistan used a combination of (CGE) modeling and microsimulation techniques to simulate the impacts of a 4% increase of the “public infrastructure investment (PII) to GDP” ratio – in line with the intent document in the Planning Commission’s Framework for Economic Growth – on several aspects of the national economy. The simulations were conducted using two different scenarios of financing mechanisms – one supposed that the increase in public spending would be financed with international loans, and the other with taxation (production tax) revenues. The analysis shows that, in the long run, regardless of the selected financing mechanism (tax or international loan). increased investments in public infrastructure lead to macroeconomic gains and improvements in poverty level. Find out more about the researchers' findings and ensuing policy recommendations through the following PEP publications:

While considerable progress has been made in terms of universal education in China over the past 20 years, a significant gap remains between rural and urban students in the rate of admission to senior high school in several parts of the country. In 2010, a team of Chinese researchers were granted PEP support to conduct a quasi-experimental evaluation in order to assess the impact of a Tuition Relief Program (TRP) - an initiative about to be implemented by the local government of Ningshan Country in Shaanxi province - on the performance of poor, rural students at junior high school level. In other words, the researchers sought to assess the effectiveness of such program in encouraging students with initially more limited prospects, to exert stronger efforts while preparing for senior high school. The results were quite positive and the researchers have been actively recommending the uptake of such investment strategy, by China’s Education policymakers, as a complementary measure to strengthen human capital in poor rural areas.  Find out more through the following PEP publications:

Agricultural activities have been and remain key for sustained growth and pro-poor development in Ethiopia. However, the sector under utilizes its irrigation capacities as well as its abundant human resources. This particular PEP project aimed at measuring the impact of public investment in small-scale irrigation and training for farmers on growth and agriculture-led development, on food security, and on poverty in Ethiopia - in line with the current five year development strategy of the government. A team of local researchers used a dynamic PEP-standard type of CGE model to capture the outcomes of public investment shocks. The simulation results show that the Ethiopian government policy strategy regarding agriculture sector development has a great potential for reducing poverty and food insecurity, and that investing in training and irrigation contributes to the effort towards achieving the MDGs. Find out more about the researchers’ results and ensuing policy recommendations through their PEP paper:

It is estimated that, despite considerable investment in this priority sector, the public health infrastructure in India - including over 150 000 facilities - can serve no more than 20% of the Indian population.  There have been numerous attempts to understand and analyze the causes underlying the failures of the health policies - most of which focused the role of public and private institutions in the provision of health care. This particular PEP research project, however, aimed to identify the role that households play in determining their health status, as well as the macroeconomic effects this decision can generate. In terms of methodology, the researcher used a CGE modeling framework to simulate the effects of complete tariff liberalization in the presence / partial withdrawal / complete absence of health subsidy. The results show that 1) complete subsidization of health reduces overall disparity by favoring rural (vs urban) households and 2) withdrawal of health subsidy leads to domestic re-allocation of poverty pushing down the wage rates in agricultural sector (i.e. for rural households). Find out more about the researchers' findings through the PEP publication below:

Research team: Nitesh Sahay
***

To date, prices of gas and other energy used by households in Ukraine have been generously subsidized by the Government. However, suppressed energy prices lead to excessive use of gas and an inefficient level of investment into energy savings. In addition, Ukraine’s dependence on imported gas contributes to trade imbalances and growing pressure on the devaluation of the national currency. In 2010, the government announced an ambition reform agenda, including the raise of gas prices as a means to restore economic growth. Such policy, however, may have unprecedented impact on the welfare of the population. Part of the PEP-UNDP "Poverty and Social Impact Analysis" (PSIA) initiative, this particular project aimed at assessing the extent of such impact, as well as the effectiveness of current social welfare programs in mitigating the negative effects for the poorest households. Find out all about the researchers' methods, findings and policy recommendations through the following PEP publication (working paper):

Part of the PEP-UNDP "Poverty and Social Impact Analysis" (PSIA) initiative, the aim of this study was to analyze the impact of rising food prices (of 2008-2009) and related government policy responses on poverty, vulnerability, inequality and child welfare in Togo. Using a partial equilibrium model and panel data, the researchers found that, on the one hand, the rise in food prices has affected the wellbeing of children and had negative effects on "net consumers", whilst, on the other hand, it has contributed to improve the welfare of farmers who are "net producers". The results show that the policy reforms implemented by of the government, especially the subsidies for agricultural inputs, have had a positive impact on overall poverty reduction in Togo. However, the researchers also find that targeted social safety nets programs are more likely to have a greater impact on poverty and children’s well-being than the costly regressive oil subsidies implemented by the government. Find out more about this project's outcomes and ensuing recommendations through the following PEP publication (working paper - in French : "Analyse de l'impact de la hausse mondiale des prix et des politiques de réponse du gouvernement sur la pauvreté'):

Part of the PEP-UNDP "Poverty and Social Impact Analysis" (PSIA) initiative, this study sought to assess the impact of microcredit on the empowerment of female household heads in Benin, using statistical (pro-score) matching techniques. The results show that access to microcredit does have a positive and significant impact on women's empowerment, in particular through the dimensions of "social responsiblities and living conditions" and "cultural rights and participation". Find out more about this project's outcomes and ensuing recommendations through the following PEP publication (working paper - in French : "Microcrédit, pauvreté et autonomisation des femmes au Bénin"):

In this PEP project, a team of researchers in Senegal set out to assess the impact of an experimental school canteen program on the performance of pupils in rural primary schools. 120 schools were selected in rural areas where the program had not yet been implemented. Half of these schools were assigned to receive the program (treatment group) and the other half, not (control group). This randomized controlled trial enabled the researchers to observe the actual effect of their feeding program on the students’ scores, on the schools’ rates of (grade) repetition and drop outs, as well as on other external, potentially unintended effects. The evidence produced by the team showed significant positive impact of the program on several aspects of schools’ and students’ performance, not to mention on the students’ nutrition. Find out more about the researchers' findings in the following PEP working paper (in French or English):

Part of the PEP-UNDP "Poverty and Social Impact Analysis" (PSIA) initiative, this study set out to analyze the socioeconomic impact of increased trade liberalization between Armenia and the EU within the framework of Eastern Partnership initiative. In addition to a quantitative assessment of the potential impact of trade liberalization on the economic situation and poverty in Armenia, the study involves evaluations of existing foreign trade regimes and regulatory systems. Results of the analysis reveal that a simple free trade agreement or tariff liberalization will not result in significant socioeconomic benefits for Armenia. Although the researchers find that regional economic integration of Armenia with the EU is of great importance to long-term development of the country, they also find that it could only be economically justifiable (and generate a positive social impact) if the process that leads to such integration is based on development and harmonization of the capacities of domestic producers and enterprises. Therefore, the analysts conclude and recommend that immediate priority, in terms of policymaking, should move away from trade liberalization and towards industrial development. Find out more through the following PEP working paper:

In western China, and particularly in the poverty- and drought-stricken countryside of the region, women have been left as the main workforce, whilst the male labourers have flock to cities as a result of China's social transformation. A project called “Land of Love, Water Cellar for Mothers” was launched and implemented in order to address the comparatively serious water scarcity in these areas. In this study, a group of local PEP-supported researchers aim to assess the impacts of this water cellar project on the welfare of the affected populations. Two waves of a household survey: one prior to installation of one of a water storage facility, or “water cellar”, and a second wave after installation, to assess not only the effects on poverty, but also the transmission channels. The results show that these effects include not only the increase of household incomes, but also significant increases in women’s labour supply. Find out more through the following working paper:

As part of the PEP-UNDP Poverty and Social Impact Analysis (PSIA) initiative, this project sought to assess the effectiveness and progressivity of Uganda’s Universal Primary Education (UPE) program since it was first introduced in 1997, by examining factors driving primary school attendance, grade delay and drop out trends for children between the ages of 6 and 12 over the past two decades. The researchers' findings reveal that primary school attendance has been progressive over time and, in recent years, pro-poor, in the sense that the poorest people have been its major beneficiaries. However, both demand and supply-side factors affecting the provision and use of primary education still stand in the way of achieving optimal and equitable participation from UPE. The analysis also suggests that policies targeting the poor as well as the poorer parts of the country could yield considerable additional benefits, in terms of greater progressiveness and pro-poorness of the UPE policy. Find out more through the following PEP working paper:

Selected for support in 2013, under the PEP initiative for "Policy Analysis on Growth and Employment" (PAGE), this project was led by a team of local researchers in Macedonia, who sought to explore whether remittances may be used to support the entrepreneurial activities of unemployed youth living in recipient households. This initiative emerges from two main observations: first, that low job creation and the persistently high youth unemployment rate (around 55%) are some of the most important socioeconomic problems in Macedonia. Second, remittance inflows represent, in average, about 4% of the country's GDP, and about USD 2,700 in additional income per household per year - of which the usage remain, however, largely unknown. Using data from a nationally-representative survey conducted in 2008, the research team applied advanced techniques of statistical and microeconomic analysis to examine how the employment status of youth in Macedonia varies owing to remittance inflow in the country, and whether the effect of remittances on youth labour supply is homogenous across genders, ethnic and rural/urban divide. Amongst the results of their analysis, they find that youth living in households receiving remittances have considerably larger probability to establish their own business, ranging between 28% and 33% compared to the non-youth non-receiving counterparts.
Find out more about their project findings and methods through the following PEP publications:

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