The Impact of Regulation on Growth and Informality: Cross-Country Evidence

This paper studies the effects of regulation on economic growth and the relative size of the informal sector in a large sample of industrial and developing countries. Along with firm dynamics, informality is an important channel through which regulation affects macroeconomic performance and economic growth in particular. The paper concludes that a heavier regulatory burden -- particularly in product and labor markets -- reduces growth and induces informality. These effects are, however, mitigated as the overall institutional framework improves.

Natural disasters and university enrolment: Evidence from L’Aquila earthquake

Although there are several studies looking at the effect of natural disasters on economic growth, less attention has been dedicated to their impact on educational outcomes, especially in more developed countries. We use the synthetic control method to examine how the L’Aquila earthquake affected subsequent enrolment at the local university. This issue has wide economic implications as the University of L’Aquila made a large contribution to the local economy before the earthquake. Our results indicate that the earthquake had no statistically significant effect on first-year enrolment at the University of L’Aquila in the three academic years after the disaster. This natural disaster, however, caused a compositional change in the first-year student population, with a substantial increase in the number of students aged 21 or above. This is likely to have been driven by post-disaster measures adopted in order to mitigate the expected negative effects on enrolment triggered by the earthquake

Climate Vulnerability and the Cost of Debt

We use indices from the Notre Dame Global Adaptation Initiative to investigate the impact of climate vulnerability on bond yields. Our methodology invokes panel ordinary least squares with robust standard errors and principal component analysis. The latter serves to address the multicollinearity between a set of vulnerability measures. We find that countries with higher exposure to climate vulnerability, such as the member countries of the V20 climate vulnerable forum, exhibit 1.174 percent higher cost of debt on average. This effect is significant after accounting for a set of macroeconomic controls. Specifically, we estimate the incremental debt cost due to higher climate vulnerability, for the V20 countries, to have exceeded USD 62 billion over the last ten years. In other words, for every ten dollars they pay in interest cost, they pay another dollar for being climate vulnerable. We also find that a measure of social readiness, which includes education and infrastructure, has a negative and significant effect on bond yields, implying that social and physical investments can mitigate climate risk related debt costs and help to stabilize the cost of debt for vulnerable countries

Propuesta de utilizaci?n del gas natural licuefactado en los camiones mineros : evaluaci?n de beneficios

El uso intensivo del di?sel en la cadena de valor de la miner?a representa una gran oportunidad de brindar eficiencia y sostenibilidad al sector minero mediante la sustituci?n parcial del di?sel por Gas Natural Licuado (GNL) en los camiones mineros. El presente trabajo de investigaci?n evalu? las ventajas competitivas para la miner?a de tajo abierto reduciendo los costos de combustibles en 49.4% (US$513 millones); adem?s se dejar?an de importar 4.5 millones de Barriles de di?sel por a?o, que representa un super?vit de US$ 386 millones en la balanza comercial del a?o 2018. Asimismo, se dejar?an de emitir 543 mil toneladas de CO2 por a?o, lo cual representa una reducci?n del 28% de las emisiones de CO2. Los otros beneficios que se generan al introducir el GNL en la matriz energ?tica de la miner?a, acorde a la pol?tica energ?tica nacional, incluyen poner en valor las reservas de gas natural e impulsar su masificaci?n, menor dependencia energ?tica y volatilidad en los precios de los recursos energ?ticos, menores riesgos asociados a la adulteraci?n y los derrames, reducci?n de material particulado que produce una serie de externalidades negativas. Tambi?n se genera el aumento del canon y regal?as por la mayor producci?n de gas natural

Tree mode of death and mortality risk factors across Amazon forests

The carbon sink capacity of tropical forests is substantially affected by tree mortality. However, the main drivers of tropical tree death remain largely unknown. Here we present a pan-Amazonian assessment of how and why trees die, analysing over 120,000 trees representing > 3800 species from 189 long-term RAINFOR forest plots. While tree mortality rates vary greatly Amazon-wide, on average trees are as likely to die standing as they are broken or uprooted—modes of death with different ecological consequences. Species-level growth rate is the single most important predictor of tree death in Amazonia, with faster-growing species being at higher risk. Within species, however, the slowest-growing trees are at greatest risk while the effect of tree size varies across the basin. In the driest Amazonian region species-level bioclimatic distributional patterns also predict the risk of death, suggesting that these forests are experiencing climatic conditions beyond their adaptative limits. These results provide not only a holistic pan-Amazonian picture of tree death but large-scale evidence for the overarching importance of the growth–survival trade-off in driving tropical tree mortality

Business constraints and growth potential of micro and small manufacturing enterprises in Uganda

Ugandan micro and small enterprises (MSEs) still perform poorly. Studies associating poor performance of manufacturers with lack of finance and low investment ignore micro enterprises. Those focusing on MSEs are either exploratory in nature or employ a descriptive analysis, which cannot show the extent to which business constraints explain the performance of MSEs. Thus, this paper tries to examine the extent to which the growth of MSEs is associated with business constraints while controlling for owners’ attributes and firms’ characteristics. The results reveal that MSEs’ growth potential is negatively associated with limited access to productive resources (finance and business development services), high taxes and lack of market access

A Tale of Two Markets: How Lower-end Borrowers Are Punished for Bank Regulatory Failures in Nigeria

In 2009, the Nigerian banking system witnessed a financial crisis caused by elite borrowers in the financial market. Regulatory response to the Nigerian crisis closely mirrored the international response with increased capital and liquidity thresholds for commercial banks. While the rise of consumer protection on the agenda of prudential supervisors internationally was logical in that consumer debt was the main cause of the global recession, the Nigerian banking reforms of 2009 disproportionately affected access by poorer consumers, who ironically had little to do with the underlying causes of the crisis. As lending criteria become more stringent, poorer consumers of credit products are pushed into informal markets because of liquidity-induced credit rationing. Overall, consumer protection is compromised because stronger consumer protection rules for the formal sector benefits borrowers from formal institutions who constitute the minority of borrowers in all markets. While the passage of regulation establishing credit bureaux and the National Collateral Registry will, in theory, ease access to credit especially by lower-end borrowers, the vast size of the informal market continues to compound the information asymmetry problem, fiscal policies to tackle structural economic issues such as unemployment and illiteracy remain to be initiated, and bank regulators continue to pander to elite customers with policy responses that endorse too big to fail but deems lower-end consumers too irrelevant to save. The essay concluded that addressing the wide disparity in access to credit between the rich and poor through property rights reforms to capture the capital of the informal class, promoting regulation to check loan concentration, and stimulating competition by allowing Telecommunication Companies (TELCOs) and fintech companies to carry on lending activities because of their superior knowledge of lower-end markets will facilitate greater access. The risk of systemic failure deriving from consumer credit in Nigeria is insignificant compared to the consumer vulnerabilities resulting from the exposure of consumers to unregulated products in the informal market