Gender Wage Differentials in Uganda: Evidence from the Uganda National Household Survey

This paper investigates the causes of gender wage differentials in Uganda. Given the potential differences in wage setting mechanisms between urban and rural labor markets, we break up the sample between rural and urban sub-samples. We use data from the nationally representative Uganda National Household Survey for 2002-03 (UNHS 2002/03). We employ standard decomposition techniques based on Oaxaca (1973) to decompose the gender wage gap into labor market characteristics and treatment components. The Neumark (1988) decomposition technique is used to address the "index number" problem. Further, self-selection into wage employment is controlled for using the Heckman (1979) two-step sample selection correction technique. Our empirical results suggest that a substantial portion of the gender wage differential results from employer-driven differences in treatment. This is more so in rural areas. Controlling for selection, the unexplained portion of the gender wage gap is between 61 percent and 78 percent in rural areas. In urban areas, the unexplained portion of the gender wage gap is between 41 percent and 68 percent. Further, in urban areas, 24 percent of the gender wage gap is due to nepotism toward males while 22 percent is a result of discrimination against females. In rural areas on the other hand, 68 percent of the gender wage gap is attributed to discrimination against females while only 1 percent is due to nepotism toward males. Working Paper 07-2

A model of financialization of commodities

We analyze how institutional investors entering commodity futures markets, referred to as the financialization of commodities, affect commodity prices. Institutional investors care about their performance relative to a commodity index. We find that all commodity futures prices, volatilities, and correlations go up with financialization, but more so for index futures than for nonindex futures. The equity-commodity correlations also increase. We demonstrate how financial markets transmit shocks not only to futures prices but also to commodity spot prices and inventories. Spot prices go up with financialization, and shocks to any index commodity spill over to all storable commodity prices

The phenomenon of negative emotions in the social existence of human

Purpose. The research is aimed at determining the influence of negative ethical emotions on social life and the activity of the individual, which involves solving the following problems: a) to find out approaches to the typology of ethical emotions, b) to highlight individual negative ethical emotions and to determine their ability to influence human behaviour. Theoretical basis. The theoretical and methodological basis of the research is the recognition of the significant influence of negative emotions on human activity in society. In this regard, it is proposed to consider them as a complex multidisciplinary phenomenon, which is predetermined by both social and personal factors of origin and has a certain specificity of objectification. Originality. The authors determined that in addition to destructive effects on a person of negative emotions, they can also have a constructive effect on person’s behaviour, due primarily to the fact that a person does not want to experience these emotions and therefore tries to avoid situations they cause. Conclusions. The ethical emotions of guilt, embarrassment, anger, disgust and contempt can affect, through the cognitive aspect of the emotional process, the decision-making process of people when they predict situations in which they risk to feel such emotions. So the emotion of guilt creates a constructive setup aimed at correcting inappropriate social norms of human behaviour. The emotion of embarrassment motivates a person to behave more benevolently in society in order to integrate in it and get its approval, thus encouraging the person to adhere to social and moral agreements and norms. The emotion of anger motivates a person to act to eliminate injustice, herewith not only in relation to himself, but also in relation to others. Rejecting those people who cause moral and social aversion, society creates a system of punishments and rewards that acts as a strong deterrent to the socio-cultural behaviour. The emotion of contempt performs the function of preventing punishment in relation to the despised individual

Wealth Transfers, Contagion, and Portfolio Constraints

This paper examines the co-movement among stock market prices and exchange rates within a three-country Center-Periphery dynamic equilibrium model in which agents in the Center country face portfolio constraints. In our model, international transmission occurs through the terms of trade, through the common discount factor for cash flows, and, finally, through an additional channel reflecting the tightness of the portfolio constraints. Portfolio constraints are shown to generate endogenous wealth transfers to or from the Periphery countries. These implicit transfers are responsible for creating contagion among the terms of trade of the Periphery countries, as well as their stock market prices. Under a portfolio constraint limiting investment of the Center country in the stock markets of the Periphery, stock prices also exhibit a flight to quality: a negative shock to one of the Periphery countries depresses stock prices throughout the Periphery, while boosting the stock market in the Center.

Asset Prices and Exchange Rates

This paper develops a simple two-country, two-good model, in which the real exchange rate, stock and bond prices are jointly determined. The model predicts that stock market prices are correlated internationally even though their dividend processes are independent, providing a theoretical argument in favor of financial contagion. The foreign exchange market serves as a propagation channel from one stock market to the other. The model identifies interconnections between stock, bond and foreign exchange markets and characterizes their joint dynamics as a three-factor model. Contemporaneous responses of each market to changes in the factors are shown to have unambiguous signs. These implications enjoy strong empirical support. Estimation of various versions of the model reveals that most of the signs predicted by the model indeed obtain in the data, and the point estimates are in line with the implications of our theory. Furthermore, the uncovered interest rate parity relationship has a risk premium in our model, shown to be volatile. We also derive agents? portfolio holdings and identify economic environments under which they exhibit a home bias, and demonstrate that an international CAPM obtaining in our model has two additional factors.

Spectral variations of AeBe Herbig stars in the Mon R1 association

We present the change in the Halpha emission-line profile of the spectra of some AeBe Herbig stars. In the spectrum of VY Mon, Halpha may have one of three profile types: P Cyg, P Cyg III or single line in accordance with the brightness variations of the star. HD259431 now shows a double Halpha profile with the red component stronger than the blue component, while in the earlier observations the blue peak was higher than the red peak. Finally, the last Halpha profile of LkHalpha215 is very similar to that obtained by Finkenzeller et al.Comment: 4pages, 3figure

An Asset-Pricing View of External Adjustment

Recent evidence on the importance of cross-border equity flows calls for a rethinking of the standard theory of external adjustment. We introduce equity holdings and portfolio choice into an otherwise conventional open-economy dynamic equilibrium model. Our model is simple and admits a closed-form solution regardless of whether financial markets are complete or incomplete. We find that the excessive emphasis put in the literature on solving models with incomplete markets for the sole purpose of obtaining nontrivial implications for the current account is misplaced. We revisit the current debate on the relative importance of the standard vs. the capital-gains-based (or "valuation'') channels of the external adjustment and establish that in our framework they are congruent. Our model's implications are consistent with a number of intriguing stylized facts documented in the recent empirical literature.

Labor Markets in CIS Countries

This work is done as contribution to the Regional Human Development Report 2004 section 3.7 on “Labor Markets”. The paper focuses on discussing peculiarities of the labor market transition in CIS countries, features of unemployment, labor legislation, and role of the trade unions. The paper gathers information on the labor markets of CIS and Eastern European countries that was available by summer 2004, and draws policy recommendations based on comparison between these two groups of countries. The main conclusion is that the transformation of labor markets is not complete in any of the CIS countries; most of the problems that prevailed in the early 1990s remain. These include: centralized wage setting in five CIS countries – Belarus, Moldova, Tajikistan, Turkmenistan, and Uzbekistan; extensive unemployment and underemployment, much of which is hidden; ineffective systems of labor relations and social protection; large mismatches between the labor market skills supplied and the skills demanded by new market economies; inadequate official labor market data. Fortunately, the strong economic growth experienced by most CIS countries since 1999 has increased the demand for labor and is putting downward pressures on unemployment rates. This offers a window of opportunity for policy makers seeking to further transform labor markets, and to modernize labor relations and social protection systems. The above analysis suggests the policy recommendations to speed up further transformation.Labor markets of CIS (FSU) countries, labor market transition, unemployment, labor unions, labor protection, labor migration, labor law and labor market institutions, labor market policy in transition countries