What Factors Determine the Allocation of Aid to Agriculture?

Agricultural and Food Policy,

African Regional Integration: Implications for Food Security

This report looks at the African regional trade, regional integration agreements (RIAs) and the implications for food security. An overview is presented on the present state of African regional integration and the determinants of regional trade in agriculture and food commodities. In particular the study focuses on eight target countries, related RIAs and a set of strategic food commodities. The evidence presented in this study shows that African countries have made progress in opening up agriculture and food trade with partner countries. With, the exception of Ghana, Tanzania and Mozambique, the effective applied tariff rates for regional trade partners are substantially lower than the (MFN) rates applied to world trade partners. Nonetheless, regional trade in agriculture and food only increased marginally between 1990 and 2009, and is relatively low in comparison with other developing regions. The weak state of soft and hard infrastructure, rather than high trade tariffs, seem to be the cause of this.Regional integration agreements, Africa, Food security., Agricultural and Food Policy, Food Security and Poverty, International Development, International Relations/Trade,

South African manufacturing performance in international perspective, 1970-1999

This paper analyses the historical performance of the South African manufacturing sector in an international perspective. After a brief overview of the industrialisation process of South Africa during the 20th century, a binary comparison of manufacturing output and productivity between South Africa and the US is presented. The industry-of-origin approach is used to construct unit value ratios (UVRs), as an alternative to the exchange range for converting US and South African output data into the same currency. Subsequently, the UVRs are used to estimate labour and total factor productivity levels for total manufacturing and 13 manufacturing branches for the period 1970-1999 in comparison to the USA. Next, these results are used to compute relative unit labour costs, which shed light on the international competitiveness of the South African manufacturing sector at a detailed level. The study is part of the International Comparisons of output and Productivity (ICOP) project carried out at the universities of Groningen and Eindhoven. We find that there exists a considerable labour and total productivity gap between the US and South Africa, which is continuously widening over time. In 1970, labour productivity stood at 32 percent of US level, while it was only 20 percent in 1999. With respect to relative unit labour costs, the results show that on average, South Africa is competitive with the USA, albeit there are some industries which show consistent relative unit labour costs above US level.

Catch Up at the Micro-Level: Evidence from an Industry Case Study Using Manufacturing Census Data

In this paper we provide a first attempt to analyse catch up at the micro level, not possible in conventional macro-studies. The Indonesian pulp and paper industry has been selected as case-study because it experienced spectacular investment and growth, becoming one of the world’s largest exporters and producers of paper in the world. We apply stochastic frontier analysis to compare technical efficiency of Indonesian paper mills with Finnish plants, which can be considered as the world technological leaders in the industry. The analysis is performed on a pooled dataset based on manufacturing census data for the period 1975-1997. In the paper we address the following questions: What is the distribution of Indonesian plant performance vis-à-vis the technological frontier? What is the role of entry, exit and survival on catch up? And, what are the characteristics of catching-up plants. Although we find that on average the Indonesian paper industry has closed the gap with the technology frontier during the 1990s, catch up has been a highly localised process in which only a few large establishments have achieved near best-practice performance, while most other plants have stayed behind.

The Micro-Dynamics of Catch Up in Indonesian Paper Manufacturing: An International Comparison of Plant-Level Performance

In this study we analyze the micro-dynamics of catch up in Indonesian paper manufacturing using a two-country plant-level data set for the period 1975-1997. The Indonesian paper industry is selected as a case-study because it experienced spectacular investment and growth. It became one of the world's largest exporters and producers of paper in the world. We apply Data Envelopment Analysis (DEA) to compare the technical efficiency of Indonesian paper mills with that of Finnish mills, which are considered to be the world technological leaders in paper making. We address three questions: What is the distribution of Indonesian plant performance vis-à-vis the technological frontier? What is the role of entry, exit and survival for catch up? What are the characteristics of catching-up plants? We find that on average the Indonesian paper industry moved closer to the technological frontier during the 1990s. However, catch up has been a highly localized process in which only a few large establishments have achieved near best-practice performance, while most other plants have stayed behindeconomic development, economic growth, technological change, paper industry, Indonesia

Tax Haven and Development Partner: Incoherence in Dutch Government Policies

This paper focuses on a relatively new issue in the debate on policy coherence for development: the incoherence between tax and aid policies, using a case study of the Netherlands as illustration. Although the Netherlands cannot be considered a ‘pure’ tax haven like the Cayman Islands and the British Virgin Islands, evidence indicates that it does play a key role as ‘conduit’ country in tax planning structures of multinationals that wish to channel funds to ‘pure’ tax havens. This paper shows that as a consequence of the Dutch fiscal regime, other countries, including developing countries, are failing to collect important tax revenues which otherwise could have been used to finance health care, education and other essential public goods and services. It is estimated that developing countries miss about € 640 million in tax revenue – about 15 % of Dutch ODA. This suggests the Dutch tax policy is incoherent with the Dutch policy on development cooperation.development policy; tax policy; policy coherence; policy incoherence

Predicting the term structure of interest rates incorporating parameter uncertainty, model uncertainty and macroeconomic information

We forecast the term structure of U.S. Treasury zero-coupon bond yields by analyzing a range of models that have been used in the literature. We assess the relevance of parameter uncertainty by examining the added value of using Bayesian inference compared to frequentist estimation techniques, and model uncertainty by combining forecasts from individual models. Following current literature we also investigate the benefits of incorporating macroeconomic information in yield curve models. Our results show that adding macroeconomic factors is very beneficial for improving the out-of-sample forecasting performance of individual models. Despite this, the predictive accuracy of models varies over time considerably, irrespective of using the Bayesian or frequentist approach. We show that mitigating model uncertainty by combining forecasts leads to substantial gains in forecasting performance, especially when applying Bayesian model averaging

Predicting the term structure of interest rates incorporating parameter uncertainty, model uncertainty and macroeconomic information

We forecast the term structure of U.S. Treasury zero-coupon bond yields by analyzing a range of models that have been used in the literature. We assess the relevance of parameter uncertainty by examining the added value of using Bayesian inference compared to frequentist estimation techniques, and model uncertainty by combining forecasts from individual models. Following current literature we also investigate the benefits of incorporating macroeconomic information in yield curve models. Our results show that adding macroeconomic factors is very beneficial for improving the out-of-sample forecasting performance of individual models. Despite this, the predictive accuracy of models varies over time considerably, irrespective of using the Bayesian or frequentist approach. We show that mitigating model uncertainty by combining forecasts leads to substantial gains in forecasting performance, especially when applying Bayesian model averaging.Term structure of interest rates; Nelson-Siegel model; Affine term structure model; forecast combination; Bayesian analysis

Competition in markets for life insurance

This report presents an empirical analysis of competition in the market for life insurance. In this market, financial advisors play a large role. Therefore, the report devotes considerable attention to the functioning of the market for financial advice. The main findings are as follows. Empirical indicators of competition find only weak competition in the market for life insurance. There are substantial economies of scale, large X-inefficiencies, and limited competition as measured by the Boone-indicator compared to other services sectors. Also, the higher profitability of Dutch life insurers compared to their foreign peers suggests weak competition, although it should be pointed out that this indicator mainly reflects the situation in the past. Better functioning of financial advisors offers a key towards improving competition. Consumers who purchased annuities through advisors are found to achieve lower pay-outs than consumers who purchased directly from life insurers. This finding underlines the importance of more transparency of life insurance products and of independent advice.