The MENA Chief Economist Seminar Series is a regular virtual event organized to help disseminate the latest scholarly research on topics relevant to the policy conversation in the Middle East and North Africa. The virtual seminar is broadcast in YouTube.
Office of the Chief Economist - Middle East and North Africa
Seminar Series
Families, Labor Markets, and Policy
Presenter | Presentation | Paper
Thursday, March 21, 2024
Abstract: Despite decades of progress, sizable gender gaps remain in most indicators of economic achievement. In this paper, Barbara Petrongolo and her coauthors bring together different strands of work on the causes of remaining gender inequalities, specifically the interactions between families, the labor market, and public policy. She will discuss lessons learned from decades of legislation and policy evaluations about the role of family policies on women’s careers.
Institutions, Comparative Advantage, and the Environment
Presenter | Presentation | Paper
Thursday, February 22, 2024
Abstract: Why do developing countries have relatively high pollution levels? In this paper, Joseph Shapiro argues that strong financial, judicial, and labor market institutions provide a comparative advantage in clean industries, and thereby improve a country’s environmental quality. He will discuss several complementary tests that support this un-explored hypothesis. Results from a structural gravity model with pollution suggest that strengthening institutions in one region decreases pollution in those countries but it increases pollution in other regions by reshuffling the location of dirty industries.
Aggregate Implications Of Barriers To Female Entrepreneurship
Presenter | Presentation | Paper
January 25, 2024
Abstract: In this paper, Professor Gaurav Chiplunkar and his coauthor develop a framework to quantify barriers to labor force participation (LFP) and entrepreneurship faced by women in developing countries. They apply this framework to the Indian economy and find that women face substantial barriers to LFP and to expanding businesses through the hiring of workers. There is one area in which female entrepreneurs have an advantage: the hiring of female workers, which is not driven by the sectoral composition of female employment. The presenter will discuss how policies that boost female entrepreneurship can significantly increase female LFP and other findings from their counterfactual simulations.
Refugees and the education of host populations: Evidence from the Syrian inflow to Jordan
Presenter | Presentation | Paper
November 16 , 2023
Abstract: What is the impact of refugee arrivals on the educational outcomes of local populations in host countries? While labor market impacts of refugees in low- and middle-income countries are commonly studied, the effects on public services like education are less well known. In this paper, Professor Mohamed Saleh and his coauthors exploit household surveys combined with school-level records to study the impact of the arrival of Syrian refugees on the educational outcomes of Jordanian students. The presenter will discuss their findings and how the response of the government mitigated potential overcrowding.
The Sovereign-Bank Nexus in Emerging Markets in the Wake of the COVID-19 Pandemic
Presenter | Presentation | Paper
October 19 , 2023
Abstract: Public debt in emerging market economies has surged in the wake of the COVID-19 pandemic as economic activity has declined and governments have increased fiscal support to nonfinancial firms and households to cushion the impact of the crisis. Most of the additional government financing needs have been met by domestic banks and their exposure to domestic sovereign debt has reached historic highs. This has reinforced the two-way relationship between the financial health of the sovereign and banking sectors. The interconnectedness of banks and sovereigns is often referred to as the sovereign-bank “nexus.” The speaker will present a study that examines the empirical strength of this relationship and the channels through which the sovereign and banking sectors interact. The study will explore whether an increase in sovereign credit risk can adversely affect banks’ balance sheets and credit supply, especially in countries with less-well-capitalized banking systems. The study also explores whether sovereign distress can also impact banks indirectly through the nonfinancial corporate sector by constraining their funding and reducing their capital expenditure.
Information and Social Norms: Experimental Evidence on the Labor Market Aspirations of Saudi Women
Presenter | Presentation |Paper
September 21 , 2023
Abstract: How important are social norms, information gaps, and family constraints in explaining the low rates of female labor force participation (FLFP) in conservative societies? The speaker will discuss findings from a survey experiment with female students at a large public university in Saudi Arabia. Participants received either information about the labor market and their female peers’ aspirations (T1), or the same information with a parental prime (T2). The speaker will discuss some of her key findings: (1) the expectations of working in the control group are quite high, yet students underestimate the expected labor force attachment of their peers; (2) social information matters: relative to the control group, expectations about own labor force participation are significantly higher in the T1 group, which is driven by information about peers’ aspirations; (3) T2, as intended, causes students to report a higher importance of parents’ approval of their choices but impacts for the T2 group on labor market expectations are not smaller than those for the T1 group; (4) T2 does lead to higher expectations of working in Education and the Public sectors - sectors that are more socially acceptable for women, suggesting that parental expectations do not impede their daughters’ labor market aspirations, but partly shape them.
The Financial Premium and Real Cost of Bureaucrats in Businesses
Presenter | Presentation | Paper
June 15th , 2023
Abstract: This paper studies the financial premium (or tax) and aggregate productivity losses (or gains) of bureaucrats in businesses. It does so, using a novel firm-level database that contains information about the ownership structure of European firms during the period 2010-2016. The paper shows that firms with public authorities (PAs) as direct shareholders (SOEs) get, on average, subsidized access to finance compared to private-owned enterprises (POEs). A 1 p.p increase in government direct shareholding reduces the average cost of finance (e.g., debt and equity) by 0.02 percent. The largest subsidies appear in the agriculture, energy, water, transport, and finance sectors. Counterfactual analyses conducted to quantify the aggregate productivity gains from removing State-ownership distortions show that real gains are maximized when the reform involves an initial targeted approach that focuses on removing unproductive SOEs from the market coupled with a subsequent complementary reform that eliminates the remaining distortions in financial markets before reallocating the released resources towards more productive firms.
Defueling Conflict: Environment and Natural Resource Management as a Pathway to Peace
Presenter | Presentation | Paper
June 1st , 2023
Abstract: Fragility, Conflict, and Violence (FCV) and environmental degradation are on the rise and threaten to reverse gains made toward achieving the World Bank’s twin goals. In recent decades, 40 and 65 percent of all intra-state conflicts were triggered, funded, or sustained by natural resources. Countries in MENA already face a wide array of environmental stresses, and face even greater resource instability due to climate change. In addition, protracted conflict, acute state fragility, and regional conflict spillovers across the region create compound climate-fragility risks. The World Bank has set out to adopt a holistic approach to prevention beyond its traditional role in post-conflict recovery, which affords new opportunities to the MENA region to increase resilience and good governance of land and water resources, and to reduce resource-related factors that undermine peace and stability. The World Bank Group Strategy for FCV 2020-2025 explicitly recognizes the importance of climate change as a driver of FCV and as a threat multiplier, while emphasizing the need to address both the environmental impacts and drivers of FCV. As the Strategy implementation rolls out, it is essential to share a common understanding of these links and ensure they are reflected at the project and policy level. This presentation will present lessons stemming from the recent report, Defueling Conflict Environment and Natural Resource Management as a Pathway to Peace, highlighting linkages between fragility, conflict, natural resources, and climate change, and articulate MENA-specific guidance and analytical tools for those working across the region.
Environmental change and migration aspirations: evidence from Bangladesh
Presenter | Presentation | Paper
December 8, 2022
Abstract: Worsening climate induced changes due to rising global temperature is already having adverse economic and social impacts, which will become more pronounced over time. Worsening climate for example manifested in wildfires, floods and rising sea levels has already uprooted millions of people in various
parts of the world. Natural disasters force an average of 21.5 million people each year from their homes around the world, according to the U.N. High Commissioner for Refugees. Over the next 30 years, 143 million people are likely to be uprooted by rising seas, drought, searing temperatures and other climate catastrophes, according to the U.N.’s Intergovernmental Panel on Climate Change report published this year. Climate induced migration will be both between and within countries. This study examines whether and how different environmental stressors shape internal migration in Bangladesh. The analysis relies on cross-sectional survey data of households residing in villages along the Jamuna River in Bangladesh – an area affected primarily by floods and riverbank erosion. The results show that long-term environmental events, i.e., riverbank erosion, increase aspirations for internal, permanent migration, while short-term environmental events, i.e., floods, do not affect migration aspirations. These results suggest that depending on the type of environmental change, people might prefer migrating rather than staying put and thus, they entail important policy implications regarding the effects of climate change on future internal migration flows.
Consequences of Historical Adaptation for Undernutrition and Diabetes in Developing Countries
Presenter | Presentation | Paper
November 3, 2022
Abstract: Two recently documented facts in developing economies run counter to the conventional wisdom that economic development leads to better health: (i) the weak association between nutritional status as measured by BMI or weight conditional on height, and income, and (ii) the elevated risk of metabolic disease - diabetes, hypertension, cardiovascular disease - among normal weight individuals. This study develops a model to connect these two seemingly unrelated facts. The model is based on a set point for BMI that is adapted to local food supply in the pre-modern economy, but which subsequently fails to adjust to rapid economic change. During the process of development, some individuals thus remain at their low-BMI set point, despite the increase in their income (food consumption), while others who have escaped their set point (but are not necessarily overweight) are at increased risk of metabolic disease. The model and the underlying biological mechanism, which are validated with micro-data from many countries, can jointly explain inter-regional (Asia versus Africa) differences in nutritional status and the prevalence of diabetes.
Do the Long-term Unemployed Benefit from Automated Occupational Advice during Online Job Search?
Presenter | Presentation | Paper
September 29, 2022
Abstract: Long-term unemployment has severe repercussions on people’s lives and is a heavy burden for many economies. Job search assistance have been historically successful in finding jobs for the unemployed, albeit often at prohibitively high costs. The shift of job search online allows for cheap information transmission, warranting a reconsideration of the trade-offs of job search assistance interventions. This study explores whether automated personalized advice included in a job search engine has any effect on “finding a stable job” or “reaching a cumulative earnings threshold” for the long-term unemployed. This is achieved through a randomized control trial of 800 participants in the UK. This study provides insights on the possibility of low-cost online interventions to tackle the challenge of reintegrating the long-term unemployed into labor markets.
Distrust in State Capacity and Low Support for Redistribution: Is Transparency the Solution
Presenter | Presentation | Paper
September 15, 2022
Abstract: Does increasing transparency in program delivery improve citizens' support for redistributive government programs? This is pertinent for the MENA region where high inequality, weak social safety net programs, and lack of transparency are well documented. In this talk, Joana Silva will discuss how trust in state capacity to deliver pro-poor programs can be key for eliciting more altruistic decisions, providing evidence on a specific mechanism through which transparency can increase public support for redistributive policies. The study is based on representative surveys of adults implemented in 4 MENA countries and a lab-in-the-field experiment in Jordan. The latter simulates at the micro level the decision faced by middle-class citizens, providing evidence on the propensity for redistribution and the impact of transparency and trust on redistributive preferences.
The Women Empowering Effect of Higher Education
Presenter | Presentation | Paper
June 23, 2022
Abstract: Long-term unemployment has severe repercussions on people’s lives and is a heavy burden for many economies. Job search assistance have been historically successful in finding jobs for the unemployed, albeit Schooling is essential for poverty reduction, better labor market outcomes and livelihood. This is the case for both genders, but it is particularly so for girls, given that investing in their education delivers high returns not only in terms of labor market outcomes, but also on a wide spectrum of aspects related to women’s empowerment, marriage, fertility, maternal and children’s health, democracy, and productivity.
In this talk, Ahmed will present his research on the causal impact of a public policy that aimed at making higher (university) education more available in Egypt, the most populous country in the MENA region. During the 1960s and 1970s, the government aimed to construct a public university in each province. The research exploits the staggered rollout of the opening of these universities to investigate the impact of access to university on higher education attainment, labor force participation and marriage outcomes, with a particular focus on the gender dimension.
Climate Shocks, Migration and Labor Markets: A Gender Analysis from West Africa
Presenter | Presentation | Paper
June 2, 2022
Abstract: Adverse weather and climate shocks can be detrimental to agricultural and resource-dependent households, and their effects might be magnified by exposure to additional political shocks. Similar to countries in the Middle East and North Africa, West African countries face a multitude of climate shocks. Several countries in West Africa are also prone to political violence and armed conflict.
In this talk, Nelly Elmallakh will investigate the effects of shocks, on labor market outcomes in the West African Economic and Monetary Union (WAEMU). In particular, she will discuss how climate shocks may disrupt long-standing gender roles via changing gender gap and female labor force participation among migrants and non-migrant households. The analysis combines survey data from Ivory Coast—as the main migrant receiving country—and from all the other 7 migrant sending countries of the WAEMU.
Worse Than You Think: Public Debt Forecast Errors in Advanced and Developing Economies
Presenter | Presentation | Paper
March 17, 2022
Abstract: Accurate debt forecasts are an essential foundation for constructing robust fiscal strategies consistent with debt sustainability. Robustness is even more important when debt is already very high as today. Public debt-to-GDP ratios have increased since the Global Financial Crisis in both advanced economies and emerging markets and developing economies (EMDEs). However, after a sharp rise in debt ratios in 2020, current projections point to debt ratios stabilizing quickly and then declining in the medium term.
In this talk, Davide Furceri will examine the accuracy of historical public debt forecasts and discuss what this means to current debt forecasts. Davide and his co-authors compile a unique dataset of medium-term public debt forecasts for an unbalanced panel of 174 countries, based on IMF (for the period 1995–2020) and Economist Intelligence Unit (2007–20) projections. Davide will discuss public debt forecast errors over different forecast horizon, for advance countries and EMDEs, for oil exporters, and whether the debt forecast errors are related to optimism about growth.
The Global Infrastructure Gap: Potential, Perils, and a Framework for Distinction
Presenter | Presentation | Paper
March 10, 2022
Abstract: Poor countries lack infrastructure services: 1.2 billion people have no electricity, and 1 billion live more than 2 kilometers from an all-weather road. In 2015, the World Bank initiated a surge of interest in financing this need when it claimed that rich-country private capital could close the infrastructure services gap, make money, and achieve the sustainable development goals by moving from “billions to trillions” in infrastructure investment in poor countries. This paper assesses and challenges the prevailing gap thinking by introducing an equilibrium framework that distinguishes those poor countries in which the Bank’s three-fold claim is tenable from those where it is not.
The Role of Justice in Development: The Data Revolution
Presenters - Daniel Li Chen & Manuel Ramos-Maqueda | Presentation | Paper
March 3, 2022
Abstract: In this seminar, Daniel Chen and Manuel Ramos-Maqueda will summarize and make sense of the current literature on the role of justice in economic development, conflict and trust in institutions: How does justice play a role in economic development, in credit markets and firm growth? How can justice help protect the vulnerable populations, deter violence, and influence over people’s trust in formal institutions? Daniel and Manuel will discuss the promise of administrative data, machine learning, and randomized controlled trials to enhance the efficiency, access, and quality of justice. They will also discuss new avenues for research and the potential for data to improve the functioning of justice systems in the age of COVID-19. The two discussants, Rita Ramalho and Klaus Decker, will help us contextualize these findings and ideas for World Bank’s operations and for the Middle East and North Africa region.
Does Democratization Promote Competition? Evidence from Indonesia
Presenter | Presentation | Paper
February 24, 2022
Abstract: To what extent does democratization promote growth? The ongoing debate brings into focus the relationship between political systems and capitalism, and the channels through which political contestability affects incentives and conditions for firms to enter, invest and grow. In this talk, Bob Rijkers will discuss his research using the case of Indonesia. He will discuss whether the severing of crony ties to President Suharto associated with Indonesia’s democratic transition led to enhanced competition in sectors disproportionately exposed to cronyism. The study uses plant-level manufacturing census data in which firms owned by the Suharto family members and cronies are identified.
Segmented market economies in the Arab world: the political economy of insider–outsider divisions
Presenter | Presentation | Paper
February 3, 2022
Abstract: The weak performance of Arab economies has been a key factor contributing to both the Arab Spring and the region’s subsequent instability. MENA has the world’s highest unemployment rates, the lowest firm entry rates, and the smallest growth in labor productivity. Yet, most Arab countries have comparatively strong state infrastructure and made strides in providing basic public goods in health and education—why then this picture of stagnation?
Steffen Hertog’s research tries to examine the causes of this weak economic performance through the lens of insider-outsider divisions. How do insider-outsider divisions manifest in different aspects of the economy, notably in labor markets and among private firms? How do they reinforce each other, which role does the state play in the process, and how do they contribute to persistent path of weak diversification and low productivity? How are they linked to the history of development of the Arab world? These are the questions that will be discussed in this seminar.
Presenter | Presentation | Paper
January 20, 2022
Abstract: Macroeconomic events such as downturns affect the accumulation of human capital at work, with potentially persistent consequences. However, downturns due to pandemics are different. Pandemic mitigation measures include not just workplace closures but also school closures. This study quantifies the long-term economic impact of these disruptions in the case of COVID-19, focusing on countries at different levels of development and using returns to education and experience by college status that are globally estimated using 1,084 household surveys across 145 countries.
Both lost schooling and experience contribute to significant losses in global learning and output. Developed countries incur greater losses than developing countries, because they have more schooling to start with and higher returns to experience. The study explores the differential effects by gender of the COVID-19 pandemic through estimates of the returns to education and experience separately for men and women. Surprisingly, gender differences are small and short-lived. While the employment shock is larger for women, the lower returns to experience for women relative to men dampen their income losses relative to men. The higher returns to education for women are offset by higher schooling of men, especially in developing countries, resulting in similar human capital losses for men and women. These findings challenge some of the ongoing narratives in policy circles.