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December 2010

Do Rigidities in Employment Protection Stifle Entry into Export Markets?

Murat Seker's picture

Editor's Note: Murat Seker recently presented the findings of the paper discussed in the following blog post at a session of the FPD Academy. Please see the FPD Academy page on the All About Finance blog for more information on this monthly World Bank event series.

Many studies point to the importance of firms that export to economic growth and development. These firms tend to be larger, more productive, and grow faster than non-exporting firms. These findings have focused policymakers’ attention on the importance of international trade for economic growth. From the 1980s to the 2000s traditional trade policies have improved significantly—applied tariff rates across a wide range of countries with varying levels of income have decreased from around 25 percent to 10 percent. However, improvements in trade policies are often not enough to reap the full benefits of international trade. To be fully effective, they require complementary reforms that improve the business environment for firms. In a recent paper on Rigidities in Employment Protection and Exporting, I focus on a particular aspect of the business environment, namely employment protection legislation (EPL), and show how these regulations relate to the decisions of firms to enter export markets.1

Evidence shows that export market entry is associated with significant changes and adjustments in firm performance around the time at which exporting begins. In data collected via the Enterprise Surveys project, the employment levels of firms that subsequently enter export markets ("future-exporters") grow by 13%, four times higher than the growth rate of firms that don’t enter export markets.2 Bernard and Jensen (1999) find that the growth premium for these future-exporters as compared to non-exporters in the U.S. is 1.4% per year for employment and 2.4% for shipments.

Waging War on Open Societies (in the Name of Openness!)

Sina Odugbemi's picture

In my nearly two-decades of living in the West, I have always been fascinated by the operatic displays of rage directed by some activists and campaigners at open societies and democracies. They do this in a world where sundry totalitarian and authoritarian regimes are getting stronger, stamping on ordinary citizens with gigantic boots, and shutting down nascent public spheres with total ruthlessness. Some of these regimes are now major players on the world stage, and the brave souls who fight for openness, transparency and citizen voice in these societies get very little support. They are mostly on their own.

Yet who are we supposed to see as a hero right now? Answer: a computer hacker whose philosophy ranges from naive libertarianism to anarchism. And what are the self-evident truths that we are supposed to line up behind?

Getting ready for 2011

Saadia Iqbal's picture

It’s not just 2010 that’s winding down, but the first decade of the millennium.  Looking back, what are the things that stand out for you? What lessons learned and memorable experiences will you bring with you into 2011? Sometimes, just one event can change a person’s life completely—and maybe other peoples’ lives too. For example, if Sir Alexander Fleming had been better about doing his dishes, maybe he would never have discovered penicillin.

How technology can enable rapid responses to acute poverty events

Randeep Sudan's picture

The immediacy and tragedy of acute poverty is exemplified by the distressing condition of not being able to buy food for a hungry child, or medicine for a sick infant, or finding money for a funeral.  The help required in such situations may indeed be small, but can make a big difference in the life of a poor family. Modern information technologies hold the promise of helping the poor in radical and game changing ways.

 

Quality Education is Unfinished Homework for Latin America, says World Bank's VP for the Region

Christine Horansky's picture

In conjunction with the Ibero-American Summit this month, Pamela Cox, Vice President for Latin American and Caribbean, emphasizes the urgent need to focus on education quality in a recent op-ed that appeared in major news outlets across the region:

If education were simply a matter of attending classes, Latin America and the Caribbean would have already done its homework. Most regional countries have made enormous progress towards achieving universal access to basic education. There is also clear progress at the secondary and tertiary levels.

But more than access, the key goal of education is learning. Making sure that children and youngsters perform according to the requirements of the day is a necessary condition for the advancement of society. In that respect, the region still has some unfinished business. 

 

Implications of the Giving Pledge: More Technocratic Solutions?

Shanthi Kalathil's picture

This article on the cons of the "Giving Pledge" approach to philanthropy is thought-provoking, particularly for those interested in non-technocratic - or rather, not-solely-technocratic - approaches to governance and development issues. The author argues, among other things, that the current trend of billionaire philanthropy tends to emphasize technocratic fixes, derived partly from the business approach to problem-solving. "Thorny social problems require investments in civil society and social justice, not technocratic business-driven solutions," he writes.

Rétrospective 2010

Olivier Puech's picture

Il peut se passer beaucoup de choses en un an. En 2010, le monde a poursuivi ses efforts pour sortir de la crise financière et la Banque mondiale a atteint des niveaux records en termes d’engagements et de décaissements. Les pays en développement se sont révélés être des moteurs de la croissance économique. Haïti et le Pakistan ont connu des catastrophes naturelles dévastatrices, et les prix des produits alimentaires ont continué à augmenter.

2010 una mirada atrás

Carlos Ferreyra's picture

Muchas cosas pueden pasar en un año. En 2010, el Banco alcanzó niveles récord de compromisos y desembolsos de recursos al tiempo que el mundo seguía tratando de salir de la crisis financiera. Los países en desarrollo emergieron como los motores del crecimiento económico, Haití y Pakistán sufrieron devastadores desastres naturales y los precios de los alimentos siguieron su tendencia al alza.


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