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Economies have always been prone to different kinds of shocks: economic downturn, industry shocks, currency crises, which can destabilize the path and pattern of regional economic growth. Regional economies are suffered from this disturbance, which consequences could be continued for a long time. The question why one region is more vulnerable to economic shock than other, impelled to analyze resilience notion in regional development context. Often used in engineering and ecological sciences, the notion of resilience is rapidly becoming part of the conceptual and analytical lexicon of regional economic studies. There is no universally agreed definition of regional resilience, as well as there is yet no theory of regional resilience as such. In this paper the multidimensional aspects of regional resilience notion will be revealed as well as proved the resilience is a dynamic feature insured regional uninterrupted development or fast enough recovery after economic shock occurred. The main purpose of the paper is to identify the specific aspects of resilience notion used in the regional development context. Based on systematic and comparative analysis of scientific literature comprehensive analysis of regional resilience is performed; regional resilience process and outcome framework is developed, structural dimensions of regional resilience is identified; regional resilience capacity building factors are presented.

Climate change has considerably increased the likelihood of experiencing extreme weather events. Governments in developing countries have a limited capacity to smooth the losses created by extreme weather, and could potentially benefit from the introduction of disaster funds, that is, ex-ante budgeting allocations for post-disaster reconstruction. So far the implementation of disaster funds has been limited, in part because it is still unclear whether disaster funds provide a cost-effective way of coping with these losses. By taking advantage of the sharp rules that govern the municipal-level eligibility for reconstruction funds in Mexico, this paper provides some of the first estimates of the impact of disaster funds on local economic activity. The main finding is that access to disaster funding boosts local economic activity between 2 and 4 percent in the year following the disaster. Another finding is that the positive impact of disaster funds on local economic recovery can persist for as long as a year and a half after the disaster. Consistent with these findings, we additionally show that access to disaster funding leads to a large and sustained 76 percent increase in the growth of local construction employment. This labor market impact slightly precedes the overall increase in local economic activity.

Shifting Kenya’s private sector into higher gear: a trade and competitiveness agenda’ was born out of the World Bank’s Trade and Competitiveness (T&C) Global Practice recent stock taking of its work in Kenya. This was part of a Programmatic Approach that aimed to organize T&C’s knowledge, advisory, and convening services to address Kenya’s development challenges in the private sector space. By Sub-Saharan African standards, Kenya has a large private sector, which accounts for around 70 percent of total formal employment. As a result, the dynamics of the private sector are a key determinant of the trajectory of the Kenyan economy. The country’s product market regulations a restrictive for domestic competitors and foreign entrants, and the actions of cartels and behavior of dominant firms across sectors undermines competition and hurts consumers. The Kenyan Government recognizes these challenges and has invested significantly in unlocking these bottlenecks with impressive results so far and several important laws passed. Additional efforts to ease regulatory constraints and expedite important legislative changes could improve the investment climate at national and county levels.

The objective of this paper is to present the Competitive Cities diagnostic methodology and to guide city practitioners through the diagnostic process, tools and resources that the Competitive Cities team offers.

Agglomeration economies are among the most important factors to increase firm productivity. However, there is little evidence supportive of this in Africa. By applying the conditional and nested logit models, this paper examines the relationship between firm locations and infrastructure accessibility in Rwanda. It is found that agglomeration economies matter to even one of the smallest countries in Africa. It is also found that infrastructure availability has an important role in affecting the firm location decision. Electricity access and transport connectivity to the domestic and international markets are found to be important to attract new investment. In addition, the quality of local labor supplied, measured by educational attainment, is found as an important determinant of firm location, while the effect of labor costs remains inconclusive.

Agglomeration economies are among the most important factors in increasing firm productivity. However, there is little evidence supportive of this in Africa. Using the firm registry database in Tanzania, this paper examines a new application of the logit approach with two empirical issues taken into account: spatial autocorrelation and endogeneity of infrastructure placement. The paper finds significant agglomeration economies. It is also found that firms are more likely to be located where local connectivity and access to markets are good. The paper finds that dealing with infrastructure endogeneity and spatial autocorrelation in the empirical model is important. According to the exogeneity test, infrastructure variables are likely endogenous. The spatial autoregressive term is significant. As expected, therefore, there are positive externalities of firm location choice around the neighboring areas.

This article reviews trends in poverty, economic policies, and growth in a sample of African countries during the 1990s, drawing on the better household data now available. Experiences have varied. Some countries have seen sharp drops in income poverty, whereas others have witnessed marked increases. In some countries overall economic growth has been pro-poor and in others not. But the aggregate numbers hide systematic distributional effects. Taking both macro and micro perspectives of growth and poverty in Africa, the article draws four key conclusions. First, economic policy reforms (improving macroeconomic balances and liberalizing markets) appear conducive to reducing poverty. Second, market connectedness is crucial to enable participation in the gains from economic growth. Some regions and households by virtue of their remoteness were left behind when growth picked up. Third, education and access to land emerge as key private endowments to help households benefit from new economic opportunities. Finally, rainfall variations and ill health have profound effects on poverty outcomes, underscoring the significance of social risk management in poverty reduction strategies in Africa.

Egungo krisi ekonomikoak eragin handia izan du ekonomiaren esparru guztietan, industria sektorean ere horrela jaso da eta gehien bat eraikuntza sektorean. Hala ere, industrian zenbait zifra positibo jasotzen dira jadanik, enpleguko datuek hau pairatzen ez duten arren. Ingurune honetan esportazioekin kontaktuan dauden enpresek abantaila handia izan dute egoera honi aurre egiteko. Izan ere, Europar batasuneko eta gainerako zenbait herrialdeetan duten egoera hobeagoa da eta ondorioz, enpresa hauek neurri txikiago batean jasango dute krisiaren efektua. Hauetako bat da Embalan3 enpresa, krisi ekonomiko batean dagoen ingurune batean egon arren, hazten jarraitu du. Hau lortzeko oinarrizkoa izan da aipatutako esportazioekin kontaktua izatearen abantaila, Embalan3 enpresaren jarduera bezeroak fabrikatzen edo saltzen dituen piezak egurrezko enbalajeetan sartzea eta azken bezeroari bidaltzea bai da. Honez gain, lorpen hau ahalbideratu diena lehiakideekiko ezberdintzea izan da, zerbitzu integral osoa eskainiz. Honen bidez, bezeroari biltegiratzetik piezen garraiorako deseinu eta garraio beraren antolaketara eskaintzen die. Gaur egun arte hau izan da hazkundearen euskarririk handiena eta etorkizunean hazten jarraitzeko ezinbesteko oinarria izango da. Hazkunde bide honetan, betiere beraien independentzia mantentzen saiatuz eta oraindik enpesa txikia izateak dituen mugak kontutan izanik.

This paper examines how the effects of dividend taxation on the cost of new equity funds depend on whether or not shareholders can recover their original equity injections without being subject to the dividend tax. We point out the alternative assumptions in the literature on this, and we compare two different tax regimes, one where it is impossible for the firm to pay cash to its shareholders that is not taxed as dividends, the other where the shareholders are allowed a tax-free return of the original capital contributed through new issues. We conclude that any model, which explicitly or implicitly assumes that the shareholders cannot recover their original equity injections without being subject to the dividend tax, exaggerates the distortive effects of the tax.

This paper examines how the distortions caused by dividend taxation depend on whether or not shareholders can recover their original equity injections without being subject to the dividend tax. We point out the alternative assumptions in the literature on this, and we compare two different tax regimes, one where it is impossible for the firm to pay cash to its shareholders that is not taxed as dividends, the other where the shareholders are allowed a tax-free return of the original capital contributed through new issues. Our analysis shows that the regimes imply a substantial difference to our perceptions of the distortive effects of dividend taxation.

This policy paper is motivated by the Government's 'Pakistan: framework for Economic Growth (FEG) 2011' which places weak corporate governance at the top of the 'software' constraints to growth. The efforts to reform the State-Owned Enterprises (SOEs) have stalled in Pakistan for almost five years with significant negative implications not only in terms of fiscal losses, but also deteriorated and cost-ineffective service delivery. The paper suggests a number of urgent policy measures designed to improve the efficiency and effectiveness of SOEs. These include basic governance reforms, revamped commercialization processes and enhanced market regulations. The paper also provides some perspectives on international experience on SOE reforms combined with some suggestions on how the Government can move forward.

In 2012, the Mexican Presidency of the G20 introduced inclusive green growth as a cross-cutting priority on the G20 development agenda. The second meeting of the G20 Development Working Group (DWG), hosted by the Government of the Republic of Korea, took place in Seoul the 19th and 20th of March 2012. As agreed during the first DWG meeting, this second meeting focused on the priorities for their presidency in the first half of 2012: infrastructure, food security and inclusive green growth (IGG). At its Seoul meeting, the DWG also agreed that IGG co-facilitators and relevant international organizations (IOs) should work together in 2012 to develop a nonprescriptive good practices guide/toolkit on enabling national policy frameworks for inclusive green growth to support countries who voluntarily wish to design and implement affordable and inclusive green growth policies, with the aim of achieving sustainable development and poverty alleviation. The toolkit is organized as follows. First, the necessity of applying the different tools in the context of a broad inclusive green growth strategy is stressed, and a harmonized framework combining approaches and tools identified by all four IOs is set forth. Second, the document offers an overview of key tools that can be mobilized to implement an inclusive green growth strategy. Quick technical descriptions of these tools are offered along with suggested sources for further details. Finally, capacity building and knowledge sharing initiatives are presented, with the Green Growth Knowledge Platform (GGKP) highlighted as a powerful collaborative tool to advance policies for inclusive green economies.

Outside of China, despite rapid economic growth in many low and middle income countries, there has been little progress in meeting the MDG1 target of halving the incidence of global poverty by 2014. Part of the explanation for this weak poverty-reducing performance has been the historic trajectory of innovation. During the 20th Century, most of global innovation had its origins in the north, producing products for high income consumers, developing technologies which excluded poor producers and technologies which were energy intensive and polluting. This innovation trajectory gave rise to the not-for-profit Appropriate Technology movement after the 1970s. But many of the technologies which they it were inefficient and were scorned by both producers and consumers. However a series of disruptive factors the growth of low income consumers in the context of global economic slowdown, the development of radical technologies (such as mobile telephony and renewable power), the development of capabilities in low income economies and the emergence of new types of innovation actors have begun to transform the potential of AT to support pro-poor growth. Whilst this new vintage of ATs will be largely market-driven (since it provides the potential for profitable production), there are important dimensions in which this market-driven process can be supported by policy.

This presentation proposes that BPO and other ICT development have a potential to be a major catalysts for economic growth and socio-economic transformation. It claims that IT-BPO sectors development represents major promises that potentially can transform the Philippine economy and also foster inclusive growth. The presentation postulates that the importance of IT-BPO industry development goes beyond the debate of picking industry winners. It argues that the BPO industry is poised to have a substantive impact on the country and that especially so if there simultaneously is major growth in other ICT sectors and the scale and scope local usage of ICTs. It claims that expanded scale and scope of BPO industry in conjunction with further development of IT services, Telecom and other ICTs industries coupled with the advancement in education, science & technology can be principal factors that can transform the Philippine economy and its interface with the rest of the world.

International audience; We have recently shown that the expression of the DNAJA1 gene encoding a heat shock protein (Hsp40) is a negative marker of meat tenderness in Charolais bulls. To acquire knowledge on the regulation of DNAJA1 expression, we analysed the abundance of DNAJA1 transcripts and protein during development and according to management factors (e. g. feeding treatments, growth path and stress status) in different bovine muscles during postnatal life. We report here a developmental expression profile for DNAJA1 with decreased levels of transcript and protein during the progression of myogenesis. During postnatal life, we found the highest expression of DNAJA1 in the most oxidative muscles. No effect was detected for dietary treatment (pasture v. maize-based diet), growth path (compensatory growth after a restriction period) or pre-slaughter stress status. Therefore, the genetic background and muscle type could be considered as the main factors regarding the level of DNAJA1. Integration of the knowledge gained from this study should help to predict muscle metabolic properties and the ability of the live animals to give high sensory quality meat.

The firming of the economic recovery is putting the policy spotlight back on the longer term challenge of faster, more inclusive Gross Domestic Product (GDP) growth. Modest investment rates despite attractive returns and low savings rates despite favorable demographics are important impediments. A virtuous cycle of faster capital accumulation, job creation (especially for the youth), and technological advancement needs to be stimulated. There are no quick fixes that can produce the desired stimulus. The quest for inclusive growth calls for a different, bolder approach. Integration of the advanced and less-developed economies and more effective integration with the global economy, using factory Southern Africa as a platform, hold considerable potential. South Africa's medium-term growth prospects point to a strengthening recovery. GDP growth is projected to be 3.5 percent in 2011, 4.1 percent in 2012 and 4.4 percent in 2013. The long term potential growth rate under the current policy environment is estimated at 3.5 percent. In light of South Africa's low national savings, the reemergence of high current account deficits, financed mostly through volatile portfolio flows, will reemerge as the biggest cause for macroeconomic concern over the medium term. With considerable strengthening of the economic recovery and GDP projected to reach its potential by 2014, the focus shifts back to the longer term challenge of raising GDP growth to 6-7 percent and making it much more inclusive to tackle the extremely high unemployment. This first issue is anchored in the national aspirations of faster and more inclusive growth, with special emphasis on the issues of savings and investment.

Regulatory reform has emerged as an important policy area in developing countries. For reforms to be beneficial, regulatory regimes need to be transparent, coherent, and comprehensive. They must establish appropriate institutional frameworks and liberalized business regulations; enforce competition policy and law; and open external and internal markets to trade and investment. This report examines the institutional set-up for and use of regulatory policy instruments in Zambia. It is one of five reports prepared on countries in East and Southern Africa (the others are on Kenya, Uganda, Rwanda, and Tanzania). The report is based on a review of public documents prepared by the government, donors, and the private sector, and on a limited number of interviews with key institutions and individuals.

This paper reconsiders the effects of dividend taxation. Particular attention is paid to the form of the “equity trap”, that is, the extent to which cash paid to the shareholders must be taxed as dividends. Our analysis shows that Sinn’s (1991) criticism of the well-known King and Fullerton (1984) methodology for underestimating the cost of new share issues amounts to a misleading comparison across two different regimes for the equity trap. Contrary to Sinn, we find that when dividends are paid following a new issue, as assumed by King-Fullerton, the cost of capital is higher than is the case when no dividends are paid.

This paper focuses on how growth theory can guide growth policy design. It first argues that policy matters for growth, in particular when policy variables are interacted with country?specific variables (financial development, institutional environment, technological development, and so forth). Second, it argues that the Schumpeterian paradigm does a better job at delivering policy prescriptions that vary with country characteristics. Third, it discusses the advantages and drawbacks of growth regression analysis. Finally, it briefly describes and then questions the recently proposed 'growth diagnostic' approach.

This paper reconsiders the effects of dividend taxation. Particular attention is paid to the form of the 'equity trap', that is, the extent to which cash paid to the shareholders must be taxed as dividends. Our analysis shows that Sinn's (1991) criticism of the well-known King and Fullerton (1984) methodology for underestimating the cost of new share issues amounts to a misleading comparison across two different regimes for the equity trap. Contrary to Sinn, we find that when dividends are paid following a new issue, as assumed by King-Fullerton, the cost of capital is higher than is the case when no dividends are paid.

Chile could well have space to increase its growth potential by 2 percentage points of Gross Domestic Product (GDP) per year. To do this, it would need to pay more attention to new sources of growth in natural resources, manufacturing, and services. In an increasingly globalized world, first-mover advantages have become more numerous and larger. Chile risks losing out, as a few recent high-profile cases suggest. Chile's total factor productivity growth can be raised by driving within-firm technological change closer to the global best-practice frontier more rapidly, especially in manufacturing. This would encourage the diversification of exports and boost Chile's supply response to global demand changes. Chile confronts obstacles in its processes of innovation, human capital accumulation, and investment. To overcome them, deep institutional changes are needed to develop a national innovation system, stronger and more equitable educational achievement, more flexible labor markets, and focused public investments that crowd in private business. Such an inclusive growth strategy is likely to yield better social outcomes than a strategy that attempts to confront social inequities head-on through more equitable access to public services without paying adequate attention to the demand for labor and generation of income. Chile could also try a new policy towards innovation, but it would need to be bolder in terms of the institutional design to maximize the chances of success.

This paper is one of several case studies prepared for the World Bank. The objective of the case studies is to provide the Commission on Growth and Development insights on the policy reform process in developing countries that give rise to economic growth. In contrast to other countries where economic reforms ushered in a long period of sustained growth, there is no such episode in Philippine economic history. Since the restoration of democracy in 1986, the Philippines under the Ramos administration came closest to breaking out of its 'sick man of Asia' image. The confidence generated by the administration among local and international players and analysts resulted from wide-ranging reforms rooted primarily in a sound macroeconomic and investor-friendly regime as well as global competitiveness. This study is not intended as a scorecard of the Ramos Administration. Rather, it concentrates on three specific sector reforms during the Ramos administration that demonstrate the elements of successful reform processes. These reforms not only helped to free up demands on public finances then- considered, in today's parlance, the 'binding constraint' on needed public investment and reduced risk premium to encourage private investments-but over time brought gains, some unforeseen and broader in terms of positive spillover effects on the rest of the economy, and linkage to overall growth today.

Many analysts consider that lack of security is a major obstacle to growth in Colombia. This paper identifies a structural downturn in economic growth-of nearly two percentage points per year-as a result of the increase in illicit crops and crime rates after 1980. A decline in total factor productivity has been the key channel linking crime and economic growth. Political upheavals and high levels of inequality and poverty motivated the adoption of a new constitution in 1991. The constitution mandated additional fiscal expenditures to curb social tensions. Major progress has been made in terms of public safety and, to a lesser extent, in the provision of health and education. However, long?run growth will continue to be constrained by inadequate transport infrastructure and low international trade volumes.

Aging of the population will affect the growth path of all countries. To assess the historical and future importance of this claim we use two popular approaches and evaluate their merits and disadvantages by confronting them to Swedish data. We first simulate an endogenous growth model with human capital linking demographic changes and income growth. Rising longevity increases the incentive to get education, which in turn has ever-lasting effects on growth through a human capital externality. Secondly, we consider a reduced-form statistical model based on the demographic dividend literature. Assuming that there is a common DGP guiding growth through the demographic transition, we use an estimate from post-war global data to backcast the Swedish historical GDP growth. Comparing the two approaches, encompassing tests show that each of them contains independent information on the Swedish growth path, suggesting that there is a benefit from combining them for long-term forecasting.

This paper reconsiders Sinn’s (1991) nucleus theory of the corporation by comparing two different regimes for the equity trap. In the first of these, all cash paid to the shareholders is taxed as dividends, in the second, shareholders are allowed a tax-free return of capital contributed through new issues. A substantial difference is found between the regimes in the seize of initial equity injections, although in both regimes, no dividends are paid until a new long-run equilibrium is reached. Contrary to Sinn, we find that with optimal behavior, the cost of new equity is lower than suggested by conventional formulae.

The potential problem of reverse causality has been obvious to everyone. It has usually been met with the standard econometric dodge: using lagged values of slow-moving variables as instruments. But this cannot be a serious solution to the problem. The causality issue points to a deeper question: Do cross-country regressions define a meaningful surface along which countries can move back and forth at will? If this is the idea, what mechanism could underlie such a surface? Brock and Durlauf call such a regression a 'model.' Reader suppose in a statistical sense it is. But an economic model should have some internal structure; its causal arrows should rest on some sort of behavioral mechanism, and that seems to be missing in this literature.

The article documents five stylized facts of economic growth: (1) the 'residual' (total factor productivity, tfp) rather than factor accumulation accounts for most of the income and growth differences across countries; (2) income diverges over the long run; (3) factor accumulation is persistent while growth is not, and the growth path of countries exhibits remarkable variation; (4) economic activity is highly concentrated, with all factors of production flowing to the richest areas; and (5) national policies are closely associated with long-run economic growth rates. These facts do not support models with diminishing returns, constant returns to scale, some fixed factor of production, or an emphasis on factor accumulation. However, empirical work does not yet decisively distinguish among the different theoretical conceptions of tfp growth. Economists should devote more effort toward modeling and quantifying tfp.

This paper aims to evaluate the structural changes of family farms in Korea. In an attempt to reach this evaluation, data from the Agricultural Census on production behaviors of family farms was examined by focusing on how they manage to procure input resources and how they run their operations. In addition, several other issues were addresses, such as the family system, the governance of rural communities, industrialization processes, family cycles and the tax system on farmers as a basic transaction enviornment that may affect farmers' management decisions; including the form of business enterprises they undertake. In Korea, farmlands are not owned by particular farmers, nor are they owned over a long period of time through inheritance. There are virtually no communal constraints on the transactions of leased farmlands. Furthermore, even at the present time, Korean farmers have access to a broader labor market far beyond their community boundaries when in need of additional labor or custom farm services. Under these circumstances, new farmers continually enter and exit farming. If there is a mechanism in the replacement of farmers based on the family cycle where the incoming farmers replace the outgoing ones, the conclusion is that, unless appropriate policy measures are implemented, large-scale farmers will not maintain or expand their size further and that small-scale family farmers will continue to be in the majority., 本研究は、韓国の家族農業経営を通して、韓国農業の構造変化を展望したものである。分析に当っては、一つに、農業センサスにより、経営資源および生産手段の所有と利用をめぐって、韓国の家族農業経営は、企業組織による内部取引より市場取引を選好していることを確認した。不達に、社会的慣習もしくは取引環境としての家族制度、農村コミュニティのガバナンス構図、産業化のプロセス、租税制度は、農業への参入、経営資源や生産手段の市場取引を妨げる要因ではないことを論証した。このような分析により、農業への参入制限がなく、かつ経営資源や生産手段を各々の市場から自由に調達できる取引環境の下では、企業的経営による農地の蓄積や経営管理の高度化は進まず、零細農家が大部分を占める農業構造に大きな変化は期待できないという結論を導いた。