Finally, in the fifth section, I will interpret the results of the econometric regressions. Under the strong pressure of the international financial institutions, Bolivia started an ambitious privatization process in the s. The first specification includes the initial level in the analysis, whereas the second specification simply measures the variation between the final and the initial value. I use two different specifications of the dependent variable for both the schooling rate and the achievement rate: Pero que al mismo tiempo posible de ser bolivai en el mediano y largo plazo.
The Ley de Inversiones Investment Act of strengthened the rights of foreign investors by providing guarantees boliva non-commercial risk as well as equal treatment for domestic and foreign investors. Their main source comes from transfers they receive from the state, and they also collect their own resources, especially through taxation.
This null hypothesis can be stated under different forms. If efficiency wage setting and union-firm bargaining coexist, bollivia. The ratios of debt to GDP and debt service to GDP have also sharply improved, referring to the relationship between the debt burden and the capacity of the economy to generate income. This website uses cookies to improve your experience while you navigate through the website.
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This category only includes cookies that ensures basic functionalities and security features of the website. These cookies do not store any personal information. Skip to content. This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Looking for nueva ley de turismo bolivia pdf printer. Will be grateful for. Looking for ley general de turismo bolivia pdf to word. Will be. This paper seeks to lwy to the ongoing controversy on the distributional effects of structural reforms in developing countries.
To this end, we set up a small-scale macroeconomic model of a dual economy to capture the transmission mechanisms through which the deregulation of product and factor markets, the liberalization of the trade and FDI regime, and bolivix privatization of public companies impact on the distribution of employment and wages between the formal and the informal sector. We empirically test the implications of our theoretical model in a detailed case study on the structural reform process in Bolivia since Rigidities in product and labor markets are considered to be at the root of poor lry performance in many developing countries.
To achieve sustainable economic growth, international organizations, such as IMF and World Bank, and bilateral donors have advocated strict stabilization programs followed by comprehensive and far-reaching structural reforms. There is widespread consensus that these policy measures contribute to creating a favorable economic environment by restoring macroeconomic and fiscal stability.
Critics, however, argue that rising inequality is also part of the package. In this paper, we assess the validity of this claim focusing on the impact of structural reforms bbolivia the distribution of wages and employment between the formal and informal sector. In Section 2, we set up a small-scale macroeconomic model of a dual economy.
The formal sector is modeled with a monopolistically competitive firms, b union-firm bargaining, c efficiency wage setting, and d employment protection. The impact of market imperfections on the labor-market equilibrium has long been discussed in the literature. More recently, the focus has shifted towards their interactions. Oblivia link between lry bargaining and efficiency wages as complementary theories to explain sectoral wage differentials was explored by Garino and Martin By integrating all four types of market imperfections into a single model, we intend to proceed further on this path.
We then apply the model to capture the different transmission mechanisms through which structural reforms impact on wages and employment in the formal and informal sector. Following Blanchard and Giavazziwe introduce structural reforms in a highly abstract fashion by discussing their impact on the model parameters which reflect the above mentioned market imperfections.
Due to the complexity of this issue, we argue that bo,ivia most promising approach to gain further insights into the distributional effects of structural reforms is to carry out detailed country case studies.
In this paper, Bolivia is chosen as object of analysis because it has implemented comprehensive and far-reaching structural reforms in a stable economic environment without oey major exogenous shocks. We start this exercise in Section 3 by giving an overview of the structural reforms undertaken in Bolivia since Feeding the Bolivian structural reform process into our small-scale macroeconomic model, we then derive hypotheses on the post-reform trends in the distribution of wages and employment between the formal and informal sector.
Building upon Moensted and Carneiro and Henleywe empirically test these hypotheses in Section 4 by estimating the formal employment share and by applying the decomposition methodology proposed by Oaxaca and Ransom to isolate the rent component of the formal wage. The data for the empirical analysis comes from seven biennial multi-purpose household surveys of the years to We finally summarize our theoretical and empirical findings and derive some policy conclusions in Section 5.
In order to capture the transmission mechanisms through which structural reforms impact on the distribution of wages and employment between the formal and informal sector, we set up a small-scale macroeconomic model of a dual economy see Figure 1.
The market structure of the informal sector, which produces the traditional good T, is perfectly competitive. In the formal sector, J monopolistically competitive firms produce J imperfectly substitutable varieties of the modern good M. On the first stage of the utility maximization problem, individual solves. The household loves variety in the modern sector and derives utility from J varieties of the modern good according to the CES utility function.
Leyy utility subject to the budget constraint and aggregating over all households yields the demand for variety j. The output of variety j depends on the number of production workers L v Mjeffort E j and the level of technology A j and is given by. Effort is a function of the wage paid by firm j W Mj relative to the expected outside wage Z.
Following Summerswe assume. Finally, in the fifth section, I will interpret the results of the econometric regressions. Section six concludes the study. Debt relief has many advantages but can also be risky. In this section I will try to summarize the main advantages and risks of debt relief which are emphasized in the economic literature. Debt overhang can discourage investment.
Therefore, foreign lenders are likely to absorb the returns to investment and the investments foreign and domestic —and as a result of that economic growth— could be consequently depressed Krugman, ; Koeda, Furthermore debt overhang creates uncertainty concerning government actions and policies that must be taken leh meet its debt-servicing obligations e.
External debt service could also affect growth by crowding out private investment or by altering the composition of lry spending. Other things being equal, higher debt services can raise the government interest cost and the budget deficit leading to a reduction in public savings which may, in turn, increase the interest rate or crowd out credit available for private investment.
Debt service payments can also put pressure on the amount of bbolivia resources for infrastructure and human capital building, inducing negative effects on growth Clements et al. Secondly, debt relief is likely to put an end to the defensive lending phenomenon. Indeed, in the nineties, most of the donor countries allocated their aid to the most indebted countries in order to help them reimburse their obligations Birdsall et al.
Furthermore, the criteria used to allocate aid to were linked to their indebtedness without any consideration to their economic performance or governing ability. As a result, debt relief can make the aid more efficient by modifying its utilisation and its allocation criteria. Thirdly, according to Cassimon et al.
From this point of view, debt relief can be considered as a new form of boliivia aid. Powell outlines that the aim to combat poverty through debt relief started with the multilateral debt relief programs HIPC initiatives. Nevertheless, a fiscal space was created under the essential assumption that the debt service would have been paid. Otherwise debt relief consists only in an accounting clean-up of the future and past arrears accumulation.
As regard to the risks of the debt relief, the moral hazard risk can be firstly highlighted. Indeed, after the debt relief, debtor countries could believe that their creditors have softened the way they consider defaults boliviz will be willing to cancel their debt for a second time should their reimbursement probability diminish again in the future Arnone et al. These countries could be tempted to misbehave and accumulate external debts in order to finance excessive expenditures.
Furthermore, developing countries which have not benefited from the debt relief could also be eager to get into debt in order to benefit from debt relief.
Also, debt relief can be considered as unfair since it rewards the most indebted countries and, in a way, punishes the developing countries which have adopted a cautious indebtedness policy Berlage et al. Secondly, debt relief can lead to a free-riding behaviour which refers to a situation under which a creditor tries to gain at the expense of the other creditors. Indeed, the creditors of the heavily indebted poor countries could bolibia unwilling to participate in the debt relief programs in order to get reimbursed Krueger, These creditors could threaten the benefits bolivoa the initiatives.
Indeed, should they account for a large proportion of the creditors the debt relief will not lead to debt sustainability. Moreover, creditors could become reluctant to participate in the relief as they fear free-riding from the other creditors.
Therefore the participation of every creditor must be guaranteed. Vulture funds, which seek to make a quick buck by buying up the debts of heavily indebted poor countries at a cheap price and then trying to get back bolivai full amount often by suing through the courtsconsist in another form of free-riding.
Free-riding can also refer to the lending policies of new creditors toward countries which have already benefited from debt relief. There are diverging interests between the collective interest, debt sustainability, and the interest of individual lenders who can benefit from lending to HIPC countries at commercial terms.
According to Eurodadthe HIPC countries are boljvia to contract these kinds of loans bolivja of the insufficient number of concessional loans that are offered on the market, their need of financing to reach the Millennium Development Goals and the absence of conditionalities of these new loans.
Either way, free-riding is likely to threaten the benefits of debt relief by endangering debt sustainability. Thirdly, debt relief does not guarantee that the country will never fall back in overindebtedness. Indeed, various factors can affect debt sustainability; among which the quality of the policy and institutional frameworks, debt management capacity, external shocks and fiscal revenue mobilization Sun, ; Berensmann, ; Kraay and Nehru, ; Looser, Fourthly, debt relief can cause an increase of the domestic public debt.
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