Working Papers
2000
March 1, 2000
Auction Quotas with a Foreign Duopoly
Description: This paper uses a partial equilibrium framework to compare the welfare consequences of different methods of quota administration relative to free trade under imperfect competition. It shows that a country importing a good from foreign duopolists may improve its welfare by setting a quota at the free trade quantity and giving a fraction of the quota licenses to the duopolists while auctioning off the rest.
March 1, 2000
Misalignment and Managed Exchange Rates: An Application to the Thai Baht
Description: This paper proposes a methodology for analyzing dynamic misalignment in managed exchange rate systems that combines the estimation approach to modeling the real exchange rate with the calibration approach to generating the equilibrium real exchange rate. The methodology is applied to the Thai baht and the model is estimated using only pre-July 1997 data. An analysis of the difference between the evolution of the actual real exchange rate and the generated equilibrium rate - the misalignment gap - reveals the extent to which the market was persistently factoring in an expected depreciation of the Thai baht.
March 1, 2000
The Complier Pays Principle: The Limits of Fiscal Approaches toward Sustainable Forest Management
Description: This paper examines the role and impact of taxation on sustainable forest management. It is shown that fiscal instruments neither reinforce nor substitute for traditional regulatory approaches. Far from encouraging more sustainable forest management, fiscal instruments such as an inappropriate tax policy can actually undermine it. The paper uses the arguments at the root of the Faustmann solution to draw conclusions on the incentives for sustainable tropical forest exploitation. The paper also proposes a bond mechanism as an alternative market-based instrument to encourage sustainable forest logging while reducing monitoring costs.
March 1, 2000
Globalization and Growth in the Twentieth Century
Description: This paper reviews the experience of economic growth during the twentieth century with a view to highlighting implications for both growth economists and policy-makers. The unprecedented divergence in income levels between the OECD economies and many developing countries is documented but so too is a more optimistic picture of widespread progress in terms of the Human Development Index. Various aspects of the changes in economic structure are explored in terms of their implications for growth performance both in retrospect and prospect. The possibility that the growth process will lead to another globalization backlash reminiscent of the 1930s is analyzed.
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2000
February 1, 2000
Educational Choices and Educational Constraints: Evidence From Bolivia
Description: Recent efforts at poverty alleviation emphasize increasing government spending on education. However, even if spending were perfectly targeted, it is not evident that spending by itself will lead to higher educational attainment. Bolivian household data is used in this paper to ascertain the probability of an individual quitting school due to financial or other reasons. Simulations show that government cash transfers can help to improve educational attainment somewhat. However, nonmonetary limitations must also be addressed if educational attainment is to improve significantly, in particular, for indigenous women who have the lowest levels of education in the country.
February 1, 2000
Trade Policy in Financial Services
Description: This paper reviews the economics of trade policy in financial services, highlighting differences between trade across borders and through commercial presence. Trade liberalization could complement other financial reforms by enhancing the efficiency, quality, and variety of financial services and by encouraging improvement of financial regulations and practices. However, it raises sectoral, strategic, and cultural concerns. The design of trade policy should therefore emphasize the nexus with the macroeconomic framework and other financial sector policies, especially prudential and capital account regulations. It should also differentiate between types of trade. National reforms should be coordinated with multilateral trade agreements and initiatives on international financial architecture.