Institutions, socio-economic models and development: An ...
Transcript of Institutions, socio-economic models and development: An ...
Institutions, socio-economic modelsand development:
An overview of the literature and a methodology
François COMBARNOUS and Eric ROUGIERUniversity of Bordeaux – GREThA UMR CNRS 5113
The effects of institutions and socio-economicmodels on development: theoretical settings
Why is there so much variety in the institutions andregulations ?
• Facts: Diversity of the national systems of institutions andregulations
• One function / Several forms• China, « western style » ?
The effects of institutions and socio-economicmodels on development: theoretical settings
How can we assess this diversity?• NIE or NCD: Diversity as an institutional gap / A narrow view on
the diversity of institutional forms / coarse data and overuse ofinstruments
• CPE, VoC: diversity of socio-economic models• but OECD capitalisms / Asian model (Amable, 2003)
• Then, socio-economic models can be defined as original systemsof institutions and regulations that display a long lasting efficiency and support in regard of the objective (and the means) that are valued by the majority of the population
The effects of institutions and socio-economicmodels on development: theoretical settings
What is the « comparative advantage » of our approach?
• Against the low dimensionality of the benchmark approach toreform, our approach adopts a broad perspective of theinstitutions as systems
• We focus on similarities and differences between institutions and regulation mechanisms across nations regarding: • Competition and labour regulations, finance and corporate governance,
training and education, social protection systems, agriculture and environmental regulations, …
• … and the observable complementarities between these fields • How do they relate one with another? Do they give rise to specific, new or
already known, configurations of capitalism?
The effects of institutions and socio-economicmodels on development: theoretical settings
Why focusing on emerging economies among all LDCs?• Countries that have experimented original mixes of institutions
and regulations are mostly emerging ones• Institutional divergence does not impede the convergence in
performance• Institutional divergence ⇒ risk diversification for the World
economy• Piecemeal and experimentation vs global reform: accounting for
complementarities
• Useful clues for OECD economies?
The effects of institutions and socio-economicmodels on development: methodological options
Questions and area of study:
• Who (and also what) are the emerging countries ?• Which are the institutional configurations that support countries
emergence ?
• The area of study has to consider all the economies in the world, except for the smallest ones for data availability reasons
Separately considering the different dimensions of emergence…
• Agriculture
• Education system
• Environmental issues
• Competition / Regulation and International integration
• Development financing, financial market and banking system
• Labour market
• Social welfare
Agriculture database
Education database
The effects of institutions and socio-economicmodels on development: methodological options
Exhaustive data collection
Labour market database
Agriculture databasePCA / K-means
MCA / HCAAG1, AG2, …, AGNag
Education database PCA / K-means
MCA / HCAED1, ED2, …, EDNed
Environmental database PCA / K-means
MCA / HCAEV1, EV2, …, EVNev
New “qualitative” cross-section database
The effects of institutions and socio-economicmodels on development: methodological options
… to produce original and relevant classifications of countries, regarding each dimension
►Who are theemerging countries ?
A tool to answer some of our questions
New qualitative cross-section database
MCA / HCA
►Do emerging countries constitute an homogeneousgroup ?
►Is there an« emergence path » ?
►How do they emerge ?
►Are they several« ways » to emerge ?
►One country, oneemergence ?
The effects of institutions and socio-economicmodels on development: methodological options
An example of collected data : the labour market database
For each considered country from Afghanistan to Zimbabwe andfor each available year back to 1980
LABOUR FORCE COMPOSITION
• Labour force participation by gender / age
• Employment to population ratio
• Child labour
• Wage workers in working population
JOB SECURITY AND EARNINGS
• Share of working poor
• Minimum wage
• Work contract protection
• Factory inspectorate
• Share of public employmentFUNDAMENTAL CONVENTIONS ANDCOLLECTIVE BARGAINING
• Ratification of int. labour standards
• Union rights
• Collective bargaining
• Labour troubles
INFORMAL ACTIVITY
• Share of vulnerable employment
• Employment in the informal sector
QUALITATIVE DATABASECountries 2007 "Type "Type of "Type of "Type of "Type of "Type of "Type of "Type of "Type of
of education environmental competition / development financial international labour socialagriculture" system" considerations" regulation" financing" market » integration" market" welfare"
AfghanistanAlbaniaAlgeriaAngolaArgentina……….……….VietnamVirgin Islands (U.S.)Yemen, Rep.ZambiaZimbabweCountries 2006 AG ED EV CR DF FM II LM SWAfghanistan……….Zimbabwe……….……….……….Countries 1980 AG ED EV CR DF FM II LM SWAfghanistan……….Zimbabwe
Less developedcountries
Industrializedcountries
Emergingcountries
F1
F2Who are the
emerging countries ?
Emergingcountries
Less developedcountries
Industrializedcountries
F1
F2
AG2
DF2
CR1
CR2
CR3
EV1
EV2 ED
3
ED4
ED2
ED1
AG1
AG3
DF1
FM1
FM2
FM3
CG1
CG2
CG3
II1
LM1
SW1
SW3
SW2
II2
II3
II4
LM2
LM3
LM4
How do they emerge ?
Less developedcountries
Industrializedcountries
Emerging
countries
F1
F2
« Emergence path » ?
Less developedcountries
IndustrializedcountriesEmerging
countries
F1
F2
« One specific way » ?
Less developedcountries
Industrializedcountries
Emerging
Countries
Group 1
F1
F2
« Several ways of emergence » ?
Emerging
Countries
Group 2
Emerging
Countries
Group 3
Less developedcountries
Industrializedcountries
F1
F2« One country / One
emergence process » ?
Emerging country 14
Emerging country 12
Emerging country 2
Emerging country 7
Emerging country 5
Emerging country 1
Emerging country 3
Emerging country 11
Emerging country 1
Emerging country 4
Emerging country 6
Emerging country 1
Emerging country 9
Emerging country 13
Emerging country 10
Possible complementarities between institutions and regulations in the case of LDCs
Labor Social Welfare Education Bank and finance
Trade and FDI Agriculture Environment
Competition on product markets
Coordination and Liberalization
Informal activities
Demand (China)
Skills upgrading
Comparative advantage
Labour and investment
Gains from openness / Protection
Export vs Subsistence
Pollutions and innovations
Labor
Decent labour
Demand support
Skills upgrading
Remittances Deregulation
Volatility
Surplus towards industry
Employment creation via innovation
Social welfare
Fiscal policy
Pension funds Social dumping Redistribution reduction
Informal protections
Reduction of inequalities
Education
Microcredit Skills and comparative advantage upgrading
Productivity, sustainability
Sustainable consumption
Bank and finance Exchange reserves Microcredit Clean development and access to international financing
Trade and FDI Struggle for land Rents from Commodities
Agriculture Pollution deforestation