Aristomene Varoudakis

Productivity and Technical Efficiency in Indian States' Manufacturing: The Role of Infrastructure

of India (New Delhi: Government of India, various issues).

Fiscal Policy and Economic Growth : Lessons for Eastern Europe and Central Asia

This study explores public finance policies in the transition countries of Europe and Central Asia (ECA) and their likely effects on economic growth. The analysis is organized in three parts. Part one reviews public finance systems across the ECA region with regard to overall size, structure of expenditures and revenues, and patterns of fiscal adjustment over time. It compares these patterns and trends in ECA countries against those in fast-growing economies in other regions, and it explores possible relationships between these public finance variables and rates of economic growth. Part two undertakes detailed analysis of public expenditures policies in four major areas: infrastructure, education, health, and pensions. Part three turns to the revenue side of the budget and looks in detail at two issues of particular importance in current policy debates: the impact of flat income tax reforms and the level and structure of taxes on labor.

Real exchange rate and openness in emerging economies: Argentina in the long run

Argentinas economic policies since the beginning of the century, provide an interesting background to the study of real exchange rate (RER) management in emerging countries. In this article, four types of RER overvaluation are identified. In the 1920s, Argentina provides a short example of overvaluation in the context of a fixed exchange rate policy. Moreover, estimations show that import substitution regimes can lead to a misalignment of RER. Argentina illustrates also the difficult management of RER in a volatile environment. Results allow, in addition, a better understanding of the failure of the trade liberalization attempts of the country and reminds one that successfully integrating the world economy requires an appropriate RER policy.

Policies for Economic Take-Off

. Political commitment is the key ingredient needed for economic take-off and long-term growth. Poor countries will be unable to escape the vicious circle of poverty unless they and the international community join forces. . Inappropriate financial policies can lead to a decline in and poor allocation of savings, subsequently holding back growth. . Trade liberalisation not only strengthens growth, but also enhances the effectiveness of other economic policies. . Basic education is a prerequisite for economic take-off, just as the subsequent training of skilled labour is one of the keys to long-term growth. . Policies aimed at fostering long-term growth must be complementary; mistakes in one area can totally undermine efforts made elsewhere.

Croissance et compétitivité de l'industrie manufacturière au Sénégal

Ce document analyse le role de la productivite globale des facteurs comme determinant de la competitivite des industries manufacturieres senegalaises. Il porte sur un panel de dix groupes d’industries manufacturieres et couvre la periode 1974-94. Apres avoir estime la fonction de production des industries manufacturieres, le document identifie le role de l’investissement public, de la protection commerciale et du niveau de qualification de la main-d’œuvre utilisee par les differents secteurs dans l’evolution de la productivite globale des facteurs dans l’industrie. Une attention particuliere est portee sur les economies externes comme source de gains de productivite et sur le role de l’investissement public comme facteur pouvant favoriser leur emergence. Les resultats montrent d’importantes disparites entre les industries manufacturieres senegalaises en ce qui concerne la progression de la productivite globale des facteurs. Les insuffisances de l’investissement public en ... This paper analyses the role of total factor productivity as a determinant of competitivity in Senegalese manufacturing industries. It is based upon a panel of ten industrial manufacturing groups and covers the period 1974-94. Following an estimation of the production function of manufacturing industry, the paper identifies the roles of public investment, protectionist measures, and the level of qualification of the workforce used by the different sectors in the evolution of industrial total factor productivity. Particular attention is given to external economies as a source of improved productivity and the role of public investment as a factor in favour of such gains. The results show major differences between Senegalese manufacturing industries as far as the growth of total factor productivity is concerned. Insufficient public investment in infrastructure and the high level of protectionism appear to plan an important role in the unfavourable evolution of productivity and ...

Growth and competitiveness as factors of Eurozone external imbalances : evidence and policy implications

The paper assesses the contribution of key factors associated with external imbalances in the Eurozone through the estimation of a panel-data vector autoregressive model over 1975-2011. Growth fluctuations, initially associated with demand booms triggered by unusually low interest rates and later with demand contractions resulting from the crisis and policy adjustments, have been key drivers of current account fluctuations. Changes in competitiveness, measured by real exchange rates or unit labor costs, have played a less important role. Demand shocks have contributed more to current account balance dynamics in the Eurozone periphery than in the core, whereas competitiveness has been a less prominent factor in the periphery but relatively more important in the core. Changes in competitiveness are positively associated with changes in growth. Preventing imbalances from building up in a context of growing financial integration and easy finance warrants enhanced mutual surveillance of fiscal imbalances, but also better regulation of credit markets to prevent excess leverage and concentration of lending in investments prone to speculative bubbles. Coordination of fiscal policy across the Eurozone would facilitate the management of external imbalances without placing an often unwarranted burden on fiscal tightening in countries with sound fiscal positions affected by credit booms. The policies of internal devaluation implemented in the periphery, aimed at promoting external competitiveness, may have had only limited effectiveness in restoring the external balance to equilibrium.

Infrastructures et performances de croissance à long terme: le cas des Etats de l'Inde

This paper examines the growth performances of Indian States from 1970 to 1994. First, using principal components analysis, we proceed at a grouping of the States following their endowments in physical, social and economic infrastructure. We then combine principal components analysis with panel data estimation techniques in order to assess the contribution of various types of infrastructure to growth. Our estimations account for reverse causality arising from the endogeneity of infrastructure investment, as well as for spatial autocorrelation of residuals and for spatial autoregression. We do find evidence of conditional convergence across States. This does not rule out persistent income inequalities due to the dispersion of steady-state income levels. Such disparities are accounted for by differences in the structure of production and in infrastructure endowments, as well as in State-specific fixed effects int he growth regression. We highlight finally spatial spillover effects of growth across States.

The post-crisis growth slowdown in emerging economies and the role of structural reforms

This article constructs indicators of structural bottlenecks arising from barriers to open markets, obstacles to business operations, and constraints to access to finance. Empirical evidence from a sample of 30 emerging economies indicates that barriers to open markets and access to finance are significantly associated with differences in total factor productivity growth in the post-global financial crisis period compared with the pre-crisis period—with countries with fewer barriers showing stronger recovery and resilience. Barriers to access to finance are also associated with differences in the performance of private investment. Reforms to improve the policy framework in these areas, up to the level of the best-ranking countries, could offset the recently observed growth slowdown in emerging economies. These reforms would revitalize potential growth and mitigate the risks from external shocks associated with the global environment in the transition from the global financial crisis.