《Review of Development Economics》2022年第26卷第3期目录及摘要

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https://onlinelibrary.wiley.com/toc/14679361/2022/26/3

The geography of intergenerational mobility: Evidence of educational persistence and the “Great Gatsby Curve” in Brazil

Tharcisio Leone

Agglomeration and innovation effort: A longitudinal study on small and medium manufacturing enterprises in Vietnam

Luong Vinh Quoc Duy,Damien Cassells

Employment effects of joining global production networks: Does domestic value added matter?

Wannaphong Durongkaveroj

Trade liberalization, domestic reforms, and income inequality: Evidence from Taiwan

Judith Liu,Mei-Ying Lai,Zong-Shin Liu

Industrial subsidies and impact on exports of trading partners: Case of China

Dessie Tarko Ambaw,Shandre Mugan Thangavelu

Special economic zones, export status, and firms’ productivity: Theory and evidence from China

Yang Liu,Yidan Jin

How is China's trade imbalance overstated? An analysis based on trade in value-added

Dongwei Wen,Guoming Xian

Advantage integration: A methodological framework for growth and development

Sherman Xie,Lin Xia

Distance of doing business and outward foreign direct investment: An empirical study of China

Xinbei Qian,Dexue Liu,Liangxiong Huang,Hanchao Li

What effect does development aid have on productivity in recipient countries?

Elena Groß,Felicitas Nowak-Lehmann Danzinger

Military spending and sustainable development

Ceyhun Elgin,Adem Y. Elveren,Gökçer Özgür,Gül Dertli

The detection dilemma of marginally non-poor households in poverty alleviation evaluation: Evidence from a linear quantile mixed model

Zhineng Hu,Jing Ma,Qiong Feng,C. Patrick Scott,Hani I. Mesak

Free to escape? Economic freedoms, growth and poverty traps

Donatella Saccone,Matteo Migheli

Does social integration matter for cohort differences in the political participation of internal migrants in China?

Haiyang Lu,Ivan T. Kandilov,Rong Zhu

The distributional effects of government spending shocks in developing economies

Davide Furceri,Jun Ge,Prakash Loungani,Giovanni Melina

Welfare impact of asymmetric price transmission on rice consumers in Bangladesh

Mohammad Chhiddikur Rahman,Valerien O. Pede,Jean Balié

Mechanization services, factor allocation, and farm efficiency: Evidence from China

Meili Huan,Fengxia Dong,Liang Chi

Engel’s law in China: Some new evidence

Menggen Chen

Effects of housing demolition on labor supply: Evidence from China

Xuecun Zhao,Yanrong Liu

Overeducation and skill mismatch of university graduates in Taiwan

Yih-chyi Chuang,Chia-Yu Liang

Unemployment only temporarily lowers happiness in an eastern society

Hung-Lin Tao

Modeling the dynamics of oil and agricultural commodity price nexus in linear and nonlinear frameworks: A case of emerging economy

Waseem Khan,Vishal Sharma,Saghir Ahmad Ansari

Financial inclusion and education: An empirical study of financial inclusion in the face of the pandemic emergency due to Covid-19 in Latin America and the Caribbean

Amirreza Kazemikhasragh,Marianna Vanessa Buoni Pineda

Dynamic correlation between crude oil and agricultural futures markets

Zhuo Chen,Bo Yan,Hanwen Kang

Political instability and youths unemployment in sub-Saharan Africa

Benjamin Fomba Kamga,Dieu Ne Dort Talla Fokam,Paul Ningaye

The geography of intergenerational mobility: Evidence of educational persistence and the “Great Gatsby Curve” in Brazil

Tharcisio Leone

Abstract:This paper explores the variation in intergenerational educational mobility across the Brazilian states based on univariate econometric techniques. The analysis of the national household survey (PNAD-2014) confirms a strong variation in mobility among the 27 federative units in Brazil and demonstrates a significant correlation between mobility and income inequality. In this sense, this work presents empirical evidence for the existence of the “Great Gatsby curve” within a single country: states with greater income disparities present higher levels of persistence in educational levels across generations. Finally, the paper investigates one specific mechanism behind this correlation: whether higher income inequality might lead to lower investment in human capital among children from socially vulnerable households. The paper delivers robust and compelling results showing that children born into families where the parents have not completed primary education have a statistically significant reduction in their chance of completing the educational system if they live in states with a higher level of income inequality.

Agglomeration and innovation effort: A longitudinal study on small and medium manufacturing enterprises in Vietnam

Luong Vinh Quoc Duy,Damien Cassells

Abstract:This paper analyzes agglomeration effects on innovation behavior by small and medium manufacturing enterprises in Vietnam. We use a novel data set of 1,520 small and medium enterprises from 2011 to 2015. We focus on the spatial concentration of economic activities that influence firms’ innovation outcomes. Moreover, we outline firms' and owners' characteristics as we examine the role of entrepreneurs and other covariates such as firm size, age, and the number of establishments in fostering their firm's innovation. Empirical results show the following: agglomeration contributes to the firms' innovation. Firms were less likely to innovate when they become larger in size, but microfirms were less innovative than others. Firms were found to be more innovative if they produce more than one product and operate in different cities or provinces. In contrast to the strong effects of agglomeration on firm innovation, firm-level characteristics, especially that of owners, exhibit a weaker or insignificant role.

Employment effects of joining global production networks: Does domestic value added matter?

Wannaphong ，Durongkaveroj

Abstract:Is the emphasis placed on domestic value added in trade and industry policy-making in developing countries consistent with the objective of employment generation through an export-oriented development strategy? This paper examines the rationale behind this policy emphasis by first revisiting the conventional case for using the value-added ratio as policy guidance and then undertaking an input–output analysis of the manufacturing industry in Thailand with emphasis on domestic employment generation. The analysis is based on a panel data set covering 74 manufacturing sectors from 1990 to 2015. The findings do not support the widely shared view that industries with a high value-added ratio have greater potential to create domestic export-induced employment. The policy implication of the results is that, in this era of economic globalization driven by global production networks, national industry policy needs to be guided by the market potential of products.

Trade liberalization, domestic reforms, and income inequality: Evidence from Taiwan

Judith Liu,Mei-Ying Lai,Zong-Shin Liu

Abstract:This paper estimates the effects of trade liberalization on household income inequality and investigates whether trade liberalization or domestic reforms are the main factors influencing increasing inequality in Taiwan, a middle-income open economy. We construct an empirical model by decomposing the sources of household disposable income in the quintile ratio and separate trade partners into OECD (Organisation for Economic Co-operation and Development) and non-OECD countries. Using time-series data to estimate the long-run effect, we find that net exports to OECD countries increase inequality, whereas net exports to non-OECD countries insignificantly decrease inequality. This finding diverges from the prediction based on the Stolper–Samuelson theorem. Overall, trade liberalization increases income inequality, and the effect is mainly attributed to net exports to OECD countries. Moreover, we provide evidence that domestic reforms, particularly technological progress in favor of skilled labor and industrial structural change, rather than trade liberalization, are the main driving forces of income inequality.

Industrial subsidies and impact on exports of trading partners: Case of China

Dessie Tarko Ambaw,Shandre Mugan Thangavelu

Abstract:This paper explores the impact of Chinese subsidy interventions in the upstream sector on the competitiveness of the downstream sector. In particular, the paper investigates the causal effect of Chinese subsidies on base metal products on the export competitiveness of downstream sectors in other major trading countries. To explore the impact of base metal subsidy interventions on the downstream sector of a trading partner, we exploit both temporal variation in subsidy interventions and base-metal consumption by the downstream sector. Using a panel data for 137 sectors in 40 major trading partners of the Chinese economy, the results of the paper reveal that a one-unit increase in Chinese subsidies decreases competitors’ exports by an average of 16.6%. This indicates that an increase in one standard deviation of Chinese subsidies in the base metals sector decreases exports in the other major economies by 0.17 percentage points. The findings of the paper reveal that the impacts of Chinese subsidy interventions are larger and statistically significant for the exports of developed countries and metal-intensive users in the downstream sectors. Production relocation to China, absorption of larger inexpensive base metals input by domestic Chinese firms, and subsidy complementarity in the Chinese upstream and downstream sectors could be some of the potential drivers for the negative impact of Chinese subsidy interventions on the export performance of foreign downstream firms.

Special economic zones, export status, and firms’ productivity: Theory and evidence from China

Yang Liu,Yidan Jin

Abstract:This paper explores the impact of special economic zones (SEZs) policy and export status on firms’ productivity. We first sketch a theoretical model to explain the selection mechanism of different types of exporters and SEZ firms, and provide the productivity ranking of firms. SEZ’s exporters have the highest productivity. Firms facing high imported intermediate tariffs will select themselves into SEZs to avoid imported input tariffs; firms become non-SEZ’s exporters when their intermediate inputs tariffs are low. Compared with other types of firms, non-SEZ’s non-exporters have the lowest productivity. Then, we empirically test the productivity ranking by firm-level data, and the results are consistent with our theoretical framework. Besides, different SEZ policies are associated with heterogeneous impacts on the firms’ productivity. Our paper further suggests that preferential policies are responsible for the productivity ranking of firms.

How is China's trade imbalance overstated? An analysis based on trade in value-added

Dongwei Wen,Guoming Xian

Abstract:This paper uses the 2015 version of the Organisation for Economic Co-operation and Development (OECD) and World Trade Organization (WTO)'s Trade in Value-added (TiVA) database to estimate China's value-added exports to gross exports ratio (VAER), and calculate and compare China's bilateral gross trade imbalances and value-added trade imbalances with its major trading partners at the aggregate and sector level, respectively. During the period from 1995 to 2011, China's value-added exports were around 35% less than gross exports at the aggregate level, and around 60% and 80% for manufacturing sectors and tech-intensive sectors, respectively. Compared with those based on conventional gross trade statistics, our estimates based on trade in value-added cut China's overall trade imbalances substantially. China's value-added trade surplus for manufacturing sectors, especially for the so-called tech-intensive sectors, was around 45% and over 85% less than gross trade surplus, respectively. China–U.S. value-added trade surplus was 28–45% less than gross trade surplus during the period from 1995 to 2011. On the contrary, China's value-added trade deficit with East and Southeast Asian economies is 71–99% and 59–93% less than gross trade deficit during the period from 2005 to 2011, respectively.

Advantage integration: A methodological framework for growth and development

Sherman Xie,Lin Xia

Abstract:This paper proposes an analytical framework for growth and development, and based on this methodological framework, this paper reveals why the United States has become powerful and predicts its probable decline. Different from the past views, this paper argues that the advantage integration–oriented production model and the proactive open strategy and policy orientation based on it are the core driving forces for growth and development. Driven by both capital and technology, the economic structure and social fabric of the United States has been undergoing tremendous changes for more than 200 years, so the members, the power, and the appeals of different interest groups are also changing. At the microlevel, the production model adapted to the economic structure and social fabric of the United States is changing, and correspondingly, at the macrolevel, the strategy and policy orientation of the United States are changing as well. This paper details the advantage integration–oriented development practices in U.S. history and briefly discusses the prospects of the practical application of this methodology. The United States is a typical country that achieved catch-up through advantage integration and ultimately gained global economic dominance, and this implies that the strategy and policy based on this model of development are necessarily open and positive. However, the current growing conservative policy orientation in the United States may not be a good sign.

Distance of doing business and outward foreign direct investment: An empirical study of China

Xinbei Qian,Dexue Liu,Liangxiong Huang,Hanchao Li

Abstract:Differences between the business environment in the home country and the host country are an important factor when enterprises consider their location choice with regard to outward foreign direct investment (OFDI). However, this is ignored by much existing literature. Based on the trade-off framework of international firms between exporting and participation in OFDI under the condition of heterogeneous enterprises, this paper constructs a theoretical model of the impact of distance of doing business (DDB) on OFDI. We take China's OFDI as an example and use the World Bank Group's Ease of Doing Business Index to construct the DDB indicator, as well as test the impact of the DDB on China's OFDI by combining the macro-location panel data of China's OFDI between 2004 and 2017. The results showed that increasing DDB significantly reduces the scale of China's OFDI. The effect is robust. The mechanism is that DDB significantly decreases the success rate of OFDI and increases the cost of OFDI, thereby decreasing the scale of OFDI. Further analysis then finds that official acts, such as building partnerships, and folk acts, such as increasing cultural identity, can significantly reduce the negative effect of DDB on OFDI.

What effect does development aid have on productivity in recipient countries?

Elena Groß,Felicitas Nowak-Lehmann Danzinger

Abstract:Development aid does not always positively impact economic growth. Instead, aid may decrease total factor productivity (TFP) and discourage the recipient country's own effort to grow. This study contributes to research on macroeconomic aid transmission channels by using panel data from 51 recipient countries over a 36-year period and applying panel time-series techniques. The main aim is to study the aid–productivity relation by analyzing the impact of different forms of aid (grants; loans; and bilateral, multilateral, and sector-related aid) on productivity while accounting for institutional factors and economic policy. The analysis controls for endogeneity and autocorrelation to ensure consistent and efficient estimates. To examine possible vicious circles often attributed to aid, we run quantile regressions to determine the role of aid across productivity quantiles. We find evidence that aid reduced TFP through grants and bilateral aid from 1972 to 1999 and in all quantiles of the TFP distribution from 1972 to 2009. We also find differences in the impact of sector-related aid, where aid is harmful in more productive countries.

Military spending and sustainable development

Ceyhun Elgin,Adem Y. Elveren,Gökçer Özgür,Gül Dertli

Abstract:Using a panel data set of 160 economies from 1950 to 2018, this paper examines the relationship between military expenditures and economic, health-related, education, environmental, and social indicators of sustainable development. The results generally suggest that the size of the military expenditures is negatively associated with educational attainment, life expectancy, infant and maternal mortality rates, female labor force participation, gender equality, and access to safe drinking water, electricity, basic sanitation, and positively correlated with mortality and poverty rates and air pollution. The findings are generally robust to different specifications and interact with GDP per capita; that is, the association of military spending with the development indicators is stronger (weaker) in less (more) developed economies.

The detection dilemma of marginally non-poor households in poverty alleviation evaluation: Evidence from a linear quantile mixed model

Zhineng Hu,Jing Ma,Qiong Feng,C. Patrick Scott,Hani I. Mesak

Abstract:Poverty alleviation remains one of the most pressing problems, and China has made considerable advancements toward poverty alleviation in recent years. Considering village as a random effect, this paper proposes a linear quantile mixed model to analyze the effects of household type, village type, and their interactions on household income, suggesting a test of who benefits more or less from anti-poverty policies. Results indicate that there has been a somewhat unbalanced development between poverty-stricken households who are scheduled to be out of poverty earlier and poverty-stricken households who are scheduled to be out of poverty later. The imbalance is slightly different across village types. Results also show that anti-poverty policies have been equally implemented among village types, but there is some unbalanced development of poverty-stricken and non-poverty-stricken households at lower income distribution quantiles depending on village type. Previously unidentified, marginally non-poor households are found to benefit disproportionately less from policy measures irrespective of village type.

Free to escape? Economic freedoms, growth and poverty traps

Donatella Saccone,Matteo Migheli

Abstract:New evidence on the relationships between economic freedoms and poverty traps is provided. Methodologically, a new way to classify countries into clusters is used, which stresses the relative position of economies with respect to each other. The paper investigates whether economic freedoms have any impact on shifts from one cluster to another, towards either better or worse situations. Moreover, it analyzes the contribution of economic freedoms to avoid falling into a poverty trap. The impacts of the five macro-components of the index are studied separately. The results show that economic freedoms help economies to grow and to avoid poverty traps.

Does social integration matter for cohort differences in the political participation of internal migrants in China?

Haiyang Lu,Ivan T. Kandilov,Rong Zhu

Abstract:Using nationally representative data from the 2017 National Internal Migrants Dynamic Monitoring Survey, this paper examines the nexus between social integration and the political participation of internal migrants in China. We document a positive association between social integration status and internal migrants’ political participation. The study further examines the political participation differentials from two perspectives: between migration types and between migration distances. Our Oaxaca–Blinder decomposition analysis suggests that while only about 5.2% of the political participation differential between urban-to-urban migrants and rural-to-urban migrants is attributable to the difference in social integration status, the difference in social integration status explains about 12.0% of the participation gap between intra-provincial migrants and inter-provincial migrants. Our findings suggest that regionally diverse social integration policies may have unintended consequences for the political participation of migrant workers in China.

The distributional effects of government spending shocks indeveloping economies

Davide Furceri,Jun Ge,Prakash Loungani,Giovanni Melina

Abstract:We construct unanticipated government spending shocks for 103 developing countries from 1990 to 2015 and study their effects on income distribution. We find that unanticipated fiscal consolidations lead to a long-lasting increase in income inequality, while fiscal expansions lower inequality. The results are robust to several measures of income distribution and size of the fiscal shocks, to an alternative identification strategy, across expansions and recessions and across country groups (low-income countries vs. emerging markets). An additional contribution of the paper is the computation of the medium-term inequality multiplier. This is on average about 1 in our sample, meaning that a cumulative decrease in government spending of 1% of gross domestic product over 5 years is associated with a cumulative increase in the Gini coefficient over the same period of about 1 percentage point. The multiplier is larger for total government expenditure than for public investment and consumption (with the former having larger effect), likely due to the redistributive role of transfers. Finally, we find that (unanticipated) fiscal consolidations lead to an increase in poverty.

Welfare impact of asymmetric price transmission on rice consumers in Bangladesh

Mohammad Chhiddikur Rahman,Valerien O. Pede,Jean Balié

Abstract:This study investigates asymmetric price transmission (APT) in the rice market in Bangladesh using monthly price series at farm, wholesale, and retail levels from October 2005 to June 2017 in a nonlinear autoregressive distributed lag model (NARDL). The results indicate a significant asymmetric relationship across price at retail, wholesale, and farm levels in the long and short term. While wholesalers/millers benefit from the imperfect price transmission at the expense of farmers, retailers gain over wholesalers/millers. We find that the consumer surplus decreases from a price rise at the wholesale or farm level, but consumers do not enjoy a proportional increase in their surplus from a price reduction. The study reveals that the consumer welfare loss due to APT along the rice value chain of Bangladesh is equivalent to US$89.05 million per month. This estimated aggregate welfare loss requires both the attention of decision-makers and corrective actions.

Mechanization services, factor allocation, and farm efficiency: Evidence from China†

Meili Huan,Fengxia Dong,Liang Chi

Abstract:The relationship between mechanization services and farm efficiency remains a debate in agricultural production. To empirically test the effects of farmers' mechanization service use on farm efficiency, we formulate a stochastic frontier (SF) model and a mediating effect model. We apply our analysis to a survey data set with 1,385 farm-level samples collected in 13 major maize-producing provinces in China in 2018. To address the endogenous mechanization service adoption in the SF model, a probit model is estimated. In the mediation model, two factor allocation, including agricultural investment and crop structure, is examined. Our study shows that current labor migration encouraged the adoption of mechanization services, and larger farms were more likely to use mechanization services. Moreover, our study shows that the effect of mechanization services on farm efficiency is significantly positive and is mediated by factor allocation.

Engel’s law in China: Some new evidence

Menggen Chen

Abstract:Engel's law states that the proportion of food in total consumption expenditure is negatively associated with household income. Different from other studies with time series, this paper investigates the applicability of Engel's law in China, with a sample of cross-sectional data in 2016 covering the 31 provincial regions of China. The empirical results support Engel's law, and, especially after the consideration of food prices, which is represented by regional food purchasing power parities, the negative impact of income on Engel's coefficient becomes more statistically significant. Meanwhile, Engel's coefficient is positively related to the food price. According to different types of income elasticity, food is divided into two groups: life necessities and life nonnecessities. Then, the inferior Engel's coefficient (IEC) and superior Engel's coefficient (SEC) are calculated with the expenditures of necessary and nonnecessary food, respectively, and a further study shows that the negative relationship between income and the SEC is much weaker than that between income and the IEC. Besides, Engel's coefficient is more strongly affected by the price of food necessities than by that of food nonecessities.

Effects of housing demolition on labor supply: Evidence from China

Xuecun Zhao,Yanrong Liu

Abstract:This paper investigates how housing demolition affects labor supply using the China Family Panel Studies, a nationally representative household survey from China. We argue that housing demolition is likely to be random across households within the same community. We find that housing demolition reduces overall labor force participation by ~3.3 percentage points and farm work participation by ~4.4 percentage points. We also find that the negative impact on labor force participation is mainly driven by older people, women, less-educated people, and people living in rural regions. The negative impact of housing demolition on labor force participation persists over time.

Overeducation and skill mismatch of university graduates inTaiwan

Yih-chyi Chuang,Chia-Yu Liang

Abstract:Overeducation and skill mismatch have become crucial issues in the modern labor market. Taiwan's rapid structural transformation under industrialization since 1980 followed by the policy of expanding higher education after 1990 provides an excellent scenario for investigating the issues of overeducation and skill mismatch. Utilizing data from the Taiwan Education Panel Survey (TEPS) and its follow-up survey (TEPS-B), this paper develops an empirical strategy to test the effect of overeducation and skill mismatch on wage and job satisfaction for university graduates. As in the literature, Taiwan shows significant wage loss for both overeducation and skill mismatch and the wage penalty is higher for overeducation than for skill mismatch. Results from wage performance and job satisfaction estimations suggest both overeducation and job mismatch caused efficiency loss; however, the high wage loss and lower job dissatisfaction for overeducation imply overeducation may arise because of self-selection under individual heterogeneity, which is not purely an efficiency loss. Therefore, the policy goal should properly focus on mitigating skill mismatch rather than overeducation.

Unemployment only temporarily lowers happiness in an eastern society

Hung-Lin Tao

Abstract:Using longitudinal data from the Taiwan Panel Study of Family Dynamics between 2007 and 2020, this study investigates how subjective well-being (SWB) changes before, during, and after unemployment. Consistent with extant findings from Western populations, unemployment significantly lowered SWB. Moreover, the anticipation effect was observed—that is, SWB began to decline years before unemployment. The change pattern in SWB before unemployment in Taiwan is similar to that in Western countries. In addition, men's SWB is more responsive to unemployment than women's. However, SWB declined due to unemployment to a smaller degree in Taiwan than in Western populations. More importantly, in contrast to the findings from Western countries, Taiwanese people's SWB quickly recovered to the baseline after reemployment. Thus, unemployment does not permanently harm Taiwanese people's SWB. Similarly, the self-esteem of unemployed Taiwanese also quickly recovered after reemployment. This study, therefore, argues that the impact of unemployment on SWB is culturally dependent.

Modeling the dynamics of oil and agricultural commodity price nexus in linear and nonlinear frameworks: A case of emerging economy

Waseem Khan,Vishal Sharma,Saghir Ahmad Ansari

Abstract:This paper aims at modeling the dynamics of oil and agricultural commodity price nexus in linear and nonlinear frameworks in the Indian context. Monthly prices of agricultural commodities from 1982:M04 to 2021:M05 for 37 agricultural commodities under 12 clusters have been considered in the study. For the symmetric and asymmetric impacts of oil prices on agricultural commodity prices, advanced econometric approaches, autoregressive distributed lag and nonlinear autoregressive distributed lag, have been applied, respectively. The results reveal that in the case of aggregate analysis, oil prices have an asymmetric impact on 10 clusters of agricultural commodities in the long run, while disaggregate analysis suggests that oil prices have a long-run positive elasticity with 29 of 37 agricultural commodity prices. Further, the asymmetric causality approach indicates that positive and negative shocks in oil prices Granger cause the prices of 34 agricultural commodities in the short run. The study has significant implications for policymakers, individual and institutional investors, wholesale producers, and primary producers (farmers).

Financial inclusion and education: An empirical study of financial inclusion in the face of the pandemic emergency due to Covid-19 in Latin America and the Caribbean

Amirreza Kazemikhasragh,Marianna Vanessa Buoni Pineda

Abstract:Financial inclusion and education contribute to a country's development and economic growth. However, despite the significant efforts being made to increase access to financial products for women, a high percentage still do not have access to and effective use of formal financial services in the countries of Latin America and the Caribbean. This study analyzes financial inclusion (based on gender equality) in the countries studied using a pooled-panel ordinary least squares econometric technique. Furthermore, the impact of interactions between the level of study, use of technology, academic degree during the Covid-19 restrictions, number of credit borrowers, and number of borrowers with the interaction of the restrictions during the health emergency was evaluated employing the Gini coefficient and human development index (HDI). This study confirms that Latin America and the Caribbean countries can increase financial inclusion by changing their social aspects based on gender equality to ease using technology and access to credit. The results of this study are helpful for policy-makers in formulating and implementing policies that lead to action plans that reverse an exclusionary financial system, promote financial education, and empower women.

Dynamic correlation between crude oil and agricultural futures markets

Zhuo Chen,Bo Yan,Hanwen Kang

Abstract:In recent years, the relationship between agricultural commodities and crude oil has become increasingly close with the promotion of biofuel policies. This study examines the dynamic correlation between global crude oil futures and seven agricultural commodity futures by applying the consistent dynamic conditional correlation and dynamic equicorrelation models. The empirical results show that the dynamic correlation between the global crude oil futures market and China's agricultural futures market is weak compared to the global agricultural futures market. In particular, soybean oil has the strongest correlation with crude oil, while Dalian Commodity Exchange (DCE) corn and Zhengzhou Commodity Exchange wheat have the weakest correlation with crude oil. There is an indirect linkage between crude oil futures and DCE soybean meal and DCE soybean oil. Moreover, the dynamic correlation between crude oil and agricultural commodities increased during the financial crisis, the novel coronavirus (COVID-19) epidemic, and the crude oil crash crisis. Brent crude oil has a stronger co-movement with China's agricultural commodities than West Texas Intermediate crude oil and can better hedge the risk of agricultural commodities. The findings of this study provide some insights into the contagion risk management of crude oil futures and agricultural futures markets.

Political instability and youths unemployment in sub-Saharan Africa

Benjamin Fomba Kamga,Dieu Ne Dort Talla Fokam,Paul Ningaye

Abstract:The main objective of this study is to analyze the effect of political instability on youths unemployment in sub-Saharan Africa. Particular interest is devoted to the channels through which political instability affects youths unemployment. The empirical analysis covers a sample of 23 countries for the period 2000–2016. To better characterize the labor market framework in sub-Saharan Africa, the empirical analysis incorporates the impact of political instability on youths underemployment and labor underutilization. Using panel data techniques, the results show that political instability increases youths unemployment, underemployment, and labor underutilization in sub-Saharan Africa. The main transmission channels identified are foreign direct investment, domestic investment, gross domestic product, government spending, human capital, and labor market flexibility. The findings confirm the investigated hypothesis. As the main policy implication, policymakers in sub-Saharan Africa should resolve political instability as a priority toward addressing youths unemployment.

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编辑：秦运兰

审核：龙文进