Economic Research Forum (ERF)

December

Distrust fuels protests in the Middle East and North Africa

Street protests are enveloping many countries in the Middle East and North Africa – and the fundamental cause is a growing sense of individual uncertainty and distrust of governments. This column argues that governments in the region must restore confidence in their abilities to lead change. More open markets can help to unleash the full potential of individuals in MENA countries – but to do so requires open governments.

Rethinking inequality in Arab countries: the latest research evidence

In an effort to explain and find policy responses to the Arab Spring, there has been considerable focus on inequality. This column summarises the findings of a major research project on the issue.

Reinforcing the re-emergence of the “missing middle” in Egypt

The more rapid growth of employment in small and medium-sized businesses compared with both micro enterprises and large firms in the Egyptian private sector presages the re-emergence of the ‘missing middle’. This column explains why this is a positive phenomenon that needs to be promoted and reinforced.

A new measure of economic wellbeing

GDP per capita is a useful metric of a nation’s average income, but it is widely considered to be incomplete as a measurement of prosperity. This column introduces a new measure that is particularly relevant for the countries of the Middle East and North Africa, namely productive capacity. Accounting for the atypical population structures and high resource rents in the region matters for developing a more accurate assessment of economic wellbeing and people’s lived experiences.

Moving to opportunity: internal migration and education in Egypt

Internal migration has the potential either to improve or to hinder educational opportunities. In Egypt, rates of internal migration are low and it is undertaken primarily by adults who have finished their education and are moving to work or marry. This column reports research evidence showing that the children of rural to urban migrants stay longer in school and complete more education. The improved economic situation of their migrant parents plays an important role in their persistence in school.

Tackling multidimensional poverty in MENA

What does most recent multidimensional poverty assessment of the Middle East and North Africa reveal about health, education, living standards and social security in the region. This column outlines the evidence and potential policy responses.

Rethinking the role of the state in the Middle East and North Africa

What should be the role of the state in MENA economies? This column argues that countries in the region should try to increase their level of accountability towards their citizenry by inculcating a culture of ‘value for money’, promoting the emergence of independent, yet accountable, regulators and relying less on the state to rejuvenate their economies.

Most read

Labour market effects of robots: evidence from Turkey

Evidence from developed countries on the impact of automation on labour markets suggests that there can be negative effects on manufacturing jobs, but also mechanisms for workers to move into the services sector. But this narrative may not apply in developing economies. This column reports new evidence from Turkey on the effects of robots on labour displacement and job reallocation.

Global value chains and domestic innovation: evidence from MENA firms

Global interlinkages play a significant role in enhancing innovation by firms in developing countries. In particular, as this column explains, participation in global value chains fosters a variety of innovation activities. Since some countries in the Middle East and North Africa display a downward trend on measures of global innovation, facilitating the GVC participation of firms in the region is a prospective channel for stimulating underperforming innovation.

Food insecurity in Tunisia during and after the Covid-19 pandemic

Labour market instability, rising unemployment rates and soaring food prices due to Covid-19 are among the reasons for severe food insecurity across the world. This grim picture is evident in Tunisia, where the government continues to provide financial and food aid to vulnerable households after the pandemic. But as this column explains, the inadequacy of some public policies is another important factors causing food insecurity.

Sustaining entrepreneurship: lessons from Iran

Does entrepreneurial activity naturally return to long-term average levels after big economic disturbances? This column presents new evidence from Iran on trends in entrepreneurship among various categories of firm size, sector and location – and suggests policies that could be effective in promoting entrepreneurial activities.

Manufacturing firms in Egypt: trade participation and outcomes for workers

International trade can play a large and positive role in boosting economic growth, reducing poverty and making progress towards gender equality. These effects result in part from the extent to which trade is associated with favourable labour market outcomes. This column presents evidence of the effects of Egyptian manufacturing firms’ participation in exporting and importing on their workers’ productivity and average wages, and on women’s employment share.

Intimate partner violence: the impact on women’s empowerment in Egypt

Although intimate partner violence is a well-documented and widely recognised problem, empirical research on its prevalence and impact is scarce in developing countries, including those in the Middle East and North Africa. This column reports evidence from a study of intra-household disparities in Egypt, taking account of attitudes toward gender roles, women’s ownership of assets, and the domestic violence that wives may experience from their husbands.

Do capital inflows cause industrialisation or de-industrialisation?

There is a clear appeal for emerging and developing economies, including those in MENA, to finance investment in manufacturing industry at home with capital inflows from overseas. But as the evidence reported in this column indicates, this is a potentially risky strategy: rather than promoting industrialisation, capital flows can actually lead to lower manufacturing value added and/or a reallocation of resources towards industries with lower technology intensity.

Financial constraints on small firms’ growth: pandemic lessons from Iran

How does access to finance affect the growth of small businesses? This column presents new evidence from Iran before and during the Covid-19 pandemic – and lessons learned by micro, small and medium-sized enterprises.

The economics of Israeli war aims and strategies

Israel’s response to last October’s Hamas attack has led to widespread death and destruction. This column outlines the impact thus far, including the effects on food scarcity, migration and the Palestinian economy in both Gaza and the West Bank.

Happiness in the Arab world: should we be concerned?

Several Arab countries have low rankings in the latest comparative assessment of average happiness across the world. But as this column explains, the average is not a reliable summary statistic when applied to ordinal data. The evidence from more robust analysis of socio-economic inequality in happiness suggests that policy-makers should be less concerned about happiness indicators than the core development objective of more equitable social conditions for citizens.