Economic Research Forum (ERF)

April

New firms and economic geography in Turkey

The Turkish economy is characterised by considerable regional disparities, including big differences in the willingness of new firms to locate in different parts of the country. This column reports research evidence that there is also spatial variation in the factors that can boost local economic activity and contribute to a smoothing of economic geography across Turkey’s western and eastern regions.

Raising Egypt’s minimum wage: the impact on inequality

Since the majority of Egypt’s labour force is in the informal sector, where three quarters of workers earn less than the minimum wage, the recent increase will not benefit them. Indeed, as research reported in this column shows, it will lead to a rise in inequality. A better policy option would be to implement self-targeted public works programmes similar to those supported by India’s National Rural Employment Guarantee Act, which push up the informal sector’s ‘effective’ minimum wage, thereby reducing both wage inequality and some of the precarious nature of informal jobs.

Self-selection of emigrants by cultural traits: MENA evidence

What are the relationships between people’s cultural traits and their aspirations to emigrate? This column explores whether emigrants from countries in the Middle East and North Africa self-select on the basis of their religiosity and their attitudes towards women’s rights – two cultural traits that are correlated with economic outcomes and on which there are considerable contrasts within the MENA region.

Sustainability of GCC development under the new global oil order

It is now a widely held view that the price of oil will eventually be converging to a lower long-term trend. Together with growing demands for political change in the MENA region, this implies the need for many countries to reconsider their growth models and their underlying social contract. This column considers the implications for the members of the Gulf Cooperation Council.

MENA Generation 2030: Prospects for a demographic dividend

UNICEF’s new report, MENA Generation 2030, focuses on ‘investing in children and youth today to secure a prosperous region tomorrow’. This column discusses the prospects for a ‘demographic dividend’ in the region with the growing share of the working age population in the total population. The authors explore the barriers that impede realisation of the potential benefits and the policy actions that need to be implemented urgently. As the report underlines, the time to act is now.

Palestinians working in Israel: the impact on West Bank food security

Employment of Palestinians in Israel is one of the special features of the labour markets in the West Bank. But this employment is volatile as closures and regulations administered by the Israeli authorities control Palestinians’ access. This column reports research simulating different levels of the employment of Palestinian labour in Israel and assesses their implications for food security in the West Bank.

Exports and innovation in the MENA region: when skills matter

Firms that want to start exporting have to be able to innovate and upgrade their use of technology in the face of fierce competition in international markets. As this column explains, highly skilled production and non-production workers are essential. In other words, engaging in international trade creates the need for a bias towards skills.

Africa youth leadership: building local leaders to solve global challenges

Accountable leadership is one of the biggest challenges to development in Africa. This Brookings column argues that the young people of the continent need to take more places in presidencies, councils of ministers, parliaments, national committees, corporate boardrooms and civil society.

Recent financial and debt crises: is the MENA region immune?

How vulnerable is the MENA region to a ‘sudden stop’ in capital inflows and the potential for associated financial and debt crises? This column outlines the risks and the appropriate policy responses.

The economic and social transformation of the Middle East and North Africa

The crises that began with the Arab revolts signal the urgent need for economic and social transformation in the Middle East and North Africa. Yet there has been near universal failure to implement the structural reforms required to transform hidebound, state-dominated economies into modern ones that embrace technology and recognise the salutary impact of competition and private enterprise. This column outlines what has to change.

Most read

Making trade agreements more environmentally friendly in the MENA region

Trade policy can play a significant role in efforts to decarbonise the global economy. But as this column explains, there need to be more environmental provisions in trade agreements in which developing countries participate – and stronger legal enforcement of those provisions at the international level. The MENA region would benefit substantially from such changes.

Iran’s globalisation and Saudi Arabia’s defence budget

How might Saudi Arabia react to Iran's renewed participation in global trade and investment? This column explores whether the expanding economic globalisation of Iran, following the lifting of nuclear sanctions, could yield a peace dividend for Saudi Arabia, consequently dampening the Middle East arms competition. These issues have attracted increased attention in recent times, notably after a pivotal agreement between the two countries in March 2023, marking the resumption of their political ties after a seven-year conflict.

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.