This paper uses a large dataset combining census, household survey and budgetary data for nearly 4.000 Brazilian municipalities to estimate the impact of government spending on education and health outcomes. We deal with the multi-dimensional nature of the population’s social status by...

This paper tests for the existence of a bank lending channel in the transmission of monetary policy in Brazil using monthly aggregate data for the period 1995:12 through 2008:6. The test is carried out in a VECM setting that allows for multiple cointegrating relationships among the variables of...

Indonesia has made considerable progress over the years in improving the social conditions of its population, especially among disadvantaged groups, not least by raising government spending and strengthening social protection programmes. Nevertheless, in some respects social outcomes remain...

Large shifts in countries’ external current account positions can be disruptive, often reflecting sudden stops in the flows of external finance and leading to exchange rate and banking crises. As a result, an empirical literature has emerged on the sustainability of, and the determinants of...

This paper assesses the sustainability of global imbalances by testing for the presence of unit roots in the current account positions (measured in relation to GDP) of the United States, China, Japan, Germany and the oil-exporting countries using a methodology that allows for structural breaks...

The global crisis has left many G20 countries with an unenviable legacy of lower potential output and high government indebtedness. Global imbalances, which had narrowed during the recession, are now beginning to widen again, as the recovery takes hold. Structural reform will be needed not only...

The Indonesian labour market is characterised by widespread informality. To some extent, these outcomes can be attributed to a sharp increase in the real value of the minimum wage since 2001, when minimum-wage setting was decentralised to the provincial governments. To test this hypothesis, this...

Brazil, like other natural resource-exporting countries, has benefited from a sharp increase in commodity prices over the last few years. To investigate the possible impact of terms-of-trade gains on the real economy, this paper estimates normalised quadratic input demand and output supply...

The possibility that a country’s external current account may adjust nonlinearly to shocks is attracting increasing attention in the empirical literature. To shed further light on this issue in the context of emerging-market economies, this paper uses Brazilian data to estimate the...

A good framework for investment in innovation can contribute to increasing Chile’s growth potential. Spending on R&D is currently low in relation to GDP and heavily reliant on government financing. Innovation activity in the business sector is also limited by insufficient seed and venture...