Economics

Estimating the Effects of Social Safety Net Programmes in Bangladesh on Calorie Consumption of Poor Households

The Social Safety Net (SSN) programmes play a key role in Bangladesh to protect the poor households from food insecurity. This study examines the effect of these programs on calorie consumption of poor households using the 2005 Household Income and Expenditure Survey data. Three treatment effect evaluation designs are applied to compare the estimated effects. Mean difference and matching estimators that do not consider endogeneity of treatment dummy produce significant negative effects when applied to the whole sample. Unconfoundedness and overlap assumptions do not exist and the assumptions are satisfied after dropping some observations using the criteria of propensity score. The effect of the SSN programmes on calorie consumption is estimated in the reduced sample using the same econometric methods, and it is found that there are insignificant positive effects in all cases. However, the treatment dummy has serious endogeneity problem, as

selection for treatment is also determined by some unobserved factors such as corruption. In this case, instrumental variables regressions taking regional

dummies as instruments that do not have relation with calorie consumption are applied, and produce significant positive average treatment effect.

Attachments:
Estimating the Effects of Social Safety Net Programmes in Bangladesh on Calorie	[Full Text]	112 Kb

Can Proxy Means Testing Improve the Targeting Performance of Social Safety Nets in Bangladesh?

This paper develops and discusses a Proxy Means Test (PMT) based household targeting system for Bangladesh. The PMT model derived from household survey data includes observable and verifiable characteristics on (i) household demographics and characteristics of household head; (ii) ownership of assets; (iii) housing quality, and access to facilities and remittances; and (iv) location variables in a formal algorithm to proxy household welfare. Simulations of the model suggest that the proposed PMT formula is able to improve the targeting efficiency by a considerable amount when compared with existing targeted safety net programmes. However,

numerous implementation challenges remain which include but are not limited to a cost-efficient data collection process, effective management of information and a feasible and cost-efficient monitoring and verification system to minimise fraud and leakage.

Attachments:
Can Proxy Means Testing Improve the Targeting Performance of Social Safety Ne	[Full Text]	437 Kb

Determinants of Trade Balance of Bangladesh: A Dynamic Panel Data Analysis

Under the new perspective of the world economy, the relationship between the determinants and the overall trade balance of a country in conventional models may not necessarily be the same as with bilateral trade balance. This paper develops a new approach to trade balance modeling that captures the effects of the factors suggested by the conventional model and explores the dynamic relationship between variables of the new model. Using recently developed dynamic panel data analysis techniques, the approach is empirically tested for Bangladesh’s trade with its 50 major trading partners for over 26 years and finds the existence of cointegration, that is, stable long-run relationship between variables of the new trade balance model. Short-run dynamics also show convergence, using Unrestricted Error Correction Mechanism (UECM) and Generalized Method of Moments (GMM) estimator.

Attachments:
Determinants of Trade Balance of Bangladesh: A Dynamic Panel Data Analysis	[Full Text]	296 Kb

COst Benefit Analysis of CFPR

EXECUTIVE SUMMARY:
This paper presents a cost-benefit analysis of the first cohort (2002-03) of
selected ultra poor (SUP) households of BRAC’s CFPR. The analysis calculates
benefit of the programme using primary data collected through a set of surveys.
Benefit is measured as the increase in expenditure on food consumption, increase
in medical expenses and/or income foregone from workdays lost as a result of an
increase in the (financial) capacity to take such decisions, and increase in net
financial and housing assets of the SUP households compared to not selected
ultra poor (NSUP) households. As the social worth of improved expenditure is
higher for poorer households, different social weights have been assigned to the
benefit accrued by different sub-categories of households. Households were
categorized on the basis of either per capita income or per capita energy
consumption of SUP households in 2002. An alternative calculation of benefit
has also been carried out by comparing the increase in per capita income of SUP
households with that of NSUP households. Using the consumption indicators it
has been found that at a 12% discount rate and a 12-year life of benefits, the
benefit-cost (B-C) ratio is 5.07, while using the income method the B-C ratio is
3.83. Sensitivity analysis of the B-C ratio using consumption indicators shows
that within a reasonable range of assumptions from relatively pessimistic to
reasonably optimistic the B-C ratio lies in the range 3.12-6.23 allowing for
discount rates of 10 to 15% and the life of benefits in the range of 10-15 years.
The analysis shows that the special investment programme of CFPR represents
productive use of development funds for the benefit of ultra poor households in
Bangladesh with obvious implications for additional investment.

Attachments:
Full Text	[ ]	277 Kb

Effects of Working Capital Management and Liquidity: Evidence from the Cement Industry of Bangladesh

EXECUTIVE SUMMARY:
This paper is an attempt to investigate the effects of working capital management efficiency as well as maintaining liquidity on the profitability of corporations. For this purpose, corporations enlisted with the cement industry of Dhaka Stock Exchange have been selected and the analysis covers a time period from year 2005 to 2009. The purpose of this paper is to establish a relationship which is statistically significant, the other purpose is to help explain the necessity of firms optimizing their level of working capital management and maintaining enough liquidity as it affects the profitability. The result of this study clearly shows significant level of relationship between the profitability indices and various liquidity indices as well as working capital components.

Attachments:
Full Text	[ ]	45 Kb

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