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This study illustrates the mechanisms linking national saving and economic growth, with the purpose of understanding the possibilities and limits of a saving-based growth agenda in the context of the Egyptian economy. This is done through a simple theoretical model, calibrated to fit the Egyptian economy, and simulated to explore different potential scenarios. The main conclusion is that if the Egyptian economy does not experience progress in productivity-stemming from technological innovation, improved public management, and private-sector reforms-then a high rate of economic growth is not feasible at current rates of national saving and would require a saving effort that is highly unrealistic. For instance, financing a constant 4 percent growth rate of gross domestic product per capita with no improvement in total factor productivity would require a national saving rate of around 50 percent in the first decade and 80 percent in 25 years. However, if productivity rises, sustaining and improving high rates of economic growth becomes viable. Following the previous example, a 2 percent growth rate of total factor productivity would allow a 4 percent growth rate of gross domestic product per capita with national saving rate in the realistic range of 20-25 percent of gross domestic product.

Access to Finance --- Achieving Shared Growth --- Domestic investment --- Economic Growth --- Economic Theory & Research --- Emerging Markets --- Growth rates --- Macroeconomics and Economic Growth --- Output --- Private entities

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This paper presents asymptotic theory and Monte-Carlo simulations comparing maximum-likelihood bivariate probit and linear instrumental variables estimators of treatment effects in models with a binary endogenous treatment and binary outcome. The three main contributions of the paper are (a) clarifying the relationship between the Average Treatment Effect obtained in the bivariate probit model and the Local Average Treatment Effect estimated through linear IV; (b) comparing the mean-square error and the actual size and power of tests based on these estimators across a wide range of parameter values relative to the existing literature; and (c) assessing the performance of misspecification tests for bivariate probit models. The authors recommend two changes to common practices: bootstrapped confidence intervals for both estimators, and a score test to check goodness of fit for the bivariate probit model.

Econometrics --- Educational Technology and Distance Education --- Growth Rates --- International Economics & Trade --- Market Integration --- Output --- Regulatory Environment --- Science Education --- Scientific Research & Science Parks --- Statistical & Mathematical Sciences

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Infrastructure contributed 1.8 percentage points to Cote d'Ivoire's annual per capita GDP growth over the mid-2000s before conflict began to erase the country's infrastructure and its growth contributions. Raising the country's infrastructure endowment to the level of the region's middle-income countries could boost the growth rate by a further 2 percentage points. Private sector contracts signed in the 1990s resulted in improved operational performance and funding for investments in the water, power, transport, and ICT sectors. Impressively, those contracts survived the crisis and delivered uninterrupted service. But private investment flows have decreased since the mid-2000s. Cote d'Ivoire's most pressing infrastructural challenge will be to regain the financial equilibrium needed to restore a reliable energy supply. Reestablishing the prominence of Abidjan's port will require investments in terminal capacity and road and rail infrastructure upgrades on hinterland linkages. The underfunding of road maintenance and poor sanitation are additional challenges. Cote d'Ivoire's annual infrastructure spending was USD 750 million in the mid-2000s, with going to power sector operations and maintenance. If the underpricing of power and other inefficiencies (valued at USD 200 million annually) were eliminated, the country's annual infrastructure funding gap would amount to USD 1 billion, and infrastructure goals could be reached within 20 years. Cote d'Ivoire's has relatively good prospects for bridging its funding gap by raising public investment from its low current level, choosing more efficient technologies, and harnessing additional private investment for infrastructure.

Banks & Banking Reform --- Economic Change --- Energy Production and Transportation --- Growth Rates --- Income --- Infrastructure Economics --- Infrastructure Economics and Finance --- Investing --- Power Outages --- Public Sector Economics --- Transport Economics Policy & Planning

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Infrastructure improvements contributed 0.6 percentage points to Zambia's annual per capital GDP growth over the past decade, mostly because of exponential growth in information and communication services. The power sector, by contrast, pulled the growth rate down by more than 0.1 percentage points. Improving Zambia's infrastructure endowment could boost growth by up to 2 percentage points per year. Zambia's relatively high generation capacity and power consumption are accompanied by fewer power outages than elsewhere in the region. But Zambia's power sector emphasizes the mining industry, while household electrification is about half that in other resource-rich countries. Zambia's power tariffs, among the lowest in Africa, are less than half the level needed to accelerate electrification and keep pace with mining sector demands. In power as in just about every other aspect of infrastructure, rural Zambians lag well behind their African peers. In a country where 70 percent of the population depends on agriculture for its livelihood, this represents a huge drag on the economy. Zambia would need to spend an average of USD 1.6 billion a year over the decade 2006-15 to develop the infrastructure found in the rest of the developing world. This is equivalent to 20 percent of Zambia's GDP and about double the country's rate of investment in recent years. Closing the country's annual infrastructure funding gap of USD 500 million requires raising more funds, looking for more cost-effective ways to meet infrastructure targets, and eliminating the inefficiencies that cause the loss of USD 300 million annually.

Banks & Banking Reform --- Economic Growth --- Energy Production and Transportation --- Factors of Production --- Growth Rates --- Infrastructure Economics --- Infrastructure Economics and Finance --- Investing --- Output --- Town Water Supply and Sanitation --- Transport Economics Policy & Planning

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Infrastructure contributed 0.6 percentage points to Ethiopia's annual per capita GDP growth over the last decade. Raising the country's infrastructure endowment to that of the region's middle-income countries could add an additional 3 percentage points to infrastructure's contribution to growth. Ethiopia's infrastructure successes include developing Ethiopia Airlines, a leading regional carrier; upgrading its network of trunk roads; and rapidly expanding access to water and sanitation. The country's greatest infrastructure challenge lies in the power sector, where a further 8,700 megawatts of generating plant are needed over the next decade, implying a doubling of current capacity. The transport sector faces the challenges of low levels of rural accessibility and inadequate road maintenance. Ethiopia's ICT sector currently suffers from a poor institutional and regulatory framework. Addressing Ethiopia's infrastructure deficit will require a sustained annual expenditure of USD 5.1 billion over the next decade. The power sector alone requires USD 3.3 billion annually, with USD 1 billion needed to facilitate regional power trading. That level of spending represents 40 percent of the country's GDP and a tripling of the USD 1.3 billion spent annually in the mid-2000s. As of 2006, there was an annual funding gap of USD 3.5 billion. Improving road maintenance, removing inefficiencies in power (notably underpricing), and privatizing ICT services could shrink the gap. But Ethiopia needs a significant increase in its already proportionally high infrastructure funding and careful handling of public and private investments if it is to reach its infrastructure targets within a reasonable time.

Banks & Banking Reform --- Economic Growth --- Factors of Production --- Growth Rates --- Infrastructure Economics --- Infrastructure Economics and Finance --- Investing --- Power Outages --- Public Sector Economics --- Town Water Supply and Sanitation --- Transport Economics Policy & Planning