2021

Sincere and heartful new year greetings to the M&S Research Hub team and trainees. Without the contribution, effort, and time of every member of the team, we could not endure and succeed. Without their belief in our vision of “bridging knowledge” and our department mission of “providing top notch live – human interactive- support and training for applied statistics” nothing of the realized success would be possible. We thank every trainee, student, and researcher who trusted our brand and had the confidence that our team will offer the best guidance, support, and training that significantly matters for his/her research and career plans. In 2020 we have

*trained over 1300 researchers at our different training, events, workshops, and webinars (40% more enrollment than the previous year)

*developed and currently contributing to 3 research projects.

* wrote more than 15 useful econometric-related posts on the MSR economics perspective (27% more contribution than the previous year).

* offered 4 fee-waiver scholarships for different training programs.

* launched our institute’s MSR working paper series and the study support service (Our educational counselors currently work with 6 students who plan to start their degree in Germany this year)

Here we are entering 2021 and wish this year to carry for every one success, blessing, happiness, and joy.

متضيعش وقتك ….

انا مش قادر افهم… بتضيع فلوسك ووقتك عشان تاخد شهادة مش معترف بيها بره محافظتك و تتعلم تعليم ملهوش اى علاقة بعلم و تتخرج تدور علي شغل بمؤهلاتك متلاقيش…. متلمش الا نفسك فى الاخر

التعليم فى المانيا ببلاش لكل مراحل التعليم حتى الدكتوراه, و منح كتير جدا عشان متصرفش مليم من جيبك و فرص شغل وخبره اذا قررت تستقر هناك او رجعت بلدك….

الموضوع شكله سهل, بس هوا مش سهل, بس احنا ان شاء الله هنخليه سهل…

احنا شركة بحثية واكاديمية فى المانيا و من شهر اعلنا عن خدمة دعم طلابى, لكل المراحل الجامعية, بكالريوس, ماجستير و دكتوراه فى كل المجالات عشان نساعدهم يقدموا على الجامعات و المنح وياخدوا فرصة حقيقية لتغيير و تعليم افضل. الخدمة مش مجانية بس مصاريفها مخفضة بشكل كبير خاصة للطلبة من الدول النامية.

فى اخر سنة فى ثانوي, دة الوقت المناسب عشان تجهز ورقك للبكالريوس …لو اخر سنة كلية, ده الوقت المناسب عشان تقدم على الدراسات العليا

…بتفكر تسافر امريكا او بريطانيا…ليه تدفع الالاف فى الدراسة لما ممكن تتعلم ببلاش فى المانيا و فى افضل جامعات العالم

الموضوع محتاج وقت ومجهود

املا الاستمارة على موقنا وهنتواصل معاك نوضحلك الخطوات اللى جاية

https://ms-researchhub.com/home/study_support.html

ولو فعلا مش قادر تدفع مصاريف الخدمة ونفسك تبذل وقت ومجهود عشان تحقق هدفك, املا الاستمارة و ممكن نخفض ليك المصاريف اكتر او نشيلها خالص

وفى علمكم فرصة الدراسة فى المانيا مجانا بقت محدوده, لان بدأت جامعات تفرض رسوم دراسية عالية على الطلبة خارج الاتحاد الاوروبي و بدا النظام ده فى اكبر 8 جامعات فى المانيا و هيستمر حتى يتطبق على كل الجامعات

والمقال عن الموضوع ده

https://www.studying-in-germany.org/germany-will-reintroduce-tuition-fees-non-eu-students/

متضيعش الفرصة وابدا النهارده قبل بكره

Why we have changed our logo for a month

Big brands have changed their logos to rainbow flags in support of gay and minority rights for a whole month. With the public projections of Hebdo caricatures of the Islam prophet Mohamed on a local government building, while heavily armed police officers stood guard. We – the international and multireligious team of M&S Research Hub – stand against anything that can hurt the convictions of someone else, in particular religious convictions. Accordingly and for a whole month, our logo will change and include the name of the prophet Mohamed in Arabic letters.

we actually took this stand in support for freedom of speech by any mean and any message, yet it is not a license to abuse or humiliates other believes rather it is a responsibility message. We would actually take this stand if the projected drawings were mocking of Jesus or Budha.

When I mock you in front of people in a humiliating way, you would not think of it as my freedom of speech, rather it is an issue of my manners and attitude, instead, it would be better to say what I think, in the right time and the right way, otherwise, the point of my message would be completely twisted because of the wrong attitude. Eventually and briefly, hate speech is never and has never been a freedom of speech, when a speech or message cost people lives, create tensions and societal isolations and divisions, then it is simply wrong. 

Now the World Witnesses the True Value of Science & Researching

The world is cruel!


Actors, football players, and models are millionaires and their monthly paychecks can sometimes exceed some developing countries’ annual budgets., while doctors, researchers, and teachers in the majority of countries earn only what is enough for living.


In such times, when the entire humankind is at threat and faces a global crisis, everyone stands at the researchers’ and doctors’ doorsteps waiting for them to develop a cure or a vaccine to save the world. In such times, the true value of science and researching emerges and the significance of investing in knowledge and education becomes evident and nonnegligible.
Our vision at MSR HUB “Bridging Knowledge between those who have it and those who need” derives our team and defines our mission, accordingly and as a part of our contribution in alleviating and supporting the world in the forthcoming global recession.


MS Research Hub institute will administrate and fund the first research project that will be moderated by selected team members to empirically investigate and predict how economies behave – and should behave- in times of the Coronavirus. Using historical data of similar epidemics that have hit the humankind, starting from the Spanish flu at the beginning of the 19 century, passing by MARS and MERS, our objective will be to develop a prescription that the world can use to mitigate the recessionary spillovers.


This research project will be the official launching of our institute’s “Research Grant Program” that aims to fund independent researchers from the least developed countries to carry on their planned human-related research projects in all scientific fields.


We believe first and always in mighty Allah, human-kind, and the power of knowledge and science in facing the current crises.


Dr. Sherif Hassan CEO & Academic Division director at MSR HUB- Germany

Children Marriage: Alarming & Unattended Phenomenon in the Middle East

A forthcoming paper has used MICS UNICEF Survey Data for a sample of three Middle Eastern countries: Egypt, Sudan, and Palestine and employed Multilevel logistic regression to empirically investigate the impact of child marriage on a large set of women and children health-related indicators. The results showed that child marriage is generally associated with giving birth to children with higher under-five mortality rates. Also, women who marry before reaching the age of 18 are less likely to receive any form of antenatal care and more likely to give birth to children who later die.

Governments and public communities should pay close attention to improving the widespread, availability and affordability of education for girls and women nationwide regardless of the women’s residence area and levels of income. Subsidizing and income transfer programs should make sure that girls continue their education and do not leave schools due to income constraints. Availability and reachability of schools especially for girls living in slums or refugee camps that are located outside the peripheral areas of public services should be improved and families need to be constantly advised and guided about the importance of education to their children.

Within the MENA region that has the lowest global share of female literacy, Palestinian women are classified as the best-educated (The Royal Academy of Science International Trust [RASIT], 2017). Our analysis suggests that the better educational attainment of Palestinian women explains the low prevalence of child marriage and having relatively lower health deprivations relative to their counterparts in the other countries. Better educated women are not only capable of better caring about their health and the health of their children but also they are better wives, citizens and a catalyst for the development of their countries. As narrated by Hafez Ibrahim the Nile poet in his poem about knowledge and morals (Ibrahim, 1937): “A mother is a school, whenever you equipped her well, you prepared a nation with a fine race”.

Reference: Hassan, S.M and Khan, M. (2020). Health Repercussions of Child Marriage on Middle-Eastern Mothers and Their Children. MSR working papers, 001-2020.

Robust Modeling of Policy Changes: Difference in Difference (DiD)

The difference in Difference (DiD) is a popular method in empirical economics and has important applications in other social sciences as well. DID is a quasi-experimental design that uses panel data to estimate the effects of specific intervention or treatment (such as policy changes, new laws, social program implementation) on outcomes over time and between two population groups, those that are affected by this policy and those that are not. DiD, in general, is an appealing choice for researchers who want to design a research methodology based on controlling for confounding variables.

Applications of DiD are quite diverse, amongst are

  • Impact evaluation (public policy analysis)
  • Measuring the variations overtime (Time Series) and over individuals (Cross-Sectional Data)
  • Focusing on the establishment of effects on a dependent variable derived from the interaction of exogenous variables given a treatment.
  • Variants of the DiD method can account to deal with auto-selection bias and endogeneity problems.
  • Comparing the differences between observed outcomes from partial and non-randomized samples in groups.

Although this method is highly important, few learning resources are available to instruct researchers and scientists how to properly implement and design it. There may be some resources that discuss the theoretical foundations of this method while listing a few examples of its applications. However a fully-fledged learning material for DiD that covers both theory, and guides researchers to implement this method on statistical software using real and simulated data applications are rather scarce.

At M&S Research Hub we recently launched a video library wherein our team of academic experts record offline training videos for advanced econometrics methods. This material is designed to fit researchers at different proficiency levels. They cover both theoretical and mathematical basics of the target models and their detailed application using statistical software, leaving the researcher in no further need to search for other learning resources.

A complete DiD course that takes around 158 minutes and is recorded over 7 videos are available in the library for everyone who wants to master the DID method.

The Development Impact of Foreign Aid: Story Re-told

There has been an intense debate in the literature over the reasons behind the loose developmental effects of foreign aid. Away from the straightforward reason that majority of aid flows follow political rather than development objectives (Kanbur et al., 1999; Dreher, et al. 2009). Further, several reasons have been introduced in the literature see for example (Radelet, 2008; Bräutigam and Knack, 2004, and others). However, these reasons can be condensed into two core causes, a) Lack of clear development agenda by the recipient countries which result in misallocation of aid and establishment of various simultaneous individual projects that even if successfully completed will have limited impact on the development of the target sectors; and b) The mismatch between donors, recipients, and target beneficiaries’ priorities and needs that create an aid system that is incapable and inadequate of achieving the entailed goals.

In response to common pitfalls of the aid system, a new setting for aid disbursements based on sector-wide approaches instead of individual projects was introduced by Kamel, et al. (1998) and was later modified by (Kanbur, et al. 1999) and evolved into a system entitled the ‘common pool approach’. Our following policy suggestions will build on these, however, we bring in some modifications for the system implementation and evaluation.

The basic rationale behind the common pool approach is that a pool of donors—instead of one— allocates unconditional funds to a recipient country’s nationally representative reform plan and its implementation strategy, instead of individual projects. Such a system would increase the recipient country’s sense of ownership and commitment while enhancing the achievability of developmental and reform goals relative to individual uncoordinated projects approach. The major drawback is the minimisation of aid received because many donors – besides political lobbies and private sector firms – might not agree to fund national plans instead of individual selective projects. In addition, donors’ ability to pursue their own interests, conditions, and opinions will dwindle. Anyhow, detailed discussion for the common pool system and sector-wide approach is found in formerly cited articles. Subsequently, we introduce a new system which combines both approaches, sector-wide and common pool, whilst including our personal reflections that will hopefully alleviate the expected drawbacks of these approaches.

 Figure A1 provides a basic graphical representation of the new blended system. The graph is elaborated in the following points,

  1. The recipient country starts to move in the direction of prohibiting all forms of aid transferred to individual uncoordinated projects, but rather allows only aid channeled towards sectoral reform plans.
  • The governmental authority with the cooperation of civil society, the private sector, policymakers, and citizens, formulate a reform plan for the target sector.
  • A series of roundtable meetings are held in the recipient country capital that involves potential donors (single and multilateral), international experts, and other national parties in order to receive feedback on the preliminary proposal (sponsoring the meetings in the recipient country would ease national parties’ involvement and cooperation, which reflects in a higher sense of belonging and ownership).
  • A final neat version of the proposal is then reformulated along with its implementation strategy that involves foreign and domestic shares. For instance, technical and human resources in the implementation strategy are distributed as 70% domestic and 30% by the donor’s side. One major drawback of the common pool approach is the lack of donor involvement in the implementation, which in essence is a good thing to increase the sense of ownership by the recipient. However, this is reflected in lower lobbying by the private sector and political parties in the donor country to step forward for similar approaches. We, therefore, propose a cooperative share of interests, however still managed and authorised by the domestic country and in the framework of the domestic strategy.
  • The donor authority in this phase lies in accepting or rejecting the plan and the amount of fund provided, based on credibility and achievability of the plan.
  • Donors together with the recipient responsible authority would agree on a set of quantifiable and measurable assessment measures that are monitored and reported by the authority itself, though donors are also allowed to intervene in the monitoring and evaluation of these measures. This is an incentive for the authority and other parties involved in the strategy to abide by the rules and the plan. Also, in the case of system corruption, which is the likely case in the majority of developing and poor countries, it is well known that foreign assessment might intervene anytime to inspect and evaluate. In addition, donors will be more relieved and secure when they have a hand in the evaluation process, unlike the common pool approach which prohibits any form of foreign intervention in the process unless requested by the recipient.
  • Finally, a renewable annual funding plan is offered based on the realisation of these measures; failure to abide by the authority results in a violation of the contract. By doing this we eliminate any chances of aid misallocation, corruptive activities, and other illegal traits because the recipient knows for sure that failure will hinder any future possibilities of funding for other reform plans. Moreover, the ex-ante participation of civil society and citizens makes the government accountable to the public, which also affects their political popularity.

Eventually, let me conclude with this phrase from Kanbur, et al. (1999) “The possibility of the decline in aid will require a substantial amount of confidence on the part of recipients who adopt the approach. It requires a government with the willpower to say to donors: ‘Here is my program in this sector: if you wish to help me implement it, you are most welcome. If you wish to do something different, I regret that you are not welcome in this sector in this country.” The foremost outcome of the proposed blended system, common pool, and sector-wide approaches, is filtration of aid received by the recipient, by adopting these approaches, will be able to locate donors that endeavor no hidden, political, or ideological agendas but only support the recipient country’s development efforts.

References:

Hassan, Sherif (2020). Revisiting the Development Impact of Sectorally Disaggregated Foreign Aid. Poverty and Public Policy (in press).

The evil in the heart of the good: Unfolding the role of remittances in the escalating trade deficit figures of the MENA region.

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

The MENA region is ranked first in terms of remittance receipts (3.83% of GDP) worldwide, it has also the highest non-oil trade deficit among other developing regions (World Bank, 2018). This study uses panel data from 11 Labor-abundant MENA countries (main destination of remittance receipts) to examine the trade balance effect of remittances. We postulate that the main driver of the trade deficit in the MENA region is the weak industrial sector, which fails to provide domestic substitutes for imports of manufactured products (El Wassal 2012). Based on our hypothesis, we imply that in countries with weaker domestic absorptive capacity, the excessive demand of remittance-recipient families will not be compensated by domestic production, but rather imports of the consumption good, thus worsening the trade balance deficit.

The empirical work from the MENA region on the trade balance effects of remittances is limited. Bouhga-Hagbe (2004) supported the evidence of this effect in Morocco, wherein remittances covered the trade deficit and contributed to the observed surpluses of the external current account. Kandil and Mirzaie (2009) showed that remittances promote both exports and imports in Jordan while nourishing only exports in Tunisia. In the case of Egypt, El Sakka, and McNabb (1999) reported that imports financed through remittances have a high-income elasticity, thereby implying
that they are either consumer durables or purchased by high-income groups. In a study, involving interviews of 304 remittance-receiving families across 16 Egyptian governorates during 2015–2016, Farzanegan et al. (2017) examined further the causes and effects of
remittances. Using a panel of 17 remittances receiving countries in the MENA and Central Asia regions over a period of 1990–2009, Abdih et al. (2012) concluded that a significant portion of remittances is
used to purchase foreign goods.

Our empirical results confirm the import triggering effects of remittances, however these effects are mitigated as the investment capacity of a country gets stronger and become able to neutralize foreign purchases with domestic products. Many policymakers are pushing to increase remittances as a reliable source of income by reducing transfer costs. The real challenge is promoting the productive use of these remittances in financing domestic production capabilities and non-oil exports. The channel of promoting domestic capital formation through encouraging private savings and productive use of remittances could improve the balance of trade. This can be realized by promoting financial services, which targets repatriates and their families, like saving incentives, interest rate premium on migrant’s deposits, and the issuance of remittances back bonds. Although
remittances may carry some development-related outcomes, such as income smoothing, reducing poverty, and promoting education, the applied literature is still equivocal about the magnitude of these effects and the governing conditions to realising these effects. Our paper is an
example of a study that has highlighted a rather countercyclical effect of the
inflow of remittances on the recipient countries’ trade balance. This piece of
evidence among others suggests that promoting remittances does not always come in favour for the recipient economies and is conditioned to the prevailing economic and institutional environments.

Reference:

Mohammad Reza Farzanegan & Sherif Maher Hassan (2019) How does the flow of remittances affect the trade balance of the Middle East and North Africa?, Journal of Economic Policy Reform, DOI: 10.1080/17487870.2019.1609357