nep-dem New Economics Papers
on Demographic Economics
Issue of 2013‒09‒24
25 papers chosen by
Clarence Nkengne Tsimpo
University of Montreal and World Bank Group

  1. Health Consequences of Transitioning to Retirement and Social Participation: Results based on JSTAR panel data By HASHIMOTO Hideki
  2. To defer or not defer? State Pension in a Lifecycle Model By Ricky Kanabar; Peter Simmons
  3. Unmet Aspirations as an Explanation for the Age U-shape in Human Wellbeing By Schwandt, Hannes
  4. Missing Women: The G20, Gender Equality and Global Economic Governance By James Heintz
  5. What Happens When a Woman Wins an Election? Evidence from Close Races in Brazil By Brollo, Fernanda; Troiano, Ugo
  6. FGT poverty measures and the mortality paradox: Theory and Evidence By LEFEBVRE, Mathieu; PESTIEAU, Pierre; PONTHIERE, Grégory
  7. Parental Leave and Children’s Schooling Outcomes: Quasi-Experimental Evidence from a Large Parental Leave Reform By Natalia Danzer; Victor Lavy
  8. Recent Changes in the Gains from Delaying Social Security By John B. Shoven; Sita Nataraj Slavov
  9. "Economic Crises and the Added Worker Effect in the Turkish Labor Market" By Serkan Degirmenci; Ipek Ilkkaracan
  10. Consistency and its Converse for Roommate Markets By Bettina Klaus
  11. Shocking Behavior : Random Wealth in Antebellum Georgia and Human Capital Across Generations By Hoyt Bleakley; Joseph P. Ferrie
  12. Educational Inequality and the Returns to Skills By Lundberg, Shelly
  13. Personality Changes in Couples: Partnership Longevity and Personality Congruence in Couples By Beatrice Rammstedt; Frank M. Spinath; David Richter; Jürgen Schupp
  14. Economic geography, endogenous fertility, and agglomeration By Tadashi Morita; Kazuhiro Yamamoto
  15. The Long-Run Effects of the Scramble for Africa By Michalopoulos, Stelios; Papaioannou, Elias
  16. Will Sooner Be Better? The Impact of Early Preschool Enrollment on Cognitive and Noncognitive Achievement of Children By Filatriau, Olivier; Fougère, Denis; Tô, Maxime
  17. Housing in Retirement Across Countries By Makoto Nakajima; Irina A. Telyukova
  18. National Institutions and Subnational Development in Africa By Michalopoulos, Stelios; Papaioannou, Elias
  19. Liberty for More: Finance and Educational Opportunities By Ross Levine; Yona Rubinstein
  20. Family Ties By Alesina, Alberto F; Giuliano, Paola
  21. 公平与效率的两难抉择——关于养老改革影响因素的一个文献综述 By Zou, Tieding
  22. Inter-provincial Employees in Alberta By Laporte, Christine Lu, Yuqian Schellenberg, Grant
  23. Balancing Fidelity and Flexibility: Implementing the Gen.M Program in Texas. By Rachel Shapiro
  24. The miracle of microfinance? Evidence from a randomized evaluation By Banerjee, Abhijit; Duflo, Esther; Glennerster, Rachel; Kinnan, Cynthia
  25. Costs and Benefits of Labour Mobility between the EU and the Eastern Partnership Partner Countries. Country report: Belarus By Alexander Chubrik; Alaksei Kazlou

  1. By: HASHIMOTO Hideki
    Abstract: Despite an extensive amount of published economic, psychological, and public health research, a consensual view on the causal relationship between retirement and health remains to be articulated. This lack of consensus is arguably due to the diversity in the transitional process from employment to full retirement, the usage of various characteristics of outcome measures, social and economic conditions affecting the retirement decision, and the impact of crowding-out by activities not related to formal work (e.g., in the family and community network). We used panel data from the Japanese Study of Aging and Retirement (JSTAR) to scrutinize the complex relationships among employment status transition; physical, functional, and cognitive aspects of health measures; and types of social participation. We confirmed that transitioning from employment to retirement is a diverse and gradual process with distinct gender-related aspects. Social participation is significantly related to exiting formal work situations for men, but not for women. There were distinct patterns of health transition across employment status transition, by types of health measures, and by reasons for retirement. Regression analyses were conducted to identify the effect of retirement, as leave from paid work, on health conditions. Variables included in the analyses accounted for social participation, stress received from the former job, and reasons for retirement. The results which included propensity weighting reveal that psychological distress and cognitive function decline after retirement for men, but not for women. Retirement from jobs with high stress was followed by an improvement in health, especially among men. Additional results indicate that retirement is accompanied by increased social participation. Social participation ameliorates psychological distress and cognitive decline among men, but not among women. Limitations in the instrumental activities of daily life as well as in grip strength are not considerably affected by retirement. Among women, retirement to engage in family care significantly and heavily affected the level of psychological distress. These results indicate that the theories on which aspects of health status determine—and are determined by—the mode of employment status transition should be improved. Policies on work and health in the elderly population should not seek a one-size-fits-all solution, but should target different segments in terms of work characteristics, economic and social needs, and gender roles in the household.
    Date: 2013–09
  2. By: Ricky Kanabar; Peter Simmons
    Abstract: The UK state pension (which depends only on age) includes an option to defer take up which yields either a subsequent lump sum or higher weekly pension. We analyse the joint decisions on pension deferral and intertemporal labour supply/participation in a life cycle setting. We show that deferral is purely a financial decision, but the impact of deferral on work decisions depends on preferences, wage rates, non-labour income and initial wealth. To exactly characterise this we use a quasilinear utility function, and provide calibrated simulations. We also discuss the choice between a lump sum or increased weekly pension
    Keywords: Retirement, Labour Supply, Ageing, UK State Pension
    JEL: J14 J18 J22 J26
    Date: 2013–09
  3. By: Schwandt, Hannes (Princeton University)
    Abstract: A large literature in behavioral and social sciences has found that human wellbeing follows a U-shape over age. Some theories have assumed that the U-shape is caused by unmet expectations that are felt painfully in midlife but beneficially abandoned and experienced with less regret during old age. In a unique panel of 132,609 life satisfaction expectations matched to subsequent realizations, I find people to err systematically in predicting their life satisfaction over the life cycle. They expect – incorrectly – increases in young adulthood and decreases during old age. These errors are large, ranging from 9.8% at age 21 to -4.5% at age 68, they are stable over time and observed across socio-economic groups. These findings support theories that unmet expectations drive the age U-shape in wellbeing.
    Keywords: life satisfaction, expectations, aging
    JEL: A12 I30 D84
    Date: 2013–08
  4. By: James Heintz
    Abstract: James Heintz addresses the lack of attention that has been paid to gender in the policy frameworks, summits, and declarations of the G20. He finds that the G20 has not seriously considered the fact that sources of gender inequality interact with changes in the economic environment to produce distinct outcomes for women and men. He concludes that gender bias must be identified within the G20’s approach to economic governance if their commitment to inclusive growth is to be realized, and makes five concrete recommendations that would represent significant steps towards this goal.
    Date: 2013
  5. By: Brollo, Fernanda (University of Warwick); Troiano, Ugo (University of Michigan)
    Abstract: This paper analyzes the eect of the gender of local policymakers on policy outcomes. Analyzing a rich dataset from Brazilian municipalities and using a regression discon- tinuity design, we nd that municipalities ruled by female mayors have better health outcomes, receive more federal discretionary transfers, and have lower corruption. Addi- tionally, male mayors hire more temporary public employees than their female counter- parts when they are allowed to run for re-election, and when municipal elections are approaching. These ndings suggest that male mayors may promote more political pa- tronage than female mayors and that men and women may respond dierently to local election incentives.
    Keywords: election incentives, Brazil
    Date: 2013
  6. By: LEFEBVRE, Mathieu (University of Liège); PESTIEAU, Pierre (University of Liège; Université catholique de Louvain, CORE, B-1348 Louvain-la-Neuve, Belgium; PSE and CEPR); PONTHIERE, Grégory (Paris School of Economics and Ecole Normale Supérieure, Paris)
    Abstract: Income-differentiated mortality, by reducing the share of poor persons in the population, leads to what can be called the "Mortality Paradox": the worse the survival conditions of the poor are, the lower the measured poverty is. We show that the extent to which FGT measures (Foster Greer Thorbecke 1984) underestimate old-age poverty under income-differentiated mortality depends on whether the prematurely dead would have, in case of survival, suffered from a more severe poverty than the average surviving population. Taking adjusted FGT measures with ex- tended lifetime income profiles as a benchmark, we identify conditions under which the selection bias induced by income-differentiated mortality is higher for distribution-sensitive measures than for headcount measures. Finally, we show, on the basis of data on poverty in 11 European economies, that the size of the selection bias varies across different sub-classes of FGT measures and across countries.
    Keywords: income-differentiated mortality, FGT poverty measures
    JEL: I32
    Date: 2013–09–11
  7. By: Natalia Danzer; Victor Lavy
    Abstract: This paper investigates the question whether long-term human capital outcomes are affected by the duration of maternity leave, i.e. by the time mothers spend at home with their newborn before returning to work. Employing RD and difference-in-difference approaches, this paper exploits an unanticipated reform in Austria which extended the maximum duration of paid and job protected parental leave from 12 to 24 months for children born on July 1, 1990 or later. We use test scores from the Austrian PISA test of birth cohorts 1990 and 1987 as measure of human capital. The evidence suggest no significant overall impact of the extended parental leave mandate on standardized test scores at age 15, but that the subgroup of boys of highly educated mothers have benefited from this reform while boys of low educated mothers were harmed by it.
    JEL: J13 J22 J24
    Date: 2013–09
  8. By: John B. Shoven; Sita Nataraj Slavov
    Abstract: Social Security retirement benefits can be claimed at any age between 62 and 70, with delayed claiming resulting in larger monthly payments. In Shoven and Slavov (2013), we show that claiming later increases the present value of lifetime benefits for most individuals. However, this has not always been the case. During the late 1990s and early 2000s, a number of policy changes increased the gains from delay, particularly for couples. In addition, mortality improved and real interest rates fell substantially over this period, further increasing the attractiveness of delay. We perform simulations to examine the role of these factors in changing the gains from delay. We find that the gains from delay increased substantially after 2000, with changes in the interest rate playing the largest role in driving the increase. Using data from the Health and Retirement study, we show that individuals who turned 62 after 2000 are indeed more likely to delay than those who turned 62 before 2000. However, even in the younger cohort, most individuals still claim benefits soon after turning 62. Moreover, we find no evidence of a relationship between the probability of delay and the individual characteristics (e.g., gender, race, or health status) that affect the gains from delay.
    JEL: D14 H55
    Date: 2013–08
  9. By: Serkan Degirmenci; Ipek Ilkkaracan
    Abstract: Turkish economic growth has been characterized by periodic crises since financial liberalization reforms were enacted in the early 1990s. Given the phenomenally low female labor force participation rate in Turkey (one of the lowest in the world) and the limited scope of the country's unemployment insurance scheme, there appears to be ample room for a female added worker effect as a household strategy against unemployment shocks under economic crises. Using micro data from household labor force surveys for the 2004-10 period, we examine the extent to which an unemployment shock to the primary male earner instigates female members of the household to move from nonparticipant status to labor market participation. This paper differs from the earlier few studies on the added worker effect in Turkey in a number of aspects. First, rather than simply basing the analysis on a static association between women's observed participation status and men's observed unemployment status in the survey period, we explore whether there is a dynamic relationship between transitions of women and men across labor market states. To do this, we make use of a question introduced to the Household Labor Force Survey in 2004 regarding the survey respondent's labor market status in the previous year. This allows us to explore transitions by female members of households from nonparticipant status in the previous year to participant status in the current year, in response to male members making a transition from employed in the previous period to unemployed in the current period. We explore whether and to what extent the primary male earner's move from employed to unemployed status determines the probability of married or single female full-time homemakers entering the labor market. We estimate the marginal effect of the unemployment shock on labor market transition probability for the overall sample as well as for different groups of women, and hence demonstrate that the effect varies widely depending on the particular characteristics of the woman--for example, her education level, age, urban/rural residence, and marital and parental status. We find that at the micro level an unemployment shock to the household increases the probability of a female homemaker entering the labor market by 6-8 percent. The marginal effects vary substantially across different groups of women by age, rural or urban residence, and education. For instance, a household unemployment shock increases by up to 34 percent the probability that a university graduate homemaker in the 20-45 age group will enter the labor market; for a high school graduate the probability drops to 17 percent, while for her counterpart with a secondary education the marginal effect is only 7 percent. Our estimate of the total (weighted) number of female added workers in the crisis years shows that only around 9 percent of the homemakers in households experiencing an unemployment shock enter the labor market. Hence we conclude that, while some households experiencing unemployment shocks do use the added worker effect as a coping strategy, this corresponds to a relatively small share. We attribute this finding to the deeply embedded structural constraints against female labor market participation in Turkey.
    Keywords: Labor Supply; Economic Crisis: Turkey
    JEL: J16 J21 J22
    Date: 2013–09
  10. By: Bettina Klaus
    Abstract: For marriage markets with equal numbers of men and women and where all men find all women acceptable and all women find all men acceptable, Sasaki and Toda (1992) characterize the core by anonymity, Pareto optimality, consistency, and converse consistency. In a recent paper, Nizamogullari and Özkal-Sanver (2012) generalize this result to the full domain of marriage markets by adding individual rationality and by replacing anonymity with gender fairness. We generalize both results by characterizing the core on the domain of no odd rings roommate markets by individual rationality, anonymity, Pareto optimality, consistency, and converse consistency. We also prove that extending this characterization to the domain of solvable roommate markets is not possible.
    Keywords: Converse Consistency; Core; Marriage and Roommate Markets
    JEL: C78 D63
    Date: 2013–09
  11. By: Hoyt Bleakley; Joseph P. Ferrie
    Abstract: Does the lack of wealth constrain parents’ investments in the human capital of their descendants? We conduct a fifty-year followup of an episode in which such constraints would have been plausibly relaxed by a random allocation of wealth to families. We track descendants of those eligible to win in Georgia’s Cherokee Land Lottery of 1832, which had nearly universal participation among adult white males. Winners received close to the median level of wealth – a large financial windfall orthogonal to parents’ underlying characteristics that might have also affected their children’s human capital. Although winners had slightly more children than non-winners, they did not send them to school more. Sons of winners have no better adult outcomes (wealth, income, literacy) than the sons of non-winners, and winners’ grandchildren do not have higher literacy or school attendance than non-winners’ grandchildren. This suggests only a limited role for family financial resources in the transmission of human capital across generations and a potentially more important role for other factors that persist through family lines.
    JEL: J01 J13 J24 J62 N11 N31 O12 O15
    Date: 2013–08
  12. By: Lundberg, Shelly (University of California, Santa Barbara)
    Abstract: Research and policy discussion about the diverging fortunes of children from advantaged and disadvantaged households have focused on the skill disparities between these children – how they might arise and how they might be remediated. Analysis of data from the National Longitudinal Study of Adolescent Health reveals another important mechanism in the determinants of educational attainment – differential returns to skills for children in different circumstances. Though the returns to cognitive ability are generally consistent across family background groups, personality traits have very different effects on educational attainment for young men and women with access to different levels of parental resources. These results are consistent with a model in which the provision of focused effort in school is complementary with parental inputs while openness, associated with imagination and exploration, is a substitute for information provision by educated parents and thus contributes to resilience in low-resource environments. In designing interventions to improve outcomes for disadvantaged children, we need to be cognizant of interactions between a child's skills and their circumstances.
    Keywords: education, inequality, noncognitive skills
    JEL: I24 J24
    Date: 2013–08
  13. By: Beatrice Rammstedt; Frank M. Spinath; David Richter; Jürgen Schupp
    Abstract: Evidence of assortative mating according to personality was reported in a previous SOEP-based study (Rammstedt & Schupp, 2008). Based on population representative data of almost 7,000 couples, high levels of congruence between spouses were found, which increased with marriage duration. Almost 5,000 of these couples were tracked over a five-year period with personality assessed at the beginning and end of this time, which allowed us to investigate the relationship between personality congruence and marriage duration longitudinally. Using this data, we investigated (a) whether personality congruence is predictive for partnership longevity and whether congruence therefore differs between subsequently stable and instable couples, (b) if stable couples become more congruent, and (c) if separated couples become less congruent with regard to their personality over time. The results provide initial evidence of personality congruence as a predictor for partnership longevity: the more congruent couples are in the personality domain of Openness, the more stable their partnership. In addition, we found no indications of an increase in personality congruence over time within the stable couples; within the separated couples, however, a strong decrease in congruence was detectable.
    Keywords: Assortative mating, Big Five, personality, congruence, personality change, partnership
    Date: 2013
  14. By: Tadashi Morita (Faculty of Economics, Osaka Gakuin University); Kazuhiro Yamamoto (Graduate School of Economics, Osaka University)
    Abstract: In this paper, we construct an interregional trade model that has en- dogenous fertility rates in the manner of Helpman and Krugman (1985). The presented model shows that fertility rates in a large region become lower than those in a small region because of the agglomeration of man- ufacturing firms in the former. The agglomeration of firms in a region lowers the relative price of manufactured goods to child rearing costs, which raises the fertility rates. We also find that a decline in transportation costs results in the ag- glomeration of manufacturing firms, which lowers fertility rates in both large and small regions. Finally, we extend our two-region model to a multi-region model and find that the number of manufacturing firms in larger regions is always greater than that in smaller regions, meaning that fertility rates in the former are always lower than those in the latter.
    Keywords: agglomeration, fertility rates, transportation costs, consumerism
    JEL: J13 R10
    Date: 2013–09
  15. By: Michalopoulos, Stelios (Brown University and NBER); Papaioannou, Elias (London Business School, NBER and CEPR)
    Abstract: We examine the long-run consequences of the scramble for Africa among European powers in the late 19th century and uncover the following empirical regularities. First, utilizing information on the spatial distribution of African ethnicities before colonization, we show that apart from the land mass and water area of an ethnicity’s historical homeland, no other geographic, economic, and historical trait, including proxies of pre-colonial conflict, predicts partitioning by the national borders. Second, we exploit a detailed geo-referenced database that records various types of conflict across African regions and show that civil conflict is concentrated in the historical homeland of partitioned ethnicities. We also document that violence against civilians (child soldiering, village burning, abductions, rapes) and territorial changes between rebel groups, militias, and government forces are more prevalent in the homelands of split groups. These results are robust to a rich set of local controls, the inclusion of country fixed effects and ethnic-family fixed effects. The uncovered evidence brings in the foreground the violent repercussions of an important aspect of European colonization, that of ethnic partitioning.
    Keywords: Africa, Borders, Ethnicities, Conflict, Development,
    Date: 2013
  16. By: Filatriau, Olivier; Fougère, Denis; Tô, Maxime
    Abstract: In this paper we measure the effect of entering preelementary school at age 2 rather than 3 in France. Our identification strategy relies on ratios between the number of young children and the capacity of preelementary schools observed at the very local level. This information allows us to solve the endogeneity issue due to the potential correlation between unobserved determinants of early enrollment decision and children achievement. We measure this effect on schooling achievement in primary and lower secondary schools. We show that early enrollment in preelementary school improves cognitive and noncognitive skills at age six, and both literacy and numeracy from the third to the ninth grades.
    Keywords: cognitive and noncognitive skills; human capital; preschool; schooling decision
    JEL: I21 J13
    Date: 2013–05
  17. By: Makoto Nakajima; Irina A. Telyukova
    Abstract: The “retirement saving puzzle” is a phenomenon in which many households U.S. households have significant wealth late in life, contrary to the predictions of a simple life-cycle model. In this project, we examine cross-country differences in the saving behavior of retirees in order to weigh in on the discussion of the puzzle. First, we find that countries in our sample vary noticeably in terms of the extent of the puzzle: one group of countries, in South and Central Europe, look like the United States, while in Northern Europe, retirees spend down their wealth much more rapidly. Second, it appears that the rate of dissaving in retirement is correlated with the extent of public coverage of healthcare and long-term care, and these differences in saving happen predominantly through dissaving of financial assets, while housing assets are less affected. In a quantitative experiment using a life-cycle model of saving in retirement, we measure the role of out-of-pocket medical spending risk in accounting for differences in observed saving patterns among retirees in the United States and Sweden, considering housing and financial assets separately. The model predicts that this risk accounts, on average across age, for one-half of the difference in median net worth between United States and Sweden, and for about 70 percent of the difference in median financial assets. The role of risk diminishes with age, and is seen primarily in financial asset saving, while housing assets do not appear to respond to spending risk, suggesting that housing is not a precautionary asset.
    Date: 2013–08
  18. By: Michalopoulos, Stelios (Brown University and NBER); Papaioannou, Elias (London Business School, NBER and CEPR)
    Abstract: We investigate the role of national institutions on subnational African development in a novel framework that accounts both for local geography and cultural-genetic traits. We exploit the fact that the political boundaries in the eve of African independence partitioned more than two hundred ethnic groups across adjacent countries subjecting similar cultures, residing in homogeneous geographic areas, to different formal institutions. Using both a matching-type and a spatial regression discontinuity approach we show that differences in countrywide institutional structures across the national border do not explain within-ethnicity differences in economic performance, as captured by satellite images of light density. The average non-effect of national institutions on ethnic development masks considerable heterogeneity partially driven by the diminishing role of national institutions in areas further from the capital cities.
    Keywords: Africa, Borders, Ethnicities, Development, National Institutions, Regression Discontinuity
    Date: 2013
  19. By: Ross Levine; Yona Rubinstein
    Abstract: Banking reforms—that reduced interest rates—boosted college enrollment rates among able students from middle class families. We define “able” students as those with learning aptitude scores in the top two-thirds of the U.S. population. We define “middle class” as families in which both parents are not highly-educated (above 12 years of education) and that are neither in the bottom fourth nor in the top 10 percent of the distribution family income in the U.S. Our findings suggest that credit conditions, the ability of an individual to benefit from college, and a family’s financial and educational circumstances combine to shape college decisions. The functioning of the financial system plays a powerful role in shaping the degree to which a child’s educational choices—and hence economic opportunities—are defined by parental income.
    JEL: G21 G28 G38 I21 I22 I24 J08 J24 O15 O16
    Date: 2013–08
  20. By: Alesina, Alberto F; Giuliano, Paola
    Abstract: We study the role of the most primitive institution in society: the family. Its organization and relationship between generations shape values formation, economic outcomes and influences national institutions. We use a measure of family ties, constructed from the World Values Survey, to review and extend the literature on the effect of family ties on economic behavior and economic attitudes. We show that strong family ties are negatively correlated with generalized trust; they imply more household production and less participation in the labor market of women, young adult and elderly. They are correlated with lower interest and participation in political activities and prefer labor market regulation and welfare systems based upon the family rather than the market or the government. Strong family ties may interfere with activities leading to faster growth, but they may provide relief from stress, support to family members and increased wellbeing. We argue that the value regarding the strength of family relationships are very persistent over time, more so than institutions like labor market regulation or welfare systems.
    Keywords: cultural economics; family values; growth; institutions; labor market regulations
    JEL: J2 J6 O4 O5 Z1
    Date: 2013–05
  21. By: Zou, Tieding
    Abstract: This paper gives a literature review for the affecting factors of pension reforming,the result indicates that,(1)Efficiency and equity are the two aspects of pension system ,and the aging problem,labor productivity,ma- croeconomic environment,et al. will affect the relationship between efficiency and equity.(2)Parameter adjusting and Structure reforming is a good way to strengthen the ability to cope with aging and improve the budget condi- tion for pension system.(3)In order to narrow the wealth gap ,keep some redistributive function is necessary.(4)D- uring a pension reforming,not only the equity is important ,but also the efficiency,the disequilibrium of capital market and labor market can be improved through pension reforming.(5)Pension reforming must pay attention to political preference of different interest group,the majority voting rule must be obeyed,which is useful to guarantee the system’s universality and impartiality,and will be good to enhance the political feasibility of pension reforming.
    Keywords: Pension; Equity; Efficiency; Aging; Decision Mechanism
    JEL: G22 H53 I38 J14
    Date: 2013–07–12
  22. By: Laporte, Christine Lu, Yuqian Schellenberg, Grant
    Abstract: In spite of much anecdotal evidence and some case studies regarding the size and characteristics of the inter-provincial workforce in Alberta, comprehensive information remains scarce. This is due in part to the many challenges faced in trying to enumerate a mobile population. Drawing on administrative data from several sources, including T4 (Statement of Remuneration Paid) and T1 (General Tax Form) files, this report provides comprehensive information on inter-provincial employment in Alberta between 2003 and 2010.
    Keywords: Labour, Labour mobility, turnover and work absences
    Date: 2013–09–04
  23. By: Rachel Shapiro
    Keywords: teen pregnancy prevention, adolescent pregnancy prevention, comprehensive sex education, adolescent health
    JEL: I I
    Date: 2013–08–05
  24. By: Banerjee, Abhijit; Duflo, Esther; Glennerster, Rachel; Kinnan, Cynthia
    Abstract: This paper reports on the first randomized evaluation of the impact of introducing the standard microcredit group-based lending product in a new market. In 2005, half of 104 slums in Hyderabad, India were randomly selected for opening of a branch of a particular microfinance institution (Spandana) while the remainder were not, although other MFIs were free to enter those slums. Fifteen to 18 months after Spandana began lending in treated areas, households were 8.8 percentage points more likely to have a microcredit loan. They were no more likely to start any new business, although they were more likely to start several at once, and they invested more in their existing businesses. There was no effect on average monthly expenditure per capita. Expenditure on durable goods increased in treated areas, while expenditures on “temptation goods” declined. Three to four years after the initial expansion (after many of the control slums had started getting credit from Spandana and other MFIs ), the probability of borrowing from an MFI in treatment and comparison slums was the same, but on average households in treatment slums had been borrowing for longer and in larger amounts. Consumption was still no different in treatment areas, and the average business was still no more profitable, although we find an increase in profits at the top end. We found no changes in any of the development outcomes that are often believed to be affected by microfinance, including health, education, and women’s empowerment. The results of this study are largely consistent with those of four other evaluations of similar programs in different contexts.
    Keywords: Microfinance
    JEL: D21 G21 O16
    Date: 2013–04
  25. By: Alexander Chubrik; Alaksei Kazlou
    Abstract: Labour migration does not appear to have the same magnitude and socio-economic importance in Belarus as in other EaP countries. It is one of the few post-socialist economies that have preserved the dominance of the state sector and built complicated systems of subsidisation and economic support for the population designed to manage the political-business cycle (see Chubrik, Shymanovich, Zaretsky (2012)). This model has allowed the economy to grow quite steadily until recently. However, the distorted system of incentives that was created for enterprises and households has resulted in the need for a “correction”, which happened in the form of a balance of payments crisis in 2011. The impact of this factor on migration has not been fully visible yet. At the same time the relatively long period of stability and gradual, but steady, increase in welfare payments has played a role as a migration-restraining factor. In order to estimate cost and benefits of labour migration between EU and Belarus, this study utilises publically available literature as background and relies where possible on micro-data: Census-2009, Household Budget Survey (HBS), as well as relevant official data and data from polls related to the topic. Additionally, some sections of this report rely on information collected in the course of a focus group meeting with labour migrants and a series of in-depth interviews with officials from state, international, and non-governmental agencies dealing with migration. Lastly, in some cases anecdotal evidence was collected to support some of the new trends that have not yet been recorded in the statistics.
    Keywords: Labour Economics, Labour Markets, Labour Mobility, Belarus
    JEL: D78 F22 F24 I25 J01 J15 J40 J61 J83
    Date: 2013–09

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