nep-dev New Economics Papers
on Development
Issue of 2014‒11‒07
twelve papers chosen by
Jacob A. Jordaan
Universitiet Utrecht

  1. Saving for a (not so) Rainy Day: A Ramdomized Evaluation of Savings Groups in Mali By Lori Beaman; Dean Karlan; Bram Thuysbaert
  2. Evidence on policies to increase the development impacts of international migration By McKenzie, David; Yang, Dean
  3. Measuring agricultural knowledge and adoption By Kondylis, Florence; Mueller, Valerie; Zhu, Siyao Jessica
  4. The Long-Term Effects of the Printing Press in Sub-Saharan Africa By Julia Cage; Valeria Rueda
  5. The Impact of Being Poor During Crisis on Child Health and Cognitive Development in Indonesia By Rosy Wediawaty
  6. Resistance to the Regulation of Common Resources in Rural Tunisia By Xiaoying Liu; Mare Sarr; Timothy Swanson
  7. The Impact of Displacement on Child Health: Evidence from Colombia's DHS 2010 By Nina Wald
  8. Emergence and evolution of learning gaps across countries: Linked panel evidence from Ethiopia, India, Peru and Vietnam By Abhijeet Singh
  9. Variable returns to fertilizer use and its relationship to poverty: Experimental and simulation evidence from Malawi: By Harou, Aurélie; Liu, Yanyan; Barrett, Christopher B.; You, Liangzhi
  10. The development push of refugees By Jean-Francois Maystadt; Gilles Duranton
  11. The land certification program and off-farm employment in Ethiopia By Mintewab Bezabih; Andrea Mannberg; Eyerusalem Siba
  12. Local poverty reduction in Chile and Mexico: The role of food manufacturing growth By Isidro Soloaga; Chiara Cazzuffi; Mariana Pereira

  1. By: Lori Beaman (Northwestern University); Dean Karlan (Economic Growth Center, Yale University); Bram Thuysbaert (Ghent University)
    Abstract: High transaction and contracting costs are often thought to create credit and savings market failures in developing countries. The microfinance movement grew largely out of business process innovations and subsidies that reduced these costs. We examine an alternative approach, one that infuses no external capital and introduces no change to formal contracts: an improved “technology” for managing informal, collaborative village-based savings groups. Such groups allow, in theory, for more efficient and lower-cost loans and informal savings, and in practice have been scaled up by international non-profit organizations to millions of members. Individuals save together and then lend the accumulated funds back out to themselves. In a randomized evaluation in Mali, we find improvements in food security, consumption smoothing, and buffer stock savings. Although we do find suggestive evidence of higher agricultural output, we do not find overall higher income or expenditure. We also do not find downstream impacts on health, education, social capital, and female decision-making power.Could this have happened before, without any external intervention? Yes. That is what makes the result striking, that indeed there were no resources provided nor legal institutional changes, yet the NGO-guided, improved informal processes led to important changes for households.
    Keywords: Micro-savings, Savings groups impact
    JEL: O12 D12 D91
    Date: 2014–10
  2. By: McKenzie, David; Yang, Dean
    Abstract: International migration offers individuals and their families the potential to experience immediate and large gains in their incomes, and offers a large number of other positive benefits to the sending communities and countries. However, there are also concerns about potential costs of migration, including concerns about trafficking and human rights, a desire for remittances to be used more effectively, and concerns about externalities from skilled workers being lost. As a result there is increasing interest in policies which can enhance the development benefits of international migration and mitigate these potential costs. This paper provides a critical review of recent research on the effectiveness of these policies at three stages of the migration process: pre-departure, during migration, and directed toward possible return. The existing evidence base suggests some areas of policy success: bilateral migration agreements for countries whose workers have few other migration options, developing new savings and remittance products that allow migrants more control over how their money is used, and some efforts to provide financial education to migrants and their families. Suggestive evidence together with theory offers support for a number of other policies, such as lowering the cost of remittances, reducing passport costs, offering dual citizenship, and removing exit barriers to migration. Research offers reasons to be cautious about some policies, such as enforcing strong rights for migrants like high minimum wages. Nevertheless, the paper finds the evidence base to be weak for many policies, with no reliable research on the impact of most return migration programs, nor for whether countries should be trying to induce communal remitting through matching funds.
    Keywords: Population Policies,Remittances,Access to Finance,Financial Literacy,Debt Markets
    Date: 2014–10–01
  3. By: Kondylis, Florence; Mueller, Valerie; Zhu, Siyao Jessica
    Abstract: Understanding the trade-offs in improving the precision of agricultural measures through survey design is crucial. Yet, standard indicators used to determine program effectiveness may be flawed and at a differential rate for men and women. The authors use a household survey from Mozambique to estimate the measurement error from male and female self-reports of their adoption and knowledge of three practices: intercropping, mulching, and strip tillage. Despite clear differences in human and physical capital, there are no obvious differences in the knowledge, adoption, and error in self-reporting between men and women. Having received training unanimously lowers knowledge misreports and increases adoption misreports. Other determinants of reporting error differ by gender. Misreporting is positively associated with a greater number of plots for men. Recall decay on measures of knowledge appears prominent among men but not women. Findings from regression and cost-effectiveness analyses always favor the collection of objective measures of knowledge. Given the lowest rate of accuracy for adoption was around 80 percent, costlier objective adoption measures are recommended for a subsample in regions with heterogeneous farm sizes.
    Keywords: Agricultural Knowledge and Information Systems,Population Policies,Rural Development Knowledge&Information Systems,Crops and Crop Management Systems,Primary Education
    Date: 2014–10–01
  4. By: Julia Cage (Département d'économie); Valeria Rueda (Département d'économie (ECON))
    Abstract: This article delves into the relationship between newspaper readership and civic attitudes, and its effect on economic development. To this end, we investigate the long-term consequences of the introduction of the printing press in the 19th century. In sub-Saharan Africa, Protestant missionaries were the first both to import the printing press technology and to allow the indigenous population to use it. We build a new geocoded dataset locating Protestant missions in 1903. This dataset includes, for each mission station, the geographic location and its characteristics, as well as the educational and health-related investments undertaken by the mission. We show that, within regions located close to missions, proximity to a printing press significantly increases newspaper readership today. We also document a strong association between proximity to a printing press and contemporary economic development. Our results are robust to a variety of identification strategies.
    Keywords: historical persistence, printing press, Protestant missions, newspaper readership, political participation, economic development.
    JEL: D72 N37 N77 O33 Z12 Z13
    Date: 2014–10
  5. By: Rosy Wediawaty (Directorate of State Finance and Monetary Analysis (BAPPENAS))
    Abstract: Shocks, such as economic crisis, that occur in the critical periods of children development are believed to have lasting effects. Using data from Indonesia Family Life Survey (IFLS), this study investigates the timing issue and whether Asian Financial 1997/1998 crisis has impacts on child health and cognitive development in Indonesia. By running pooled cross-section model, this study finds that generally crisis has not had negative impacts on child health and cognitive development for those who were poor. Yet, in urban areas, crisis struck harder and negatively affected the cognitive score of specific age groups. This study also finds that the critical periods of children development might be in the first two years of early life. Expenditure levels and mothers’ education are strong predictors for child health and cognitive development.
    Keywords: Crisis, Child Health, Cognitive Development, Indonesia
    JEL: I15 O15 O53
    Date: 2014–10
  6. By: Xiaoying Liu; Mare Sarr; Timothy Swanson (School of Economics, University of Cape Town, South Africa)
    Abstract: We examine the effect of the introduction of uniform water-charging for aquifer management and provide evidence using a survey-based choice experiment of agricultural water users in rural Tunisia. Theoretically, we show that the implementation of the proposed second-best regulation would result both in efficiency gains and in distributional effects in favour of small landholders. Empirically, we find that resistance to the introduction of an effective water-charging regime is greatest amongst the largest landholders. Resistance to the regulation of common resources may be rooted in the manner in which heterogeneity might determine the distributional impact of different management regimes.
    Date: 2014–09–29
  7. By: Nina Wald
    Abstract: This paper investigates the causal impact of displacement on health outcomes for Colombian children of different age cohorts. It uses the Colombian Demographic and Health Survey 2010, which provides both a number of health outcomes and information about displacement of households. Two different empirical strategies are employed to identify the impact of displacement on child health, namely a linear regression model and propensity score matching. In order to capture different dimensions of health, four health outcomes are used as dependent variables: (i) height-for-age z-scores; (ii) subjective health status; (iii) affiliation to a health insurance; and (iv) having a health problem last month. Overall, a negative relationship between displacement and child health is documented. In line with findings from African and Asian countries, displacement increases the likelihood for malnutrition for young children and primary school children. Moreover, being displaced leads to a lower subjective health status for children from all age cohorts. Yet, displaced children are not affected by health problems significantly more often than non-displaced children. Last, but not least, displaced children from all age cohorts are significantly less likely to have health insurance.
    Keywords: Child Health, Displacement, Armed Conflict, Colombia, Propensity Score Matching
    JEL: C21 D19 I13 O54
    Date: 2014
  8. By: Abhijeet Singh
    Abstract: There are substantial learning gaps across countries on standardized international assessments. In this paper, I use unique child-level panel data from Ethiopia, India, Peru and Vietnam with identical tests administered across these countries to children at 5, 8, 12 and 15 years of age to ask at what ages do gaps between different populations emerge, how they increase or decline over time, and what the proximate determinants of this divergence are. I document that a clear pattern of stochastic dominance is evident at the age of 5 years, prior to school enrolment, with children in Vietnam at the upper end, children in Ethiopia at the lower, and with Peru and India in between. Differences between country samples grow in magnitude at later ages, preserving the country rankings noted at 5 years of age over the entire age range studied. This divergence is only partly explained by home investments and child-specific endowments in a value-added production function approach. The divergence in achievement between Vietnam and the other countries at primary school age is largely explained by the differential productivity of a year of schooling. These findings are confirmed also using an IV approach, using discontinuities in grade completion arising between children born in adjacent months due to country-specific enrolment guidelines.
    Date: 2014
  9. By: Harou, Aurélie; Liu, Yanyan; Barrett, Christopher B.; You, Liangzhi
    Abstract: Despite the rise of targeted input subsidy programs in Africa over the last decade, several questions remain as to whether low and variable soil fertility, frequent drought, and high fertilizer prices render fertilizer unprofitable for large subpopulations of African farmers. To examine these questions, we use large-scale, panel experimental data from maize field trials throughout Malawi to estimate the expected physical returns to fertilizer use conditional on a range of agronomic factors and weather conditions. Using these estimated returns and historical price and weather data, we simulate the expected profitability of fertilizer application over space and time. We find that the fertilizer bundles distributed under Malawi’s subsidy program are almost always profitable in expectation, although our results may be reasonably interpreted as upper-bound estimates among more skilled farmers given that the experimental subjects were not randomly selected.
    Keywords: Fertilizers, subsidies, Agricultural development, productivity, farm inputs, poverty alleviation,
    Date: 2014
  10. By: Jean-Francois Maystadt; Gilles Duranton
    Abstract: We exploit a 1991–2010 Tanzanian household panel to assess the effects of the temporary refugee inflows originating from Burundi (1993) and Rwanda (1994). We find that the refugee presence has had a persistent and positive impact on the welfare of the local population. We investigate the possible channels of transmission, underscoring the importance of a decrease in transport costs as a key driver of this persistent change in welfare. We interpret these findings as the ability of a temporary shock to induce a persistent shift in the equilibrium through subsequent investments rather than a switch to a new equilibrium in a multiple-equilibrium setting.
    Keywords: Refugees, Tanzania, Multiple equilibrium, Roads
    JEL: I32 O18 Q54
    Date: 2014
  11. By: Mintewab Bezabih; Andrea Mannberg; Eyerusalem Siba
    Abstract: Land tenure security has long been touted as key to increased performance of the agricultural sector in developing countries. This paper utilizes household level panel data to analyse the impact of a land certification program on farmers’ off-farm participation and activity choices in the Central Highlands of Ethiopia. Identification of the program’s impact relies on the sequential nature of its implementation and application of the difference-in-differences strategy. Our results suggest that certification is a significant determinant of participation in off-farm employment. However, the impact differs substantially between different types of off-farm activities. While land certification is associated with an increased probability of participation in non-agricultural activities requiring unskilled labor, it reduces the probability to engage in work on others’ farms. In addition, the effect of the program depends on the size of landholdings. The differentials in the responsiveness of different off farm activities to both certification and farm size indicate the need to recognize the complex relationships between land tenure enhancing reform policies and the non agricultural sub-sector in rural areas. In light of similar previous studies, the major contributions of the paper are twofold: assessment of the effects of enhanced land tenure security on activities outside agriculture and the role of farm size in determining off-farm participation.
    Date: 2014–09
  12. By: Isidro Soloaga (Department of Economics, Universidad Iberoamericana, Mexico City. Mexico); Chiara Cazzuffi; Mariana Pereira
    Abstract: This paper analyses the relationship between local poverty and food manufacture growth in Chile and Mexico using propensity score matching, differences in differences and spatial econometrics methods. We focus on food manufacture as a sector with a number of characteristics that make it potentially pro-poor, and whose incentives for spatial distribution may either strengthen or dampen its poverty reduction potential. The overall results indicate that i) geographically, food manufacture locates in relatively poor areas, but not in the poorest; ii) food manufacture tends to locate in municipalities with more availability of labor and raw materials and with better infrastructure; iii) controlling for other factors, food manufacture growth contributes to local poverty reduction both in terms of magnitude and speed.
    Date: 2014

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