nep-dev New Economics Papers
on Development
Issue of 2016‒11‒27
eleven papers chosen by
Jacob A. Jordaan
Universiteit Utrecht

  1. Poverty Accounting. A fractional response approach to poverty decomposition By Richard Bluhm; Denis de Crombrugghe; Adam Szirmai
  2. Building connections: Political corruption and road construction in India By Jonathan Lehne; Jacob N. Shapiro; Oliver Vanden Eynde
  3. Income inequality and intimate partner violence against women: Evidence from India By Rashada, Ahmed Shoukry; Sharaf, Mesbah Fathy
  4. Heterogeneous Treatment Effects in the Low Track: Revisiting the Kenyan Primary School Experiment By Joseph Cummins
  5. Access to Financial Services and Working Poverty in Developing Countries By Aïssata COULIBALY; Urbain Thierry YOGO
  6. Decentralized versus Statistical Targeting of Anti-Poverty Programs: Evidence from Burkina Faso By Schleicher, Michael; Souares, Aurélia; Pacere, Athanase Narangoro; Sauerborn, Rainer; Klonner, Stefan
  7. The Effect of the Availabilty of Student Credit on Tuitions: Testing the Bennet Hypothesis using Evidence from a Large-Scale Student Loan Program in Brazil By Isabela Duarte; Joao de Mello
  8. The effectiveness of aid under post-conflict conditions: A sector-specific analysis By Donaubauer, Julian; Herzer, Dierk; Nunnenkamp, Peter
  9. Corruption, trade costs, and gains from tariff liberalization: evidence from Southern Africa By Sandra Sequeira
  10. The impact of taxes, transfers, and subsidies on inequality and poverty in Uganda By Jon Jellema; Nora Lustig; Astrid Haas; Sebastian Wolf
  11. Cash crops and food security: Evidence from Ethiopian smallholder coffee producers By Kuma, Tadesse; Dereje, Mekdim; Hirvonen, Kalle; Minten, Bart

  1. By: Richard Bluhm (Leibniz University Hannover, Germany); Denis de Crombrugghe (Maastricht University, The Netherlands); Adam Szirmai (UNU-MERIT and Maastricht University, The Netherlands)
    Abstract: This paper proposes a new empirical framework for poverty accounting. Using a large collection of household surveys from 124 countries, we estimate income and inequality (semi-)elasticities of poverty for the \$2 and \$1.25 a day poverty lines as well as their contributions to poverty alleviation. We show that initial inequality is a strong moderator of the impact of growth and there has been a shift towards more pro-poor growth around the turn of the millennium. We project poverty rates until 2030 and show that an end of extreme poverty within a generation is unlikely.
    Keywords: poverty, inequality, income growth, fractional response models.
    JEL: I32 C25 O10 O15
    Date: 2016–10
  2. By: Jonathan Lehne (PSE - Paris-Jourdan Sciences Economiques - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - École des Ponts ParisTech (ENPC) - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics); Jacob N. Shapiro (WWSPIL - Woodrow Wilson School of Public and International Affairs - Princeton University [Pinceton]); Oliver Vanden Eynde (PSE - Paris-Jourdan Sciences Economiques - ENS Paris - École normale supérieure - Paris - INRA - Institut National de la Recherche Agronomique - EHESS - École des hautes études en sciences sociales - École des Ponts ParisTech (ENPC) - CNRS - Centre National de la Recherche Scientifique, PSE - Paris School of Economics)
    Abstract: Politically-driven corruption is a pervasive challenge for development, but evidence of its welfare effects is scarce. Using data from a major rural road construction programme in India we document political influence in a setting where politicians have no official role in contracting decisions. Exploiting close elections to identify the causal effect of coming to power, we show that the share of contractors whose name matches that of the winning politician increases by 63% (from 4% to 6.4%). Regression discontinuity estimates at the road level show that political interference raises costs, lowers quality, and increases the likelihood that roads go missing.
    Keywords: Elections,Corruption
    Date: 2016–07
  3. By: Rashada, Ahmed Shoukry; Sharaf, Mesbah Fathy
    Abstract: Intimate Partner Violence (IPV) has been consistently linked to poor health and adverse social outcomes. Though there is substantial empirical evidence on the determinants of IPV, little attention has been given to the potential impact of income inequality on domestic violence, especially in the developing world. This study aims to investigate the relationship between the IPV and contextual income inequality in India, a country with high prevalence of IPV and substantial income inequality. We use data on a nationally representative sample of 69,704 women from the third National Family Health Survey for India, conducted in 2005-06. Standard logistic regression and a Tobit model are used to examine the effect of income inequality, measured by the Gini-index, on different forms of IPV: physical, and sexual. In addition to income inequality, the multivariate analyses also control for other IPV determinants that are widely used in the literature. Results show a robust statistically significant positive association between income inequality and IPV in India. A one unit increase in the Gini-index increases the odds of sexual violence by 6.2% and less severe form of violence by 2.1%. Results of the Tobit model show that the intensity of violence against women increases by 0.0317 when the Gini-index increases by one unit. As for the other covariates, we find education level, husband's employment status, living in rural areas, being from non-scheduled caste, and the economic status of household to be protective factors from IPV. We also find the type of religion and caste/tribe to influence the likelihood of experiencing IPV. Policies that reduce income inequality would help in reducing the level of IPV against women.
    Keywords: Income Inequality,Intimate Partner Violence,India
    JEL: I14 I15 I18
    Date: 2016
  4. By: Joseph Cummins (Department of Economics, University of California Riverside)
    Abstract: I present results from a partial re-analysis of the Kenyan school tracking experiment first described in Duflo et. al (2011). My results suggest that, in a developing country school system with state-employed teachers, tracking can reduce short-run test scores of initially low-ability students with high learning potential. The highest scoring students subjected only to the tracking intervention scored well below comparable students in untracked classrooms at the end of the intervention. In contrast, students assigned to tracking under the experimental alternative teacher intervention experienced gains from tracking that increased across the outcome distribution. These alternative teachers were drawn from local areas, exhibited significantly higher effort levels and faced different incentives to produce learning. I conclude that although Pareto-improvements in test scores from tracking are possible, they are not guaranteed.
    Keywords: ability tracking, human capital, economic development
    JEL: I21 J45 O15
    Date: 2016–11
  5. By: Aïssata COULIBALY; Urbain Thierry YOGO
    Abstract: This paper investigates the effect of access to financial services on the prevalence of working poor. Using a panel of 63 developing countries over the period 2004-2013, we find that improving financial access (as measured by the number of bank branches per 100,000 adults) reduces the prevalence of working poor (workers living with less than US$ 1.25 a day). This effect is even more relevant in countries affected by strong macroeconomic instability. Our findings are robust to endogeneity bias, the addition of various controls including remittances and mobile phone subscriptions, and to the shifting of the poverty line from US$ 1.25 to US$ 1.90. We also show that barriers to use banking services are correlated positively with working poverty. Moreover, our results confirm the validity of some transmissions channels such as growth (trickle-down effect) and the access of the non-poor workers to financial services, suggesting that improving financial access for the excluded non-poor can have a strong reducing-effect on working poverty.
    Keywords: Financial access, Working poverty, Developing countries, Trickle-down effect.
    JEL: G20 E44 O11
    Date: 2016–11
  6. By: Schleicher, Michael; Souares, Aurélia; Pacere, Athanase Narangoro; Sauerborn, Rainer; Klonner, Stefan
    Abstract: Targeting of national anti-poverty programs in low-income countries commonly relies on statistical procedures involving household-level survey data, while small-scale poverty-alleviation programs often employ so-called community-based targeting, where village communities themselves identify program beneficiaries. Combining data from community-based targeting exercises in north-western Burkina Faso with household-level survey data, we compare the targeting accuracy of community-based targeting with several statistical procedures when the program's purpose is to target consumption-poor households. We find that the community-based assessment targets a similar share of consumption-poor households as the best-performing statistical procedures which are not calibrated with household-level consumption data. Community-based targeting performs relatively better in urban than in rural areas and is not at a disadvantage in larger or more heterogeneous communities. In a cost-benefit analysis we find that in our sub-Saharan African context community-based targeting is far more cost-effective than any statistical procedure for common amounts of welfare program benefits.
    Keywords: Targeting; Community-based Targeting; Welfare Programs; Poverty; Community Wealth Rankings; Proxy-means Testing
    Date: 2016–11–22
  7. By: Isabela Duarte (PUC - Rio); Joao de Mello (Insper)
    Abstract: We test whether the availability of student loans increases tuition costs, the Bennet Hypothesis. Starting in 2010, there was a major ramp-up in the FIES, a student loan program funded by the Brazilian federal government. FIES’s rules for eligibility produce a marked heterogeneity in the access to funding in different higher education institutions. We take advantage of these rules and of an unique dataset with information on tuition costs at the major-college level, and document two facts. Using a difference-in-differences approach, we show that relaxing access to student loans caused an increase in tuition fees. We also estimate a structural model of demand, and show that relaxing credit constraints reduces the demand price elasticity. Thus the mechanism behind the increase in tuition costs is an increased tuition insensitivity, at least in part.
    Date: 2016
  8. By: Donaubauer, Julian; Herzer, Dierk; Nunnenkamp, Peter
    Abstract: It is widely believed that foreign aid may help conflict-affected countries to recover after the settlement of conflicts. However, the available empirical evidence supporting this view largely neglects the heterogeneous nature of aid. Drawing on the conflict database of the Uppsala Conflict Data Program, we address the hypothesis that the effectiveness of post-conflict aid differs between specific sectors. Our focus is on social and economic infrastructure which is most likely to suffer during conflict episodes so that the need for aid is particularly pressing in this area. We find fairly robust evidence that post-conflict aid is effective in improving social infrastructure. In contrast, aid appears to be ineffective in improving economic infrastructure.
    Keywords: aid effectiveness,civil conflict,social infrastructure,economic infrastructure
    JEL: F35 O18
    Date: 2016
  9. By: Sandra Sequeira
    Abstract: This paper exploits quasi-experimental variation in tariffs in southern Africa to estimate trade elasticities. Traded quantities respond only weakly to a 30 percent reduction in the average nominal tariff rate. Trade flow data combined with primary data on firm behavior and bribe payments suggest that corruption is a potential explanation for the observed low elasticities. In contexts of pervasive corruption, even small bribes can significantly reduce tariffs, making tariff liberalization schemes less likely to affect the extensive and the intensive margins of firms' import behavior. The tariff liberalization scheme is, however, still associated with improved incentives to accurately report quantities of imported goods, and with a significant reduction in bribe transfers from importers to public officials.
    JEL: D73 F13 H83 O17 O19 O24
    Date: 2016–10
  10. By: Jon Jellema (Commitment to Equity Institute); Nora Lustig (Tulane University, U.S.A.); Astrid Haas (International Growth Centre, Uganda); Sebastian Wolf (International Growth Centre, Uganda)
    Abstract: This paper uses the 2012/13 Uganda National Household Survey to analyze the redistributive effectiveness and impact on poverty and inequality of Uganda’s revenue collection instruments and social spending programs. Fiscal policy – including many of its constituent tax and spending elements – is inequality-reducing in Uganda, but the reduction of inequality due to fiscal policy in Uganda is lower than other countries with similar levels of initial inequality, a result tied to low levels of spending in Uganda generally. The impact of fiscal policy on poverty is negligible, while the combination of very sparse coverage of direct transfer programs and nearly complete coverage of indirect tax instruments means that many poor households are net payers into, rather than net recipients from, the fiscal system. As Uganda looks ahead to increased revenues from taxation and concurrent investments in productive infrastructure, it should take care to protect the poorest households from further impoverishment from the fiscal system.
    Keywords: fiscal incidence, poverty, inequality, fiscal policy, Uganda.
    JEL: D31 D63 H22 H23 I38
    Date: 2016–10
  11. By: Kuma, Tadesse; Dereje, Mekdim; Hirvonen, Kalle; Minten, Bart
    Abstract: One of the key questions in food policy debates in the last decades has been the role of cash cropping for achieving food security in low income countries. We revisit this question in the context of smallholder coffee production in Ethiopia. Using unique data collected by the authors on about 1,600 coffee farmers in the country, we find that coffee income improves food security, even after controlling for total income and other factors and after addressing the endogeneity of coffee income. Further analysis suggests that the pathway for achieving this improved food security is linked to being better able to smooth consumption across agricultural seasons. In contrast with food crops, coffee sales take place almost throughout the whole year, providing farmers with cash income also during the lean season.
    Keywords: ETHIOPIA, EAST AFRICA, AFRICA SOUTH OF SAHARA, AFRICA, agriculture, agricultural policies, food policies, seasonality, coffee, smallholders, food security, O12 Microeconomic Analyses of Economic Development, O13 Economic Development: Agriculture, Natural Resources, Energy, Environment, Other Primary Product, Q18 Agricultural Policy, Food Policy
    Date: 2016

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