nep-dev New Economics Papers
on Development
Issue of 2017‒04‒02
twelve papers chosen by
Jacob A. Jordaan
Universiteit Utrecht

  1. Debunking the Stereotype of the Lazy Welfare Recipient By Abhijit Banerjee; Rema Hanna; Gabriel Kreindler; Benjamin A. Olken
  2. Intensive and Extensive Margins of Mining and Development: Evidence from Sub-Saharan Africa By Nemera Mamo; Sambit Bhattacharya; Alexander Moradi; Rabah Arezki
  3. Financing rural households and its impact: Evidence from randomized field experiment data By Mekonnen, Tigist
  4. Value Subtraction in Public Sector Production: Accounting vs Economic Cost of Primary Schooling in India By Lant Pritchett; Yamini Aiyar
  5. Local Food Prices and International Price Transmission By Bekkers, Eddy; Brockmeier, Martina; Francois, Joseph; Yang, Fan
  6. Medium- and Long-run Consequences of Pollution on Labor Supply: Evidence from Indonesia's Forest Fires of 1997 By Younoh Kim; James Manley; Vlad Radoias
  7. Impact of agricultural technology adoption on market participation in the rural social network system By Mekonnen, Tigist
  8. Decentralized Despotism? Indirect Colonial Rule Undermines Contemporary Democratic Attitudes By Lechler, Marie; McNamee, Lachlan
  9. Managing the Impact of Climate Change on Migration: Evidence from Mexico By Isabelle Chort; Maelys de la Rupelle
  10. Is Ethiopia’s Productive Safety Net Program Enhancing Dependency? By Araya, Girma Behe; Holden , Stein T.
  11. Access to Credit and Quality of Education in Vietnam By Hur, Yoon Sun
  12. Better management practices and their outcomes in shrimp farming : evidence from small-scale shrimp farmers in Southern Vietnam By Suzuki, Aya; Vu, Hoang Nam

  1. By: Abhijit Banerjee; Rema Hanna (Center for International Development at Harvard University); Gabriel Kreindler; Benjamin A. Olken
    Abstract: Targeted transfer programs for poor citizens have become increasingly common in the developing world. Yet, a common concern among policy makers - both in developing as well as developed countries - is that such programs tend to discourage work. We re-analyze the data from 7 randomized controlled trails of government-run cash transfer programs in six developing countries throughout the world, and find no systematic evidence that cash transfer programs discourage work.
    Date: 2015–10
  2. By: Nemera Mamo; Sambit Bhattacharya; Alexander Moradi; Rabah Arezki
    Abstract: What are the economic consequences of mining in Sub-Saharan Africa? Using a panel of 3,635 districts from 42 Sub-Saharan African countries for the period 1992 to 2012 we investigate the effects of mining on living standards measured by night-lights. Night-lights increase in mining districts when mineral production expands (intensive margin), but large effects approximately equivalent to 16% increase in GDP are mainly associated with new discoveries and new production (extensive margin). We identify the effect by carefully choosing feasible but not yet mined districts as a control group. In addition, we exploit giant and major mineral discoveries as exogenous news shocks. In spite of the large within district effects, there is little evidence of significant spillovers to other districts reinforcing the enclave nature of mines in Africa. Furthermore, the local effects disappear after mining activities come to an end which is consistent with the ’resource curse’ view.
    Keywords: Mineral discovery; Mineral production; Night-time lights
    JEL: O11 O13 Q32
    Date: 2017
  3. By: Mekonnen, Tigist (UNU-MERIT, and Maastricht University)
    Abstract: We evaluate the short-term impact of financial support to smallholder farmers and training program to married women in two regions of Ethiopia. Using household-level panel data from the World Bank collected in 2010-2012, the combined Difference-In-Difference (DID) and matching methods are applied. The three main findings emerge from the analysis shows that first; the program seems to improve rural households’ annual income from farm and non-farm economic activities (26 percent). Second, financial incentive positively affects smallholders’ innovative farm practices, adoption of modern technologies and new marketing approach. Third, only training to resource-poor rural women is not enough to their income earning activities. Farm households engage themselves in nonfarm economic activities measured in working days positively affect households’ income. However, the whole household member participation in agricultural activities has a negative effect on income, suggesting that the surplus labor participation on a small land holding household resulting in diminishing marginal return on income.
    Keywords: C93, O12, O33, Q14
    Date: 2017–02–06
  4. By: Lant Pritchett (Center for International Development at Harvard University); Yamini Aiyar
    Abstract: We combine newly created data on per student government expenditure on children in government elementary schools across India, data on per student expenditure by households on students attending private elementary schools, and the ASER measure of learning achievement of students in rural areas. The combination of these three sources allows us to compare both the "accounting cost" difference of public and private schools and also the "economic cost"—what it would take public schools, at their existing efficacy in producing learning, to achieve the learning results of the private sector. We estimate that the "accounting cost" per student in a government school in the median state in 2011/12 was Rs. 14,615 while the median child in private school cost Rs. 5,961. Hence in the typical Indian state, educating a student in government school costs more than twice as much than in private school, a gap of Rs. 7,906. Just these accounting cost gaps aggregated state by state suggests an annual excess of public over private cost of children enrolled in government schools of Rs. 50,000 crores (one crore=10 million) or 0.6 percent of GDP. But even that staggering estimate does not account for the observed learning differentials between public and private. We produce a measure of inefficiency that combines both the excess accounting cost and a money metric estimate of the cost of the inefficacy of lower learning achievement. This measure is the cost at which government schools would be predicted to reach the learning levels of the private sector. Combining the calculations of accounting cost differentials plus the cost of reaching the higher levels of learning observed in the private sector state by state (as both accounting cost differences and learning differences vary widely across states) implies that the excess cost of achieving the existing private learning levels at public sector costs is Rs. 232,000 crores (2.78% of GDP, or nearly US$50 billion). It might seem counterintuitive that the total loss to inefficiency is larger than the actual budget, but that is because the actual budget produces such low levels of learning at such high cost that when the loss from both higher expenditures and lower outputs are measured it exceeds expenditures.
    Date: 2015–06
  5. By: Bekkers, Eddy; Brockmeier, Martina; Francois, Joseph; Yang, Fan
    Abstract: World food prices spiked in the periods 2007-2008 and 2010-2011. The impact of these spikes in world food prices on local food prices and thus on local consumers is determined by the food price pass through. Pass through is defined as the extent to which changes in world food prices lead to changes in local food prices. We examine the determinants of variation in food price pass through from global to local consumer prices in a global sample of 147 countries, using FAO data on world food prices and ILO data on food prices for consumers. While market integration matters, our study finds that income per capita is the dominant factor explaining cross-country variation in pass through of food prices. We estimate an elasticity of about -0.3 of pass through with respect to income per capita. This means far greater price transmission of food price shocks at the commodity level to final consumers in low income countries than in high income countries. The implication is that future swings in world food prices will in particular jeopardise food security in poor countries. Trade policy measures of market integration also affect the pass through significantly, whereas infrastructure and geography measures play no significant role.
    Keywords: Food Price Pass Through; Local Food Prices; Primary Food Shares
    JEL: Q02 Q11 Q17 Q18
    Date: 2017–03
  6. By: Younoh Kim (Department of Economics, Sam Houston State University); James Manley (Department of Economics, Towson University); Vlad Radoias (Department of Economics, Sam Houston State University)
    Abstract: We use a natural experiment in Indonesia to study the medium- and long-run effects of air pollution on labor supply. We find that exposure to air pollution reduces hours worked and while the medium-run effects are larger in magnitude, some effects do persistent in the long run. More interestingly, we are able to provide some insight regarding the underlying channels that contribute to the reduced labor supply. Own health seems to be the only responsible channel in the long-run, while in the medium-run an additional channel based on dependent care-giving is also important
    Keywords: Air Pollution, Working Hours, Indonesia.
    JEL: J22 Q53
    Date: 2017–03
  7. By: Mekonnen, Tigist (UNU-MERIT, and Maastricht University)
    Abstract: This paper provides empirical evidence regarding the impact of agricultural technologies on smallholders’ output market participation. The analysis is based on Farmer Innovation Fund impact evaluation survey collected by the World Bank in 2010-2012 covering 2,675 households in Ethiopia. Endogenous treatment effect and sample selection models are employed to account for the self-selection bias in technology adoption and market participation. Regressions based on matching techniques are employed for robustness check. The estimation results show that the use of improved agricultural inputs significantly affects farm households marketable surplus production. We found evidence that application of high-yielding varieties increases surplus crop production by 7.39 percent per year, whereas chemical fertilizer use increases surplus by 2.32 percent. When farmers apply the two inputs jointly, marketed surplus increases by 6 percent which establish the complementarity of the two technologies. Marketable surplus crop production and market participation of farmers are determined by access to modern inputs, crop price, farm size, availability of labor, and infrastructure. Access to credit and training fosters technology adoption. Therefore, agriculture and rural development policy need to focus on supporting agricultural technology adoption.
    Keywords: Surplus production, technologies, social network, Ethiopia, agricultural innovation,endogenous treatment effect model
    JEL: D04 O12 O13 O33 Q13
    Date: 2017–02–06
  8. By: Lechler, Marie; McNamee, Lachlan
    Abstract: This paper identifies indirect and direct colonial rule as causal factors in shaping support for democracy by exploiting a within-country natural experiment in Namibia. Throughout the colonial era, northern Namibia was indirectly ruled through a system of appointed indigenous traditional elites whereas colonial authorities directly ruled southern Namibia. This variation originally stems from where the progressive extension of direct German control was stopped after a rinderpest epidemic in the 1890s, and thus constitutes plausibly exogenous within-country variation in the form of colonial rule. Using this spatial discontinuity, we find that individuals in indirectly ruled areas are less likely to support democracy and turnout at elections. We explore potential mechanisms and find suggestive evidence that the greater influence of traditional leaders in indirectly ruled areas has socialized individuals to accept non-electoral bases of political authority.
    Keywords: Indirect Colonial Rule; Decentralized Despotism; Political Attitudes; Namibia; Democratic Institutions; Spatial RDD
    JEL: F54 N27 N47 P16
    Date: 2017–03–08
  9. By: Isabelle Chort (LEDa, UMR DIAL-Paris-Dauphine); Maelys de la Rupelle (THEMA, Université de Cergy-Pontoise)
    Abstract: This paper uses state-level migration flow data between Mexico and the U.S. from 1999 to 2011 to investigate the migration response to climate shocks and the mitigating impact of an agricultural cash-transfer program (PROCAMPO) and a disaster fund (Fonden). Our results suggest that droughts increase undocumented migration. Fonden amounts are found to mitigate the effect of climate shocks by lowering the undocumented migration response to precipitation anomalies. Similarly an increase in the share of PROCAMPO funds to the ejido sector decreases undocumented migration after a shock. By contrast, we find no robust evidence of a mitigating impact on documented migration.
    Keywords: International migration, Climate change, Public policies, Weather variability, Natural disasters, Mexico-U.S. migration.
    JEL: F22 Q54 Q18 J61
    Date: 2017–03
  10. By: Araya, Girma Behe (Centre for Land Tenure Studies, Norwegian University of Life Sciences); Holden , Stein T. (Centre for Land Tenure Studies, Norwegian University of Life Sciences)
    Abstract: Although development intervention programs can have far-reaching impacts beyond their stated objective, there have been few careful studies of unintended outcomes of such programs. This study assesses the impact of Ethiopia’s Productive Safety Net Program (PSNP) on household size and dependency ratio using the difference in differences method based on a panel data of four rounds over 12 years. Results show that member households in the PSNP have built a larger household size and dependency ratio than non-member households. These results are not only unintended by program designers but also worrisome as they potentially jeopardize the viability of the program in achieving its stated objective of enabling member households come out of poverty.
    Keywords: Household size; consumer to worker ratio; safety nets; difference in differences
    JEL: I38 O35
    Date: 2017–03–20
  11. By: Hur, Yoon Sun (Korea Institute for International Economic Policy)
    Abstract: This paper tries to determine the relationship between two of growth engines in Vietnam: access to credit and education. To avoid potential bias due to the endogeneity of access to credit variable, this paper utilizes the propensity score matching. This paper takes advantage of the Young Lives Survey of Vietnam that collected information on children of various ages to observe the effect of credit access in different stage of childhood. The result of propensity score matching analysis shows that the quality of education, measured by test scores, is impacted significantly by access to credit when the child is young and household income is low. However, when the child is older, most of the input to enhance the quality of education comes from outside of household resources, such as school, friends, and teachers, and the access to credit status of the household does not have significant effects on the quality of education.
    Keywords: Access To Credit; Education; Vietnam; Propensity Score Matching
    JEL: I24 I25 O15
    Date: 2016–06–29
  12. By: Suzuki, Aya; Vu, Hoang Nam
    Abstract: Despite the growth of aquaculture exports from developing countries in recent years, a high percentage of these products are rejected at developed countries' ports because of non-compliance with international standards. This paper presents a case study of the shrimp aquaculture sector in Vietnam to examine the factors behind the persistence of such port rejections. In particular, we focus on why the so-called Better Management Practices (BMPs) are not appropriately adopted by many farmers and examine whether the number and types of information sources matter in farmers' decisions on BMP adoption and whether BMP adoption actually leads to better performances. On the basis of our estimation using primary data collected in Southern Vietnam, we find that information sources and training experiences indeed matter in the adoption of a higher number of BMPs and that BMP adoption indeed reduces the possibility of disease outbreaks. These results prove the effectiveness of BMPs and suggest the importance of disseminating knowledge regarding them to farmers through experts.
    Keywords: Aquaculture, Production management, Quality control, International trade, Vietnam, Port rejection, Better Management Practices
    JEL: L15 O13 O19 F63
    Date: 2017–03

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