nep-dev New Economics Papers
on Development
Issue of 2017‒04‒23
fourteen papers chosen by
Jacob A. Jordaan
Universiteit Utrecht

  1. Scaling Up Sanitation: Evidence from an RCT in Indonesia By Cameron, Lisa A.; Shah, Manisha
  2. Growing Markets through Business Training for Female Entrepreneurs: A Market-Level Randomized Experiment in Kenya By McKenzie, David; Puerto, Olga Susana
  3. Aid dispersion: Measurement in principle and practice By Fløgstad, Cathrin; Hagen, Rune Jansen
  4. Gender and Birth Order Effects on Intra-household Schooling Choices and Education Attainments in Kenya By Fredrick M. Wamalwa; Justine Burns
  5. Poverty, disasters and remittances: do remittances and past disasters influence households’ resilience? By Tebkieta Alexandra TAPSOBA
  6. One-off subsidies and long-run adoption: Experimental evidence on improved cooking stoves in Senegal By Bensch, Gunther; Peters, Jörg
  7. Private Schools and Student Learning Achievements in Kenya By Fredrick M. Wamalwa; Justine Burns
  8. The employment impact of microcredit program participation in Bangladesh: Evidence from a longitudinal household survey By Hussain, A.K.M. Ghulam; Nargis, Nigar; Ashiquzzaman, S.M.; Khalil, Fahad
  9. Occupational segregation by race in South Africa after apartheid By Carlos Gradín
  10. Exploring regional and gender disparities in Beninese primary school attendance: A multilevel approach By Kyle McNabb
  11. Ethnic inequality and community activities in Indonesia By Christophe Muller
  12. Discrimination, social capital, and financial constraints: The case of Viet Nam By Tho Pham; Oleksandr Talavera
  13. Assessing the Role of Land Use Consolidation for Consumption Growth in Rwanda By Nilsson, Pia
  14. Private standards and labour productivity in the food sector in Viet Nam By Neda Trifkovic

  1. By: Cameron, Lisa A. (Monash University); Shah, Manisha (University of California, Los Angeles)
    Abstract: This paper evaluates the effectiveness of a widely used sanitation intervention, Community-Led Total Sanitation (CLTS), using a randomized controlled trial. The intervention was implemented at scale across rural East Java in Indonesia. CLTS increases toilet construction, reduces roundworm infestations, and decreases community tolerance of open defecation. Financial constraints faced by poorer households limit their ability to improve sanitation. We also examine the program's scale up process which included local governments taking over implementation of CLTS from professional resource agencies. The results suggest that all of the sanitation and health benefits accrue from villages where resource agencies implemented the program, while local government implementation produced no discernible benefits.
    Keywords: impact evaluation, sanitation, scale up, development, health
    JEL: O12 I15
    Date: 2017–03
  2. By: McKenzie, David (World Bank); Puerto, Olga Susana (Youth Employment Network (UN, ILO, World Bank))
    Abstract: A common concern with efforts to directly help some small businesses to grow is that their growth comes at the expense of their unassisted competitors. We test this possibility using a two-stage randomized experiment in Kenya which randomizes business training at the market level, and then within markets to selected businesses. Three years after training, the treated businesses are selling more, earn higher profits, and their owners have higher well-being. There is no evidence of negative spillovers on the competing businesses, and the markets as a whole appear to have grown in terms of number of customers and sales volumes. This market growth appears to come from enhanced customer service and new product introduction, generating more customers and more sales from existing customers. As a result, business growth in underdeveloped markets is possible without taking sales away from non-treated businesses.
    Keywords: business training, spillovers, microenterprise, market development
    JEL: O12 O17 J16 L26
    Date: 2017–03
  3. By: Fløgstad, Cathrin (Department of Economics, University of Bergen); Hagen, Rune Jansen (Department of Economics, University of Bergen)
    Abstract: Excessive dispersion of development assistance has been high on the Paris Agenda on aid effectiveness. However, there is no agreement in the existing literature on how aid dispersion should be measured and few studies of the extent of the problem. We argue for using the Theil Index for both recipients and donors. This relative inequality measure has a major advantage: it allows for a perfect decomposition into variation between and within entities. Exploiting this property, we can rank official donors and recipients not only in terms of the total spread, but also assess the contributions of geographic and sectoral dispersion. We provide a detailed picture of developments along various dimensions (globally as well as for countries, income groups, and regions, over 1998-2013). We further distinguish between bilateral and multilateral donors. Consistent with other studies using more limited samples, we find little effect of the Paris Agenda overall. Aid is more fragmented in Sub-Saharan Africa and in the poorest countries. Globally as well as for most donor and recipient countries, between variation is the main driver of the spread, lending support to the geographic concentration policies many donor countries have adopted. Bilateral aid has been somewhat more dispersed than multilateral aid and in both cases the large number of donors controlling similar shares of total funds is a major driver of the total spread. The latter suggests that concentration could also be achieved through a reduction of the number of actors on the donor side of the aid industry, a perspective that previous studies using other measures have been unable to capture.
    Keywords: Foreign aid; aid dispersion; transaction COSTs; Paris Agenda; Theil Index
    JEL: F35 H87
    Date: 2017–04–19
  4. By: Fredrick M. Wamalwa (School of Economics, University of Cape Town); Justine Burns (School of Economics, University of Cape Town)
    Abstract: In this paper, we investigate the effect of two important family characteristics - gender and birth order- on intra-household investments in, and educational outcomes of, children in Kenya. We measure intra-household education investments in children by household's decision to enrol children in private schools and educational outcomes by two variables, completed years of education and relative grade attainment. We use a large household survey data that allows us to apply the family fixed effects models that address the potential endogeneity of children's gender and family size as well as factors that are unobservable at the household level. Although we do not find an intra-household gender preference in terms of investments in children's education, there is a female advantage in terms of the two measured education outcomes. Such female advantage is in contrast with literature generally reported from developing countries. It is, however, in line with global trends which show that more girls are getting educated and the gender gap in education has narrowed considerably. Regarding birth order effects, we find significant negative birth order effects on private enrolment, completed years of education and relative grade attainment. The negative birth order effects are not in line with the evidence from many other developing countries but are in line with results from developed countries. Our results are robust to different sample restrictions. We find that household wealth plays a significant role in propagating the birth order but not the gender effects we observe.
    Keywords: Birth order, gender, household fixed effects, fully interacted models, Kenya
    Date: 2017
  5. By: Tebkieta Alexandra TAPSOBA
    Abstract: Using a multi-topic household panel survey conducted in Burkina Faso by the “Institut national de la statistique et de la démographie” (INSD), in 2014, this paper assesses the impact of remittances on poverty in Burkina Faso. To do so, a poverty index is computed using household’s housing characteristics. Propensity score matching method is used as an empirical strategy, and results show that remittances have a negative impact on poverty. Another important result is that remittances have a higher impact on the resilience of households, when they have experienced disasters in the past. Therefore, when it comes to natural disasters, these inflows act as an important tool for populations to be more resilient.
    Keywords: Poverty, Remittances, Natural disasters, Resilience, Burkina Faso.
    JEL: N57 Q54 F24 I32
    Date: 2017–04
  6. By: Bensch, Gunther; Peters, Jörg
    Abstract: Free distribution of a technology can be an effective development policy instrument if its adoption is socially inefficient and hampered by affordability constraints. Improved cookstoves may be such a case: they generate high environmental and public health returns, but adoption is generally low. Based on a randomized controlled trial in rural Senegal, this paper studies whether one-time free cookstove distribution affects households' willingness to pay (WTP) in the long run. Effects might be negative because people anchor their WTP on the earlier zero price (reference dependence) or positive because information deficits about potential benefits are overcome. We find that households who received a free stove six years back exhibit a higher WTP today compared to control households. Potential reference dependence effects are thus at least compensated by learning effects. Our findings suggest that one-time free distribution does not spoil future prices and might even be a stepping stone for future market establishment.
    Keywords: Technology adoption,cookstoves,willingness to pay,real-purchase offer,energy access
    JEL: D03 D12 O12 O13 Q41
    Date: 2017
  7. By: Fredrick M. Wamalwa (School of Economics, University of Cape Town); Justine Burns (School of Economics, University of Cape Town)
    Abstract: This paper examines the effect of private schools on literacy (language) and numeracy (maths) skill acquisition among children drawn from lower primary grades in Kenya. We use a comprehensive household survey data that allows us to apply a number of econometric techniques to deal with the challenge of the endogeneity of private school choice. We begin with the OLS as a baseline model. We then estimate the village and household fixed effects (FE) models that control for unobservables at the village and household levels, respectively. We supplement the OLS and FE models with the propensity score matching (PSM) technique. We find positive and significant private school effect throughout all these methodologies. However, assessing the impact of omitted variable bias on the estimated coefficient of private schools by use of recent techniques, we find that the estimated bias in household FE is quite small in magnitude relative to the bias based on other estimation techniques. Since (private) schooling decision is made at the household level, it is likely that a substantial part of the unobservable component is pertaining to the household.
    Keywords: Private schools, student learning achievements, Kenya
    Date: 2017
  8. By: Hussain, A.K.M. Ghulam; Nargis, Nigar; Ashiquzzaman, S.M.; Khalil, Fahad
    Abstract: Microcredit program, originating in Bangladesh in the late 1970s, has played an important role to meet the financing needs of the impoverished communities around the world. While the successes and failures of microcredit in lifting the poor out of poverty have been recorded in a wide array of literature, the employment outcome of participating in a microcredit program as a pathway to poverty reduction has been studied much less. Using two waves of longitudinal data on over 2000 households, we examine the employment impact of microcredit program in Bangladesh during 1998-2004. The longitudinal nature of data allows us fixed effects estimation of the effect of microcredit program participation on self-employment hours and household labor income isolating the biases that may result from non-random program placement, censoring in self-employment work hours and income data, and non-random sample selection of households or individuals as participants who already have entrepreneurial skills or pre-existing household conditions favourable to self-employment activities. The fixed effects estimate shows that households that participate in microcredit program work on average 245 hours longer in self-employment activities and earn 9.4% higher labor income than non-participant households. These extra hours are equivalent to around 7 weeks of employment for a person. The income effect of microcredit program participation is more discernible on household labor income than on total household income due to lack of direct link of microcredit program with non-labor income sources such as remittance. The participating households at the bottom of the income distribution appear to have gained more than those at the upper end suggesting equalizing effect of microcredit program participation over and above the positive effect on employment and income growth. Thus microcredit program in Bangladesh has succeeded in providing employment generating capacities to participants and raised the potential for income growth that contributed to poverty reduction.
    Keywords: microcredit,self-employment,labor income,poverty
    JEL: I32 J21 J22 J43 J46
    Date: 2017
  9. By: Carlos Gradín
    Abstract: This paper investigates progress in reducing the high level of racial stratification of occupations after apartheid in South Africa. Empirical analysis, using census microdata and Labour Force Surveys, does not provide strong evidence of sustained or significant desegregation. Occupations remain highly segmented by race, with blacks disproportionally holding low-paying jobs (compared with whites). Less than a third of segregation and about half of racial stratification in occupational distribution are related to blacks’ characteristics, especially their lower educational achievement, a gap that has been reduced over time. Segregation and stratification, however, remain when blacks and whites with similar characteristics are compared.
    Date: 2017
  10. By: Kyle McNabb
    Abstract: This study combines household survey data from the Beninese Demographic and Health Survey with school supply statistics in order to investigate regional and gender disparities in primary school attendance rates in Benin. Despite almost unparalleled increases in enrolment since the 1990s, Benin remains virtually ignored in the literature surveying school attendance. Results of a logistic regression model highlight the important role played by factors such as household wealth and religion and show that, despite progress, gender disparities in education persist in Benin. The opportunity cost of attending school is also investigated and, in order to account for regional disparities in attendance, a multilevel model is estimated; results from a random slopes model highlight those communes where reductions in the cost of schooling could see the greatest improvements in attendance rates.
    Date: 2017
  11. By: Christophe Muller
    Abstract: For the first time in Indonesia, we jointly analyse several economic statistics and ethnic diversity indicators at national and local levels. Nationally, we find very high levels of economic inequality, measured from household asset values or consumption expenditure. In contrast, the levels of ethnic diversity, while non-negligible, are much lower, whether they reflect fractionalization, polarization, or ethnic inequality based on individual living standards. All ethnic inequality indicators surged after the Asian economic crisis. Ethnic inequality based on education is much lower and decreasing. In panel data models, individual participation in community activities is found to be much determined by local patterns of ethnic diversity. Different dimensions of ethnic diversity generate distinct effects. Ethnic polarization stimulates participation in strategic activities. Instead, ethnic fragmentation and ethnic inequality depress most local activities. Finally, we provide tentative explanations of local ethnic inequality in regressions that show a mixed pattern of socioeconomic influences.
    Date: 2016
  12. By: Tho Pham; Oleksandr Talavera
    Abstract: This paper examines the relationship between gender, social capital, and access to finance of micro, small, and medium enterprises in the manufacturing sector in Viet Nam. Our dataset is from the 2011, 2013, and 2015 waves of the Micro, Small, and Medium Enterprise Survey in Viet Nam. Using the Heckman technique to control for sample selection bias, the data do not provide evidence for discrimination against female-owned enterprises in the formal lending market. Specifically, female entrepreneurs have a higher probability of getting a loan and they pay lower interest rates in comparison with male entrepreneurs. No discrimination in formal credit markets may arise from the preference for informal loans over formal loans—that is, entrepreneurs tend to borrow informal loans before applying for formal ones. Further analysis shows that social capital could facilitate loan applications: firms that have a closer relationship with government officials and other business people can get loans of longer duration.
    Date: 2017
  13. By: Nilsson, Pia (Jönköping International Business School, Discipline of Economics, Finance and Statistics, CEnSE (Centre for Entrepreneurship and Spatial Economics))
    Abstract: This paper studies the effects of land use consolidation on consumption growth of farm households in Rwanda. Data on 1 920 households, observed in two time periods, are used to estimate a first-differenced model using an instrumental variables estimator, which allow the analysis to account for selection bias and placement effects. Results show no significant effect of land use consolidation on consumption growth and the results are robust to changes in model specification and estimation method. Rather, the results point to the importance of factors such as education, rural infrastructure and market linkages in the consumption growth process. These results highlight the need to consider that alternative public investments, that reduce households’ transaction costs, may be better able to target rural farmers that operate under conditions such as land scarcity, high population pressure and high risk linked to rapidly changing climate conditions.
    Keywords: land consolidation; consumption; Rwanda; first-difference
    JEL: O12 Q15 Q18
    Date: 2017–04–06
  14. By: Neda Trifkovic
    Abstract: A rising number of firms from developing countries have adopted voluntary private standards in the last decade. This has become an area of active research, especially in terms of the impact of private standards on trade, organizational performance, and employee outcomes. This paper analyses how standards affect labour productivity of small and medium firms from the food sector in Viet Nam. The results based on a 3-year panel show that the application of private standards improves labour productivity. These gains primarily occur to firms operating above a threshold labour-intensity level. Firms with low labour intensity are not likely to experience gains in labour productivity from standards. This implies that employee compensation increase due to standards is a likely mechanism for labour productivity gains. The results are robust to several specification changes and instrumental variable estimation.
    Date: 2016

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