nep-dev New Economics Papers
on Development
Issue of 2017‒10‒08
eleven papers chosen by
Jacob A. Jordaan
Universiteit Utrecht

  1. The Effect of Quality of Education on Violence: Evidence from Colombia By Andres Giraldo; Manini Ojha; Manini Ojha
  2. Toxic roads: Unearthing hazardous waste dumping By Caterina Gennaioli; Gaia Narciso
  3. Does Mother's Employment Affect Children’s Schooling? An Empirical Evidence from Indonesian Households By Purmini; Sutyastie Soemitro Remi; Yayan Satyakti; Mohamad Fahmi; Iqbal Dawam Wibisono
  4. Cash-Plus: Cash Transfer Extensions and Recipient Agency By Richard Sedlmayr; Anuj Shah; Munshi Sulaiman
  5. The effect of neighbourhoods and school quality on education and labour market outcomes in South Africa By Asmus Zoch
  6. Income Inequality in Côte d'Ivoire: 1985-2014 By Léo Czajka
  7. Do government transfers reduce poverty in China?: Micro evidence from five regions By Ben Westmore
  8. Migration and gender in South Africa: following bright lights and the fortunes of others? By Dieter von Fintel; Eldridge Moses
  9. The Importance of Oil in the Allocation of Foreign Aid: The case of the G7 donors By Cécile Couharde; Fatih Karanfil; Eric Gabin Kilamaa; Luc Désiré Omgbaa
  10. Searching for grouped patterns of heterogeneity in the climate-migration link By Martinez-Zarzoso, Inmaculada
  11. Has the Gender Wage Gap been Reduced during the 'Peruvian Growth Miracle?' A Distributional Approach By Juan Manuel del Pozo Segura

  1. By: Andres Giraldo; Manini Ojha; Manini Ojha
    Abstract: This paper evaluates the impact of quality of education on violence and crime using student performances on a mandatory examination as the measure of quality. The paper exploits transfers of funds from central government to municipalities for investments in education as a source of exogenous variation and finds that better education quality has a negative impact on economic crimes such as kidnapping rates, rate of theft on persons and presence of illegal armed groups. The findings are consistent with an opportunity cost effect of education, that is, high quality education increases expectations of being absorbed by the labor market and discourages engaging in criminal activities. Results also point to perhaps a pacifying effect of education such that improvement of education quality generates less violent environments, promotes social and political stability. The results are found to be robust to a number of econometric concerns and different measures of quality of education.
    Keywords: Quality of Education, Economic Crime, Conflict, Spatial Instruments
    JEL: D74 I25 O11
    Date: 2017–06–07
  2. By: Caterina Gennaioli; Gaia Narciso
    Abstract: Illegal disposal of toxic waste has become an issue of concern in both developing and developed countries. Recycling hazardous waste entails very high costs, which might give strong incentives to dispose toxic material in an illegal way. This paper adopts an innovative strategy to identify where toxic waste might have been illicitly dumped. The strategy relies on a crucial premise: road constructions provide an ideal setting in which the burial of hazardous waste may take place. Guided by the medical literature, we investigate the health outcomes of individuals living along recently constructed roads in Ethiopia. We construct a unique dataset, which includes the extensive Demographic and Health Survey, together with georeferenced data on roads, villages and economic development, covering a 10-year period. We find that an additional road within a 5 kilometres radius is associated with an increase in infant mortality by 3 percentage points. Moreover, we provide evidence that young children living near a recently built road show a lower level of haemoglobin and are more likely to suffer from severe anaemia. A series of robustness checks confirms the above findings and excludes other potential confounding factors.
    Keywords: Hazardous Waste, Health, Infant Mortality, Ethiopia
    JEL: I15 Q51 Q53 O10
    Date: 2017–09
  3. By: Purmini (Universitas Bengkulu); Sutyastie Soemitro Remi (Department of Economics, Padjadjaran University); Yayan Satyakti (Department of Economics, Padjadjaran University); Mohamad Fahmi (Department of Economics, Padjadjaran University); Iqbal Dawam Wibisono (Department of Economics, Padjadjaran University)
    Abstract: In almost all society in the world, women are assigned by culture to be the primary caregiver for the children in the households (UNDP, 1995 in Glick, 2002). Despite their primary role in the household, mothers can also contribute to their family by involving themselves in employment activity. This can potentially improve the wellbeing of their family, including their children's education. Using multilevel mixedeffects probit, this study examines the effect of mother’s employment on children’s schooling with panel data from Indonesian Family Life Survey (IFLS) 2000 and 2007. Result shows that mother’s employment have a positive impact on children’s schooling decision.The results also demonstrate the effect of variables such as mother and father education, mother and father income, numbers of siblings, and family wealth. In addition, this study also compares the effect in urban and rural area, different regions, and different religions. However, this study confirms that mother's employment have an important role on children's schooling decision.
    Keywords: mother's employment, education, Indonesia
    JEL: D1 I2
    Date: 2016–12
  4. By: Richard Sedlmayr; Anuj Shah; Munshi Sulaiman
    Abstract: Can extensions such as coaching and training augment the poverty relief effects of cash transfers, or do they unnecessarily constrain the agency of recipients in the allocation of program resources? We use a randomized trial to estimate the impacts of philosophically distinct variants of transfer-based poverty reduction approaches in rural Uganda. One is a microenterprise intervention in the spirit of so-called graduation programming that provides beneficiaries with an integrated package of cash transfers, coaching, and training on sustainable livelihoods; the other variant monetizes the cost of coaching and training so as to more than double the size of cash transfers. We also we evaluate the merits of more marginal individual extension components, involving savings group formation in the microenterprise variant and light-touch behavioral intervention (involving goal-setting and plan-making) in the cash variant. Overall, we build confidence that investing program resources in productive extensions can expand poverty reduction. We gain elevated confidence in the impacts and cost-effectiveness of the fully integrated microenterprise intervention.
    Keywords: cash transfers; graduation; microenterprise; aspirations; affirmations
    JEL: O12 O22 I38
    Date: 2017
  5. By: Asmus Zoch (Department of Economics, University of Mannheim)
    Abstract: This study evaluates the relative importance of family, neighbourhood and school quality in explaining variation in standardized test results, reaching and passing matric, university attendance and labour market earnings. It adds to the literature, by using a spatial approach to link a neighbourhood wealth index from the Census 2011 community survey to a unique administrative school data set from the Western Cape. For the long-term perspective the household and school information from the National Income Dynamics Study are explored. The results from administrative school data show how student wealth and differences in school quality produce vastly different outcomes for a cohort of grade 6 to 12 learners in Cape Town. It shows how grade 6 children going to the richest 20% of all schools are 30% more likely to pass matric in time, furthermore by grade 9 the learning gap is approximately four grade-levels worth of learning in comparison to children going to the poorest 20% of schools. However, this study also demonstrates that even children from the poorest neighbourhood would perform well if they go to one of the richest 20% of schools. Yet, given the limited number of quality schools, the segregated location of quality schools, financial as well as transport constraints, only very few children from the poorest 60% actually attend a top quintile schools. These results can be replicated for the national data set and show that in order to achieve more equal education outcomes, the quality of schools in the poor neighbourhoods have to be drastically improved. In addition, using the new school wealth index as an instrument for school quality, there seems to be a significant premium for quality education in labour markets earnings regressions, which show the long-term implications of the schooling system.
    Keywords: South Africa, Education, Spatial analysis, Neighbourhood effects, Family effects
    JEL: D10 I24 J15
    Date: 2017
  6. By: Léo Czajka (Paris School of Economics)
    Abstract: Data on income/consumption distributions in Sub-Saharan Africa have been mainly used to study the welfare of the poorest. Yet, the rapid growth experienced by several countries in the last decades has drawn the attention towards higher earnings groups in the income/consumption distributions. However, due to under-reporting and non-response, surveys often fail to accurately measure the income of the wealthiest. Little is known about the size of such biases as it requires to have access to more reliable sources of information. In this paper we confront the 2014-2015 household survey with first-hand income tax files in the case of Côte d’Ivoire, 2014. We first identify, within the survey, a sub-sample corresponding to the one for which we have fiscal data. Comparing the earning distribution of this sub-sample with the one extrapolated from the fiscal data, we are able to measure the magnitude and the distribution of the bias among top earners in the survey. We then use this estimation to adjust the pre-tax and pre-transfer income distribution of the entire survey sample and thus recover corrected nationally representative inequality statistics. Our results show that the 2014-2015 survey significantly underestimates income inequalities. After our correction, the top 1 % share increases from 11.57 % to 17.15 %, the top 10 % share from 40.34 % to 48.28 %, and the Gini coefficient from 0.53 to 0.59. We compare our estimates with more commonly used consumption inequality measures and discuss the potential sources of differences. Making the assumption that the bias is constant over time for a given level of income, we also extend our correction to previous surveys. After correction, top 1 % shares increase by 5-6 percentage points, top 10 % shares by 7-8 percentage points and Gini coefficients increase by 6 points, making Côte d’Ivoire’s inequality levels comparable to that of the US.
    Date: 2017–07
  7. By: Ben Westmore (OECD)
    Abstract: This paper estimates urban and rural poverty rates across five Chinese administrative regions (Shanghai, Liaoning, Guangdong, Henan and Gansu) in 2014 using representative household level data from the China Family Panel Studies survey. The types of government transfer payments that households in poverty received and the ability for such payments to lift households from poverty are also assessed. Consistent with official estimates, the results highlight substantial disparities in poverty rates between administrative regions. Smaller differences exist between urban and rural locations within the same administrative region. In 2014, the most common types of government transfer received by households in poverty were agricultural subsidies or social assistance - principally the dibao. Regarding the latter, the results suggest some improvement in payment targeting in rural areas, but most dibao recipients had income above the poverty line (as defined in this paper) in 2014. Furthermore, across all administrative regions, the vast majority of households living below the defined poverty line did not receive social assistance at that time.
    Keywords: China, development, poverty, social assistance policies
    JEL: I30 I32 I38 O53 R20 R28
    Date: 2017–10–04
  8. By: Dieter von Fintel (Department of Economics, Stellenbosch University and Institute for Labor Economics (IZA), Bonn); Eldridge Moses (Department of Economics, Stellenbosch University)
    Abstract: Internal migration in South Africa has a strong gender dimension. Historically, the apartheid-era migrant labour system meant that predominantly black African men moved to urban areas without their families. After the abolition of influx controls in 1986, many women relocated, presumably to join their male partners. The period of migration feminization was also coupled with labour market feminization. However, existing research shows that increased female labour supply was poorly matched by labour market absorption, leading to rising unemployment among black African women. This paper studies incentives for female migration in this context, by building a gravity model of male and female inter-municipal migration. We find that neither men nor women move primarily for family reasons. Instead, they follow the traditional male migrant route to well-lit economic centres. Women also do not migrate primarily for increases in their own labour market opportunities, but tend to flock to regions where other fortunate groups have higher earnings potential. While this might signal that migrants base relocation decisions on incorrect information (and could in turn explain why many migrants have unfulfilled expectations), our results also show that women not only move for work, but for public services. The implications are twofold if migration is to alleviate poverty in the long run: firstly, in the short run, management of public resources must improve, as poor (women) place large emphasis on their effect; and secondly, labour market barriers – especially into the informal sector – should be better understood.
    Keywords: Regional migration, gravity model, feminization of migration, income mobility, economics of gender, South Africa
    JEL: C31 J16 J61 O15 O18 R23
    Date: 2017
  9. By: Cécile Couharde; Fatih Karanfil; Eric Gabin Kilamaa; Luc Désiré Omgbaa
    Abstract: While it is often alleged that oil endowment might influence the destination of foreign aid, there is lack of empirical evidence of how and why such an effect may come into play, and even less so of the channels through which it works. This paper aims to bring evidence that contributes to address those points. Specifically, we investigate the role of oil in aid allocation of the G7 donors, over the 1980-2010 period. Results show that, unsurprisingly, aid allocated by these donors increases significantly with oil endowment of recipient countries. Looking more deeply, we interestingly show that their strategic interests in terms of oil security play a role in their provision of aid. More importantly, we find evidence for competition for access to oil supplies among this group of donors.
    Keywords: aid allocation, G7 donors, oil competition, spatial lag model.
    JEL: F35 C31
    Date: 2017
  10. By: Martinez-Zarzoso, Inmaculada
    Abstract: This paper uses international migration data and climate variables in a multi-country setting to investigate the extent to which international migration can be explained by changes in the local climate and whether this relationship varies between groups of countries. Moreover, the primary focus is to further investigate the differential effect found by Cattaneo and Peri (2016) for countries with different income levels using a high-frequency dataset. The idea being that country grouping is considered to be data driven, instead of exogenously decided. The estimation technique used to endogenously group the countries of origin is based on the group-mean fixedeffects (GFE) estimator proposed by Bonhomme and Manresa (2015), which allows us to group the origin countries according to the data generation process. The main results indicate that an increasing average local temperature is associated with an increase in that country's emigration rate, on average, but the effect differs between groups. The results are driven by a group of countries mainly located in Sub-Saharan Africa and Central Asia; however, no statistically significant association is found between the average amount of local precipitation and that country's rate of emigration.
    Keywords: international migration,climate change,developing countries,GFE,group heterogeneity
    JEL: F22 Q54
    Date: 2017
  11. By: Juan Manuel del Pozo Segura (Departamento de Economía de la Pontificia Universidad Católica del Perú)
    Abstract: Between 2004 and 2014 the Peruvian economy experienced a noticeable growth which surpassed most of Latin American countries during that period, leading some to quote this episode as the Peruvian Growth Miracle. Yet, growth of wages would not have been accompanied by an equally marked reduction in wage differentials between men and women despite government efforts to address this issue. Consequently, this study analyzes and decomposes the gender wage gap in Peru for 2004 and 2014 using the Machado and Mata (2005) decomposition method correcting for sample selection bias in the context of quantile regression (Albrecht et al. 2009). This allows to decompose the differential in terms of the endowment and treatment effect at each point of the income distribution instead of, as has been customary in previous studies for Peru, only at the average of the distribution. Using data from the National Household Survey, we find that unconditional and conditional gaps, which favour men, have deepened between 2004 and 2014 at every point of the distribution, while there is evidence of sticky floors and glass ceilings in both years. Decompositions consistently reveal that, for both years, discrimination against women is the most important factor behind gender gaps at each percentile even though the effect of endowments plays in favor of those. All in all, this raise doubts about the aggregate effectiveness of pro-equity policies applied in recent years. JEL Classification-JEL: C01, J08, J16, O12
    Keywords: Gender Wage Gap, Distributional Decomposition, Inequality, Peru, Quantile regressions
    Date: 2017

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