nep-dev New Economics Papers
on Development
Issue of 2018‒05‒21
twelve papers chosen by
Jacob A. Jordaan
Universiteit Utrecht

  1. Alleviating Global Poverty: Labor Mobility, Direct Assistance, and Economic Growth By Pritchett, Lant
  2. Spatial Diffusion of Economic Shocks in Networks By Ashani Amarasinghe; Roland Hodler; Paul A. Raschky; Yves Zenou
  3. The deterrence effect of immigration enforcement in transit countries: Evidence from Central American deportees By Martínez Flores, Fernanda
  4. Fertilizer and Sustainable Intensification in Africa By Holden , Stein T.
  5. Weather, Labor Reallocation and Industrial Production: Evidence from India By Jonathan Colmer
  6. What can we learn on Chinese aid allocation motivations from new available data? A sectorial analysis of Chinese aid to African countries By Marlène Guillon; Jacky Mathonnat
  7. Negotiating a Better Future: How Interpersonal Skills Facilitate Inter-Generational Investment By Nava Ashraf; Natalie Bau; Corinne Low; Kathleen McGinn
  8. The impact of women's age at marriage on own and spousal labor market outcomes in India: causation or selection? By Dhamija, Gaurav; Roychowdhury, Punarjit
  9. Remittances, Human Capital, and Economic Growth: Panel Data Evidence from Asia and Sub-Saharan Africa By Chakra Pani Acharya; Roberto Leon-Gonzalez
  10. Food for Work and Diet Diversity in Ethiopia By Debela, Bethelhem Legesse; Shively, Gerald E.; Holden, Stein T.
  11. Women's Empowerment, Gendered Institutions and Economic Opportunity: An Investigative Study for Pakistan By Parlow, Anton
  12. Social capital as a coping mechanism for seasonal deprivation: The case of the Monga in Bangladesh By Bakshi, Rejaul; Mallick, Debdulal; Ulubaşoğlu, Mehmet

  1. By: Pritchett, Lant (Harvard University)
    Abstract: Decades of programmatic experimentation by development NGOs combined with the latest empirical techniques for estimating program impact have shown that a well-designed, well-implemented, multi-faceted intervention can in fact have an apparently sustained impact on the incomes of the poor (Banerjee et al 2015). The magnitude of the income gains of the “best you can do†via direct interventions to raise the income of the poor in situ is about 40 times smaller than the income gain from allowing people from those same poor countries to work in a high productivity country like the USA. Simply allowing more labor mobility holds vastly more promise for reducing poverty than anything else on the development agenda. That said, the magnitude of the gains from large growth accelerations (and losses from large decelerations) are also many-fold larger than the potential gains from directed individual interventions and the poverty reduction gains from large, extended periods of rapid growth are larger than from targeted interventions and also hold promise (and have delivered) for reducing global poverty.
    Date: 2018–03
  2. By: Ashani Amarasinghe; Roland Hodler; Paul A. Raschky; Yves Zenou
    Abstract: The aggregate economic impact of any developmental project depends on its effects within the chosen administrative region as well as its economic spillovers into other regions. However, little is known about how these spillovers propagate through geographic, ethnic and road networks. In this paper, we analyze both theoretically and empirically the role of these networks in the spatial diffusion of local economic shocks. We develop a network model that shows how a district’s level of prosperity is related to its position in the network. The network model’s first-order conditions are used to derive an econometric model of spatial spillovers that we estimate using a panel of 5,944 districts from 53 African countries over the period 1997-2013. To identify the causal effect of spatial diffusion, we exploit cross-sectional variation in the location of mineral mines and exogenous time variation in world mineral prices. Our results show that road and ethnic connectivity are particularly important factors for diffusing economic spillovers over longer distances. We then use the estimated parameters from the econometric model to calculate the key player centralities, which determine which districts are key in propagating local economic shocks across Africa. We further show how counterfactual exercises based on these estimates and the underlying network structure can inform us about the potential gains from policies that increase economic activity in specific districts or improve road connectivity between districts.
    Keywords: economic development, networks, spatial spillovers, key player centrality, natural resources, transportation, Africa
    JEL: O13 O55 R12
    Date: 2018
  3. By: Martínez Flores, Fernanda
    Abstract: Immigration enforcement cooperation between final destination and transit countries has increased in the last decades. However, the question whether these measures are successful in deterring undocumented migrants has not been previously explored by the empirical literature. This paper examines whether the Southern Border Plan, an immigration enforcement program implemented by the Mexican government in 2014, has curbed intentions of unauthorized migrants from El Salvador, Guatemala, and Honduras to migrate to the United States. Combining surveys from Central American and Mexican deportees and using a DiD approach, I find that increased enforcement in Mexico decreases the likelihood of attempting repeated unauthorized crossings. The results indicate that in the short-run the cooperation between destination and transit countries could be effective in deterring undocumented migrants.
    Keywords: immigration enforcement,deportees,Central American migrants,unauthorized,undocumented,remigration,transit countries
    JEL: F22 K42 O15
    Date: 2018
  4. By: Holden , Stein T. (Centre for Land Tenure Studies, Norwegian University of Life Sciences)
    Abstract: The paper investigates the important role of fertilizer to enhance sustainable intensification and food security in Sub-Saharan Africa based on a multi-disciplinary literature review. The review starts with a macro-perspective taking population growth, economic development and climate change into account. This is complemented with a micro-perspective summarizing findings from comprehensive micro-data in selected African countries. Agronomic, environmental and economic profitability implications of fertilizer use are reviewed. An assessment is made whether small farmers in Africa should be considered rational or partly irrational agricultural decision-makers and whether this can affect fertilizer use. I then discuss some controversial and promising policy approaches that may have the potential to enhance sustainable intensification and nutrient use efficiency in African agriculture before I conclude.
    Keywords: Sub-Saharan Africa; fertilizer; sustainable intensification; food security; policy.
    JEL: Q12 Q18 Q56
    Date: 2018–01–05
  5. By: Jonathan Colmer
    Abstract: Temperature-driven reductions in the demand for agricultural labor are associated with increases in the share of workers engaged in manufacturing, suggesting that the ability of non-agricultural sectors to absorb workers may play a key role in attenuating the economic consequences of weather-driven changes in agricultural productivity. Exploiting firm-level variation in the propensity to absorb these workers, I find that this reallocation is associated with relative expansions in manufacturing activity in exible labor market environments. Counter-factual estimates suggest that in the absence of labor reallocation the aggregate consequences of temperature increases would be up to 40% higher.
    Keywords: labor reallocation, agricultural productivity, labor regulation, industrial production
    JEL: O13 Q54 J62
    Date: 2018–05
  6. By: Marlène Guillon (CERDI - Centre d'Études et de Recherches sur le Développement International - Clermont Auvergne - UCA - Université Clermont Auvergne - CNRS - Centre National de la Recherche Scientifique); Jacky Mathonnat (CERDI - Centre d'Études et de Recherches sur le Développement International - UdA - Université d'Auvergne - Clermont-Ferrand I - CNRS - Centre National de la Recherche Scientifique, FERDI - Fondation pour les Etudes et Recherches sur le Développement International)
    Abstract: Since the creation of the Forum on China-Africa Cooperation (FOCAC) in 2000, Chinese official development assistance (ODA) to Africa has increased drastically. Only few analyses on the determinants of Chinese ODA allocation to African countries are available. Moreover, existing literature mainly focused on total aid flows while Chinese motivations for aid allocation might differ depending on the ODA sector considered. Our objective is to study the factors associated with Chinese aid allocation to African countries by sector between 2000 and 2014. We consider 3 ODA broad sectors as defined by the Organisation for Economic Cooperation and Development (OECD): the social infrastructure and services sector, the economic infrastructure and services sector and the production sector. Chinese ODA is measured using the AidData's Global Chinese Official Finance Dataset, 2000-2014, Version 1.0, released in fall 2017. Over the 2000-2014 period, China allocated 971, 218 and 138 ODA projects to African countries in the social infrastructure and services sector, the economic infrastructure and services sector and the production sector respectively. Between 2000 and 2014, the economic infrastructure and services sector was the first sector in terms of ODA amount with a total of US$18.9 billion ahead from the social infrastructure and services sector with US$7 billion or the production sector with US$3.1 billion. Results of our analysis suggest that the motivations of Chinese aid allocation to African countries differ by sector. Chinese ODA in the social infrastructure and services sector appears responsive to the economic needs of recipient countries but is also driven by foreign policy considerations. Chinese economic interest, in particular for natural resources acquisition, is associated with China’s ODA allocation in the economic infrastructure and services sector. Finally, while institutions in recipient countries are not related to Chinese ODA in the social infrastructure and services sector, we find that China allocates more ODA in the economic infrastructure and services sector and the production sector to African countries with weaker institutions. One of the strong conclusions of this study is to show that considering only China's overall aid to Africa can be misleading as to its underlying determinants, and therefore to point out the need to disaggregate the analysis by ODA sectors.
    Keywords: Official development assistance,China,Africa,sectorial analysis
    Date: 2018–04–24
  7. By: Nava Ashraf (Harvard University); Natalie Bau (University of Toronto); Corinne Low (University of Pennsylvania); Kathleen McGinn (Harvard Business School)
    Abstract: Using a randomized control trial, we examine whether offering adolescent girls non-material resources – specifically, negotiation skills – can improve educational outcomes in a low-income country. In so doing, we provide the first evidence on the effects of an intervention that increased non-cognitive, interpersonal skills during adolescence. Long-run administrative data shows that negotiation training significantly improved educational outcomes over the next three years. The training had greater effects than two alternative treatments (offering girls a safe physical space with female mentors and offering girls information about the returns to education), suggesting that negotiation skills themselves drive the effect. Further evidence from a lab-in-the-field experiment, which simulates parents’ educational investment decisions, and a midline survey suggests that negotiation skills improved girls’ outcomes by moving households’ human capital investments closer to the efficient frontier. This is consistent with an incomplete contracting model, where negotiation allows daughters to strategically cooperate with parents.
    Keywords: Zambia, critical periods, non-cognitive skills, educational achievement, adolescence, female education
    JEL: J24 C93 D19
    Date: 2018–05
  8. By: Dhamija, Gaurav; Roychowdhury, Punarjit
    Abstract: The labor market impacts of women's age at marriage have recently received significant attention from social scientists. The focus of this literature, however, has been the developed world and almost nothing is known about how a delay in marriage affects labor market prospects of women in developing countries. This paper addresses this gap in the existing literature by providing the first comprehensive assessment of the relationship between women's age at marriage and own as well as spousal labor market outcomes specifically in context of a developing country. Using nationally representative household data from India, we find evidence of positive effects of women's age at marriage on their own and their spouses' labor market outcomes. To examine whether these effects are causal or arise due to selection into marriage, we use an instrumental variables-based empirical strategy that utilizes variation in age at menarche to obtain exogenous variation in women's age at marriage. Our results indicate that the positive effects of age at marriage of women on own as well spousal labor market outcomes are not causal and arise purely due to selection. The results are robust to addressing biases due to nonrandom selection of individuals into labor force. Our findings shed new light on theories of labor market in developing countries specifically through the lens of marriage.
    Keywords: Age at Marriage, India, Instrumental Variables, Labor Market Outcomes, Selection, Women
    JEL: J12 J16 J22 J31 O12
    Date: 2018–05–05
  9. By: Chakra Pani Acharya (National Planning Commission Secretariat, Kathmandu, Nepal); Roberto Leon-Gonzalez (National Graduate Institute for Policy Studies, Tokyo, Japan)
    Abstract: We examine the impact of remittances on economic growth using panel data (1975-2014) for 18 countries in Asia and Sub-Saharan Africa (SSA) that are similar in size and development level. We allow for heterogeneous production functions across countries and calculate the average marginal effects of remittances using the panel dynamic ordinary least squares estimator. The estimation results show that remittances increase growth significantly, especially through investments in human capital. In addition we find that: (i) remittances have a modest impact on growth when controlling for physical and human capital channels through which remittances potentially affect output growth; (ii) when we do not control for human capital the effect is larger regardless of the sub-samples considered - the elasticity of output with respect to remittances is 7.3 percent in the full sample, and 18.6 percent among Asian countries ; (iii) remittances have a significant positive long-run effect on human capital formation regardless of the sub-samples considered but the effect on physical capital accumulation is significant only among middle income and Asian countries. The findings suggest that channeling the remittances towards investments in physical capital and adoption of new knowledge, skills and technology is crucial for high economic growth in low income countries.
    Date: 2018–05
  10. By: Debela, Bethelhem Legesse (Department of Agricultural Economics and Rural Development); Shively, Gerald E. (bDepartment of Agricultural Economics and Purdue Policy Research Institute); Holden, Stein T. (Centre for Land Tenure Studies, Norwegian University of Life Sciences)
    Abstract: We use four waves of panel data from Northern Ethiopia to investigate the link between Food for Work (FFW) participation and the diversity of food consumption and production. Food-based transfer programs have become a standard tool for addressing the problem of chronic food insecurity in developing countries. Such programs have the potential to expand diet diversity if food items provided under FFW are not part of the beneficiaries’ staple diet. By raising effective incomes, cash payments also have the potential to “crowd in” purchases of nutritionally important foods. On the other hand, FFW programs have the potential to undermine dietary diversity by altering the basic crop mix if participation requires households to divert labor away from on-farm production. The net effect is unclear, which we empirically investigate in this study. By employing random effects, fixed effects and difference-indifference estimations, we find that FFW participants had greater dietary diversity compared to non-participants, with an average effect magnitude equivalent to onefifth of a standard deviation in the food variety score. When items directly provided by the FFW program are excluded from the variety score, the overall effect is statistically weaker, but similar in sign and magnitude, suggesting modest “crowding in” of diet diversity from FFW participation. Findings also reveal that higher intensity of participation in FFW is linked with diversified food consumption. We find no evidence that FFW participation led to changes in production diversity, suggesting that FFW programs may not be competing for labor with on farm production. Findings have relevance for interventions that aim to improve food security and promote dietary quality in low-income populations.
    Keywords: diet diversity; Ethiopia; food for work; food security; nutrition
    JEL: I38 Q12
    Date: 2017–11–27
  11. By: Parlow, Anton
    Abstract: Increasing female landownership or labor force participation are policies designed to empower women in developing countries. Yet, societies are diverse and I find that across language and ethnic groups not all Pakistani women benefit from these increased economic opportunities in their decision making. I even find negative impacts of labor force participation on empowerment for some groups. This can be explained by different gender expectations along these gendered institutions.
    Keywords: Women's Empowerment, Ethnicity, Identity
    JEL: J0 J01 O12
    Date: 2018–04–23
  12. By: Bakshi, Rejaul; Mallick, Debdulal; Ulubaşoğlu, Mehmet
    Abstract: The extreme hunger and deprivation that recurs every year in the lean season in northern Bangladesh, locally known as the Monga, is mainly due to the malfunctioning local labor and credit markets. Using data covering 5,600 extreme poor households in the Monga-prone region, we investigate in detail the role of social capital in securing employment and obtaining informal loans. Correcting for the endogeneity of social capital by the heteroscedasticity-based method proposed by Klein and Vella (2010) and also by the standard IV method for a robustness check, we document that social capital plays an important role in obtaining both wage- and self-employment. We also document a weak negative effect of social capital on obtaining informal loans. We explain our results in terms of the role of horizontal and vertical components of our measures of social capital in influencing different outcomes.
    Keywords: Monga, extreme seasonality, social capital, heteroscedasticity, employment, informal loan
    JEL: G21 I32 P46
    Date: 2017

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