nep-dev New Economics Papers
on Development
Issue of 2019‒01‒28
sixteen papers chosen by
Jacob A. Jordaan
Universiteit Utrecht

  1. The Returns to Parental Health: Evidence from Indonesia By Luca, Dara Lee; Bloom, David E.
  2. Learning Spillovers in Conditional Welfare Programs: Evidence from Brazil By Fernanda Brollo; Katja Maria Kaufmann; Eliana La Ferrara
  3. The Impact of Household Shocks on Domestic Violence: Evidence from Tanzania By Abiona, Olukorede; Foureaux Koppensteiner, Martin
  4. Who is an internal migrant? By Sharma, Rasadhika; Grote, Ulrike
  5. Does Education Reduce Fertility in a Low Income Country ? Evidence based on Fuzzy Regression Discontinuity Design in Tanzania By Salome Maseki; Hisahiro Naito
  6. Thirty years of economic growth in Africa By João Amador; António R. dos Santos
  7. The gold digger and the machine evidence on the distributive effect of the artisanal and industrial gold rushes in Burkina Faso By Remi Bazillier; Victoire Girard
  8. Misperceived Quality: Fertilizer in Tanzania By Michelson, Hope; Ellison, Brenna; Fairbairn, Anna; Maertens, Annemie; Manyong, Victor
  9. “Land Ownership and Informal Credit in Rural Vietnam" By Matteo Migheli
  10. Mothers and Fathers : Education, Co-residence and Child Health By Elodie Djemai; Yohan Renard; Anne-Laure Samson
  11. Parental Migration Decisions and Child Health Outcomes: Evidence from China By Lin, Carl; van der Meulen Rodgers, Yana
  12. Financial Inclusion and Bank Competition in Sub-Saharan Africa By Azanaw Mengistu; Hector Perez Saiz
  13. Community mills and women's empowerment in Burkina Faso By Claudio Araujo; Catherine Araujo-Bonjean; Victor Beguerie
  14. The Dynamics of Finance-Growth-Inequality Nexus: Theory and Evidence for India By Pranab Kumar Das; Bhaswati Ganguli; Sugata Marjit; Sugata Sen Roy
  15. Foreign aid,poverty and economic growth in developing countries: A dynamic panel data causality analysis By Mahembe, Edmore; Odhiambo, Nicholas M
  16. Adoption of improved crop varieties by involving farmers in the e-wallet program in Nigeria By Joseph I. Uduji; Elda N. Okolo-Obasi

  1. By: Luca, Dara Lee (Mathematica Policy Research); Bloom, David E. (Harvard University)
    Abstract: This paper investigates the economic returns to parental health. To account for potential endogeneity between parental health and child outcomes, we leverage longitudinal microdata from Indonesia to estimate individual fixed effects models. Our results show that the economic returns to parental health are high. We show that maternal health not only significantly affects her children's health, but is also intrinsically linked to her spouse's labor market status and earnings. Paternal health appears to be more linked to child schooling outcomes, especially for girls. When both parents are in poor health, the negative effects on their children are compounded. Additionally, the consequences of poor parental health are enduring. Longer-run effects of poor parental health manifest in a lower likelihood of high school completion, fewer years of schooling, and poorer adult health.
    Keywords: parental health, spousal health, child health, education, family economics
    JEL: I12 J13 J16
    Date: 2018–11
  2. By: Fernanda Brollo; Katja Maria Kaufmann; Eliana La Ferrara
    Abstract: We study spillovers in learning about the enforcement of Bolsa Familia, a program conditioning benefits on children’s school attendance. Using original administrative data, we find that individuals’ compliance responds to penalties incurred by their classmates and by siblings’ classmates (in other grades/schools). As the severity of penalties increases with repeated noncompliance, the response is larger when peers are punished for “higher stages†than the family’s, consistent with learning. Individuals also respond to penalties experienced by neighbors who are exogenously scheduled to receive notices on the same day. Our results point to important social multiplier effects of enforcement via learning.
    Date: 2018–11
  3. By: Abiona, Olukorede (University of Leicester); Foureaux Koppensteiner, Martin (University of Leicester)
    Abstract: In this paper, we study the effect of household shocks on the incidence of domestic violence using household survey microdata from Tanzania. We use idiosyncratic variation in rainfall to proxy for shocks on household income of rural households. We find that droughts lead to a considerable increase of domestic violence in the households. A one standard deviation negative rainfall shock from the long-term mean increases the incidence by about 13.1 per cent compared to the baseline. We make use of the rich information from the household survey to investigate the underlying pathways.
    Keywords: domestic violence, household shocks, rainfall, Tanzania
    JEL: D13 I10 J12 J16
    Date: 2018–11
  4. By: Sharma, Rasadhika; Grote, Ulrike
    Abstract: There is no internationally accepted definition of an internal migrant. Different surveys and academic papers use varied definitions that are open to subjectivity. Our paper stresses this issue and tests the sensitivity of results obtained by econometric analysis to the use of different defining criterion. Using four definitions of an internal migrant based on aspects of varied time intervals, purpose of migration and geographical shifts, we examine the determinants of the migration decision and the impact of migration on the household’s income. We employ Probit modelling and difference-in-difference Probability Score Matching to estimate the two questions, respectively. We find that a change in definition alters the target sample and therefore induces identification errors. In case of determinants, the magnitude and significance of variables capturing human and social capital, socio-demography and wealth of the household change across the four definitions. Additionally, having a migrant, increases the household’s income under two definitions, while negatively impacting the household’s income under the other two definitions. Therefore, it is pertinent to standardize the definition of an internal migrant before assessing the impact of migration. Our paper aims to bring this issue to the attention of international organizations and future researchers who work in the area of migration. It advocates for a standardized definition by proposing basic guidelines.
    Keywords: Internal migration, Internal migrant, Vietnam, Measurement
    JEL: O15 R23 J61 I32 O53
    Date: 2019–01
  5. By: Salome Maseki; Hisahiro Naito
    Abstract: Using adoption of no-expulsion policy in primary schools in Tanzania and a fuzzy regression discontinuity design, we examine the causal effect of education on fertility and child mortality using Tanzania census data sets. A no-expulsion policy in Tanzania generates a discontinuous change of years of schooling of females by about 2 years. Using this change of years of schooling, we show that the effect of education on fertility is non-uniform in the sense that one year increase of female schooling {\sl increases} the probability of having at least one birth by 1.55 percentage point but it {\sl decreases} the probability of having a large number of births such as at least 8 births or 10 births by about 3 percentage points. This suggest that it is not sufficient to focus on the average number of births to examine the effect of education on fertility. We also find that one year increase of schooling decreases the number of experienced child death by 0.2 frequency and decrease the child mortality rate by 2 percentage point. Due to those several offsetting effects, the effect of additional year of schooling on the number of surviving children is very close to zero or marginally positive.
    Date: 2019–01
  6. By: João Amador; António R. dos Santos
    Abstract: This paper examines the contribution of employment, capital accumulation and total factor productivity (TFP) to economic growth in African countries over the period 1986-2014. The methodology consists in the estimation of a translog dynamic stochastic production frontier for a set of 49 African economies, thus allowing for the breakdown of TFP along efficiency developments and technological progress. Although the heterogeneity amongst African countries poses a challenge to the estimation of a common production frontier, this is the best approach to perform cross-country comparisons. The results of our growth accounting exercise are more accurate for the contribution of input accumulation and TFP to GDP growth than for the separation between contributions of technological progress and efficiency. We conclude that economic growth patterns differ across African countries but they have been almost totally associated to input accumulation, notably in what concerns capital. The experience of Egypt, Nigeria and South Africa - the three largest African economies - confirms this pattern.
    Keywords: Africa, Development, Growth Accounting, Dynamic Stochastic Frontiers
    Date: 2018
  7. By: Remi Bazillier; Victoire Girard
    Abstract: This paper uses a quasi-natural experiment, the recent gold boom in Burkina Faso, to document the local impact of two alternative mining techniques: artisanal and industrial mines. Artisanal mines have a bad reputation. When these mines (managed in commons) compete for land with industrial mines (privatized), governments tend to favor industries. However, more than 100 million people depend on artisanal mines for their livelihoods. Our identification strategy exploits two sources of variation. The spatial variation comes from the exposure of households to different geological endowments, and the temporal variation comes from changes in the global gold price. We are the first to document the economic impact of artisanal mines. We show that a 1% increase in the gold price increases consumption by 0.15% for households neighboring artisanal mines. Opening an industrial mine, in contrast, has no impact on local consumption.
    Keywords: Artisanal mining, Commons, Extractive industries, Gold, Poverty, Burkina Faso
    Date: 2019
  8. By: Michelson, Hope; Ellison, Brenna; Fairbairn, Anna; Maertens, Annemie; Manyong, Victor
    Abstract: Fertilizer use remains below recommended rates in most of Sub-Saharan Africa, contributing to poor crop yields and poverty. Farmers voice suspicion that available fertilizer is often adulterated, but these concerns are not backed by reliable evidence. In fact, an insight from industry but absent from academic literature is that profitable fertilizer adulteration is difficult. We surveyed all fertilizer sellers in Morogoro Region, Tanzania and tested 633 samples of their fertilizer. We also conducted a willingness-to-pay assessment with farmers. We find that fertilizers meet nutrient standards but that belief of rampant product adulteration persists among farmers. We find evidence of a quality inference problem in the market: 25% of fertilizer has deteriorated in observable ways and farmers rely on these observable attributes to (incorrectly) assess unobservable nutrient quality. We show that this misperception likely reduces technology adoption beyond the effect of nutrient quality being unobservable.
    Keywords: agriculture, fertilizer, input adoption, technology adoption, quality, Sub-Saharan Africa
    JEL: D8 D82 O1 O10 O13 Q12
    Date: 2018–10–01
  9. By: Matteo Migheli (University of Turin and CeRP-Collegio Carlo Alberto)
    Abstract: Access to credit and its cost is a major challenge for farmers in developing countries. Several studies show that land serves as collateral for accessing formal credit, but they often do not find any significant effect of land size on access to informal credit. I study the effects of land ownership on both the demand and the cost of informal credit in the Mekong Delta. The results show that as land ownership increases, both the demand and the cost of informal loans decrease. Design and implementation of appropriate land redistributions seems a fundamental way to fight the informal credit market.
    Date: 2018–06
  10. By: Elodie Djemai (PSL, Université Paris-Dauphine, LEDa); Yohan Renard (PSL, Université Paris-Dauphine, LEDa); Anne-Laure Samson (LEM, Universite de Lille)
    Abstract: We use four waves of Demographic and Health Surveys from Zimbabwe to evaluate the effect of mother’s and father’s education on child health outcomes. We identify causal effects using the 1980 education reform. A simultaneous-equation model is estimated to take into account possible selection and endogeneity biases. Our results suggest some specialization within parents, as mothers and fathers do not affect the same health outcomes of their under-5 children. Fathers matter more than mothers, and mother’s education improves health only when she is matched to a low-educated man. There is selection in our sample, as is usual. The inverse Mills ratio capturing the likelihood of living with one’s father or mother significantly affects child health. Last, parental educational sorting is shown to be important, so that estimation that does not take both mother’s and father’s education into account will produce biased results.
    Keywords: Couples, Child’s Health, Education, Reform, Sub-Saharan Africa
    JEL: I10 O12 J12 C36 C34
    Date: 2019–01
  11. By: Lin, Carl (Bucknell University); van der Meulen Rodgers, Yana (Rutgers University)
    Abstract: This study uses migrant household survey data from 2008 and 2009 to examine how parental migration decisions are associated with the nutritional status of children in rural and urban China. Results from instrumental variables regressions show a substantial adverse effect of children's exposure to parental migration on height-for-age Z-scores of left-behind children relative to children who migrate with their parents. Additional results from a standard Blinder-Oaxaca decomposition, a quantile decomposition, and a counterfactual distribution analysis all confirm that children who are left behind in rural villages – usually because of the oppressive hukou system – have poorer nutritional status than children who migrate with their parents, and the gaps are biggest at lower portions of the distribution.
    Keywords: migration, China, children, health, nutrition
    JEL: I10 J61
    Date: 2018–11
  12. By: Azanaw Mengistu; Hector Perez Saiz
    Abstract: In this paper we study how competition and financial soundness affect financial inclusion in Sub-Saharan Africa (SSA). We use detailed individual-level survey data, combined with key country-level indicators of bank competition and financial soundness, to study the effect on the adoption of several financial products (bank accounts, credit and debit cards, and bank loans). We find that more competition tends to increase the probability of access to these financial products. On the contrary, we do not find strong evidence of the effect of bank-balance sheet variables (i.e. capital adequacy or liquidity) on borrowing by individuals. Our results may help policy makers design regulations that could improve financial inclusion, which could potentially impact economic growth and long-term economic development.
    Keywords: Accounts;Competition;Financial inclusion;Financial soundness indicators;Balance sheets;Sub-Saharan Africa;financial soundness, debit cards, Business Objectives of the Firm
    Date: 2018–12–07
  13. By: Claudio Araujo (CERDI - Centre d'Études et de Recherches sur le Développement International - Clermont Auvergne - UCA - Université Clermont Auvergne - CNRS - Centre National de la Recherche Scientifique); Catherine Araujo-Bonjean (CERDI - Centre d'Études et de Recherches sur le Développement International - Clermont Auvergne - UCA - Université Clermont Auvergne - CNRS - Centre National de la Recherche Scientifique); Victor Beguerie (FERDI - Fondation pour les Etudes et Recherches sur le Développement International, CERDI - Centre d'Études et de Recherches sur le Développement International - Clermont Auvergne - UCA - Université Clermont Auvergne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: The Multi-Functional Platforms program consists of setting up powered community mills managed by women in rural areas. By strengthening women's capacities in areas traditionally reserved for men, the program places women at the core of local development and places emphasis on the empowerment of women. To assess the impact of community mills on women's empowerment, which is by its very nature a non-observable variable with multiple dimensions, we propose an original operational framework based on Sen's capability theory. We argue that community mills participate in women's empowerment by giving them more control over the decision-making process in all spheres of their life (agency freedom), and by expanding their capability set (well-being freedom). We use structural equation modeling to explore the relationship between these two unobservable latent variables, and to assess the impact of community mills. The database is taken from a survey of 2,400 women living in 200 villages in Burkina Faso. The results are consistent with a positive impact of the program on women's empowerment. The results also confirm the validity of the approach for evaluating a potentially important, but hard-to-value, intangible outcome of a development program like individual empowerment.
    Keywords: Capability,Agency,Structural equation model,Burkina Faso.
    Date: 2018–12–18
  14. By: Pranab Kumar Das; Bhaswati Ganguli; Sugata Marjit; Sugata Sen Roy
    Abstract: The purpose of this research study has been to expand our understanding of the finance-growth ‘nexus’ to finance-growth-inequality ‘nexus’ in the presence of both the formal and the informal sources of borrowing. Using empirical evidence of IHDS Survey data for two rounds the study attempts to assess the co-evolution of finance-growth-inequality in an intertemporal framework. The most important finding of the paper pertains to the econometric result that the household asset grows at the same rate independent of the source of loans - banks or moneylenders though the level effect (intercept) is higher if the loan is obtained from banks or lower if the household lives below poverty line. The same also holds for the rate of growth of per capita income. There is virtually no significant difference for the households living below poverty line (BPL) on the rate of growth of capital asset or income whether source of borrowing is bank or money lender. This is then formalized in a theoretical model of intertemporal choice of entrepreneur-investor to show that if there are both formal and informal sources of borrowing with a constraint on the formal sector borrowing and no constraint on the latter, then growth rates of asset and income are determined by the informal sector interest rate. The result can be generalised for any number of sources of borrowing. This questions the conventional wisdom regarding the policy aimed at financial inclusion. Inequality of income increases independent of the source of borrowing, though the BPL households are worse off in general.
    Keywords: financial development, financial inclusion growth, inequality, bank, India, IHDS, logit model
    JEL: C35 E50 G21 O11
    Date: 2018
  15. By: Mahembe, Edmore; Odhiambo, Nicholas M
    Abstract: This article examines the causal relationship between foreign aid, poverty and economic growth in 82 developing countries for the period 1981???2013. Taking advantage of the recently developed dynamic panel data estimation techniques, the paper tests for both panel unit roots and cointegration before employing the panel vector error-correction model (VECM) Granger causality test. The main findings are that in the short run, there was evidence of (a) a bidirectional causal relationship between economic growth and poverty; (b) a unidirectional causal relationship from economic growth to foreign aid; and (c) unidirectional causality from poverty to foreign aid. In the long-run, the study found that (a) foreign aid tends to converge to its long-run equilibrium path in response to changes in economic growth and poverty; and (b) both economic growth and poverty jointly Granger cause foreign aid.
    Keywords: official development assistance (ODA); foreign aid; poverty; economic growth; dynamic panel data analysis; Granger Causality; vector error-correction model (VECM).
    Date: 2019–01
  16. By: Joseph I. Uduji (University of Nigeria, Nsukka, Nigeria); Elda N. Okolo-Obasi (University of Nigeria, Nsukka, Nigeria)
    Abstract: The amount of improved seed used in Nigeria is extremely low. Overall, only 5 to 10 percent of cultivated land is planted with improved seeds, and about 10 percent of rural farmers use improved varieties. The objective of this investigation was to identify determinants of adoption of improved seed by farmers not participating in and those participating in the federal government’s e-wallet program in Nigeria. We determined the impact of the e-wallet program on adoption of improved seed in rural areas. One thousand, two hundred (1200) rural farmers were sampled across six geopolitical zones of Nigeria. Results from the use of a bivariate probit model indicated that the e-wallet program continued to become increasingly popular among rural farmers; and that farmers’ literacy, ownership of a mobile phone, value output, mobile network coverage, power for charging phone batteries and contact with extension agents were the positive determinants of farmer participation in thee-wallet program. Cultural obstacles to married women, growers’ age, and increased distance to registration and input collection centers reduced farmers’ tendency to participate in the e-wallet program. The results also showed that rural farmers depended on the e-wallet program for increased use and adoption of improved seed in Nigeria, to boost food security in sub-Saharan Africa. The results suggested the need for an improved e-wallet model by lessening constraints mostly associated with rural information and communication infrastructure, and distance to the registration and input collection centers.
    Keywords: Agricultural transformation agenda; bivariate probit model
    JEL: J43 O40 O55 Q10
    Date: 2018–01

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