nep-dev New Economics Papers
on Development
Issue of 2019‒09‒16
twelve papers chosen by
Jacob A. Jordaan
Universiteit Utrecht

  1. Gender Equality in the Family Can Reduce the Malaria Burden in Malawi By Klein, Matthew J.; Barham, Bradford L.; Wu, Yuexuan
  2. Dynamics of income inequality under disequilibrium: The case of India By Anand Sahasranaman; Henrik Jeldtoft Jensen
  3. The Impact of Family Size and Sibling Structure on the Great Mexico-U.S. Migration By Bratti, Massimiliano; Fiore, Simona; Mendola, Mariapia
  4. On the transmission channels for the resource curse By K. Peren Arin; Elias Braunfels; Christina Zenker
  5. The Great Divergence in South Africa: Population and Wealth Dynamics Over Two Centuries By von Fintel, Dieter; Fourie, Johan
  6. ECONOMIC GROWTH IN SUB-SAHARAN AFRICA, 1885-2008 By Stephen Broadberry; Leigh Gardner
  7. Growth Enhancement Support Scheme (GESS) and Farmers’ Fertilizer Use in Rural Nigeria By Joseph I. Uduji; Elda N. Okolo-Obasi; Simplice A. Asongu
  8. Seasonal Migration and Education of Children Left Behind: Evidence from Armenia By Davit Adunts; Geghetsik Afunts
  9. Does Education Increase Risk Aversion? Evidence Using Artefactual Experiments in Peru By Alberto Chong; Joan J. Martínez
  10. Beyond Solidarity and Accumulation Networks in Urban Informal African Economies By Jean-Philippe Berrou; François Combarnous
  11. Labor protection laws and the drain on productivity: Evidence from India By Daniel Schwab
  12. Parental Migration, Investment in Children, and Children's Non-cognitive Development: Evidence from Rural China By Jiang, Hanchen; Yang, Xi

  1. By: Klein, Matthew J. (U of Wisconsin-Madison); Barham, Bradford L. (U of Wisconsin-Madison); Wu, Yuexuan (U of California, Davis)
    Abstract: We provide the first empirical evidence that increasing equality between decision makers in a family reduces malaria transmission in Malawi. International organizations and the Malawi government have invested more than one hundred million dollars to reduce the disease burden in the past decade, successfully reducing malaria prevalence by innovating, and scaling up impactful interventions. Additional progress is possible: we show that integrating women’s empowerment programs into malaria control efforts would reduce the disease burden further. We measure power in three different ways: we estimate two separate collective models of the family, one with outside options and one without, and we construct a reduced form index as a proxy. We find that women have less power than men across all three measurement methods. Using an instrumental variables approach, we find that a one standard deviation increase in women’s bargaining power decreases the likelihood that a family member contracts malaria by between 45% and 48%, depending on which measurement we use. We suggest that NGO and government programs addressing malaria incorporate a female empowerment component, like a gendered cash transfer, to better combat this deadly disease.
    JEL: D1 I14 I15
    Date: 2019–09
  2. By: Anand Sahasranaman; Henrik Jeldtoft Jensen
    Abstract: Income inequality is one of the most significant socio-economic challenges confronting India, with potentially long-lasting implications for the future of its democracy and society. In this work, we explore income inequality in India, without assumptions of equilibrium, and illustrate the nature and direction of re-distribution within the income distribution in a dynamic sense. Given that both mean income and income inequality show a rising trend post the Industrial Revolution, we argue that such a process is appropriately modeled using Geometric Brownian Motion (GBM). Specifically, we use the mechanism of GBM with a reallocation parameter (which indicates the nature of re-distribution occurring in the income distribution) proposed by Berman et al. We find that since the mid-1990s, reallocation is negative, meaning that incomes are exponentially diverging, indicating that there is a perverse re-distribution of resources from the poor to the rich. It has been well known that static inequality is rising in India, but the assumption has been that while the rich may be benefiting more than proportionally from economic growth, the poor are also better off than before. The surprising finding from our work is that the nature of income inequality is such that we have moved from a regime of progressive to regressive re-distribution. Essentially, continued impoverishment of the poor is directly spurring multiplicative income growth of the rich. We characterize these findings in the context of increasing informality of the workforce in the formal manufacturing and service sectors, as well as the possible evolution of negative net incomes of the agriculture workforce in India. Significant structural changes may be required to address this phenomenon.
    Date: 2019–09
  3. By: Bratti, Massimiliano; Fiore, Simona; Mendola, Mariapia
    Abstract: We investigate how fertility and demographic factors affect migration at the household level by assessing the causal effects of sibship size and structure on offspring's international migration. We use a rich demographic survey on the population of Mexico and exploit presumably exogenous variation in family size induced by biological fertility and infertility shocks. We further exploit cross-sibling differences to identify birth order, sibling-sex, and sibling-age composition effects on migration. We find that large families per se do not boost offspring out-migration. Yet, the likelihood of migrating is not equally distributed within a household, but is higher for sons and decreases sharply with birth order. The female migration disadvantage also varies with sibling composition by age and gender.
    Keywords: International Migration,Mexico,Family Size,Sibling Structure
    JEL: J13 F22 O15
    Date: 2019
  4. By: K. Peren Arin; Elias Braunfels; Christina Zenker
    Abstract: Recent literature shows that oil revenues may have a positive effect on long-run economic growth. However, there is no clear evidence for such an effect in the medium-run, suggesting the existence of a so-called resource-curse in the medium-run. Taking this as a starting point, we investigate all the transmission channels through which oil revenues can retard growth in the medium-run within a Bayesian Model Averaging (BMA) framework. Our results show that oil revenues have indeed a negative effect on the medium-run economic growth, which is transmitted through medium-term trends in oil prices and (poor) institutional quality.
    Date: 2019–09
  5. By: von Fintel, Dieter (African Economic History Network); Fourie, Johan (African Economic History Network)
    Abstract: Does wealth persist over time, despite the disruptions of historical shocks like colonisation? This paper shows that South Africa experienced a reversal of fortunes after the arrival of European settlers in the eastern half of the country. Yet this was not, as some have argued was the case elsewhere in colonial Africa, because of an institutional reversal. We argue, instead, that black South Africans found themselves at the mercy of two extractive regimes: those in `white South Africa and those in the `homelands. The political and economic institutions of each of those regimes favoured a small elite: in white South Africa, whites, and in the homelands, the black chiefs and headmen. Democracy brought inclusive institutions for black residents in white South Africa but not for those in the former home- lands. This is why we see mass migration to the urban areas of South Africa today, and why addressing the institutional weaknesses of the former homelands is key to alleviating the poverty in these regions where a third of South Africans still reside.
    Keywords: reversal of fortunes; population persistence; institutional reversal; colonial impact; settler economy; African economic history; traditional leaders
    JEL: J10 J11 N37 N57
    Date: 2019–08–22
  6. By: Stephen Broadberry; Leigh Gardner
    Abstract: Estimates of GDP per capita are provided on an annual basis for eight Sub-Saharan African economies for the period since 1885. Although the growth experienced in most of SSA since the mid-1990s has had historical precedents, there have also been episodes of negative growth or “shrinking†, so that long run progress has been limited. Despite some heterogeneity across countries, this must be seen as a disappointing performance for the region as a whole, given the possibilities of catch-up growth. Avoiding episodes of shrinking needs to be given a higher priority in understanding the transition to sustained economic growth.
    Date: 2019–03–19
  7. By: Joseph I. Uduji (University of Nigeria, Nsukka, Nigeria); Elda N. Okolo-Obasi (University of Nigeria, Nsukka, Nigeria); Simplice A. Asongu (Yaoundé, Cameroon)
    Abstract: Fertilizer use in Nigeria is estimated at 13 kg/ha, which is far below the 200 kg/ha recommended by the Food and Agricultural Organization (FAO). The objective of this investigation was to identify the determinant factors of farmers’ participation in the Nigeria’s growth enhancement support scheme (GESS). In addition, we determined the impact of the GESS on fertilizer use in rural areas. One thousand, two hundred rural farmers were sampled across the six geopolitical zones of Nigeria. Results from the use of recursive bivariate probit model indicated that GESS significantly impacted on the access and usage of fertilizer among the rural farmers; and that contact with extension agents, ownership of mobile phones, power for charging phone batteries, value output, mobile network coverage, ability to read and write were positive determinants of rural farmers participation in the GESS; whereas increased distance to registration and collection centers, and cultural constraints to married women reduced farmers’ tendency to participate in the GESS. The findings suggest that farmers’ participation in the GESS is a critical factor for raising fertilizer use in Nigeria. This implies that food security in sub-Saharan Africa can be achieved by increasing the participation of rural farmers in the growth enhancement support scheme.
    Keywords: Growth Enhancement Support Scheme, Fertilizer Use, Rural Farmers, Recursive Bivariate Probit Model, Nigeria
    JEL: O13 Q1 N27
    Date: 2019–01
  8. By: Davit Adunts; Geghetsik Afunts
    Abstract: There is much evidence that migration of a parent affects the educational performance of children left behind (CLB). Nevertheless, there is no agreement on the direction of the impact. In this paper, we use Armenian school data and report evidence of a negative impact of parental seasonal migration on the educational performance of CLB. We employ a different approach than those used in the prior literature by (i) using the intensity of seasonal migration (the number of times the parent migrated) instead of a binary variable (whether the parent migrated or not) and (ii) the number of children entering first grade whose parent is a seasonal migrant as an instrument for the intensity of seasonal migration. We find that seasonal migration negatively affects the educational performance of CLB, and that it mainly affects boys; there is no significant impact on girls. Additionally, we find that using a zero-one dummy for migration as prior studies have done upwardly biases the IV estimate by approximately a factor of three, while our intensity measure yields more accurate results.
    Keywords: seasonal migration; children left behind; educational performance;
    JEL: F22 J13 O15
    Date: 2019–04
  9. By: Alberto Chong (Department of Economics, Andrew Young School of Policy Studies, Georgia State University, USA); Joan J. Martínez (University of California, Berkeley, USA)
    Abstract: We provide empirical evidence that supports a causal link from education to risk aversion when using representative data from representative surveys and artefactual or lab-in-the field experiments in Lima, Peru. We employ three standard experimental measures of risk aversion and find that each of them is positively correlated with years of education. We suggest that this relationship may be causal as we take advantage of an identification strategy that exploits a national law enacted in order to incentivize the construction of new schools in Lima, which allows us to provide evidence that more education may increase risk aversion. Our findings are further confirmed when applying a broad set of robustness tests.
    Date: 2019–09
  10. By: Jean-Philippe Berrou (GREThA - Groupe de Recherche en Economie Théorique et Appliquée - UB - Université de Bordeaux - CNRS - Centre National de la Recherche Scientifique, LAM - Les Afriques dans le monde - Sciences Po - Sciences Po - CNRS - Centre National de la Recherche Scientifique, IEP Bordeaux - Sciences Po Bordeaux - Institut d'études politiques de Bordeaux); François Combarnous (GREThA - Groupe de Recherche en Economie Théorique et Appliquée - UB - Université de Bordeaux - CNRS - Centre National de la Recherche Scientifique)
    Abstract: This paper examines the role and nature of entrepreneurs' social networks in the urban informal economy of Bobo-Dioulasso (Burkina Faso). Using an original dataset, the configuration of social networks is described based on three salient dimensions: tie content, member attributes and network structure. Multidimensional analysis allows for the simultaneous consideration of all three dimensions. Our findings suggest that network configurations at play extend well beyond the standard distinction between solidarity and accumulation networks. The complex networks highlighted by this study are consistent with rapid social changes in contemporary urban Africa. They can also significantly enhance the outcomes of small businesses.
    Keywords: Burkina Faso,Informal economy,Social networks analysis,Micro and Small Enterprises,Sub-Saharan Africa
    Date: 2018
  11. By: Daniel Schwab (Department of Economics and Accounting, College of the Holy Cross)
    Abstract: Employment protection legislation (EPL) is designed to promote security for workers by placing restrictions on firing, but it generates unintended consequences. With India as a setting, I argue that EPL shifts jobs from younger to older workers in two ways: by discouraging the hiring of unproven young workers and by preventing the firing of low-productivity workers. The identification strategy is motivated by Rajan and Zingales (1998): I assume that EPL is more binding in those manufacturing sectors where the involuntary separation rate in other countries is high. The data show that older workers are more likely to have formal jobs, and the effect is strongest in high-firing sectors, which indicates EPL shifts jobs from young to old. Additionally, EPL reduces plant-level total productivity (TFP), and this effect is seen only in plants which are large enough to fall within the purview of EPL, which provides a useful placebo test.
    Keywords: Unemployment, labor security
    JEL: J83 J60
    Date: 2019–08
  12. By: Jiang, Hanchen; Yang, Xi
    Abstract: Many children worldwide are left behind by parents who are migrating for work. While previous literature has studied the effect of parental migration on children's educational outcomes and cognitive achievements, this study focuses on how parental migration affects children's non-cognitive development. We use longitudinal data of children in rural China and adopt labor market conditions in destination provinces as instrumental variables for parental endogenous migration choice. We find that parental migration has a significant negative effect on children's non-cognitive development. Differentiating inter- and intra-provincial migrations suggests that the negative effect of parental migration is mainly driven by inter-provincial migrations. We test four different mechanisms of how parental migration affects child development including parental financial inputs, parental time inputs, household bargaining, and children's own time input. Our results provide insights into the relative importance of different mechanisms in determining the effect of parental migration on children's non-cognitive skill formation.
    Keywords: Left-behind Children,Parental Migration,Parental Input,Non-cognitive Development,China
    JEL: J12 J13 J24 J61 R23
    Date: 2019

This nep-dev issue is ©2019 by Jacob A. Jordaan. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.