nep-dev New Economics Papers
on Development
Issue of 2019‒10‒14
seventeen papers chosen by
Jacob A. Jordaan
Universiteit Utrecht

  1. Can Transparency and Accountability Programs Improve Health? Experimental Evidence from Indonesia and Tanzania By Dan Levy
  2. The Challenges of Universal Health Insurance in Developing Countries: Evidence from a Large-scale Randomized Experiment in Indonesia By Rema Hanna; Benjamin A. Olken
  3. SME Financial Inclusion for Sustained Growth in the Middle East and Central Asia By Mishel Ghassibe; Maximiliano Appendino; Samir Elsadek Mahmoudi
  4. Microfinance and Poverty Reduction: Evidence from Djibouti By Mazhar Yasin MUGHAL; Mohamed ABDALLAH ALI
  5. Domestic violence and women’s earnings: Does frequency matter? By Edith Aguirre
  6. The (non) impact of education on marital dissolution By Edith Aguirre
  7. Access to micro – and informal loans: evaluating the impact on the quality of life of poor females in South Africa By Talita Greyling; Stephanié Rossouw
  8. Colonial origin, ethnicity, and intergeneration mobility in Africa By Funjika Patricia; Getachew Yoseph
  9. Ethnic Violence and Birth Outcomes: Evidence from Exposure to the 1992 Conflict in Kenya By Fredah Guantai; Yoko Kijima
  10. Land distribution, income generation & inequality in India's agricultural sector By Sanjoy Chakravorty; S Chandrasekhar; Karthikeya Naraparaju
  11. Farm diversification and climate change: implications for food security in Northern Namibia By Chalmers Mulwa; Martine Visser
  12. Can Microfinance Unlock a Poverty Trap for Some Entrepreneurs? By Abhijit Banerjee; Emily Breza; Esther Duflo; Cynthia Kinnan
  13. Local Incentives and National Tax Evasion: Unintended Effects of a Mining Royalties Reform in Colombia By Saavedra, S; Romero, M
  14. Public Infrastructure Provision and Ethnic Favouritism: Evidence from South Africa By Leone Walters; Manoel Bittencourt; Carolyn Chisadza
  15. Understanding the drivers of subsistence poaching in the Great Limpopo Transfrontier Conservation Area: What matters for community wildlife conservation? By Herbert Ntuli; Aksel Sundström; Martin Sjöstedt; Edwin Muchapondwa; Sverker C. Jagers; Amanda Linell
  16. Transaction costs and land rental market participation in Malawi By Tione, Sarah E.; Holden , Stein T.
  17. Trade tax reforms and poverty in developing countries: Why do some countries benefit and others lose? By Kouwoaye Amèvi

  1. By: Dan Levy (Center for International Development at Harvard University)
    Abstract: We assess the impact of a transparency and accountability program designed to improve maternal and newborn health (MNH) outcomes in Indonesia and Tanzania. Co-designed with local partner organizations to be community-led and non-prescriptive, the program sought to encourage community participation to address local barriers in access to high quality care for pregnant women and infants. We evaluate the impact of this program through randomized controlled trials (RCTs), involving 100 treatment and 100 control communities in each country. We find that on average, this program did not have a statistically significant impact on the use or content of maternal and newborn health services, nor the sense of civic efficacy or civic participation among recent mothers in the communities who were offered it. These findings hold in both countries and in a set of prespecified subgroups. To identify reasons for the lack of impacts, we use a mixed-method approach combining interviews, observations, surveys, focus groups, and ethnographic studies that together provide an in-depth assessment of the complex causal paths linking participation in the program to improvements in MNH outcomes. Although participation in program meetings was substantial and sustained in most communities, and most attempted at least some of what they had planned, only a minority achieved tangible improvements and fewer still saw more than one such success. Our assessment is that the main explanation for the lack of impact is that few communities were able to traverse the complex causal paths from planning actions to accomplishing tangible improvements in their access to quality health care.
    Keywords: Health Outcomes
  2. By: Rema Hanna (Center for International Development at Harvard University); Benjamin A. Olken
    Abstract: To assess ways to achieve widespread health insurance coverage with financial solvency in developing countries, we designed a randomized experiment involving almost 6,000 households in Indonesia who are subject to a nationally mandated government health insurance program. We assessed several interventions that simple theory and prior evidence suggest could increase coverage and reduce adverse selection: substantial temporary price subsidies (which had to be activated within a limited time window and lasted for only a year), assisted registration, and information. Both temporary subsidies and assisted registration increased initial enrollment. Temporary subsidies attracted lower-cost enrollees, in part by eliminating the practice observed in the no subsidy group of strategically timing coverage for a few months during health emergencies. As a result, while subsidies were in effect, they increased coverage more than eightfold, at no higher unit cost; even after the subsidies ended, coverage remained twice as high, again at no higher unit cost. However, the most intensive (and effective) intervention – assisted registration and a full one-year subsidy – resulted in only a 30 percent initial enrollment rate, underscoring the challenges to achieving widespread coverage.
    Keywords: Global Health
    JEL: I13 O15
    Date: 2019–10
  3. By: Mishel Ghassibe; Maximiliano Appendino; Samir Elsadek Mahmoudi
    Abstract: This paper offers empirical evidence that greater financial inclusion of small and medium enterprises (SMEs) can promote higher economic growth and employment, especially in the Middle East and Central Asia regions. First, we show that countries with higher SME financial inclusion exhibit more effective monetary policy transmission and tax collection. Second, we find substantial employment and labor productivity growth gains at the firm level from access to credit, gains that are higher for SMEs. We also obtain evidence of a substantial positive impact on SME employment and labor productivity growth from improved credit bureau coverage and insolvency regimes. Finally, cross-country aggregate evidence confirms the employment and growth gains from SME financial inclusion, which appear larger in the Middle East and Central Asia than in other regions.
    Date: 2019–09–27
  4. By: Mazhar Yasin MUGHAL; Mohamed ABDALLAH ALI
    Abstract: Does access to microfinance improve household welfare? We seek the answer to this question using data on 2,060 borrower and non-borrower households based in six major urban centers of Djibouti. We construct a composite index of multi-dimensional poverty and carry out estimations using a number of econometric techniques. Our results show that neither access to micro-credit nor its ostensibly productive use is significantly associated with poverty regardless of the duration of time since the loan was acquired. This holds both for access to, and the amount of micro-credit obtained. The results raise doubts on the effectiveness of Djibouti’s microfinance programme.
    Keywords: Microfinance, Poverty, Productive Loans, Djibouti
    Date: 2019–10
  5. By: Edith Aguirre
    Abstract: In this paper I analyse the effect of domestic violence on women’s earnings, when the levels and the frequency of abuse are considered. An index for domestic violence is designed to capture the variation observed, challenging the traditional use of a dichotomous variable within this context. In addition, to conduct a causal analysis, an instrument indicating the husband’s random irritability is created. Findings show that women exposed to higher levels of domestic violence, economic, emotional or physical, struggle with lower salaries. Physical violence is the type of abuse with the largest negative incidence on earnings, followed by economic and emotional violence, respectively.
    Keywords: Earnings, female labor-force participation, marriage, omitted variable bias, violence against women.
    JEL: B54 J12
    Date: 2019–10
  6. By: Edith Aguirre
    Abstract: Despite the relevant role attributed to education on marital outcomes, literature does not show a generalized consensus regarding a positive or negative effect from education on marital decisions. In this paper I investigate the impact of education on marriage dissolution exploiting a change in the length of compulsory education in Mexico in 1993 as an instrument for education. The federal government increased compulsory education from completion of primary school, sixth grade, to completion of secondary school, ninth grade, at a national level. In the first part of the analysis, the probit models reveal that education is significant and negatively related to the probability of marital breakdown. An additional year of education is associated with a decrease between 0.6 and 0.9 percentage points in the probability of marital disruption for the 2002-2012 period. However, the results using the instrumental variables methodology indicate that an additional year of schooling has no effect on the probability of marriage dissolution. This finding demonstrates that the relationship between education and divorce is not causal and suggests that although higher levels of education are an undeniable trait observed in non-broken marriages, it is not education by itself one of the mechanisms leading to better marriage outcomes.
    Keywords: Marriage; Marital Dissolution; Education; Instrumental Variables; Mexico.
    JEL: J12 I21 C26
    Date: 2019–10
  7. By: Talita Greyling; Stephanié Rossouw
    Abstract: Background: Since the early 1980s, many governments have investigated the possibility of utilising access to microloans as a pathway to grow economies out of unemployment and thereby improve people's quality of life. Studies that have previously investigated the impact of microloans found a positive relationship to quality of life. Unfortunately, these studies mainly measure quality of life using monetary (income) measures rather than assessing the entire multidimensionality of quality of life.Aim: This paper investigates the relationship between objective multidimensional income-independent quality of life (IIQoL) and having access to micro - and informal loans (M&ILs). Specifically, we focus on South Africa's most marginalized, i.e. 'poor females' and 'poor females residing in rural areas', as their empowerment is a critical social objective, aligned to that of international agencies.Methods: We use a panel dataset spanning four waves from 2008 to 2015 of the National Income Dynamics Study (NIDS). Principal component analysis is used to construct the IIQoL index and various panel; and survey estimation techniques are applied in the regression analyses.Results: M&ILs are significant and negatively related to IIQoL for both; 'poor females' and 'poor females residing in rural areas'. This implies that those 'with' loans failed to translate those monetary gains into higher levels of IIQoL over time.Conclusions: Access to M&ILs does not increase the quality of life of South Africa's most marginalized groups. Without government interventions and education programmes, related to microloans, the marginalized will not experience an increase in their non-income quality of life.
    Keywords: quality of life, income-independent measures, microloans, informal loans, South Africa
    JEL: C01 C33 O15 O55 R2
    Date: 2019–03
  8. By: Funjika Patricia; Getachew Yoseph
    Abstract: This paper estimates the relationship between differences in skills measured among‚ within-country ethnic groups and individual human capital accumulation in eight African‚ countries.Our results show that the skills of an individual in these countries depends more on the‚ human capital levels of their parents¢â‚¬â„¢ ethnic group (ethnic capital) than on parental investment.‚ Therefore, differences in initial levels of ethnic capital may explain the persistence of ethnicitybased‚ differences in educational attainment over time. Birth cohort analysis and the results from‚ an interaction effects model show that ethnic capital has a persistent effect, and that this effect is‚ higher in former British colonies than former French colonies.Using historical religion-based data‚ from the colonial and independence periods as instruments for ethnic capital, we demonstrate‚ large effects of parental ethnicity on an individual¢â‚¬â„¢s human capital skill level and show that colonial‚ origin may be important in understanding intergenerational mobility in African countries.
    Keywords: Intergenerational Mobility,Human capital,Education,Colonialism,Ethnicity
    Date: 2019
  9. By: Fredah Guantai (University of Tsukuba, Japan); Yoko Kijima (National Graduate Institute for Policy Studies, Tokyo, Japan)
    Abstract: This study is an examination of the effect of intrauterine exposure to electoral violence on child birthweight; an outcome that has long-term effects on an individual’s education, income, and health in later life. By considering the electoral violence that resulted from the introduction of multi-party democracy in Kenya as an exogenous source of shock and by adopting difference-in-differences method and mother-fixed effect model, we found that prenatal exposure to the violence increased the probabilities of low birth weight and a child being of very small size at birth by 19 and 6 percentage points, respectively. We found that violence exposure in the first trimester of pregnancy decreased birth weight by 271 grams and increased the probabilities of low birthweight and very small size at birth by 18 and 4 percentage points, respectively. The results reaffirm the significance of the nine months in utero as one of the most critical periods in life that shapes future health, economic, and educational trajectories.
    Date: 2019–10
  10. By: Sanjoy Chakravorty (Temple University); S Chandrasekhar (Indira Gandhi Institute of Development Research); Karthikeya Naraparaju (Indian Institute of Management, Indore)
    Abstract: This paper is a contribution to understanding income generation and inequality in India's agricultural sector. We analyse the National Sample Surveys of agriculture in 2003 and 2013 using descriptive and regression based methods, and estimate income inequality in the agricultural sector at the scale of the nation and its 17 largest states. We show that: (a) there are significant state-level differences in the structures/patterns of income generation from agriculture, (b) there is a negative relationship between the amount of land owned by the household and share of wages in total income, (c) income inequality in India's agricultural sector is very high (Gini Coefficient of around 0.6 during the period), and (d) about half of the income inequality is explained by the household-level variance in income from cultivation, which in turn is primarily dependent on variance in landownership.
    Keywords: Agricultural Households, Sources of Income, Income Inequality, India
    JEL: D1 D63
    Date: 2019–06
  11. By: Chalmers Mulwa; Martine Visser
    Abstract: Limited non-farm opportunities in the rural areas of the developing world, coupled with population growth, means agriculture will continue to play a dominant role as a source of livelihood in these areas. Thus, while rural transformation has dominated recent literature as a way of improving welfare through diversifying into non-farm sectors, improving productivity and resilience to shocks in smallholder agricultural production cannot be downplayed. This is especially so given the changing climatic conditions affecting agricultural production, and thus threatening many livelihoods in rural areas. Farm diversification is an important strategy for creating resilience against climatic shocks in farm production. Using cross-sectional data from northern Namibia, the study assesses the barriers and success factors related to effective crop and livestock enterprises diversification and the effect of these on food security outcomes. A Seemingly Unrelated Regression model is used to assess the joint factors explaining total farm diversification, while a step-wise error correction model is used to evaluate the conditional effect of diversification in each of the two farm enterprises on two measures of food security: food expenditure and dietary diversity. We find that past exposure to climate shocks informs current diversification levels and that access to climate information is a key success factor for both livestock and crop diversification. In terms of food security, greater diversification in either crop or livestock production leads to higher food security outcomes, with neither crop nor livestock diversification showing dominance in affecting food security outcomes. However, an overall higher level of diversification in both livestock and crop enterprises is dominant in explaining food security outcomes.
    Keywords: climate change, Agriculture, Namibia
    Date: 2019–10
  12. By: Abhijit Banerjee; Emily Breza; Esther Duflo; Cynthia Kinnan
    Abstract: Can microcredit help unlock a poverty trap for some people by putting their businesses on a different trajectory? Could the small microcredit treatment effects often found for the average household mask important heterogeneity? In Hyderabad, India, we find that “gung ho entrepreneurs” (GEs), households who were already running a business before microfinance entered, show persistent benefits that increase over time. Six years later, the treated GEs own businesses that have 35% more assets and generate double the revenues as those in control neighborhoods. We find almost no effects on non-GE households. A model of technology choice in which talented entrepreneurs can access either a diminishing-returns technology, or a more productive technology with a fixed cost, generates dynamics matching the data. These results show that heterogeneity in entrepreneurial ability is important and persistent. For talented but low-wealth entrepreneurs, short-term access to credit can indeed facilitate escape from a poverty trap.
    Keywords: Microfinance, Entrepreneurship, Poverty Trap
    JEL: D03 D14 D21 G21 O16 Z13
    Date: 2019
  13. By: Saavedra, S; Romero, M
    Abstract: Achieving a fair distribution of resources is one of the key goals of fiscal policy. To do this, governments often transfer tax resources from rich to marginalized areas. We study whether lower transfers dampen the incentives of local authorities to curb tax evasion in the context of mining in Colombia. To overcome the challenge of measuring evasion, we use machine learning on satellite images. Using differencein- differences strategies, we find that a reduction in the share of revenue transferred back to mining municipalities led to an increase in illegal mining. This result illustrates the difficulties of redistributing tax revenues.
    Keywords: Illegal Minig, Machine Learning
    JEL: H26 O13 O17
    Date: 2019–10–02
  14. By: Leone Walters; Manoel Bittencourt; Carolyn Chisadza
    Abstract: Does ethnic favouritism in administrative governments affect public infrastructure provision? While previous literature has studied the effects of ethnic favouritism on economic growth and development determinants, there has been limited empirical evidence on ethnic favouritism in public infrastructure provision, particularly in South Africa. We study the effects of ethnic favouritism on provision of water and electricity infrastructure. Using municipal-level data for 52 district municipalities from 1996 to 2016, we nd that coethnic municipalities are associated with higher growth in infrastructure relative to non-coethnic municipalities. The results remain robust to time and municipal xed eects, as well as dynamic specications. Additionally, we construct a counterfactual scenario to conrm our results.
    Keywords: Ethnic Favouritism, South Africa, Public Infrastructure
    JEL: J15 H54 O55
    Date: 2019–07
  15. By: Herbert Ntuli; Aksel Sundström; Martin Sjöstedt; Edwin Muchapondwa; Sverker C. Jagers; Amanda Linell
    Abstract: While subsistence poaching is a large threat to wildlife conservation in Southern Africa, this behaviour is seldom researched. Individual and community level factors that really drive such behaviour are less understood because of both lack of data and literature’s predominant focus on commercial poaching. To study the drivers of subsistence poaching, this article uses primary survey data from a large number of respondents and communities in the Great Limpopo, a transfrontier reserve spanning across Mozambique, South Africa and Zimbabwe. We focus on two features, reported poaching incidences in the community and the previous hunting behaviour of individuals, in multivariate regression analysis. There is no evidence of the role of education, employment and livestock ownership on poaching. However, speaking to previous theoretical accounts, our results suggest that factors such as age, gender, trust, group size, local institutions, resource quality and perceptions about park management influence subsistence poaching. The findings indicate that capacity building in local institutions, training related to wildlife management and public awareness campaigns could be used by policymakers to affect peoples’ perceptions and behaviours in this context.
    Keywords: common pool wildlife, fugitive resource, subsistence poaching, CAMPFIRE
    JEL: Q28 Q57 Q58
    Date: 2019–09
  16. By: Tione, Sarah E. (Centre for Land Tenure Studies, Norwegian University of Life Sciences); Holden , Stein T. (Centre for Land Tenure Studies, Norwegian University of Life Sciences)
    Abstract: We assess the extent of access and degree of participation by smallholder tenants in the land rental market in Malawi. Our study is based on three rounds of nationally representative Living Standards Measurement Surveys collected in 2010, 2013 and 2016, from which we construct a balanced panel. We apply the transaction cost theory, which suggests transaction costs to be non-linear and depend on resource as well as socioeconomic characteristics within the customary tenure system that determines who hold, use and transfer land. Controlling for unobserved heterogeneity, the dynamic random effects probit and Tobit models show that transaction costs in the rental market (on the tenant side) are non-linear, high and lead to state dependency in the market. This implies that past land rental experience, social capital and networks, trust and reputation significantly reduce transaction costs and facilitate entry and extent of participation in the rental market. The results point towards the need for land tenure reforms that can reduce these high transaction costs. Access to information through social network could be one way that can improve land access for land-poor and potential tenants, thereby enhancing both equity and efficiency effects of land rental markets.
    Keywords: Land rental markets; Transaction costs; Dynamic random effects models; Malawi
    JEL: Q12 Q15
    Date: 2019–09–30
  17. By: Kouwoaye Amèvi
    Abstract: This paper studies the relationship between trade tax and domestic tax reforms and poverty in developing countries, and explores whether the role of public goods provision matters in this relationship.Using a sample of 91 developing countries for the 1980¢â‚¬â€œ2016 period, I model the trade tax reforms¢â‚¬â€œpoverty nexus as heterogeneous across countries with cross-sectionally dependent errors. I find that a shift from taxes on international trade towards domestic taxes under revenue-neutrality reduces poverty in the countries that have consolidated, on average, over time their comparative advantage in agriculture, while it increases poverty in countries that moved from being net exporters to net importers of agricultural products.Public goods, however, do not play a significant role in the relationship.
    Keywords: Government spending policy,Common factor models,Taxation,Poverty alleviation,Tax reforms
    Date: 2019

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