nep-dev New Economics Papers
on Development
Issue of 2019‒11‒11
ten papers chosen by
Jacob A. Jordaan
Universiteit Utrecht

  1. A micro-based approach to evaluate the effect of water supply on health in Uganda By Raymond Frempong; Lucas Kitzmüller; David Stadelman
  2. Nonlinear Pricing in Village Economies By Attanasio, Orazio; Pastorino, Elena
  3. Poverty alleviation strategies under informality: Evidence for Latin America By Martín Caruso Bloeck; Sebastian Galiani; Federico Weinschelbaum
  4. Remittances and Economic Growth: A Quantitative Survey By Cazachevici, Alina; Havranek, Tomas; Horvath, Roman
  5. Early Childhood Education and Cognitive Outcomes in Adolescence: A Longitudinal Study from Vietnam By Robert Rogers; Doan Hai Ma; Tra Nguyen; Anh Ngoc Nguyen
  6. Determinants of Mobile Broadband Use in Developing Economies: Evidence from Sub-Saharan Africa By Hasbi, Maude; Dubus, Antoine
  7. Nakusha? Son Preference, Resource Concentration and Gender Gaps in Education By Ashwini Deshpande; Apoorva Gupta
  8. One Step Ahead of the Law: The Net Effect of Anticipation and Implementation of Colombia's Illegal Crops Substitution Program By Ladino, J. F; Saavedra, S; Wiesner, D
  9. (In)Visibility, Care and Cultural Barriers: The Size and Shape of Women's Work in India By Ashwini Deshpande; Naila Kabeer
  10. Counting Women’s Work in South Africa: Incorporating Unpaid Work into Estimates of the Economic Lifecycle in 2010 By Morné Oosthuizen

  1. By: Raymond Frempong; Lucas Kitzmüller; David Stadelman
    Abstract: This paper investigates the impact of improved water provision on individual health outcomes in rural Uganda. We merge household and individual panel datasets with sub-county level administrative data on water supply projects. Our approach allows us to estimate fixed-effect panel data models which use temporal and spatial variation at the sub-county level as identifying variation. We find evidence of small effects from more installations of improved water supply on its water usage, health outcomes of household members, and water collection times. Increasing the sub-county rate of improved water sources per capita leads to a reduction in the likelihood of individuals suffering from symptoms of illness associated with inadequate water supply. We argue that our micro-based approach provides a more externally-valid and highly cost-effective means of evaluating scalable development projects.
    Keywords: Evaluation; development projects; drinking water; sanitation; child mortality
    JEL: O12 I15 I31
    Date: 2019–11
  2. By: Attanasio, Orazio (University College London); Pastorino, Elena (Federal Reserve Bank of Minneapolis)
    Abstract: This paper examines the price of basic staples in rural Mexico. We document that nonlinear pricing in the form of quantity discounts is common, that quantity discounts are sizable for typical staples, and that the well-known conditional cash transfer program Progresa has significantly increased quantity discounts, although the program, as documented in previous studies, has not affected on average unit prices. To account for these patterns, we propose a model of price discrimination that nests those of Maskin and Riley (1984) and Jullien (2000), in which consumers differ in their tastes and, because of subsistence constraints, in their ability to pay for a good. We show that under mild conditions, a model in which consumers face heterogeneous subsistence or budget constraints is equivalent to one in which consumers have access to heterogeneous outside options. We rely on known results (Jullien (2000)) to characterize the equilibrium price schedule, which is nonlinear in quantity. We analyze the effect of nonlinear pricing on market participation as well as the impact of a market-wide transfer, analogous to the Progresa one, when consumers are differentially constrained. We show that the model is structurally identified from data on prices and quantities from a single market under common assumptions. We estimate the model using data from municipalities and localities in Mexico on three commonly consumed commodities. Interestingly, we find that nonlinear pricing is beneficial to a large number of households, including those consuming small quantities, relative to linear pricing mostly because of the higher degree of market participation that nonlinear pricing induces. We also show that the Progresa transfer has affected the slopes of the price schedules of the three commodities we study, which have become steeper as consistent with our model, leading to an increase in the intensity of price discrimination. Finally, we show that a reduced form of our model, in which the size of quantity discounts depends on the hazard rate of the distribution of quantities purchased in a village, accounts for the shift in price schedules induced by the program.
    Keywords: Nonlinear pricing; Budget constraints; Cash transfers; Structural estimation
    JEL: D42 D43 D82 I38 O12 O13 O22
    Date: 2019–08–26
  3. By: Martín Caruso Bloeck; Sebastian Galiani; Federico Weinschelbaum
    Abstract: Strategies based on growth and inequality reduction require a long-run horizon, and this paper therefore argues that those strategies need to be complemented by poverty alleviation programs. With regards to such programs, informality in Latin America and the Caribbean is a primary obstacle to carry out means testing income-support programs, and countries in the region have therefore mostly relied on proxy means testing mechanisms. This paper studies the relative effectiveness of these and other mechanisms by way of a formal model in which workers choose between job opportunities in the formal and informal sectors. Although the means testing mechanism allows for a more pro-poor design of transfers, it distorts labor decisions made by workers. On the other hand, (exogenous) proxy means testing does not cause distortions, but its pro-poor quality is constrained by the power of observable characteristics to infer income levels. However, since taxation is necessary to fund programs, redistribution becomes less effective, especially for programs other than means testing. The paper concludes by discussing the implications of these results for the design of more efficient targeting programs.
    Keywords: Poverty, inequality, means testing, proxy means testing, Latin America and the Caribbean
    JEL: J38 I38
    Date: 2019–10–31
  4. By: Cazachevici, Alina; Havranek, Tomas; Horvath, Roman
    Abstract: Expatriate workers’ remittances represent an important source of financing for low- and middle-income countries. No consensus, however, has yet emerged regarding the effect of remittances on economic growth. In a quantitative survey of 538 estimates reported in 95 studies, we find that approximately 40% of the studies report a positive effect, 40% report no effect, and 20% report a negative effect. Our results indicate publication bias in favor of positive effects. Correcting for the bias using recently developed techniques, we find that the mean effect of remittances on growth is still positive but economically small. Nevertheless, our results uncover noticeable regional differences: remittances are growth-enhancing in Asia but not in Africa. Studies that do not control for alternative sources of external finance, such as foreign aid and foreign direct investment, mismeasure the effect of remittances. Finally, time-series studies and studies ignoring endogeneity issues report systematically larger effects of remittances on growth.
    Keywords: remittances,economic growth,meta-analysis,publication bias,Bayesian model averaging
    JEL: D22 E58 G21 F63
    Date: 2019
  5. By: Robert Rogers (Development and Policies Research Center (DEPOCEN), Hanoi, Vietnam); Doan Hai Ma (Development and Policies Research Center (DEPOCEN), Hanoi, Vietnam); Tra Nguyen (Development and Policies Research Center (DEPOCEN), Hanoi, Vietnam); Anh Ngoc Nguyen (Development and Policies Research Center (DEPOCEN), Hanoi, Vietnam)
    Abstract: Previous research shows that Early Childhood Education (ECE) positively impacts cognitive outcomes later in life. Few studies examine the impacts of time spent in ECE in developing countries. We use data from the Young Lives project in Vietnam with 2SLS regressions to estimate the impact of years spent in ECE on cognitive outcomes in adolescence. We find that one extra year in ECE corresponds to 21.8 percentage point (1.25 SD) and 30.8 percentage point (2.78 SD) increases in math and verbal cognition scores, respectively. Our estimates suggest that ECE is highly effective in Vietnam and is a potential strategy for bridging educational outcomes gaps.
    Keywords: early childhood education; education outcomes; Vietnam; cognitive outcomes.
    Date: 2018–01
  6. By: Hasbi, Maude; Dubus, Antoine
    Abstract: Broadband is seen as a vector of economic growth and social development. In the developing world, mobile technologies are widely adopted and mobile broadband is progressively rolled-out with high expectations on its impact on the countries' development. We highlight what the determinants of mobile broadband use are in four Sub-Saharan countries. Using micro-level data coming from household surveys over 5 years, from 2013 to 2017, we show that the ownership of a mobile phone is highly correlated with mobile broadband use. We also show that for non-mobile owners, the ownership of an active SIM card is a prerequisite for using mobile broadband. In addition, mobile money users tend to be more likely to use mobile broadband. This could highlight the existence of a learning effect. By using mobile money services, individuals gain more experience and are more inclined to use more advanced technologies, such as mobile broadband. Although we show that mobile broadband use is increasingly growing, a large part of the population, mainly composed of poor households living in rural areas, is still left behind. This raises concerns on the increase of the digital gap between people and territories.
    Keywords: Mobile Broadband Use,Developing Economy,Economic Growth,Inequality,Digital Gap
    JEL: I30 O12 L50 L96 O55
    Date: 2019
  7. By: Ashwini Deshpande (Department of Economics, Ashoka University); Apoorva Gupta (Department of Economics, Ramjas College, University of Delhi)
    Abstract: Using nationally representative data over three decades for India, we investigate mechanisms underlying parental motivation to invest differentially between their sons’ and daughters’ education. We identify three channels: strong son preference, meta son preference (resulting in “unwanted girls†), and the resource concentration motivation. We find that gender gaps in educational quantity outcomes have declined significantly for all children. However, gender gaps in the quality of education have increased over the period, and the increase is the largest in families with unwanted girls, i.e. due to an intensification of meta son preference, followed by families motivated by resource concentration.
    Keywords: Gender, Education, School Choice, Stream Choice, Educational Expenditure, Discrimination, India
    Date: 2019–06
  8. By: Ladino, J. F; Saavedra, S; Wiesner, D
    Abstract: Pre-announced policies often generate anticipation effects that may end up in unin- tended consequences. But little is known about the extent to which the actual imple- mentation of the policy can offset these effects. Previous research have shown that the announcement of an illegal crop substitution program made coca cultivation increase substantially in Colombia, but the net effect of the policy has not been estimated. We use detailed data on both coca cultivation and substitution payments at 1km x 1km grid squares to estimate the net effect of the policy. Our data also allows us to study the geographical spillovers of the program to non-targeted neighboring areas. Using a difference-in-differences empirical strategy, we nd that program recipients reduced illegal crops by 94% with respect to the pre-program mean. Surprisingly, the reduction in neighboring (non-targeted) grid areas is of similar magnitude. However, these re- ductions are not enough to compensate for the large increase in coca growing that took place between the announcement and the implementation of the policy, and thus the net effect is negative. This suggest both that the early announcement was a mistake that led to a substantial one-time cost, but the ongoing substitution efforts will have the intended effects if continued.
    Keywords: Policy anticipation; Illegal Markets; Coca; Colombia
    Date: 2019–10–31
  9. By: Ashwini Deshpande (Department of Economics, Ashoka University); Naila Kabeer (Department of Gender Studies and Department of International Development, London School of Economics)
    Abstract: Based on primary data from a large household survey in seven districts in West Bengal in India, this paper analyses the reasons underlying low labor force participation of women. In particular, we try to disentangle the intertwined strands of choice, constraints posed by domestic work and care responsibilities, and the predominant understanding of cultural norms as factors explaining the low labor force participation as measured by involvement in paid work. We document the fuzziness of the boundary between domestic work and unpaid (and therefore invisible) economic work that leads to mis-measurement of women's work and suggest methods to improve measurement. We find that being primarily responsible for domestic chores lower the probability of “working†, after accounting for all the conventional factors. We also document how, for women, being out of paid work is not synonymous with care or domestic work, as they are involved in expenditure saving activities. We also find that religion and visible markers such as veiling are not significant determinants of the probability of working. Our data shows substantial unmet demand for work. Given that women are primarily responsible for domestic chores, we also document that women express a demand for work that would be compatible with household chores.
    Keywords: Women, Gender, Labor Force Participation, India
    Date: 2019–05
  10. By: Morné Oosthuizen (University of Cape Town; Deputy Director)
    Abstract: National Transfer Accounts (NTA) have been used to describe the generational economy in countries around the world, including South Africa. However, gender disaggregations highlight the fact that the contributions made particularly by women within the household are invisible, the result of NTA’s link to the System of National Accounts. Women’s economic contribution (i.e. production) is therefore underestimated, giving a false sense of patterns of dependency by gender and age. This paper addresses this issue by constructing National Time Transfer Accounts (NTTA) for South Africa using timeuse and NTA data from 2010, allowing the construction of a more complete picture of total production and consumption across the lifecycle. Based on these estimates, household production is valued at 27.3 percent of GDP in 2010, of which almost three-quarters is contributed by females. While per capita consumption rises at all ages once household production is included, it is more than tripled for infants, revealing that the amajority of the consumption by infants and young children is of non-market services, particularly care. Reducing gender-based differences in labour income is found to have a beneficial impact on both the magnitude and duration of the first demographic dividend.
    Keywords: Generational economy, National Transfer Accounts, South Africa, Gender, Women
    Date: 2018–11

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.