nep-dev New Economics Papers
on Development
Issue of 2022‒05‒16
fifteen papers chosen by
Jacob A. Jordaan
Universiteit Utrecht

  1. Household Vulnerability to Income Shocks in Emerging and Developing Asia: the Case of Cambodia, Nepal and Vietnam By Alessia De Stefani; Athene Laws; Alex Sollaci
  2. Cumulative Climate Shocks and Migratory Flows: Evidence from Sub-Saharan Africa By Salvatore Di Falco; Anna B. Kis; Martina Viarengo
  3. Natural Disasters and Economic Dynamics: Evidence from the Kerala Floods. By Beyer, Robert C. M.; Narayanan, Abhinav; Thakur, Gogol Mitra
  4. Local inequality and crime: New evidence from South Africa By Büttner, Nicolas
  5. Unintended consequences of farm input subsidies: women’s contraceptive usage and knock-on effects on children By Mwale, Martin Limbikani
  6. The fertility transition in Sub-Saharan Africa: The role of structural change By Büttner, Nicolas; Grimm, Michael; Günther, Isabel; Harttgen, Kenneth; Klasen, Stephan
  7. Financial Access and Gender Gap in Entrepreneurship and Employment: Evidence from Rural India By Sandhya Garg; Samarth Gupta
  8. Clean Energy Access: Gender Disparity, Health, and Labour Supply By Anjali P. Verma; Imelda
  9. Evaluating the Distributive Effects of a Development Intervention By Pushkar Maitra; Sandip Mitra; Dilip Mookherjee; Sujata Visaria
  10. “Earthquake exposure and schooling: impacts and mechanisms” By Khalifany-Ash Shidiqi; Antonio Di Paolo; Álvaro Choi
  11. How impact evaluation methods influence the outcomes of development projects? Evidence from a meta-analysis on decentralized solar nano projects By Fatoumata Nankoto Cissé
  12. Within-Group Heterogeneity in a Multi-Ethnic Society By Artiles, Miriam
  14. Pandemic, Poverty, and Inequality: Evidence from India By Mr. Arvind Virmani; Surjit Bhalla; Karan Bhasin
  15. Mobility at the Lower Echelons? Evidence Based on Slum Household Panel Data from a Dynamic Indian City By Arup Mitra; Yuko Tsujita

  1. By: Alessia De Stefani; Athene Laws; Alex Sollaci
    Abstract: We leverage survey data from emerging and developing Asia to highlight different aspects of household vulnerability to income shocks arising from the Covid-19 pandemic: occupation in Cambodia, self-insurance mechanisms in Nepal, and financial leverage in Vietnam. Occupation and ex-ante income levels emerge as the main drivers of vulnerability. We estimate that the pandemic could have placed an additional 6 to 9 percent of the population of each country in a vulnerable position, with the impact concentrated on urban, informal, and service sector workers. Government intervention and financial access emerge as key resilience-enhancing mechanisms.
    Keywords: Income shocks; Informality; Covid-19; Developing Asia
    Date: 2022–04–01
  2. By: Salvatore Di Falco; Anna B. Kis; Martina Viarengo
    Abstract: We re-examine the effects of negative weather anomalies during the growing season on the decision to migrate in rural households in five sub-Saharan African countries. To this end we combine a multi-country household panel dataset with high-resolution gridded precipitation data. We find that while the effect of recent adverse weather shocks is on average modest, the cumulative effect of a persistent exposure to droughts over several years leads to a significant increase in the probability to migrate. The results show that more frequent adverse shocks can have more significant and long-lasting consequences in challenging economic environments.
    Keywords: climate shocks, rural-urban migration, economic development
    JEL: O15 O13 Q54
    Date: 2022
  3. By: Beyer, Robert C. M. (World Bank); Narayanan, Abhinav (Asian Infrastructure Investment Bank); Thakur, Gogol Mitra (Centre for Development Studies)
    Abstract: Exceptionally high rainfall in the Indian state of Kerala caused major flooding in 2018. This paper estimates the short-run causal impact of the disaster on the economy, using a difference-in-difference approach. Monthly nighttime light intensity, a proxy for aggregate economic activity, suggests that activity declined for three months during the disaster but boomed subsequently. Automated teller machine transactions, a proxy for consumer demand, declined and credit disbursal increased, with households borrowing more for housing and less for consumption. In line with other results, both household income and expenditure declined during the floods. Despite a strong wage recovery after the floods, spending remained lower relative to the unaffected districts. The paper argues that increased labor demand due to reconstruction efforts increased wages after the floods and provides corroborating evidence: (i) rural labor markets tightened, (ii) poorer households benefited more, and (iii) wages increased most where government relief was strongest. The findings confirm the presence of interesting economic dynamics during and right after natural disasters that remain in the shadow when analyzed with annual data.
    Keywords: natural disasters ; aggregate activity ; household behavior ; spatial analysis
    JEL: Q54 R22 D12 O44
    Date: 2022–04
  4. By: Büttner, Nicolas
    Abstract: The relationship between inequality and crime has been of long-standing interest to social scientists of various disciplines. While theorical work from both economics and sociology postulates a positive link between the two, the empirical evidence is rather inconclusive and typically focuses on higher-income countries. In this study, I investigate the relationship between socio-economic inequalities of various dimensions and both violent and property crime at the local level in South Africa. For this, I created a novel panel dataset of police precincts that combines official crime records from the South African Police Service with socio-economic data from two population censuses and household surveys. For identification, I exploit the variation of inequality and crime across time and space, while controlling for socio-economic and demographic characteristics of police precincts, provincespecific time trends, police cluster-fixed effects, and the spatial correlation of crime. I find strong and robust evidence for a significant, positive and linear relationship between income inequality within police precincts and local rates of violent crime and an inverted u-shaped relationship with property crime. Education inequality is more strongly related to violent crime, while housing inequality is only associated with property crime. In turn, cultural heterogeneity is positively correlated with all analyzed crimes. I also find suggestive evidence that inter-racial inequality contributes more to property crime, while intra-racial inequality contributes more to violent crime. Lastly, the results indicate that precincts which are relatively rich as compared to their neighbors suffer from higher rates of vehicle theft and aggravated robbery.
    Keywords: Crime,Local inequality,Small Area Estimation,South Africa
    JEL: D31 D74 O12
    Date: 2022
  5. By: Mwale, Martin Limbikani
    Abstract: Sub-Saharan Africa’s countries adopted farm input subsidies, with a twin goal of bolstering food security and reducing poverty. Many scholars evaluate the subsidies against these intended impacts, while ignoring the potential unintended consequences. In this paper, I take advantage of a rare combination of information on both contraceptive usage and a subsidy program, from Malawi’s 2020 Multiple Indicator Cluster Survey (MICS), to investigate whether Malawi’s Farm Input Subsidy Program (FISP) affected women’s contraceptive usage. I find that women that lived in FISP households increased contraceptives usage. This is in line with the hypothesis that the women aimed to prevent pregnancy, and hence dedicate uninterrupted time to farming, complementing the FISP. More of women’s time in farming could imply less of their time in domestic chores. I therefore further investigated whether children, in the same households, increased participation in the domestic chores, to take up roles left by the farming women. I find that this is the case. These findings therefore suggest that past studies evaluating the subsidies, and failed to consider the unintended consequences on fertility choices and domestic child labour, may have over- or underestimated the benefits of the subsidies
    Keywords: Women; Contraceptive Usage; Children; Domestic Chores; Subsidies; Malawi
    JEL: D13 D61 I15 Q12 Q18
    Date: 2022–04–10
  6. By: Büttner, Nicolas; Grimm, Michael; Günther, Isabel; Harttgen, Kenneth; Klasen, Stephan
    Abstract: Despite relatively sustained economic growth in at least parts of Sub-Saharan Africa over the past twenty years, the fertility transition has not much advanced in most countries in that region. We explore whether the lack of structural change can explain this slow transition. For this end, we analyze the determinants of fertility transitions across the developing world using a novel regional level panel dataset created by matching Demographic and Health Surveys and Household Income Surveys from 60 countries over three decades. Our key hypothesis is that structural change, i.e. a shift of employment from subsistence agriculture to more skill-intensive services, accompanied by an increase in human capital accumulation, is a key driver of the fertility transition. Our results indicate that higher education of women, female employment in non-agricultural formal jobs and industrialization as measured by an increase in nighttime light intensity are indeed important determinants of the fertility transition. We also find suggestive evidence for a complementary role of access to health insurance. Simulations show that if high-fertility countries in Sub-Saharan Africa had experienced the same structural change as the most demographically advanced regions in our sample over the last twenty years, fertility levels would be up to 40% lower.
    Keywords: Demographic transition,Fertility,Structural change,Human capital,Sub-SaharanAfrica
    JEL: D13 J11 J13 J22 O12
    Date: 2022
  7. By: Sandhya Garg; Samarth Gupta (Institute of Economic Growth, Delhi)
    Abstract: Can expansion of bank branch network reduce gender-gap in economic activity at the village level? To explore this issue, we construct a novel village-level panel data where we observe the financial access of each unbanked village in India defined as its distance to the nearest village/town with bank branch from 1951-2019; and village-level enterprise data of four economic census rounds of 1990, 1998, 2005 and 2013. To account for endogeneity in placement of bank branches, we use a difference-indifference methodology. We find that the presence of a bank branch within 5km of an un-banked village between 2005 and 2013 (Treatment Group) mitigated the gender gap in entrepreneurship, and employment. The increase in number of female enterprises and in the size of female employment occurs fully driven by non-agricultural sector, whereas a shift is observed in male entrepreneurship from agricultural to nonagricultural sector. We also find evidence that this transition may be a consequence of credit uptake by enterprises from non-institutional sources as proximity to a bankedcenter improves. Our results are robust to unobservable village and year effects, and presence of alternative village-level infrastructure.
    Keywords: Credit, Banking, Branch Expansion, Gender Gap, Entrepreneurship, Enterprise and Development
    JEL: G21 G28 O12
    Date: 2021–09
  8. By: Anjali P. Verma (The University of Texas at Austin); Imelda (IHEID, Graduate Institute of International and Development Studies, Geneva)
    Abstract: Women bear a disproportionate share of the health and time burden associated with lack of access to modern energy. We study the impact of clean energy access on adult health and labour supply outcomes by exploiting a nationwide rollout of a clean cooking fuel program in Indonesia. We find that access to clean cooking fuel led to an improvement in women's health and an increase in their work hours. We also find an increase in men's work hours and in their propensity to have an additional job, primarily in those households where women accrued the largest program benefits.
    Keywords: gender inequality; energy access; health; labour supply; Indonesia
    JEL: H51 I15 I18 J22 O13 Q48 Q53
    Date: 2022–05–06
  9. By: Pushkar Maitra (Department of Economics, Monash University); Sandip Mitra (Sampling and Official Statistics Unit, Indian Statistical Institute); Dilip Mookherjee (Department of Economics, Boston University); Sujata Visaria (Department of Economics, The Hong Kong University of Science and Technology)
    Abstract: Most analyses of randomized controlled trials of development interventions estimate an average treatment effect. However, the aggregate impact on welfare also depends on distributional effects. We propose a simple approach to evaluate efficiency-equity trade-offs, that follow the utilitarian tradition of Atkinson (1970). The method does not impose additional assumptions or data requirements beyond those needed to estimate the average treatment effect. We illustrate the approach using data from a credit delivery experiment we implemented in West Bengal, India.
    Keywords: Distributive Impacts, Program Evaluation, Agricultural Finance
    JEL: D82 O16 C93 H21
    Date: 2021–04
  10. By: Khalifany-Ash Shidiqi (Universitas Muhammadiyah Yogyakarta and University of Barcelona); Antonio Di Paolo (AQR-IREA, University of Barcelona); Álvaro Choi (University of Barcelona)
    Abstract: Natural disasters are a significant threat to human development. In this paper, we analyze the effects of being exposed to a strong earthquake during school age on schooling outcomes. We merge geolocated data about the intensity of the shock at the district level with individual information from the Indonesia Family Life Survey. The identification strategy exploits variation in exposure to the natural shock by birth cohort and district of residence, considering as the treated group individuals who were residing in affected districts while they were in school age. Earthquake exposure reduces years of schooling by somewhat less than one year and negatively affects the probability of completing compulsory education but does not alter the chances of enrolling into postcompulsory education. Falsification analysis and several robustness checks corroborate the causal interpretation of our findings. The analysis of the potential mechanisms indicates that induced migration and casualties occurring at the family level as a consequence of the earthquake do not seem to play a relevant role. However, damages in educational infrastructures do represent a relevant channel through which natural disasters harm human capital formation. Part of the overall impact of the earthquake represents a delay in schooling progression, but a substantial share of its effect consists in a permanent loss of human capital among affected individuals..
    Keywords: Natural disasters, Earthquake, Schooling, Educational infrastructures. JEL classification: I25, I24, O15, Q54
    Date: 2022–05
  11. By: Fatoumata Nankoto Cissé (CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique, I&P - Investisseurs et Partenaires)
    Abstract: This study analyzes the effect of impact evaluation methodologies on the positive and negative outcomes of decentralized solar nano projects in developing countries. Data originate from the Collaborative Smart Mapping of Mini-grid Actions (CoSMMA) developed by the Foundation for Studies and Research on International Development (FERDI). This study is based on a total of 727 tested effects from 10 decentralized solar nano projects which have been measured by experimental and quasi-experimental approaches. Using a multinomial-logit regression shown that randomized and non-randomized evaluation methods have a similar probability of generating a proven favorable outcome on the sustainable development of decentralized solar nano projects. By estimating a complementary log-log model, projects are most often evaluated as successful when effects on education are tested. In addition, a discrepancy of impacts is found between randomized control trials and difference-indifference strategies in proven-unfavorable outcomes of projects. This analysis also highlights the convergence of impacts between randomization and matching techniques on projects implemented in Africa. Findings from this paper provide strong evidence for development practitioners to choose the appropriate impact assessment method.
    Keywords: Matching,Difference-in-difference,Quasi-experimental methods,Randomized control trials,Experimental methods,Meta-analysis,Impact evaluation,Decentralized electrification,Sustainable development
    Date: 2022–03
  12. By: Artiles, Miriam
    Abstract: Is ethnic diversity good or bad for economic development? Most empirical studies find corrosive effects. In this paper, I show that ethnic diversity need not spell poor development outcomes–a history of within-group heterogeneity can turn ethnic diversity into an advantage for long-run development. I collect new data from a natural experiment regarding Peru's colonial history: the forced resettlement of native populations in the 16th century. This intervention forced together various ethnic groups into new jurisdictions. In those jurisdictions where colonial officials concentrated individuals with a history of within-group heterogeneity, who, prior to colonization, worked in complementary climates of the Andes, ethnic diversity results in systematically lower costs and may even become advantageous. Neither precolonial groups' political complexity nor their degree of economic development explain this result. The transmission of prosocial behavior is one likely channel. I also find evidence consistent with a positive role of economic complementarities between ethnic groups.
    Keywords: Ethnic Diversity, Within-Group Heterogeneity, Long-Run Economic Development
    JEL: J15 N16 O10 O12 Q56 Z10
    Date: 2022–04–16
  13. By: C.S.C Sekhar; Namrata Thapa (Institute of Economic Growth, Delhi)
    Abstract: The gap between the incomes of agricultural workers vis-a-vis non-agricultural workers in India has widened since the 1990s and improving farmers’ income has emerged as the key policy focus in recent times. In realizing this objective, functioning of the markets is very critical as market imperfections can increase the production and transaction costs of farmers and can have a crucial bearing on farm income. The present study, based on primary data, attempts to explore imperfections (if any) in important markets viz. output, input, factor and credit markets. The study also takes into account the asset base, skill endowments, coping mechanisms of farmers in the face of economic hardships and their social capital. Some of the important government programs have also been analyzed. The study was conducted in four states – Bihar, Gujarat, Madhya Pradesh and Punjab. Based on multi-stage sampling methodology, 1800 households spread over 45 villages and 21 districts were surveyed across four states. Tabular analysis has been complemented by an econometric analysis using data at the household level. The results show a strong inverse relation between land productivity and farm size and this was almost entirely driven by an intensive use of family labour on smaller farms. There was little evidence of differences in intensity of use of any other factor or input. This underlines the prevalence of imperfections mainly in the land and labour markets. The per capita income increased with the farm size though, underlining the positive impact on income of better access to technology and credit of larger farmers.
    Keywords: market imperfections, farm profitability, farmers’ income, small and marginal farmers
    Date: 2021–09
  14. By: Mr. Arvind Virmani; Surjit Bhalla; Karan Bhasin
    Abstract: The paper presents estimates of poverty [extreme poverty PPP$1.9 and PPP$3.2] and consumption inequality in India for each of the years 2004-5 through the pandemic year 2020-21. These estimates include, for the first time, the effect of in-kind food subsides on poverty and inequality. Extreme poverty was as low as 0.8 percent in the pre-pandemic year 2019, and food transfers were instrumental in ensuring that it remained at that low level in pandemic year 2020. Post-food subsidy inequality at .294 is now very close to its lowest level 0.284 observed in 1993/94.
    Keywords: Poverty Measurement, Pandemic
    Date: 2022–04–05
  15. By: Arup Mitra; Yuko Tsujita (Institute of Economic Growth, Delhi)
    Abstract: This paper based on the household panel data collected from the slum surveys in the national capital of India notes that the extent of mobility is not uniform across slum households, which in the literature is interpreted as time independent mobility. It tries to identify the determinants of mobility through various econometric models, keeping in view the appropriateness to reflect on the mobility aspect. Given the city environment, the individual specific factors such as educational attainments are important in determining mobility. Even within the city, activities and labour market vary widely across regions, and the outcomes in terms of mobility are different, reflecting on physical segmentation, the mobility constraints and the variations in individual motivational drive. Access to information also differs depending on the migration status of the population. In the labour market gender discriminatory factors are at place for which the wages diverge between females and males, resulting in variations in mobility. The policy implications may be envisaged in terms of educational and skill imparting programmes, effective dissemination of job market information, provision of inexpensive commuting facilities within the city and reduction in gender differentials in the labour market
    Date: 2021–07

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