New Economics Papers
on Central and South America
Issue of 2014‒08‒09
ten papers chosen by

  1. Shelter from the Storm: Upgrading Housing Infrastructure in Latin American Slums By Sebastian Galiani; Paul Gertler; Ryan Cooper; Sebastian Martinez; Adam Ross; Raimundo Undurraga
  2. Job Vacancies in Colombia: 1976-2012 By Andrés Álvarez; Marc Hofstetter
  3. Transition to Centralized Unit Commitment: An Econometric Analysis of Colombia’s Experience By Luciano de Castro; Shmuel Oren; Alvaro Riascos; Miguel Bernal
  4. Why Internal Conflict Deteriorates State Capacity? Evidence from Colombian Municipalities By Mauricio Cárdenas; Marcela Eslava; Santiago Ramírez
  5. Tendencias históricas y regionales de la adjudicación de baldíos en Colombia By Juanita Villaveces; Fabio Sánchez
  6. The Economics of the War on Illegal Drug Production and Trafficking By Daniel Mejia; Pascual Restrepo
  7. Crime in Colombia: More law enforcement or more justice? By Catalina Gómez; Hermilson Velásquez; Andrés Julián Rendón; Santiago Bohórquez
  8. Towards a Micro-Founded Theory of Aggregate Labor Supply By Andres Erosa; Luisa Fuster; Gueorgui Kambourov
  9. Rendimiento académico: ¿qué papel juegan los factores institucionales? By Alberto Jaramillo; Isabel Montes; Sandra Milena Chica G.; José David Garcés C.
  10. On the Radio: Effectiveness of the Viva Seguro Financial Education Program By Catherine Rodríguez; Fabio Sánchez; Sandra Zamora

  1. By: Sebastian Galiani (University of Maryland); Paul Gertler (UC Berkeley); Ryan Cooper (J-PAL); Sebastian Martinez (Inter-American Development Bank); Adam Ross (Bill & Melinda Gates); Raimundo Undurraga (New York University)
    Abstract: This paper provides empirical evidence on the causal effects that upgrading slum dwellings has on the living conditions of the extremely poor. In particular, we study the impact of providing better houses in situ to slum dwellers in El Salvador, Mexico and Uruguay. We experimentally evaluate the impact of a housing project run by the NGO TECHO which provides basic pre-fabricated houses to members of extremely poor population groups in Latin America. The main objective of the program is to improve household well-being. Our findings show that better houses have a positive effect on overall housing conditions and general well-being: treated households are happier with their quality of life. In two countries, we also document improvements in children’s health; in El Salvador, slum dwellers also feel that they are safer. We do not find this result, however, in the other two experimental samples. There are no other noticeable robust effects on the possession of durable goods or in terms of labor outcomes. Our results are robust in terms of both internal and external validity because they are derived from similar experiments in three different Latin American countries.
    JEL: I12 I31 J13 O15 O18
    Date: 2014–07
  2. By: Andrés Álvarez; Marc Hofstetter
    Abstract: Based on the counting of Help-wanted advertisements in print newspapers, we present national vacancy indexes and vacancy rates for Colombia. These series will allow tackling a myriad of questions related to the functioning of the labor markets in emerging economies, where such datasets were not available.
    Keywords: Vacancies, Help-wanted index, unemployment, Beveridge curve, labor market, Colombia.
    JEL: E24 E32 J63 J64
    Date: 2013–12–04
  3. By: Luciano de Castro; Shmuel Oren; Alvaro Riascos; Miguel Bernal
    Abstract: This paper evaluates the impact of Resolution CREG 051 on the performance of the electricity markets in Colombia. We found out that productive efficiency has improved since the introduction of the Resolution, that is, the total costs of producing electricity have been reduced. This shows a positive impact of the Resolution. On the other hand, we also found that mark-ups and forward energy prices (from bilateral contracts) have increased since 2009, suggesting that there was an increase in the exercise of market power by producers. From the two previous points, we conclude that, although the productive efficiency has increased, the larger share of the efficiency gains were appropriated by the energy producers, rather than passed on to consumers.
    Keywords: Energy markets, auctions, centralized unit commitment.
    JEL: D22 D44 L94 Q41
    Date: 2014–07–16
  4. By: Mauricio Cárdenas; Marcela Eslava; Santiago Ramírez
    Abstract: Previous work has documented a negative correlation between internal conflict and state capacity. We attempt to shed light on mechanisms that underlie this relationship, using data for Colombian municipalities. We rely on identifying heterogeneous effects of different types of violent events on state capacity, taking advantage of variability across municipalities in the prevalence of specific manifestations of conflict and their intensity. Our findings suggest that events making civilians feel targeted affect the state’s capacity to collect taxes, while those reflecting a stronger military capacity of illegal armies, in particular their large-scale attacks, affect the state’s capacity to provide public goods.
    Keywords: State capacity; state capacity at the local level; internal conflict; Colombia
    Date: 2013–12–11
  5. By: Juanita Villaveces; Fabio Sánchez
    Abstract: El presente documento hace una revisión de la política de reforma agraria en Colombia desde principios del siglo XX hasta 2012, caracterizada por la adjudicación de baldíos a campesinos. En este documento, se busca dar cuenta de la magnitud e importancia de esta política pública que ha perdurado a lo largo del tiempo y con una dinámica continua desde sus inicios, con el fin de aportar a la amplia literatura sobre reforma agraria en Colombia que, si bien analiza las tensiones propias de esta política no cuenta con datos desagregados del comportamiento de la política para más de un siglo. Igualmente se hace un recorrido regional que evidencia la dinámica de la reforma agraria en diferentes regiones a lo largo del tiempo.
    Keywords: reforma agraria, baldíos, Colombia
    JEL: Q15
    Date: 2014–06–13
  6. By: Daniel Mejia; Pascual Restrepo
    Abstract: We model the war on drugs in source countries as a conflict over scarce inputs of successive levels of the production and trafficking chain. We explicitly model the vertical structure of the drug trade as being composed of several stages, and study how different policies aimed at different stages affect the supply, prices and input markets. We use the model to study Plan Colombia, a large scale intervention in Colombia aimed at reducing the supply of cocaine by targeting illicit crops and illegal armed groups’ control of the routes used to transport drugs outside of the country - two of the main inputs of the production and trafficking chain. The model fits many of the patterns found in the data and sheds light on certain puzzling findings. For a reasonable set of parameters that match well the data on the war on drugs under Plan Colombia, our model predicts that the marginal cost to the U.S. of reducing the amount of cocaine transacted in retail markets by one kilogram is $1’631.900 if resources are allocated to eradication efforts; and $267.450 per kilogram if resources are allocated to interdiction efforts.
    Keywords: Hard Drugs, Conflict, War on Drugs, Plan Colombia
    JEL: D74 K42
    Date: 2013–11–14
  7. By: Catalina Gómez; Hermilson Velásquez; Andrés Julián Rendón; Santiago Bohórquez
    Abstract: This study considers the effect that judicial and police efficiency exercised on crime in 25 of the 33 political-administrative divisions in Colombia during the period 2000- 2011. Specifically, the study seeks to determine whether the reduction of crime was the result of increases in the cost of crime as a result of the strengthening of the country’s security forces, especially the National Police, or instead was due to the greater efficiency of the penal system resulting from a structural change stemming from Act 906 of 2004. To view this we propose a model of dynamic panel data that not only includes the individual and temporal effects of the variables of interest, but also allows us to understand the inertia in criminal behavior. The results indicate an inverse relationship between the number of crimes and the greater efficiency of the police and judicial action, which is consistent with the evidence reported in other international work. Robustness checks confirmed the validity of the findings.
    Keywords: Crime economy, data panel, police, judicial system, efficiency
    JEL: D61 H83 I38 K14 K42
    Date: 2014–02–01
  8. By: Andres Erosa; Luisa Fuster; Gueorgui Kambourov
    Abstract: We build a heterogeneous life-cycle model which captures a large number of salient features of individual labor supply over the life cycle, by education, both along the intensive and extensive margins. The model provides an aggregation theory of individual labor supply, firmly grounded on individual-level micro evidence, and is used to study the aggregate labor supply responses to changes in the economic environment. We find that the aggregate labor supply elasticity to a transitory wage shock is 1.75, with the extensive margin accounting for 62% of the response. Furthermore, we find that the aggregate labor supply elasticity to a permanent-compensated wage change is 0.44.
    Keywords: Aggregate labor supply, intensive margin, extensive margin, life cycle, fixed cost of work, non-linear earnings, precautionary savings, preference heterogeneity
    JEL: D9 E2 E13 E62 J22
    Date: 2014–07–14
  9. By: Alberto Jaramillo; Isabel Montes; Sandra Milena Chica G.; José David Garcés C.
    Abstract: El presente artículo examina cuáles son los factores institucionales que tienen relación con el rendimiento académico en matemáticas. Para ello se tomó un corte transversal de 1653 estudiantes que presentaron el examen de Estado de la educación media (Saber 11) en el 2010, provenientes de 44 instituciones educativas de la ciudad de Medellín - Colombia. La estimación se hizo por medio de un Modelo Lineal Jerárquico cuyas variables independientes se clasificaron en dos niveles: estudiante e institución. Los principales resultados evidencian que el 31,4% del rendimiento de los estudiantes en matemáticas es explicado por variables institucionales como el número de horas de matemáticas, el pertenecer a colegios privados y de un solo género, el uso de texto guía y el tamaño del colegio.
    Keywords: Rendimiento académico, factores institucionales, modelos lineales jerárquicos/ academic achievement, institutional factors, Hierarchical Linear Models
    JEL: I20 I21 I28
    Date: 2014–06–16
  10. By: Catherine Rodríguez; Fabio Sánchez; Sandra Zamora
    Abstract: Through a novel randomized control trial this paper estimates the impact of Viva Seguro, a financial education program that covers topics on risks and insurance management, on knowledge, attitudes and actual behavior. The program was broadcasted in two Colombian radio stations that have low and medium income households as target audience. Listeners from these radio stations comprise our treatment group. The control group is comprised by listeners from other two radio stations of similar characteristics and from the same broadcasting company. Using panel data information on both the treatment and the control group we find that giving financial education through such mass media channel has a positive impact on the knowledge of risks individuals face, the number of insurance they know exist and their perceived capability of understanding and handling insurance. No effect however is found on the knowledge of specific concepts of insurance, or their attitudes towards it, in savings behavior or the number of insurance bought. In general results show that delivering financial education through radio is a cost effective alternative in order to improve knowledge on insurance related concepts.
    Keywords: financial education, radio, insurance, randomized control tral (RCT)
    JEL: I20 I25
    Date: 2014–05–22

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