Seminar Series – Fall 2023

Adam Osman, University of Illinois at Urbana Champaign

August 31, 2023

Big Loans to Small Businesses: Predicting Winners and Losers in an Entrepreneurial Lending Experiment

We experimentally study the impact of relatively large enterprise loans in Egypt. Larger loans generate small average impacts, but machine learning using psychometric data reveals that “top-performers” (those with the highest predicted treatment effects) substantially increase profits, while profits drop for poor-performers. The large differences imply that lender credit allocation decisions matter for aggregate income, yet we find that existing practice leads to substantial misallocation. We argue that some entrepreneurs are over-optimistic and squander the opportunities presented by larger loans by taking on too much risk, and show the promise of allocations based on entrepreneurial type relative to firm characteristics.

Reshmaan Hussam, Harvard University

September 7, 2023

The Household at Work: Evidence from a refugee camp

Why does employment generate psychosocial value beyond income alone? Is engaging in productive activity enough, or does one need to be paid for it? And how is this mediated by one’s social identity in the household – namely one’s role as a husband or a wife? We study this question in the Rohingya refugee camps, the largest refugee camps in the world, and a setting in which pervasive unemployment and strong gender norms characterize daily refugee experience. We involve 2520 married couples in a field experiment, randomly assigning either the husband or wife to one of three interventions relative to a control: cash, volunteering, or gainful employment, and estimate how each intervention affects both own and partner’s wellbeing. We find that gainful employment delivers psychosocial benefits above and beyond both cash alone and volunteering alone. This broadly holds for women and men; however, households in which men are treated appear to fare better on net as measured by domestic violence and psychosocial wellbeing for both partners. We find no systematic evidence of a retrenchment of male power in these households, nor do we find evidence that treating females improves their bargaining power.

Ricardo Dahis, Monash University

September 14, 2023

Decentralizing Development: Evidence from Government Splits

Changes in political boundaries aimed at devolving power to local governments are common in many countries. We examine the economic consequences of redistricting through the creation of smaller government units. Exploiting reforms that led to sharp variations in the number of government units in Brazil, we show that voluntary redistricting increases the size of the public sector, public services delivery, and economic activity in new local governments over the long-term. These benefits are not offset by losses elsewhere and are stronger in peripheral and remote backward areas that are neglected by their parent governments. We provide evidence that the decentralization of decision-making power boosts local development in disadvantaged areas beyond simply gains in fiscal revenues.

Natalia Garbiras-Diaz, Harvard Business School

September 21, 2023

The Limits of Decentralized Administrative Data Collection: Evidence from Colombia (coauthored with Tara Slough, NYU)

States collect vast amounts of data for use in policymaking and public administration. To do so, central governments frequently solicit data from decentralized bureaucrats. Because central governments use these data in policymaking, decentralized bureaucrats may face incentives to selectively report or misreport, limiting the quality of administrative data. We study the production of a transparency index by measuring the reporting behavior of bureaucrats in the near-universe of Colombian public sector entities. Using an original audit, we show that failure to report and misreporting vary systematically in actual transparency practices, revealing limits to the use of these data. Further, in partnership with a Colombian government watchdog agency, we implement a large-scale experiment that varies the salience of central government oversight. Increased salience changed the data bureaucrats reported to the central government. Similar dynamics across policy areas and regime types are apt to limit the quality of state information in multiple contexts.

Cauê Dobbin, Georgetown University

September 28, 2023

The Effect of Online Education on Market Structure and Students’ Outcomes (with Nano Barahona, Joaquin Fuenzalida, and Sebastian Otero)

We investigate the costs and benefits of expanding access to online higher education. The net effect of increasing the availability of online degrees on student outcomes is ambiguous and depends on two key objects. First, it depends on whether the demand for online education comes from students substituting away from in-person degrees or students who would otherwise not study. Second, it depends on how the value-added of online degrees and in-person degrees compare. We analyze this issue in the context of the Brazilian higher education market, where the market share of online degrees increased from 21% to 51% between 2015 and 2019.

Rohini Somanathan, University of Delhi

October 5, 2023

Nudging Marriage Norms Through Cash Transfers

We explore the ability of conditional cash transfer programs to reduce child marriages in the presence of heterogeneous social  norms.  Contrary to popular belief, we show that groups strong child marriage norms can exhibit larger program effects for a given transfer than groups with weak norms. We empirically explore this relationship between norms and transfers by combining household data reflecting marriage ages with administrative data on one of the earliest and largest programs to reduce child marriage in North India.  Consistent with our theoretical results, we find that regions and households with strong early marriage norms do exhibit large effects. Our results suggest that  norms can be influenced by modest financial incentives depending on the configuration of  norms and  laws relative to household preferences. It is not therefore surprising that attempts to  aim to change culturally driven behavior through cash transfers have had mixed success.

Laura Boudreau, Columbia University

October 12, 2023

Monitoring Harassment in Organizations (new window) (with Sylvain Chassang, Ada González-Torres, and Rachel Heath)

We evaluate secure survey methods designed for the ongoing monitoring of harassment in organizations. To do so, we partner with a large Bangladeshi garment manufacturer and experiment with different designs of phone-based worker surveys. “Hard’’ garbling (HG) responses to sensitive questions, i.e., automatically recording a random subset as complaints, increases reporting of physical harassment by 290%, sexual harassment by 271%, and threatening behavior by 45%, from reporting rates of 1.5%, 1.8%, and 9.9%, respectively, under the status quo of direct elicitation. Rapport-building and removing team identifiers from responses do not significantly increase reporting. We show that garbled reports can be used to consistently estimate policy-relevant statistics of harassment, including: How prevalent is it? What share of managers is responsible for the misbehavior? and, How isolated are its victims? In our data, harassment is widespread, the problem is not restricted to a minority of managers, and victims are often isolated within teams.

Kelsey Jack, University of California, Santa Barbara

October 19, 2023

Targeting subsidies through price menus: Contract design and evidence from clean fuels

Targeting subsidies to maximize social objectives relies on either observable or unobservable characteristics of recipients. We start by adapting the theory of second degree price discrimination to a setting where it is not feasible to impose purchased quantity limits over a given period, but households face heterogeneous saving costs and transaction costs.  We show that a separating equilibrium with non-linear pricing can maximize a social planner’s objective function in this setting.  Next, we demonstrate implementation through a two stage design that first gathers the empirical inputs for a sufficient statistic approach to menu design, and then tests the optimal non-linear price menu against counterfactual linear pricing. Our empirical setting is clean fuels for household cooking in Ghana, where the use of biomass for energy remains common and generates substantial health and environmental costs. Relative to the counterfactual, non-linear pricing achieves the same level of LPG demand with 30% less in public expenditure.

Sarah Deschênes, The World Bank

October 26, 2023

Expanding access to schooling in Nigeria: Impact on Marital Outcomes (with Rozenn Hotte, University of Tours)

The paper uses the Universal Primary Education Program (UPE) implemented in Nigeria in 1976 to investigate the effect of wife and husband’s education on women’s empowerment. We combine regional disparities in baseline levels of enrollment with the timing of the program and the traditionally high age difference between partners to disentangle the impact of wife’s education from husband’s education. The UPE had heterogeneous effects in the South compared to the North of Nigeria. In the South, women achieve more gender-equal marriages by delaying marriage by 1.23 years, and by reducing the age gap with their husband by 2 years. More educated women also maintain a stable education gap with their husband. In the North, unions’ characteristics remain unchanged except for the probability to marry a polygamous partner that increases when husbands are treated. In both regions, women are better off as the UPE decreases women’s tolerance of domestic violence and increases their say in decision-making but the mechanic of the effects differ: Northern women are made better off by the education of their husband’s whereas Southern women are better off thanks to the combined effects of their own education and their husband’s.

Sandra Rozo, The World Bank Group

November 2, 2023

Housing Subsidies and Well-being: Forecasts and Experimental Evidence from Syrian Refugees in Jordan

Augustin Bergeron, University of Southern California

November 9, 2023

Does Collecting Taxes Erode the Accountability of Informal Leaders? Evidence from the D.R.C (with Augustin Bergeron, Elie Kabue Ngindu, Gabriel Tourek, Jonathan Weigel) 

Delegating tax collection to informal leaders could raise tax revenue but runs the risk of undermining the local accountability of those leaders. We investigate this tradeoff by exploiting whether city chiefs in the Democratic Republic of the Congo were randomly assigned to collect property taxes in 2018. To measure accountability, we study the other side of the social contract: chiefs’ distribution of resources in a government cash transfer program in which they had discretion over the recipients of development aid. In line with citizens’ preferences, chiefs who collected taxes allocated more program benefits to poorer households and thus made fewer inclusion and exclusion errors. They were no more or less likely to pocket benefits or allocate them to family. Across a range of measures, citizens appear to have updated positively about chiefs who collected taxes. We provide evidence that collector chiefs allocated aid to poorer households because door-to-door tax collection created opportunities to learn which households were in greatest need. In contrast to concerns of ‘decentralized despotism,’ the paper thus finds evidence of accountability benefits from delegating tax responsibilities to local leaders in low-capacity states.

Donghyun Danny Choi, Brown University

November 16, 2023

Mobile Internet Technology and National Identity in Sub-Saharan Africa (with Benjamin Laughlin, NYU Abu Dhabi;, and Anna Schultz, Independent Researcher)

We examine how the expansion of mobile internet infrastructure affects national identity in sub-Saharan Africa. In diverse societies where elections are contested along ethno-communal lines, we argue that access to mobile internet undermines national identity because it facilitates voter exposure to the polarizing tendencies of internet-based social media and communication platforms. Applying a difference-in-differences design on mobile coverage maps and geocoded survey data of more than 50,000 African citizens, we show that access to mobile internet reduces identification with the nation by up to 5–7 percentage points. To establish support for our electoral mechanism, we exploit as-if random variation in the timing of individuals’ survey interviews relative to presidential elections, during which we argue divisive and polarizing forces are at their peak. Our analysis shows that electoral proximity intensifies the negative effect of mobile internet. These findings highlight how technological innovations can inhibit the process of state-building in diverse societies.

Pascaline Dupas, Princeton University

November 30, 2023

Keeping Up Appearances: An Experimental Investigation on Social Pressure and Relative Ranks”, joint with Marcel Fafchamps and Laura Hernandez.