Seminar Series Spring 2025 - Georgetown University Initiative on Innovation, Development and Evaluation

A weekly seminar featuring guest speakers presenting cutting-edge research in development economics. Please note that the series this semester will be in person. All seminars will take place from 1:00-2:15 on Thursdays in ICC 550.

Dennis Egger

Oxford University

February 20, 2025

Slack and Economic Development

Michael Walker (University of California, Berkeley)
Nachiket Shah (University of California, Berkeley)
Edward Miguel (University of California, Berkeley)
Felix Soliman (University of Zurich)
Tilman Graff (Harvard University)
Dennis Egger (Oxford University)

Slack — the underutilization of factors of production — varies systematically with economic development. Using novel and detailed measures of the utilization of labor and capital from a large representative sample of firms in rural and urban Kenya, we show that utilization is increasing in firm size, market access, and economic activity. We present a model of firm capacity choice where indivisibility in at least one input is a key driver of slack. We embed the model in spatial general equilibrium, with features characteristic of low-income settings — including many small firms and high transport costs — and show that it rationalizes both the endogenous emergence of slack in steady-state and elastic aggregate supply curves. We empirically validate model predictions using reduced-form estimates of the general equilibrium effects of cash transfers from a large-scale RCT in Kenya. The parsimonious model replicates much of the experimental evidence, predicting a large real multiplier of 1.5, driven by expansion in low-utilization sectors and firms, and limited average price inflation. Counterfactual analyses indicate that multipliers are likely to be meaningfully smaller in lower slack settings, such as urban areas. We use the model to revisit the estimation of spatial spillovers in clustered RCTs and uncover non-trivial ‘missing intercept’ effects on income and inflation. Additionally, we innovate methodologically by pre-registering key elements of model estimation and validation. The findings suggest that input indivisibilities and slack are key features of developing country settings, and are quantitatively important for macroeconomic dynamics and policies.

Lucia Corno

Cattolica University and LEAP

February 27, 2025

Norm Replacement and Information. An Experiment on Ending Female Genital Cutting

Lucia Corno (Cattolica University)
Eliana La Ferrara (Harvard Kennedy School)

Female Genital Cutting (FGC) is a deeply harmful practice with severe consequences for women’s health, human capital accumulation, and psychological well-being. This paper evaluates the effectiveness of two interventions designed to reduce the incidence of FGC among adolescent girls in Sierra Leone, where FGC is integral to the traditional initiation ceremony known as Bondo, symbolizing a girl’s transition to womanhood. We randomly assigned 150 villages to three experimental arms: (i) a control group; (ii) an Information arm, which facilitated community discussions about the ”costs” associated with FGC, emphasizing why it should be abandoned; and (iii) a Norm-replacement arm, aimed at substituting the traditional ritual with an alternative that does not involve cutting (“Bondo without cutting”), focusing on how to abandon FGC. We measured girls’ FGC status both through maternal reports and clinical observations by healthcare professionals. Three years after the intervention, both treatments resulted in a 23%-25% reduction in the likelihood of FGC among girls aged 10-18. Mechanism analysis reveals that the Information arm improved awareness of health risks, while the Norm-replacement arm increased acceptance of alternative rituals. Both interventions also led to a modest reduction in social pressure, as reflected in second-order beliefs. These findings highlight the importance of culturally sensitive, grassroots approaches to transforming entrenched harmful social norms.

Spring Break

March 6, 2025

Stelios Michalopoulos

Brown University

March 13, 2025

Paper

Uprootedness, Human Capital, and Skill Transferability

Stelios Michalopoulos (Brown University)
Elie Murard (University of Trento)
Elias Papaioannou (London Business School)
Seyhun Orcan Sakalli (King’s College London)

More than a century has passed since the abrupt exodus of 1.2 million Greek Orthodox from Anatolia and their arrival in Greece, a transformative event for the country’s social and demo- graphic landscape. Today, one in three Greeks reports a refugee background. While its historical significance is well-documented, its short-, medium-, and long-term impact on human capital accu- mulation remains unexplored. How did forced displacement shape the educational trajectories of the uprooted and their offspring? Did refugees invest in portable skills to respond to uncertainty, or did they struggle to catch up with the autochthonous? To address these questions, we trace the educational investments of refugees and their descendants over the last 100 years, leveraging gran- ular census data and a comprehensive mapping of both their origins in Anatolia and settlements in Greece. The analysis provides compelling support for the uprootedness hypothesis. Though initially lagging, refugees settling in the Greek countryside eventually surpassed nearby natives’ educational attainment. Their university choices also diverged with refugees’ lineages favoring de- grees transferable beyond the Greek labor market, such as engineering and medicine, and natives specializing in law and other fields with a strong home bias. Exploring additional mechanisms reveals the critical role of linguistic barriers and economic conditions at the destination, as opposed to origin and background characteristics. The widespread educational gains of refugees and their descendants over three generations offer some hope that the ongoing surge of forced displacement, despite its tragedy, if properly addressed by the international community, can be a backbone of economic resilience for the affected communities.