We document that an experimental intervention offering transport subsidies for poor rural households to migrate seasonally in Bangladesh improved risk sharing. A theoretical model of endogenous migration and risk sharing shows that the effect of subsidizing migration depends on the underlying economic environment. If migration is risky, a temporary subsidy can induce an improvement in risk sharing and enable profitable migration. We estimate the model and find that the migration experiment increased welfare by 12.9%. Counterfactual analysis suggests that a permanent, rather than temporary, decline in migration costs in the same environment would result in a reduction in risk sharing.
Measuring the extent to which assortative matching differs between two economies is challenging when the marginal distributions of the characteristic along which sorting takes place (e.g. education) also changes for either or both sexes. Drawing from the statistics literature we define simple conditions that any index has to satisfy to provide a measure of change in sorting that is not distorted by changes in the marginal distributions of the characteristic. While our characterisation of indices of assortativeness is not complete, and hence cannot exclude the possibility of multiple indices providing contradictory results, in an empirical application to US data we find that all indices satisfying our conditions indicate that homogamy by education has increased over time.
Conditional Cash transfer (CCT) programs have been shown to have positive effects on a variety of outcomes including education, consumption and health visits, amongst others. We estimate the long-run impacts of the urban version of Familias en Acción, the Colombian CCT program on crime, teenage pregnancy, high school dropout and college enrollment using a Regression Discontinuity design on administrative data. ITT estimates show a reduction on arrest rates of 2.7pp for men and a reduction on teenage pregnancy of 2.3pp for women. High school dropout rates were reduced by 5.8pp and college enrollment was increased by 1.7pp for men.
We build an equilibrium model of a small open economy with labor market frictions and imperfectly enforced regulations. Heterogeneous firms sort into the formal or informal sector. We estimate the model using data from Brazil, and use counterfactual simulations to understand how trade affects economic outcomes in the presence of informality. We show that: (1) Trade openness unambiguously decreases informality in the tradable sector, but has ambiguous effects on aggregate informality. (2) The productivity gains from trade are understated when the informal sector is omitted. (3) Trade openness results in large welfare gains even when informality is repressed. (4) Repressing informality increases productivity, but at the expense of employment and welfare. (5) The effects of trade on wage inequality are reversed when the informal sector is incorporated in the analysis. (6) The informal sector works as an “unemployment,” but not a “welfare buffer” in the event of negative economic shocks.
We investigate the role of training in reducing the gender wage gap using the British Household Panel Survey. On the basis of a life-cycle model and using tax and welfare benefit reforms as a source of exogenous variation, we evaluate the role of formal training and experience in defining the evolution of wages and employment careers, conditional on education. Training is potentially important in compensating for the effects of children, especially for women who left education after completing high school, but does not fundamentally change the wage gap resulting from labor market interruptions following child birth.
Poor early childhood development in low- and middle-income countries is a major public health problem. Efficacy trials have shown the potential of early childhood development interventions but scaling up is costly and challenging. Guidance on effective interventions’ delivery is needed. In an open-label cluster-randomized control trial, we compared the effectiveness of weekly home visits and weekly mother-child group sessions. Both included nutritional education, whose effectiveness was tested separately.
We estimate production functions for cognition and health for children aged 1–12 in India, based on the Young Lives Survey. India has over 70 million children aged 0–5 who are at risk of developmental deficits. The inputs into the production functions include parental background, prior child cognition and health, and child investments, which are taken as endogenous. Estimation is based on a nonlinear factor model, based on multiple measurements for both inputs and child outcomes. Our results show an important effect of early health on child cognitive development, which then becomes persistent. Parental investments affect cognitive development at all ages, but more so for younger children. Investments also have an impact on health at early ages only.
Social connections are fundamental to human wellbeing. This paper examines the social networks of young married women in rural Odisha, India.. This is a group, for whom highly-gendered norms around marriage, mobility, and work are likely to shape opportunities to form and maintain meaningful ties with other women. We track the social networks of 2,170 mothers over four years, and find a high degree of isolation. Wealthier women and women more-advantaged castes have smaller social networks than their less-advantaged peers. These gradients are primarily driven by the fact that more-advantaged women are less likely to know other women within their same socioeconomic group than are less-advantaged women are. There exists strong homophily by socioeconomic status that is symmetric across socioeconomic groups. Mediation analysis shows that SES differences in social isolation are strongly associated to caste, ownership of toilets and distance. Further research should investigate the formation and role of female networks.
Improving school quality with limited resources is a key issue of policy. This article uses a randomised controlled trial (RCT) to estimate the effectiveness of guided instruction methods as implemented in under-performing schools in Chile. The intervention improved performance substantially, and equally for boys and girls. However, the effect is mainly accounted for by children from relatively higher-income backgrounds. Basing our study on the Classroom Assessment Scoring System (CLASS) instrument, we document that the quality of teacher–student interactions is positively correlated with the performance of low-income students; however, the intervention did not affect these interactions. Guided instruction improves outcomes, but the challenge to reach the most deprived children remains.
Using city-level crime data for six major U.S. cities from Jan 21 to May 30 2020, we document an approximately 20% average reduction in reported crimes during March, simultaneous with sharp economic downturn and heightened social distancing restrictions. We also decompose trends by crime type and location. Our key findings are:
Since the steep 20% crime drop in March, overall rates have steadily risen but remain below pre-pandemic levels on average.
Crimes committed in commercial and street settings (as opposed to residential areas) account for most of the drop in crimes.
Violent crimes decline in similar proportion to nonviolent crimes.
Though larcenies fall by one-third, other kinds of theft like burglary and auto theft rise.
Caveats to our findings include the possibility of simultaneous changes in reporting and policing activities.