VoxDev Development Economics

Relationships between groups are vital in village economies, but do these social structures affect the success of development policies? If resources are delivered by someone from the community, does the social relationship between that agent and the people who could benefit from the success of the intervention matter? In this VoxDevTalk, Oriana Bandiera discusses an experiment in Uganda that addresses these questions. Randomly selecting one of two viable candidates to deliver an agricultural extension programme in rural Ugandan villages, she and her co-authors find that delivery agents favour their own social ties over ex-ante identical farmers connected to the other (unselected) candidate and that this is inconsistent with output maximisation or targeting the poorest. Favouritism disappears when both potential delivery agents belong to the same social group. Using the randomised allocation of the programme across villages, they show how unobserved social structures explain the variation in in delivery rates and programme effectiveness that they often observe in the data.

Across the developing world, many girls face difficulties in persuading their parents to enrol them in secondary education. Whilst financial incentives have often been analysed as a means to encourage female school enrollment, there has been little focus on the role of negotiation skills. In this VoxDevTalk, Kathleen McGinn discusses an innovative experiment in Zambia, which assesses the impact of negotiation skills on female educational outcomes. Fascinatingly, the researchers find that teaching negotiation skills significantly increased female educational outcomes, particularly for high-ability girls. 

By 2050, the world’s urban population is estimated to reach nearly seven billion, driven mainly by urbanisation in developing countries. Despite this growth, development economists have often chosen to focus on rural areas. In this VoxDevTalk, Ed Glaeser discusses a new paper that brings together research into urbanisation in the developing world. He argues that policymakers should not try to slow migration into cities, given the benefits of urbanisation that existing research has shown. These benefits include higher productivity and wages over the long-term.     

Across the world, women face invisible barriers that prevent them from taking up education and work. This is particularly the case in conservative societies such as in Punjab, Pakistan. In this VoxDev Talk, Asim Khwaja discusses an experiment in Punjab, Pakistan, that assessed the take-up rates of a vocational training programme for women. The researchers found that despite high interest, few women actually took up the programme. This low take-up rate was largely explained by social barriers that prevented women travelling to neighbouring villages (where the trainings were held). However, if group transport could be secured through a male from the village, then take-up increased dramatically.      

Editors’ note: This podcast was updated on 25.08.2020  How can policymakers solve the problem of non-payment of utility bills while still maintaining access to water and sanitation services? In the developing world, urban settings often struggle to provide basic needs, including water and sanitation. Often, the challenge lies in the cost of the last mile between the main infrastructure and individual households. In this VoxDev talk, Paul Gertler discusses an innovative experiment targeted at improving payment of utility bills in slums in Nairobi, Kenya. The researchers find that shaming landlords who failed to pay their bills did not subsequently increase payments. However, a credible threat of cutting water services was enough to ensure that landlords made their utility payments. Read "Pipe dreams: Enforcing payment for water and sanitation services in Nairobi’s slums" by Aidan Coville, Sebastian Galiani, Paul Gertler, and Susumu Yoshida here.

Why do trade barriers remain high in developing countries despite the significant potential to drive economic growth through trade? Advanced economies have mostly removed tariffs and other barriers to trade. By contrast, in many developing countries such barriers remain in spite of the huge potential to drive economic growth through trade. In this VoxDev talk, David Atkin and Amit Khandelwal discuss their new paper on trade in developing economies. They argue that we think about trade policy often through neoclassical models that emphasise perfect competition. Whilst this way of thinking may suit environments in advanced economies, it does not resemble the realities on ground in developing countries.     Read “How distortions alter the impact of international trade in developing countries” by David Atkin and Amit Khandelwal here.

Many development economists have advocated unconditional cash transfers as a crucial tool for reducing poverty, especially during the present COVID-19 pandemic. In this VoxDev talk, Karthik Muralidharan discusses the effects of a small unconditional cash transfer for India’s development goals. He argues that an inclusive growth dividend, pegged at 1% of GDP and paid to all citizens, would have major positive impacts on key development indicators.  And crucially, such a transfer is fiscally affordable for India, as opposed to Universal Basic Income, which requires spending of 4-10% of GDP.    Read "An inclusive growth dividend: Reframing the role of income transfers in India’s anti-poverty strategy" by Maitreesh Ghatak and Karthik Muralidharan here.  

Exploring the impact of vocational training in Mongolia on labor market outcomes including positive effects on employment and earnings, particularly for women. Discussion on the methodology of a randomized control trial and challenges in evaluating long-term data. Insights on the popularity of vocational schools in Mongolia and the range of trade programs offered.

Why do we still see high rates of child marriage in settings such as Bangladesh, despite significant improvements in women’s economic empowerment?

How do poor mental health and poverty interact, and how can we best ensure access to mental health services?