Hand It to the Developers
Left-handedness and economic development
Fabio Mariani, Marion Mercier & Luca Pensieroso
Journal of Economic Growth, March 2023, Pages 79-123
This paper studies the interplay between left-handedness and economic development, thereby contributing to our understanding of the relationship between evolutionary forces, human diversity and growth. We propose a novel theoretical framework in which economic development influences the prevalence of left-handedness through structural change and a genetic mechanism driven by differential fertility. In particular, the emergence of the industrial sector puts left-handers at a reproductive disadvantage, because of their lower manual ability and wages. This fertility differential changes sign as soon as the income-fertility relationship is reversed, and eventually fades away when the rise of human capital makes manual skills irrelevant. Our model thus explains the decline and subsequent recovery of left-handedness observed over the last few centuries in the Western world. We further explore the possibility that left-handedness in turn influences growth: despite their lower productivity in manual tasks, left-handers may enhance technological progress through cognitive skills that are conducive to innovation, and through their contribution to the diversity of the workforce. This implies that the link between handedness and economic performance varies across stages of development. We present empirical evidence that lends credence to the core differential-fertility mechanism of our model and suggests that left-handedness can positively contribute to growth, once the economy has reached a sufficiently high level of human capital.
Earthquake hazard and civic capital
Paolo Buonanno, Giacomo Plevani & Marcello Puca European
Journal of Political Economy, forthcoming
We examine the empirical relationship between the exposure to earthquake hazard and civic capital in Italian municipalities. Drawing on the Italian National Institute of Geophysics and Volcanology, we find that earthquake hazard increases civic capital. We exploit variation across neighboring municipalities and use a neighbor-pair fixed effect estimator to establish a causal link between earthquake hazard and the accumulation of civic capital. We decompose the effect of earthquake hazard variation along four dimensions -- frequency, space, magnitude, and timing -- and observe that the effect is mostly explained by high-magnitude seismic events in the past. Our results are in line with the intuition that cooperative social norms build over a very long time span.
The Learning Crisis of Developing Country Elites: Lessons from PISA-D
Lant Pritchett & Martina Viarengo
World Bank Economic Review, forthcoming
How much of the learning crisis can be addressed through “inclusion” -- the equalization of grade attainment and learning outcomes across groups (e.g., girls/boys, rural/urban, poor/rich) -- and how much of the learning crisis requires improvement in the country's system of basic education to improve learning outcomes across the board? This study uses the data from the seven countries who participated in Programme for International Student Assessment (PISA) for Development (PISA-D) to show that for most countries and subjects the average learning outcome for the advantaged (male, urban, native-born, speakers of assessment language), and elite (95th percentile in PISA measured socio-economic status) students was below the Sustainable Development Goal (SDG) “minimum learning level” target of PISA level 2. Even if every child in these countries were fully “included” -- had the same distribution of learning outcomes as the advantaged, SES elite, public school children -- 80 percent of all children would still fall short of proposed global minimum levels of learning.
Circle of fortune: The long-term impact of Western customs institution in China
Journal of Development Economics, forthcoming
This paper examines the long-run effect of the customs institution founded by the Chinese Maritime Customs (CMC), a foreign-run customs agency established in the mid-19th century in China. A historical natural experiment is exploited to identify a causal effect: in 1902, the CMC took over a number of Chinese Native Customs stations, for which it established clear procedural guidelines and improved transparency and efficiency, while the other Native Customs stations remained under Chinese authority. Using the historical criterion that determined which Native Customs stations were taken over -- those located within a 25 km radius of a CMC customs station -- as a source of exogenous variation in the quality of the local customs institution, I show that counties historically affected by the CMC institution are more developed today relative to nearby but unaffected areas. Moreover, today’s business and bureaucracy in the affected counties suffer less from corruption, suggesting that the long-run effect of institutions can be explained by the cultural norms it fostered in the local society.
Does Performance Competition Impact China's Leadership Behaviour? Re-examining the Promotion Tournament Hypothesis
Baoqing Pang, Shu Keng & Siyi Zhang
China Quarterly, forthcoming
How can China develop so quickly and yet maintain stability? Most scholars pinpoint the efforts of China's local government leaders as a primary factor. Regarding what motivates these leaders, however, scholars display wide disagreement. The widely accepted “promotion tournament” hypothesis stresses competition among local leaders as the driving force, but empirical test results vary considerably and create controversy. We argue that tests of promotion competition should target leadership behaviour rather than institutional inducements; the latter are, at best, a necessary condition of the former. Informed by extensive fieldwork, this study proposes an alternative and more direct approach to verifying the promotion tournament hypothesis by examining the impacts of promotion competition on leaders’ performance efforts. Our test results show, however, that competition for promotion has no significant impact on local leaders’ behaviour, thereby indicating that the promotion tournament hypothesis cannot be the primary explanation for China's economic achievements and regime resilience. In so doing, our study illuminates the oversimplified assumptions behind a prevailing proposition in Chinese politics and offers empirically informed insights into the tensions between political institutions and leadership behaviour.
Is Income Inequality Linked to Infectious Disease Prevalence? A Hypothesis-Generating Ecological Study Using Tuberculosis
Jay Bhattacharya, Joydeep Bhattacharya & Minkyong Kim
NBER Working Paper, March 2023
We study the association between infectious disease prevalence and income inequality. We hypothesize that random social mixing in an income-unequal society brings into contact a) susceptible and infected poor and b) the infected-poor and the susceptible-rich, raising infectious disease prevalence. We investigate this association by examining whether countries with elevated levels of income inequality have higher rates of pulmonary Tuberculosis (TB) incidence per capita. We analyzed publicly available country-level panel data for a large cross-section of countries between 1995 and 2013. A “negative control” using anemia (a non-communicable disease, and hence impervious to the hypothesized mechanism) is also applied. We find that elevated levels of income inequality were positively associated with tuberculosis prevalence. All else equal, countries with income-Gini coefficients 10% apart are a statistically significant 4% different in tuberculosis incidence. Income inequality had a null effect on anemia, the negative control. Our cross-country regression results suggest that income inequality may create conditions where TB spreads more easily.
Global High-Resolution Estimates of the United Nations Human Development Index Using Satellite Imagery and Machine-learning
Luke Sherman et al.
NBER Working Paper, March 2023
The United Nations Human Development Index (HDI) is arguably the most widely used alternative to gross domestic product for measuring national development. This is in large part due to its multidimensional nature, as it incorporates not only income, but also education and health. However, the low country-level resolution of the global HDI data released by the Human Development Report Office of the United Nations Development Programme (N=191 countries) has limited its use at the local level. Recent efforts used labor-intensive survey data to produce HDI estimates for first-level administrative units (e.g., states/provinces). Here, we build on recent advances in machine learning and satellite imagery to develop the first global estimates of HDI for second-level administrative units (e.g., municipalities/counties, N = 61,591) and for a global 0.1 × 0.1 degree grid (N=806,361). To accomplish this we develop and validate a generalizable downscaling technique based on satellite imagery that allows for training and prediction with observations of arbitrary shape and size. This enables us to train a model using provincial administrative data and generate HDI estimates at the municipality and grid levels. Our results indicate that more than half of the global population was previously assigned to the incorrect HDI quintile within each country, due to aggregation bias resulting from lower resolution estimates. We also illustrate how these data can improve decision-making. We make these high resolution HDI estimates publicly available in the hope that they increase understanding of human wellbeing globally and improve the effectiveness of policies supporting sustainable development. We also make available the satellite features and software necessary to increase the spatial resolution of any other global-scale administrative data that is detectable via imagery.
Landed elites and education provision in England: Evidence from school boards, 1871-99
Journal of Economic Growth, March 2023, Pages 125–171
I study the relationship between land concentration and the expansion of state education in 19C England. Using a broad range of education measures for 40 counties and 1,387 School Boards, I show a negative association between land concentration and local taxation, school expenditure, and human capital. I estimate reduced-form effects of 19C land concentration, geographic factor endowments, and the land redistribution after the Norman conquest of 1066. The negative effects on state-education supply are stronger where rural labour can easily migrate, where landowners had political power, is not offset by voluntary schooling, and not driven by a demand channel. This suggests that landowners opposed taxation in order to reduce state education provision.
Predicting food crises using news streams
Ananth Balashankar, Lakshminarayanan Subramanian & Samuel Fraiberger
Science Advances, March 2023
Anticipating food crisis outbreaks is crucial to efficiently allocate emergency relief and reduce human suffering. However, existing predictive models rely on risk measures that are often delayed, outdated, or incomplete. Using the text of 11.2 million news articles focused on food-insecure countries and published between 1980 and 2020, we leverage recent advances in deep learning to extract high-frequency precursors to food crises that are both interpretable and validated by traditional risk indicators. We demonstrate that over the period from July 2009 to July 2020 and across 21 food-insecure countries, news indicators substantially improve the district-level predictions of food insecurity up to 12 months ahead relative to baseline models that do not include text information. These results could have profound implications on how humanitarian aid gets allocated and open previously unexplored avenues for machine learning to improve decision-making in data-scarce environments.
Human Capital, Female Employment, and Electricity: Evidence from the Early 20th-Century United States
Review of Economic Studies, forthcoming
This paper revisits the link between electrification and the rise in female labor force participation (LFP), and presents theoretical and empirical evidence showing that electrification triggered a rise in female LFP by increasing market opportunities for skilled women. I formalize my theory in an overlapping generations model and find that my mechanism explains one quarter of the rise in female LFP during the rollout of electricity in the United States (1880–1940), and matches the slow decline in female home-production hours during this period. I then present micro-evidence supporting my theory using newly digitized data on the early electrification of the United States.
Hinterlands, city formation and growth: Evidence from the U.S. westward expansion
Dávid Krisztián Nagy
Review of Economic Studies, forthcoming
I study how geography shaped city formation and aggregate development in the United States prior to the Civil War. To guide my analysis, I present a conjecture that cities’ farm hinterlands fostered both city development and aggregate growth: the hinterland hypothesis. The hinterland hypothesis has rich implications on how various elements of U.S. geography – railroads, changes in U.S. political borders, and international trade – affected city formation and U.S. growth. To evaluate the hinterland hypothesis and its implications, I assemble a novel historical dataset on population, trading routes and agricultural productivity at a high spatial resolution. I combine the data with a dynamic quantitative model of economic geography that yields the hinterland hypothesis as a prediction. I find evidence for the hinterland hypothesis by showing that the model can replicate the key patterns of U.S. urbanization and city formation. Finally, I conduct a series of counterfactuals in the model to quantify the effect of geography on cities and growth, guided by the implications of the hinterland hypothesis. Results indicate that railroads were responsible for 1.8% of urban population in 1860 and for 25% of real GDP growth between 1830 and 1860. The effect of international trade was similar in magnitude, while the effect of political border changes was small during the period.
Women Legislators in Africa and Foreign Aid
Kurt Annen & Henrietta Asiamah
World Bank Economic Review, February 2023, Pages 1–23
There has been a significant rise in the share of women legislators in Africa. What makes this fact puzzling is that it cannot be attributed to an African electorate that values gender equality and having women in political leadership positions. In stark contrast to this, gender equality and women’s empowerment have successively moved up in the priority list of the international donor community over the last two decades. This raises the question of whether there is a relationship between women legislators in Africa and foreign-aid allocations. This study finds a strong and statistically robust relationship: an increase in the share of women legislators from 15 to 20 percent is associated with an increase of about 4 percent in aid conditional on current levels of aid. Additionally, the study finds that democratic countries receive more aid but does not find an interaction effect between democracy and the share of women legislators, which suggests that donors do not tailor their gender-selective aid towards more democratic countries. The results provide evidence in support of aid selectivity for policies that improve gender equality in aid-recipient countries in Sub-Saharan Africa.