Simple Diagnostics for Two-Way Fixed Effects
CGD Working Paper 559 (October 2020)
Joint with Owen Ozier, Lia C.H. Fernald, and Heather A. Knauer
The Telegraph: Children with older sisters in developing countries do better
NPR Morning Edition: What Impact Can Having An Older Sister Have On A Child’s Development?
NPR Goats and Soda: The Secret To Success? Having A Big Sister
NBC’s TODAY: Are big sisters the key to success? New research suggests yes
Yahoo: We’re Placing Too Much Burden On The Big Sisters
Evaluating the Effects of an Early Literacy Intervention
Accepted based on Stage 1 Pre-Results Review at Journal of Development Economics
Joint with Lia C.H. Fernald, Healther A. Knauer, and Owen Ozier
Trial Registry Information
CGD Working Paper #500
Joint with Owen Ozier
A Firm of One’s Own: Experimental Evidence On Credit Constraints and Occupational Choice
World Bank Policy Resarch Working Paper #7977
Joint with Andrew Brudevold, Maddalena Honorati, and Owen Ozier
Trial Registry Information
There’s No Place Like Home: Theory and Evidence on Decentralization and Politician Preferences
Joint with Vivian Hoffmann, Michael Kremer, Ryan Sheely, and Matthew Goodkin-Gold
The impact of early childhood interventions on mothers
Science, 2021, 372(6544): 794-796
Joint with David K. Evans and Heather A. Knauer
Gender Gaps in Education: The Long View
IZA Journal of Development and Migration, 2021, 12(1)
Joint with David K. Evans and Maryam Akmal
AbstractMany countries remain far from achieving gender equality in the classroom. Using data from 126 countries between 1960 and 2010, we document four facts. First, women are more educated today than fifty years ago in every country in the world. Second, they remain less educated than men in the vast majority of countries. Third, in many countries with low levels of education for both men and women in 1960, gender gaps widened as more boys went to school, then narrowed as girls enrolled; thus, gender gaps got worse before they got better. Fourth, gender gaps rarely persist in countries where boys are attaining high levels of education. Most countries with large, current gender gaps have low levels of male educational attainment. Many also perform poorly on other measures of development such as life expectancy and GDP per capita. Improving girls’ education is an important goal in its own right, but closing gender gaps in education will not be sufficient to close critical gaps in adult life outcomes.
How Soon Is Now? Evidence of Present Bias from Convex Time Budget Experiments
Experimental Economics, 2020, 23: 294-321
Joint with Uttara Balakrishnan and Johannes Haushofer
AbstractEmpirically observed intertemporal choices about money have long been thought to exhibit present bias, i.e. higher short-term compared to long-term discount rates. Recently, this view has been called into question on both empirical and theoretical grounds, and a spate of recent findings suggest that present bias for money is minimal or non-existent when one allows for curvature in the utility function and transaction costs are tightly controlled. However, an alternative interpretation of many of these findings is that, in the interest of equalizing transaction costs across earlier and later payments, small delays were introduced between the time of the experiment and the soonest payment. We conduct a laboratory experiment in Kenya in which we elicit time and risk preference parameters from 494 participants, using convex time budgets and tightly controlling for transaction costs. We vary whether same-day payments are made immediately after the experimental session or at the close of the business day. Using the Kenyan mobile money system M-Pesa to make real-time transfers to subjects' phones allows us to make the soonest payments truly immediate. We find strong evidence of present bias, with estimates of the present bias parameter ranging from 0.902 to 0.924 - but only when same-day payments are made immediately after the experiment. This result suggests that present bias for money does in fact exist, but only for truly immediate payments.
Enhancing Young Children’s Language Acquisition Through Parent-Child Book Sharing: a Randomized Trial in Rural Kenya
Early Childhood Research Quarterly, 2020, 1(1): 179-190
Joint with Lia C.H. Fernald, Heather A. Knauer, and Owen Ozier
Worldwide, 250 million children under five (43%) are not meeting their developmental potential because they lack adequate nutrition and cognitive stimulation in early childhood. Several parent support programs have shown significant benefits for children’s development, but the programs are often expensive and resource intensive. The objective of this study was to test several variants of a potentially scalable, cost-effective intervention to increase cognitive stimulation by parents and improve emergent literacy skills in children. The intervention was a modified dialogic reading training program that used culturally and linguistically appropriate books adapted for a low-literacy population. We used a cluster randomized controlled trial with four intervention arms and one control arm in a sample of caregivers (n=357) and their 24- to 83-month-old children (n=510) in rural Kenya. The first treatment group received storybooks, while the other treatment arms received storybooks paired with varying quantities of modified dialogic reading training for parents. Main effects of each arm of the trial were examined, and tests of heterogeneity were conducted to examine differential effects among children of illiterate vs. literate caregivers. Parent training paired with the provision of culturally appropriate children’s books increased reading frequency and improved the quality of caregiver-child reading interactions among preschool-aged children. Treatments involving training improved storybook-specific expressive vocabulary. The children of illiterate caregivers benefited at least as much as the children of literate caregivers. For some outcomes, effects were comparable; for other outcomes, there were differentially larger effects for children of illiterate caregivers.
Multilingual Assessment of Early Child Development: Analyses from Repeated Observations of Children in Kenya
Developmental Science, 2019, 22(5): e12875
Joint with Lia Fernald, Patricia Kariger, Heather Knauer, and Owen Ozier
In many low‐ and middle‐income countries, young children learn a mother tongue or indigenous language at home before entering the formal education system where they will need to understand and speak a country's official language(s). Thus, assessments of children before school age, conducted in a nation's official language, may not fully reflect a child's development, underscoring the importance of test translation and adaptation. To examine differences in vocabulary development by language of assessment, we adapted and validated instruments to measure developmental outcomes, including expressive and receptive vocabulary. We assessed 505 2‐to‐6‐year‐old children in rural communities in Western Kenya with comparable vocabulary tests in three languages: Luo (the local language or mother tongue), Swahili, and English (official languages) at two time points, 5–6 weeks apart, between September 2015 and October 2016. Younger children responded to the expressive vocabulary measure exclusively in Luo (44%–59% of 2‐to‐4‐year‐olds) much more frequently than did older children (20%–21% of 5‐to‐6‐year‐olds). Baseline receptive vocabulary scores in Luo (β = 0.26, SE = 0.05, p < 0.001) and Swahili (β = 0.10, SE = 0.05, p = 0.032) were strongly associated with receptive vocabulary in English at follow‐up, even after controlling for English vocabulary at baseline. Parental Luo literacy at baseline (β = 0.11, SE = 0.05, p = 0.045) was associated with child English vocabulary at follow‐up, while parental English literacy at baseline was not. Our findings suggest that multilingual testing is essential to understanding the developmental environment and cognitive growth of multilingual children.
The Impact of Violence on Individual Risk Preferences: Evidence from a Natural Experiment
Review of Economics and Statistics, 2019, 101(3): 547-549
Joint with Owen Ozier
We estimate the impact of Kenya’s post-election crisis on individual risk preferences. The crisis interrupted a longitudinal survey of more than five thousand Kenyan youth, creating plausibly exogenous variation in exposure to civil conflict prior to the survey. Our results indicate that the post-election crisis sharply increased individual risk aversion. Immediately after the crisis, the fraction of subjects displaying extreme risk aversion increased by more than 80 percent. Findings remain robust when we use an IV estimation strategy that exploits random assignment of respondents to waves of surveying. The crisis also impacted trust, social capital, and beliefs about the economy.
Unconditional Cash Transfers for Clinical and Economic Outcomes Among HIV-Affected Ugandan Households: A Bayesian Randomised Trial
AIDS, 2018, 32(14): 2023-2031
Joint with Ed Mills, Achyuta Adhvaryu, Josephine Birungi, Stephen Okoboi, Teddy Chimulwa, Wangisi Jonathan, Tina Achilla, Evan Popoff, Shirin Golchi, and Dean Karlan
HIV infection has profound clinical and economic costs at the household level. This is particularly important in low-income settings, where access to additional sources of income or loans may be limited. While several microfinance interventions have been proposed, unconditional cash grants, a strategy to allow participants to choose how to use finances that may improve household security and health, has not previously been evaluated.
We examined the effect of an unconditional cash transfer to HIV-infected individuals using a 2 × 2 factorial randomized trial in two rural districts in Uganda. Our primary outcomes were changes in CD4+ cell count, sexual behaviors, and adherence to ART. Secondary outcomes were changes in household food security and adult mental health. We applied a Bayesian approach for our primary analysis.
We randomized 2170 patients as participants, with 1081 receiving a cash grant. We found no important intervention effects on CD4+ T-cell counts between groups [mean difference 35.48, 95% credible interval (CrI) −59.9 to 1131.6], food security [odds ratio (OR) 1.22, 95% CrI: 0.47 to 3.02], medication adherence (OR 3.15, 95% CrI: 0.58 to 18.15), or sexual behavior (OR 0.45 95% CrI: 0.12 to 1.55), or health expenditure in the previous 3 weeks (mean difference $2.65, 95% CrI: −9.30 to 15.69). In secondary analysis, we detected an effect of mental planning on CD4+ cell count change between groups (104.2 cells, 9% CrI: 5.99 to 202.16). We did not have data on viral load outcomes.
Although all outcomes were associated with favorable point estimates, our trial did not demonstrate important effects of unconditional cash grants on health outcomes of HIV-positive patients receiving treatment.
Distributional Preferences and Political Behavior
Journal of Public Economics, 2017, 155: 1-10
Joint with Raymond Fisman and Shachar Kariv
We document the relationship between distributional preferences and voting decisions in a large and diverse sample of Americans. Using a generalized dictator game, we generate individual-level measures of fair-mindedness (the weight on oneself versus others) and equality-efficiency tradeoffs. Subjects' equality-efficiency tradeoffs predict their political decisions: equality-focused subjects are more likely to have voted for Barack Obama in 2012, and to be affiliated with the Democratic Party. Our findings shed light on how American voters are motivated by their distributional preferences.
Does Africa Need a Rotten Kin Theorem? Experimental Evidence from Village Economies
Review of Economic Studies, 2016, 83(1): 231-268
Joint with Owen Ozier
This paper measures the economic impacts of social pressures to share income with kin and neighbors in rural Kenyan villages. We conduct a lab experiment in which we
randomly vary the observability of investment returns to test whether subjects reduce their income in order to keep it hidden. We find that women adopt an investment
strategy that conceals the size of their initial endowment in the experiment, though that strategy reduces their expected earnings. This effect is largest among women
with relatives attending the experiment. Parameter estimates suggest that women anticipate that observable income will be "taxed" at a rate above four percent; this
effective tax rate nearly doubles when kin can observe income directly. At the village level, we find an association between willingness to forgo expected return to keep
income hidden in the laboratory experiment and worse economic outcomes outside the laboratory.
The Distributional Preferences of an Elite
Science, 2015, 349(6254)
Joint with Raymond Fisman, Shachar Kariv, and Daniel Markovits
We studied the distributional preferences of an elite cadre of Yale Law School students, a group that will assume positions of power in U.S. society. Our experimental design allows us to test whether redistributive decisions are consistent with utility maximization and to decompose underlying preferences into two qualitatively different tradeoffs: fair-mindedness versus self-interest, and equality versus efficiency. Yale Law School subjects are more consistent than subjects drawn from the American Life Panel, a diverse sample of Americans. Relative to the American Life Panel, Yale Law School subjects are also less fair-minded and substantially more efficiency-focused. We further show that our measure of equality-efficiency tradeoffs predicts Yale Law School students’ career choices: Equality-minded subjects are more likely to be employed at nonprofit organizations.
How Fair Shares Compare: Experimental Evidence from Two Cultures
Journal of Economic Behavior and Organization, 2015, 118: 40-54
We use a suite of economic experiments to study social preferences governing the distribution of earned and unearned income in rural villages in western Kenya. Our experiments vary the extent to which income depends on individual effort while holding other aspects of the economic environment constant. Results suggest that, in rural villages, the relative weight placed on others does not depend on the extent to which those individual increased the total surplus through their own effort. However, more educated subjects and those drawn from villages closer to the road do reward others for their effort; their allocation decisions are consistent with models of reciprocity.
You’ve Earned It: Estimating the Impact of Human Capital on Social Preferences
Experimental Economics, 2015, 18(3): 385-407
Joint with Edward Miguel and Vera te Velde
We combine data from a randomized evaluation and a laboratory experiment to measure the causal impact of human capital on respect for earned property rights, a component of social preferences with important implications for economic growth and development. We find that higher academic achievement reduces the willingness of young Kenyan women to appropriate others' labor income, and shifts players toward a 50-50 split norm in a modified dictator game. This study demonstrates that education may have long-run impacts on social preferences, norms and institutions beyond the human capital directly produced.
How Did Distributional Preferences Change During the Great Recession?
Journal of Public Economics, 2015, 128: 84-95
Joint with Raymond Fisman and Shachar Kariv
To better understand how support for redistributive policies is shaped by macroeconomic shocks, we explore how distributional preferences changed during the recent "Great Recession." We conducted identical modified dictator games during both the recession and the preceding economic boom. The experiments capture subjects' selfishness (the weight on one's own payoff) and equality-efficiency tradeoffs (concerns for reducing differences in payoffs versus increasing total payoffs), which we then compare across economic conditions. Subjects exposed to recession exhibit greater selfishness and higher emphasis on efficiency relative to equality. Reproducing recessionary conditions inside the laboratory by confronting subjects with possible negative payoffs [weakly] intensifies selfishness and increases efficiency orientation, bolstering the interpretation that differing economic circumstances drive our results.
Using Economic Experiments to Measure Informal Institutions
In Institutions, Property Rights, and Economic Growth: the Legacy of Douglass North
Cambridge University Press, edited by Sebastian Galiani and Itai Sened, 2014
Equity vs. Efficiency vs. Self-Interest
Experimental Economics, 2013, 16(2): 208-221
We conduct modified dictator games in which price of giving varies across choice situations, and examine responses to price changes in two contexts - one where dictators divide their own earnings, and another where they divide the earnings of others. Varying the price of giving allows us to decompose social preferences into two components: the level of altruism when the price of giving is one, and the willingness to reduce aggregate payoffs to enhance equity. Changing the source of a dictator's budget impacts her decisions because it affects the weight that she places on others' payoffs. However, we find no impacts on the willingness to trade off equity and efficiency.
Social Preferences and Fairness Norms as Informal Institutions: Experimental Evidence
American Economic Review: Papers and Proceedings, 2011, 101(3): 509-513
American Economic Journal: Applied Economics, 2010, 2(3): 60-95
Joint with Dean Karlan, Xavier Giné, and Jonathan Morduch
Microfinance banks use group-based lending contracts to strengthen borrowers incentives for diligence, but the contracts are vulnerable to free-riding and collusion. We systematically unpack microfinance mechanisms through ten experimental games played in an experimental economics laboratory in urban Peru. Risk-taking broadly conforms to theoretical predictions, with dynamic incentives strongly reducing risk-taking even without group-based mechanisms. Group lending increases risk-taking, especially for risk-averse borrowers, but this is moderated when borrowers form their own groups. Group contracts benefit borrowers by creating implicit insurance against investment losses, but the costs are borne by other borrowers, especially the most risk averse.