Essays in Applied-Microeconomics and Development
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The access to the contents of this doctoral thesis it is limited to the acceptance of the use conditions set by the following Creative Commons license: https://creativecommons.org/licenses/?lang=en Universitat Autonoma` de Barcelona Doctoral Thesis: Essays in Applied-Microeconomics and Development Author: Alejandra Ramos Advisors: Prof. Giacomo De Giorgi and Prof. Nezih Guner A thesis submitted to the Departament d'Economica i d’Hist`oria Econ`omica in fulfillment of the requirements for the degree of Doctor of Philosophy at the International Doctorate in Economic Analysis (IDEA). April 21, 2017 A mi mam´a,que se nos fue demasiado pronto... Acknowledgments I am deeply indebted to Giacomo De Giorgi and Nezih Guner for their invaluable su- pervision and superb guidance. I will be forever grateful for everything they taught me throughout these years; for their patience, their motivation, and encouragement. Words cannot express my gratitude for their continuous support of my Ph.D. I would like to express my appreciation to my coauthor Samuel Berlinski. He not only provided me the amazing opportunity to join the Research Department of the Inter- American Development Bank, but also helped me to navigate through pain and grief. I have learned a lot from him, both as a researcher and as a human being. All of these years would have been unberable without the laughter, talking, travels and support of my friends Ana Maria Manrique, Ana Maria Porras, Camila Fonseca, Camilo Pecha, Laura Ramos, Lavinia Piemontese, and Maria Paula Gandur. To my colleagues and friends Alberto Ramirez, Alex Filatov, Alex Tagliabracci, Ana Maria Chirinos, Anna Houˇsteck´a,Annalisa Loviglio, Andrii Parkhomenko, Augustin Tap- soba, Codruta Boar, Davide Pietrobon, Edgardo Lara, Florence Nimoh, Francesco Ceri- gioni, Gabor Kocsis, In^esBlack, Jose Garc´ıa-Louzao, and Yuliya Kulikova; thank you for our conversations, for the innumerable coffees, and for always providing me with comfort. I would like to praise special thanks to IDEA. I could not possibly imagine being part of a better team. I am very thankful to Susanna Esteban and Luca Gambetti for their direction of the program; and to Merc`eVicente and Angels` L´opez Garc´ıafor their administrative work. To Ada Ferrer-i-Carbonell, Albert Marcet, Alessandro Ruggieri, Antonio Miralles, Arnau Valladares-Esteban, Benjam´ınTello, Carmen Bevi´a,Caterina Calsamiglia, Christopher Rauh, David P´erez-Castrillo,Dilan Ok¸cuo˘glu,Dmitry Matveev, Esther Hauk, Frances Obiols, Hannes Muller, Hugo Rodr´ıguezMendiz´abal,In´esMacho- Stadler, Isabel Melguizo L´opez, Javier Fern´andez-Blanco,Joachim Jungherr, Joan Este- ban, Joan Lull, Johannes Gierlinger, Jordi Caball´e,Jordi Masso, Juan Carlos Conesa, Laura Mayoral, Lidia Farr´e,Luis Rojas, Matt Deventhal, Michael Creel, Miguel Angel Ballester, Pau Mil´an,Pau Olivella, Pau Pujolas, Pedro Rey Biel, Tom´asRodr´ıguezBar- raquer, Tongbin Zhang, Xavier Mart´ınez-Giralt;thank you for always having the doors open. To Carmen, thank you for making my office the place to organize my thoughts. Special thanks to Melissa Hidrobo for providing me the data of Food, Cash, or Voucher, and to the International Food Policy Research Institute (IFPRI) and the World Food Programme (WFP) Head Quarters and Ecuador's office. I also thank the Ministerio de Educaci´onin Chile and its Centro de Estudios for sharing the data of Asignaci´ona la Excellencia Pedag´ogica with me. I gratefully acknowledge financial support of Universitat Aut`onomade Barcelona through the PIF Scholarship. Nothing would have been possible without my family: they are the ultimate bone of what I do. I cannot stop thanking my father for his permanent interest in my research; my sisters for their loving presence regardless the oceans between us; my beloved friend Silvana Mantilla for being my refuge and bastion even in the darkest nights. i Contents Introduction 1 1 Household Decision Making with Violence: Implications for Transfer Programs 3 1.1 Introduction . 3 1.2 A Model of Household Decision Making with Violence . 8 1.2.1 In-kind versus Cash Transfers . 12 1.2.2 Taking the Model to the Data . 14 1.3 Data . 14 1.4 Reduced-Form Evidence . 17 1.5 Identification and Estimation . 18 1.6 Results . 21 1.7 Policy Experiments: In-Kind versus Cash . 24 1.8 Scaling-up the Program . 24 1.9 Conclusions . 27 2 Does Rewarding Pedagogical Excellence Keep Teachers in the Class- room? Evidence from a Voluntary Award Program 28 2.1 Introduction . 28 2.2 Background . 30 2.3 Data . 32 2.4 A Model of Teachers' Quit Behavior . 33 2.5 Identification Strategy . 37 2.6 Results . 38 2.6.1 Teacher Retention and Labor Supply . 38 2.6.2 Between-School Mobility . 39 2.6.3 Robustness Checks . 41 2.7 Conclusions . 41 3 The Effects of Public Recognition of Teaching Excellence on Peers Vol- untary Certification 43 3.1 Introduction . 43 3.2 Background . 44 3.3 Data . 47 3.4 Identification Strategy . 49 3.5 Results . 52 3.6 Conclusions . 54 Bibliography 56 ii Tables and Figures for Chapter 1 62 Tables and Figures for Chapter 2 74 Tables and Figures for Chapter 3 86 Appendix A Chapter 1 102 A.1 A Model with Private Goods and Disutility of Violence . 102 A.2 Figures . 103 A.3 Tables . 104 Appendix B Chapter 2 108 B.1 AEP . 108 B.1.1 Figures . 108 B.1.2 Tables . 112 B.2 AVDI . 114 B.2.1 Figures . 116 B.2.2 Tables . 118 Appendix C Chapter 3 122 C.1 Example . 122 C.2 Figures . 124 C.3 Tables . 129 iii Introduction In this doctoral thesis I use applied-microeconomics as a tool for policy re-design in developing countries. With it, I deep in the understanding of why policies work, and how we can use economic incentives to attain better outcomes. My goal is to propose strategies to leverage the resources devoted to social assistance programs, without dealing with the political economy of introducing new items in the development agenda. Specifically, I concentrate in the domains of gender and education. In the domain of gender, I address the issue of intimate partner violence and its interplay with transfers that governments give to women. In the domain of education, I focus on school teachers and a strategy to select and praise the best of them. In Chapter 1, Household Decision Making with Violence: Implications for Transfer Programs, I study how intimate partner violence responds to transfers to women, and whether this response depends on the transfer being in-kind or in-cash. To this end, I develop and estimate a model of household decision making in which the husband and wife maximize a weighted sum of their utilities, and the weights of the agents are endogenously determined through violence. Only the husband can inflict violence to solve spousal disagreement and increase his relative weight. Yet violence comes at the cost of destroying female labor productivity. Under this framework, the utility gains the husband can appropriate through violence are lower when the transfers are in-kind than when the transfers are in-cash. As a result, depending on the level of disagreement, in-kind and cash transfers can have different effects. I estimate this model using data from a randomized controlled trial of the World Food Programme in Ecuador that provides transfers to women of poor families, either in-kind or in-cash. The results indicate that, on average, violence destroys 4 percent of female labor productivity, with a market value of 10 dollars or one day of female labor a month. Violence also reduces female's relative weight in the household utility by 10 percentage points. Therefore, it is as if perpetrators were willing to sacrifice one day of female labor every month to reduce their victims' say in household decisions by 20 percent. If the women beneficiaries of the program receive a cash transfer equivalent to 10 percent of the average household income, the prevalence of violence would reduce from 17 percent to 10 percent. If the same transfer were given in-kind, violence would decline by 3 additional percentage points, from 17 percent to 7 percent. These results also hold for all women receiving Ecuador's main social assistance program, Bono de Desarrollo Humano. Furthermore, the differential effect that in-kind transfers have on violence { relative to cash transfers{ amplifies as the size of the transfer increases. From a policy perspective these results imply that, with the same resources, the goverment can reduce violence against the women by targeting transfers. Chapter 2 and Chapter 3 of the thesis are joint work with Samuel Berlinski. In them, we analyze a program that rewards excellence in pedagogical practice in Chile. Similar to the United States, in Chile every year around 12 percent of the teachers transition out 1 of the school system, and 9 percent move to a different school. To prevent good teachers from leaving the profession, in 2002 the Chilean government introduced Asignaci´ona la Excelencia Pedag´ogica or AEP. This is a voluntary certification program designed to reward excellence in teaching practice, both economically and socially. Teachers who succeed on a set of assessments receive a 6 percent annual wage increase for up to 10 years; are invited to become mentors of other teachers in the Red Maestro de Maestros; and their names are announced in a ceremony with local authorities and media coverage.