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Good Fathers & Lemon Sons: Why Political Dynasties Cause “Reversals of Fortune” -- Guest post by Siddharth George

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Aquinos, Bhuttos, Trudeaus, Yudhoyonos, Gandhis, Lees, Fujimoris: political dynasties remain ubiquitous in democratic countries.  Though many societies democratised to end hereditary rule, nearly half of democratic countries have elected multiple heads of state from a single family.  Politics is significantly more dynastic than other occupations in democratic societies.  Individuals are, on average, five times more likely to enter an occupation their father was in.  But having a politician father raises one's odds of entering politics by 110 times, more than double the dynastic bias of other elite occupations like medicine and law.  Despite their prevalence and influence, we know little about the economic effects of political dynasties.

Effects of dynastic politics are theoretically ambiguous

Economic theory makes ambiguous predictions about how dynastic politics affects development.  On the one hand, bequest motives might lengthen politicians’ time horizons  and encourage them to make long-term investments. These founder effects could be good for economic development.  However, if some political capital is heritable (e.g., a prominent name or a powerful network), dynastic politics may render elections less effective at selecting good leaders and disciplining them in office.  These descendant effects are likely bad for development.  The overall impact of dynastic politics is ambiguous, because it is the net result of founder and descendant effects.

Land: Trap or Opportunity for the Rural Poor? Guest post by Juan Sebastián Galán

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Across the developing world, providing land through agrarian reform has been a popular strategy for expanding economic opportunities among the rural poor. Its use is commonly debated in several developing countries, including South Africa, China, India and many others in Latin America. A widely held view against providing land is that it traps recipient families in the countryside, forcing them to remain in the subsistence sector (Banerjee, 2000). This limits their chances to move up the social ladder.

Does It Matter Who Answers the Survey to Identify Families in Poverty? Guest post by Adan Silverio-Murillo

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Imagine that you receive a grant from the Bill & Melinda Gates Foundation to give money transfers to families living in poverty. Yet, the selected country does not have formal income records. As a consequence, you decide to collect income information through a household survey. On your way to collect the information, you find an economist who points out two problems: (1) income can be measured with a lot of noise; and (2) individuals may have incentives to sub-report income to participate in the program.
 

FinTech Adoption and its Spillovers. Guest post by Sean Higgins

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During my last trip to Mexico, I bought tamales from a street vendor and paid by card—something that would have been impossible not long ago. The vendor, who had a Bluetooth card reader connected to his cell phone, told me that his potential customers are not always carrying cash, and as a result, accepting card payments has increased his sales. This anecdote illustrates a broader trend: as the adoption of financial technologies (FinTech) increases on both the supply and demand sides of the market (see Figure 1), both consumers and small retail firms benefit.

The Perils of Being a Firstborn Child Amidst Forest Cover Loss in Indonesia: Guest post by Averi Chakrabarti

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This is the thirteenth in this year's series of posts by PhD students on the job market.

Our planet is currently experiencing substantial environmental degradation. The resulting depletion of resources and climate change patterns endanger the prospects for human life on earth in the long run, but there are often detrimental consequences that materialize sooner. While governments might have little incentive to reign in dangerous practices if the effects are not expected to emerge until the future, the recognition of concurrent costs might provide more urgency to the need to stem environmental harms. In my job market paper, I document an immediate human health impact of the rapid rates of deforestation in Indonesia, one that arises due to forest loss-induced spikes in malaria.
 

Why are relatively poor people not more supportive of redistribution? Guest Post by Christopher Hoy

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This is the twelfth in this year's series of posts by PhD students on the job market.

Social commentators and researchers struggle to explain why, despite growing inequality in many countries around the world,  there is often relatively limited support among poorer people for policies where they are set to benefit (such as increases in cash transfers or in the minimum wage). Recent research drawing on surveys from the United States and Europe has identified a potential reason for why poorer people are not more supportive of redistribution: they don’t realise they are poor. These studies illustrate the majority of people tend to think they are positioned around the middle of the national income distribution regardless of whether they are actually rich or poor.

Five things we learnt from a loan and grain storage intervention in Tanzania. Guest post by Hira Channa

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Two of the main post-harvest concerns that many small holders in Sub Saharan Africa (SSA) face are:
  1. Maintaining the quantity and quality of staple grains throughout the year. 
  2. Managing the persistent price seasonality in grain commodity markets. In Mbeya, Tanzania, where our experiment was conducted, for the last two years maize prices in the lean season were 80% higher than prices at harvest.

Same Sex Marriage, Employment and Discrimination. Guest post by Dario Sansone

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Progress towards marriage equality within the U.S. has been extremely rapid in the last twenty years. In 2004, Massachusetts became the first state to legalize same-sex marriage (SSM). Following its example, more and more states introduced SSM until the final ruling in 2015 of the U.S. Supreme Court in Obergefell v. Hodges legalized SSM at the federal level. Were these amendments to marriage law a revolution with a profound impact for gays and lesbians?

How do entrepreneurs in the poorest countries navigate taxes? Guest post by Gabriel Tourek

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This is the ninth in this year's series of posts by PhD students on the job market.

In low-income countries, small firms account for the majority of taxpayers (World Bank 2011). Yet we know little about how they navigate taxation.  Existing research in the developing world focuses mostly on middle-income countries (Pomeranz 2015; Best et al. 2015; Brockmeyer and Hernandez 2018), and there is good reason to think that the tax behavior of firms in the world’s poorest countries might look different.  On the one hand, higher credit constraints may undermine entrepreneurs’ ability to meet their tax obligations. On the other, limited resources for tax oversight might create gaps in enforcement that allow firms to evade taxes more easily.
 
The question of how such firms respond to taxes is a consequential one.  It matters both for governments’ ability to raise revenues, in places where funds are much-needed, and for the take-home earnings of large populations of poor entrepreneurs.
 
My job market paper explores how small firms in Rwanda respond to a change in tax incentives. Rwanda provides a useful setting to study small firms’ tax behavior because such firms comprise 99% of all taxpayers.  Rwanda is also a representative low-income country, ranking as 18th poorest in the world (IMF 2018). I focus on entrepreneurs that are earning less than USD $4,000 per year.

Do Knowledge and Income Have Synergistic and Distributional Effects on Preventing Child Undernutrition? Guest Post by Seollee Park

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This is the eighth in this year's series of posts by PhD students on the job market.

High rates of stunting in many developing countries pose important health threats to young children and lead to adverse later-life outcomes. Many nutrition-specific interventions that target a single dimension of causes of child undernutrition have often found limited effects. This generates the question as to whether interventions that address multidimensional and nutrition-sensitive causes of undernutrition, such as lack of knowledge and income, are more effective in bringing about healthy child development.

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