“There is nothing in this book that needs to be confirmed by complex laboratory experiments. You have only to open the window or step into the street”, Hernando de Soto, The Other Path, p14., 1989.
One of my favorite papers to present is my paper on improving management in India, in part because we have wonderful photos to illustrate what bad management looks like and what improved practices look like (see the appendix to the paper for some of these). Photographing impact isn’t only useful for presentations and glossy summaries, but may potentially offer a new form of data. However, this is easier said than done, and today I thought I’d share some misadventures in trying to photograph impacts on small firms.
Typical policies to improve the incomes of poor households and their businesses are based on the sustained provision of services – be it microfinance with multiple loan cycles and regular meetings; conditional cash transfers with regular transfers over a period of years; or business training programs which are based on the idea that capital along is not enough – as in the proverb “give a man a fish and he eats for a day, teach a man to fish and he can feed himself for life”.
This week I would like to explore more something I saw during my recent visit to Ghana. As I explained in a previous post, a conversation with a rural bank manager made me realize that in Ghana, just like in the United States, people take payday loans.
To get children to attend school in developing countries, our approach has been primarily to assume that the schooling that is available is worth pursuing, meaning that the problem must be with some barrier to go to school despite a great desire to do so: perhaps the family cannot afford the costs of schooling; perhaps the schools are not good or too far; perhaps the children want to be in school but the parents prefer food today to educated daughter tomorrow; maybe people don’t know the value of schooling, etc.
I’ve been meaning to read for the last month this new paper by Orazio Attanasio and co-authors, which is the latest in the still small number of studies to carry out a randomized experiment to measure the impact of microfinance. David Roodman was quick to give his thoughts on it in this post, but I thought I’d also summarize it briefly for you and offer my thoughts.
Poor households in rural areas are exposed to substantial weather shocks that can generate great fluctuations in income and consumption if insurance markets are not complete (Dercon and Christiaensen 2011, etc.).
I thought I’d kick-start what I hope will be a somewhat regular feature on this blog, which is some insights, observations, and general glimpses of the real world encountered as we work on implementing new impact evaluations. I know some of our readers take umbrage with the term “the field” but I’m sure it is preferred to “Mission musings” , although maybe “Random rambling” might be appropriate.
Saving is hard for most people (unless you’re Chinese or German it seems). A typical approach to encourage savings might be to emphasize all the good reasons to save (children’s education, healthcare needs, retirement, etc.) and set savings goals for these reasons.