Policy Research Working Paper series publication roundup for March 1-March 15, 2022

This blog is a biweekly feature highlighting recent working papers from around the World Bank Group that were published in the World Bank’s Policy Research Working Paper Series. This entry introduces 6 papers published from March 1 to March 15 on various topics, including taxation, gender, and wildfire smokes. 

The first two papers we introduce in March of 2022 take us to Kenya. In Do Judges Favor Their Own Ethnicity and Gender: Evidence from Kenya, Daniel Chen and coauthors explore the extent and predictors of bias along with gender and ethnic lines in judicial decisions in the higher courts in Kenya. In Gender Differences in Household Coping Strategies for COVID-19 in Kenya, Utz Pape and coauthors use original household data from a phone survey conducted between May 2020 and June 2021 in Kenya to investigate the gender differences in household coping strategies during the COVID-19 shock.  

• Evidence from high-income countries suggests judges often exhibit in-group bias, favoring litigants that share an identity with the judge. In Do Judges Favor Their Own Ethnicity and Gender: Evidence from Kenya the authors examine High Court decisions in Kenya. The paper leverages the random assignment of cases to judges to evaluate the existence of in-group bias along gender and ethnic lines. It finds that, relative to a baseline win rate of 43 percent, defendants are 4 percentage points more likely to win if they share the judge’s gender and 5 percentage points more likely to win if they share the judge’s ethnicity. The paper also finds that the written judgments are on average shorter and less likely to be cited when defendants who are of the same gender or ethnicity as the judge win their case. Figure 1 suggests in-group bias as win proportions are higher for female majority defendants among female judge panels and win proportions are higher for male majority defendants among male judge panels 

Figure 1: Defendant win proportion by judge and defendant majority gender 

• Gender Differences in Household Coping Strategies for COVID-19 in Kenya analyzes the differences in household coping strategies by household head gender. The paper finds that female headed households are less likely to cope by selling assets or taking loans, compared with male-headed households. Instead, female headed households rely more on social networks to cope. No difference in coping by reducing meals is observed across these two types of households. The paper also documents that the reasons behind the gender difference include that female-headed households are poorer, and they are more likely to rely on friends and family to cope with shocks even prior to the COVID-19 shock. The findings suggest that widowed and divorced women are in high need of relief programs.  

The next two papers we introduce touch fascinating topics related to taxes. In Globalization and Factor Income Taxation, Pierre Bachas and coauthors examine how globalization has affected the relative taxation of labor and capital. In Nudging in the Time of the Coronavirus : Evidence from an Experimental Tax Trial in Albania at the Onset of a Global Pandemic, Jonathan Karver and coauthors present the results of a randomized controlled trial testing the effectiveness of taxpayer communications informed by behavioral science in inducing business payroll tax compliance at the onset of the COVID-19 pandemic. 

• Globalization and Factor Income Taxation builds and analyzes a new database of effective macroeconomic tax rates covering 150 countries since 1965, constructed by combining national accounts data with government revenue statistics. Main findings of the paper include i) that the effective tax rates on labor and capital have converged globally since the 1960s; ii) the decline in capital taxation is concentrated in high-income countries; iii) the rise in capital taxation in developing countries can be explained by a tax capacity effect of international trade: trade openness leads to a concentration of economic activity in formal corporate structures and; iv) international economic integration reduces statutory tax rates, due to increased tax competition.  

• Nudging in the Time of the Coronavirus : Evidence from an Experimental Tax Trial in Albania at the Onset of a Global Pandemic examines an experimental tax trial targeting 5,423 firms in Albania coinciding with the national lockdown due to the global pandemic. In March of 2020 the Albanian tax authority sent postal letters to employers and selected employees highlighting a suspicion that wages were under-declared to avoid personal income tax withholding. Employers and employees suspected of under-declaring were randomly assigned to receive a soft-tone letter (highlighting the social importance of contributing through taxes), a strong-tone letter (highlighting the penalties associated with under-declaring), or none (forming a control group against which the impact of receiving the letters could be estimated). For employers receiving soft-tone letters, the study finds large, statistically significant increases on subsequent payroll declarations (by as much as 10 percent relative to the control group), which gradually attenuate over the following six months. No statistically significant effects are found for letters sent to employees or strong-tone letters. Figure 2 below provides a visualization of the sustained impact of the two letters (across all firms) over a 12-month period, particularly the soft tone letter.  

Figure 2: Indexed wage bill by treatment group over time 

For the last two papers of this roundup, we turn to two very timely topics related to climate change and gender. North American wildfires will likely increase in size and number due to climate change. In Current Benefits of Wildfire Smoke for Yields in the US Midwest May Dissipate by 2050, Patrick Behrer and Sherrie Wang examine how these smoke plumes change direct, diffuse, and total sunlight during the crop growing season and consequently influence yields of both corn and soybeans. In Beyond Money: Does Migration Experience Transfer Gender Norms Empirical Evidence from Kerala, India, George Joseph and coauthors examine the impact of return migration from Saudi Arabia and the Gulf on the transfer of gender norms to the Indian state of Kerala.  

• Current Benefits of Wildfire Smoke for Yields in the US Midwest May Dissipate by 2050 shows that low-density plumes enhance yields, likely by increasing in the fraction of diffuse light, while high-density plumes decrease yields. Because there are more low-density plumes today, the net effect is a slight increase in yields on average. As climate change makes wildfires larger and more frequent, the overall impact of smoke on yields is expected to be substantially more negative.  

Figure 3: Impact of smoke on current yields 

• Beyond Money : Does Migration Experience Transfer Gender Norms Empirical Evidence from Kerala, India finds that returning migrants from Saudi Arabia tend to exhibit conservative values regarding gender-based violence and extreme attitudes pertaining to the perpetration of physical violence against women. Compared with those who have no migration experience, the attitudes of returning migrants from Saudi Arabia toward gender-based violence were more conservative by three standard deviations, while the attitudes of those returning from the Gulf were less conservative by 0.5 standard deviation. Results suggest that migration experience can have a substantial impact on the gender attitudes of returning migrants, with potential implications for migration and gender policies.  

The following are other interesting papers published in the first half of March. Please make sure to read them as well.  

1. Smoke and Mirrors : Infrastructure State-Owned Enterprises and Fiscal Risks (Dappe,Matias,Musacchio,Aldo,Pan,Carolina,Semikolenova,Yadviga Viktorivna,Turkgulu,Burak,Barboza,Jonathan) 

2. Infrastructure State-Owned Enterprises : A Tale of Inefficiency and Fiscal Dependence (Herrera Dappe,Matias,Musacchio,Aldo,Pan,Carolina,Semikolenova,Yadviga Viktorivna,Turkgulu,Burak,Barboza,Jonathan) 

3. Fiscal Risks from Early Termination of Public-Private Partnerships in Infrastructure (Herrera Dappe,Matias,Melecky,Martin,Turkgulu,Burak) 

4. Targeting in Tax Compliance Interventions : Experimental Evidence from Honduras (Del Carmen,Giselle,Espinal Hernandez,Edgardo Enrique,De Gouvea Scot De Arruda,Thiago) 

5. Measuring Disaster Crop Production Losses Using Survey Microdata : Evidence from Sub-Saharan Africa (Markhof,Yannick Valentin,Ponzini,Giulia,Wollburg,Philip Randolph) 

6. Assessing the Effects of Natural Resources on Long-Term Growth : An Extension of the World Bank Long Term Growth Model (Loayza,Norman V.,Galego Mendes,Arthur,Mendez Ramos,Fabian,Pennings,Steven Michael) 

7. The Impact of Covid-19 on Household Welfare in the Comoros : The Experience of a Small Island Developing State (Mendiratta,Vibhuti,Nsababera,Olive Umuhire,Sam,Hannah) 

8. The Labor Market Implications of Restricted Mobility during the COVID-19 Pandemic in Kenya : Evidence from Nationally Representative Phone Surveys (Heemann,Markus,Pape,Utz Johann,Vollmer,Sebastian) 

9. Crypto-Assets Activity around the World : Evolution and Macro-Financial Drivers (Feyen,Erik H.B.,Kawashima,Yusaku,Mittal,Raunak) 

10. Impact of COVID-19 on Labor Market Outcomes of Refugees and Nationals in Kenya (English) (Vintar,Mirko,Beltramo,Theresa Parrish,Delius,Antonia Johanna Sophie,Egger,Dennis Timo,Pape,Utz Johann) 

11. Heterogeneous Agglomeration Economies in the Developing Countries : The Roles of Firm Characteristics, Sector Tradability, and Urban Mobility (Burger,Martijn,Ianchovichina,Elena,Akbar,Prottoy Aman) 

12. Socioemotional Skills Development in Highly Violent Contexts : Measurements and Impacts (Dinarte Diaz,Lelys Ileana,Egana-delSol,Pablo,Martinez A.,Claudia 

13. Balancing Work and Childcare : Evidence from COVID-19 School Closures and Reopenings in Kenya (Biscaye,Pierre E.,Egger,Dennis Timo,Pape,Utz Johann) 

14. Global Transition Online (Ragoussis,Alexandros,Timmis,Jonathan David) 

15. Does Foreign Direct Investment Catalyze Local Structural Transformation and Human Capital Accumulation Evidence from China (Liu,Yan) 

16. Pandemic, Climate Mitigation, and Reshoring : Impacts of a Changing Global Economy on Trade, Incomes, and Poverty (Chepeliev,Maksym,Maliszewska,Maryla,Osorio-Rodarte,Israel,Seara E Pereira,Maria Filipa,Van Der Mensbrugghe,Dominique) 

17. Technology and Resilience (Cirera,Xavier,Comin,Diego Adolfo,Vargas Da Cruz,Marcio Jose,Lee,Kyungmin,Torres Coronado,Jesica) 

18. How to Cope with a Refugee Shock Evidence from Uganda (Kadigo,Mark Marvin,Diallo,Nene Oumou,Maystadt,Jean Francois Paul C)