· In the FT, Tim Harford asks “can we nudge our way to higher growth?” and notes that sending texts as reminders is not a growth strategy “So far, behavioural insights and rapid experiments have been solution-producers looking for problems. If one growth strategy is to find and solve thousands of small problems, an alternative is to start with the biggest problems and ask if behavioural science can help….In the UK, those problems include: poor skills education, especially for people not bound for university; bad infrastructure; low business investment; a long tail of unproductive firms; and burdensome planning restrictions.”. He then gives an example of how behavioral science may help here – giving the example of how mental accounting may result in firms spending more on training and innovation if levies coupled with rebates are used instead of simple tax breaks. For example, the “apprenticeship levy, which effectively levies a tax on businesses to fund apprenticeships, but offers a tax rebate to those that spend the money on their own training schemes….harnessed mental accounting by suggesting to firms that they had a chunk of training money sitting in a jar, and if it wasn’t spent the government would take it.”
· New IPA evidence synthesis on the impact of savings groups on women’s economic activity. On one hand, when I hear about these groups I think about Lant Pritchett’s smell test and people in West Bengal asking how women’s self-help groups work in the U.S. – but then the review also says there are 500 million members of women’s savings groups worldwide, and revealed preference suggests they must be getting something out of it. The review notes some of their benefits in increasing financial inclusion in places without much other financial infrastructure, and a potential role for accountability and structure.
· Last week I did the behind-the-scenes seminar which goes into the process behind a research paper and discusses some of the publication experience. Video of the talk is now up on YouTube. The next one in their series is on June 10 with Pietro Ortovela.
· Interview with Mushfiq Mobarak about his action-oriented approach to research, how he got interested in economics, and some of the ideas behind his State and Society MBA class.
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