Published on Development Impact

Weekly links May 20: scary age-maths, Liberian property tax collection, changing gender attitudes in Pakistan, and more…

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·       I saw multiple people on twitter recommending this lecture by David Laibson that provides his overview of the household finance literature, from the NBER Behavioral Public Economics bootcamp. It is a really nice overview. His view on financial literacy programs is “I don’t think there is compelling evidence that financial education is going to move the needle much.” – and he worries about publication bias in some of the meta-analyses. He notes repeatedly how far people are from knowing the financial concepts that we take for granted in modeling a lot of their behavior – and there is a provocative graph that shows how far the share of people that can divide 2 million by 5 falls as age goes from 50% at age 50 to 30% at 80 and only 10% at age 90 – raising concerns about the ability of people to make calculations about finances as they age.

·       On Let’s Talk Development, Oyebola Okunogbe and Ya He Li discuss lessons from two experiments conducted on increasing property tax collection in Liberia. “Tax payments barely budged in the Detection and Penalty treatment groups. However, the combined Detection and Penalty treatment group paid significantly more in taxes, reaching almost 10 percent payment rate compared to the 2.2 percent payment rate of the control group. The increase in property tax payment persisted even four years after the experiment, and the additional tax revenues in the first year alone more than covered the cost of establishing the property database and sending notices.”

·       “There has always been something irresistible about advice in mathematical form.” So starts an interesting review in the New Yorker by Idrees Kahloon of Elizabeth Popp Berman’s new book Thinking Like an Economist: How Efficiency Replaced Equality in U.S. Public Policy. The book argues that economists have had too much sway over public policy, to the detriment of progressive ideas – but the review pushes back at this idea.

·       Some partially encouraging news on the NPR Goats and Soda blog- first malaria vaccine hits 1 million doses for kids in Ghana, Kenya and Malawi. “It's taken over 30 years to develop, in part because "the malaria parasite is so complex,…. There are concerns about the effectiveness of the new vaccine – and its demanding schedule. It requires 3 or 4 doses by age 2 – a challenge for parents. What's more, the vaccine only reduces hospital admissions of severe malaria by 30%, and there's a wide margin of error on that figure. With three doses, efficacy can wane, although children do gain a measure of protection at a vulnerable age.”

·       On VoxDev, Sultan Mehmood, Shaheen Naseer and Daniel Li Chen summarize their experiment with teachers in Pakistan which tests the impacts of a program of visual narrative (movie and self-reflection) and a gender-rights curriculum. The treatment causes more support among teachers for women’s rights over a six month and 1 year period; these attitudes then get transmitted to their students; and “Using a causal medication design, we cross randomised teachers to form study groups of same sex and opposite sex. We find that teachers who were assigned the joint treatment and re-randomised to form mixed-sex study groups had students improving their math scores by 0.15 standard deviations. However, no effect is observed for the students assigned to teachers who formed same-sex study groups. This argument is further supported by results of behavioural games: the mixed-sex study group students display greater cooperation with the opposite sex in strategic dilemmas. We interpret these empirical results as evidence that the classroom achievement in math improved via better cooperation among the sexes.”

·       Funding opportunity: SIEF has a call for proposals to fund evaluations that examine innovative interventions that enable individuals in low- and middle-income countries recover from human capital losses incurred as a result of Covid-19.


David McKenzie

Lead Economist, Development Research Group, World Bank

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