Standard economic theory would suggest that a one-time infusion of cash should have at most a temporary effect on business profitability – over time, individuals facing high returns should be able to re-invest business profits and bit-by-bit bootstrap themselves up to the steady-state size. Yet in an experiment I did with Suresh de Mel and Chris Woodruff in Sri Lanka, we find a one-time grant has sustained impacts five years later on male microenterprise owners.
- Call for papers – NEUDC conference November 2-3 at Harvard. This is a fun conference which allows you to see lots of new work in development .
Of all the impact evaluation methods, the one that consistently (and justifiably) comes last in the methods courses we teach is matching. We de-emphasize this method because it requires the strongest assumptions to yield a valid estimate of causal impact. Most importantly this concerns the assumption of unconfoundedness, namely that selection into treatment can be accurately captured solely as a function of observable covariates in the data.
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Given Jed's post last week on thinking through performance incentives for health workers, and the fact that the World Bank is in the throes of a reform process itself, a fascinating new paper from Imran Rasul and Daniel Rogger on autonomy and performance based incentives in Nigeria gives us some other food for thought. In a nutshell, Rasul and Rogger
Most experiments in development economics involve giving the treatment group something they want (e.g. cash, health care, schooling for their kids) or at least offering something they might want and can choose whether or not to take up (e.g. business training, financial education). Indeed among the most common justifications for randomization is that there is not enough of the treatment for everyone who wants it, leading to oversubscription or randomized phase-in designs.
- Are regression-discontinuity designs ok for election studies? The Monkey Cage summarizes a new paper which says yes.
These past weeks I’ve visited several southern African nations to assist on-going evaluations of health sector pay-for-performance reforms. It’s been a whirlwind of government meetings, field trips, and periods of data crunching. We’ve made good progress and also discovered roadblocks – in other words business as usual in this line of work. One qualitative data point has stayed with me throughout these weeks, the paraphrased words of one clinic worker: “I like this new program because it makes me feel that the people in charge of the system care about us.”