Journal Issue: World Bank Economic Review, Volume 37, Issue 4
Loading...
Volume
37
Number
4
Issue Date
2023-11
Journal Title
Journal ISSN
1564-698X
Journal
World Bank Economic Review
1564-698X
Journal Volume
Other issues in this volume
Journal Issue Journal Issue Journal Issue
Articles
The Social Protection Engel Curve
(Published by Oxford University Press on behalf of the World Bank, 2023-08-08) Lokshin, Michael; Ravallion, Martin; Torre, Iván
Why do richer countries spend a
higher share of their income on social protection than poor
countries A newly assembled dataset on social protection
spending for 142 countries since 1995 allows an exploration
of alternate hypotheses, treating the pandemic period
separately, as it entailed a large expansion in social
protection efforts. While the mean income share devoted to
social protection rises with income, this is attributable to
multiple confounders, including relative prices, weak
governance in low-income countries, and access to
information communication technologies. Controlling for
these, social protection spending is similar between rich
and poor countries. This was also true during the pandemic.
Measuring Inequality Using Geospatial Data
(Published by Oxford University Press on behalf of the World Bank, 2023-08-25) Galimberti, Jaqueson K.; Pichler, Stefan; Pleninger, Regina
The main challenge in studying
inequality is limited data availability, which is
particularly problematic in developing countries. This study
constructs a measure of light-based geospatial income
inequality (LGII) for 234 countries and territories from
1992 to 2013 using satellite data on night-lights and
gridded population data. Key methodological innovations
include the use of varying levels of data aggregation, and a
calibration of the lights– prosperity relationship to match
traditional inequality measures based on income data. The
new LGII measure is significantly correlated with
cross-country variation in income inequality. Within
countries, the light-based inequality measure is also
correlated with measures of energy efficiency and the
quality of population data. Two applications of the data are
provided in the fields of health economics and international
finance. The results show that light- and income-based
inequality measures lead to similar results, but the
geospatial data offer a significant expansion of the number
of observations.
Subsistence Farming and Factor Misallocation
(Published by Oxford University Press on behalf of the World Bank, 2023-07-06) Morando, Bruno
This paper presents a model where
misallocation in the agricultural factors of production is
caused by transportation costs to and from local markets,
which result in an inefficiently large share of inputs
operated by less productive subsistence farmers. The model
derives some testable predictions which are verified in the
empirical analysis, based on a representative census of
Ugandan farms. Specifically, subsistence farmers operate
inefficiently high shares of land and capital, and the
efficiency losses are more severe in areas where subsistence
farming is more widespread, due to lower connectivity with
local markets. Conversely, there is no relationship between
the level of misallocation and credit access and/or
land-market activity. These findings suggest that
transportation costs play a key role in determining the
efficiency of agricultural input distribution and that
land-market liberalization is a necessary but not sufficient
condition to tackle misallocation.
Female Education and Brideprice
(Published by Oxford University Press on behalf of the World Bank, 2023-07-27) Nagashima, Masuru; Yamauchi, Chikako
Universal primary education (UPE)
policies have been shown to improve educational attainment
and delay marriage and childbearing, particularly among
rural girls. This disproportionate improvement in female
relative to male education can change the bargaining
structure between the wife and the husband. Furthermore,
with the expectation of this change, decisions about
marriage-market entry, matching, and marital arrangements,
such as brideprice, can change. Greater female bargaining
power can increase the share of marriages without a
brideprice in settings where husbands may demand a refund
upon divorce. Using first-hand data on marital transfers and
exploiting Uganda’s UPE, which abolished primary school fees
in 1997, this study shows that longer UPE exposure is
associated positively with female education and negatively
with brideprice practice. The results imply that UPE
policies can affect women’s marital lives by empowering them
in household decisions. The study also discusses the
consistency of the results with other potential mechanisms,
such as selective marriage-market entry, marital squeeze,
and assortative matching.
Nudging Payment Behavior
(Published by Oxford University Press on behalf of the World Bank, 2023-06-24) Bonan, Jacopo; D'Adda, Giovanna; Mahmud, Mahreen; Said, Farah
This paper reports results from a
randomized control trial with a pay-as-you-go (PAYG) solar
system provider in Pakistan. In the default treatment,
customers are told the amount to pay every month to keep the
system active. In a first treatment, customers are assisted
in planning this monthly payment. A second treatment
discloses that payments can be made flexibly within the
month. This disclosure may reduce contract cancellation by
helping minimize transaction costs but may increase contract
complexity and reduce discipline. A third treatment combines
flexibility with assistance in planning payments. Disclosing
flexibility increases contract cancellation relative to the
default but combining flexibility with planning offsets this
effect. Treatment effects appear stronger among users facing
high mental constraints and transaction costs. These
findings support the idea that behavioral factors, such as
inattention and commitment problems, lay behind the negative
impact of flexibility on cancellation. The results suggest
that providers of PAYG systems may face a trade-off between
disclosing complex contractual features and customer
retention. Planning helps customers handle the added complexity.
Long-Term Effects of an Education Stipend Program on Domestic Violence
(Published by Oxford University Press on behalf of the World Bank, 2023-06-08) Sara, Raisa; Priyanka, Sadia
Intimate partner violence (IPV)
remains a widespread global phenomenon. Among various
factors, a low level of education is considered a
significant risk factor for experiencing IPV. This paper
evaluates whether a secondary school stipend program
introduced in 1994 for rural girls affected the long-term
prevalence of IPV in Bangladesh. The study exploits two
sources of variation in the intensity of program exposure
and geographic eligibility and finds that cohorts of rural
women eligible for the program experienced significant
declines in IPV. Evidence on mechanisms suggests that the
program delayed marriage formation and changed partner
quality, namely their education and employment, consistent
with positive assortative matching resulting from women
improved educational attainment. There are no significant
changes in labor market outcomes, decision making within the
household, or women’s attitude toward the acceptability of
domestic violence. Marital matches present a plausible
channel through which the program reduces the risk of IPV.
Mind the Gap
(Published by Oxford University Press on behalf of the World Bank, 2023-06-08) Bleakley, Hoyt; Guptu, Bhanu
While increasing years of schooling
has been a long-standing development priority, the
associated fiscal costs and benefits have been less studied,
because of a lack of appropriate data. Recently, an
UNESCO-funded project measured subsidies, by levels of
schooling, from all levels of government, in eight
developing countries including Nepal. The household-level
Nepal Living Standards Measurement Survey provides
information to estimate the degree of formality, tax
payments, and benefit receipts as a function of schooling
years. Using a simple Mincerlike model, this study estimates
the fiscal externality of an additional year of school. It
finds that within primary school, fiscal benefits and costs,
on the margin, are quite balanced, with subsidies close to
the present value of future taxes minus benefits. At higher
levels of schooling, however, marginal fiscal benefits
exceed costs by 5 percent of per capita consumption. This
contrasts with previous literature on social returns and
assumptions underlying multilateral development goals.
The Combined Role of Subsidy and Discussion Intervention in the Demand for a Stigmatized Product
(Published by Oxford University Press on behalf of the World Bank, 2023-08-23) Shrestha, Vinish; Shrestha, Rashesh
This paper studies the joint role of
subsidization and group discussion intervention in
increasing the demand for sanitary pads, a product that is
widely available but demand for which may be curtailed due
to the psychological cost associated with menstrual
stigmatization. The study deploys a field experiment in
Nepal to randomly allocate discount coupons of various
values so that participants face exogenous variation in the
effective price of sanitary pads. In addition, a randomly
selected group of women in the sample participate in
menstrual health-related group discussion intervention. The
findings suggest that an increase in subsidy level increases
the probability of adoption across both groups of women,
those receiving only a subsidy and those participating in
the discussion intervention coupled with a subsidy. Also,
women participating in the discussion intervention have a
higher adoption rate. The effects of group discussion
intervention are concentrated among women with high
psychological cost, whose purchase decisions are more likely
to be affected by societal stigma. The results suggest that
combining a subsidy with group discussion could provide a
cost-effective strategy to increase the adoption of health
technology, the demand for which is constrained by social norms.