Journal Issue: World Bank Economic Review, Volume 28, Issue 3

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Effects of Colombia's Social Protection System on Workers' Choice between Formal and Informal Employment
(Oxford University Press on behalf of the World Bank, 2014-10-02) Camacho, Adriana ; Conover, Emily ; Hoyos, Alejandro
We examine whether the Colombian government's expansion of social programs in the early 1990s, particularly the publicly provided health insurance, discouraged formal employment. Using household survey data and variation across municipalities in the onset of interviews for the SISBEN, the instrument used to identify beneficiaries for public health insurance, we find robust and consistent estimates of an increase in informal employment of approximately 4 percentage points. We find similar results using an alternative dataset, consisting of a panel of individuals interviewed for the first and second SISBEN. Our findings suggest that marginal individuals optimized when deciding whether to participate in the formal sector.
Can We Trust Shoestring Evaluations?
(Oxford University Press on behalf of the World Bank, 2014-10-02) Ravallion, Martin
Many more impact evaluations could be done, and at lower unit cost, if evaluators could avoid the need for baseline data using objective socio-economic surveys and rely instead on retrospective subjective questions on how outcomes have changed, asked post-intervention. But would the results be reliable? This paper tests a rapid-appraisal, “shoestring” method using subjective recall for welfare changes. The recall data were collected at the end of a full-scale evaluation of a large World Bank supported poor-area development program in China. Qualitative recalls on how living standards have changed are found to provide only weak and biased signals of the changes in consumption as measured from contemporaneous surveys. Importantly, the shoestring method was unable to correct for the selective placement of the program favoring poor villages. The results of this case study are not encouraging for future applications of the shoestring method, although similar tests are needed in other settings.
Evaluation of Development Programs: Randomized Controlled Trials or Regressions?
(Oxford University Press on behalf of the World Bank, 2014-10-02) Elbers, Chris ; Gunning, Jan Willem
Can project evaluation methods be used to evaluate programs: complex interventions involving multiple activities? A program evaluation cannot be based simply on separate evaluations of its components if interactions between the activities are important. In this paper a measure is proposed, the total program effect (TPE), which is an extension of the average treatment effect on the treated (ATET). It explicitly takes into account that in the real world (with heterogeneous treatment effects) individual treatment effects and program assignment are often correlated. The TPE can also deal with the common situation in which such a correlation is the result of decisions on (intended) program participation not being taken centrally. In this context RCTs are less suitable even for the simplest interventions. The TPE can be estimated by applying regression techniques to observational data from a representative sample from the targeted population. The approach is illustrated with an evaluation of a health insurance program in Vietnam.
Can Conditional Cash Transfers Compensate for a Father's Absence?
(Oxford University Press on behalf of the World Bank, 2014-10-02) Fitzsimmons, Emla ; Mesnard, Alice
This paper investigates how the permanent departure of the father from a household affects children's school enrollment and work participation in rural Colombia. The results indicate that the permanent departure of the father decreases children's school enrollment by approximately 5 percentage points and increases child labor by 3 percentage points. This paper explores the rollout of a conditional-cash-transfer program during the period of study and shows that this program counteracts these adverse effects. When coupled with other evidence, this finding strongly suggests that the channel through which the father's departure most affects children is by reducing the income of very poor households, which tightens their liquidity constraints. This finding also highlights the important safety-net role played by welfare programs with respect to disadvantaged households, particularly because these households are unlikely to have formal or informal mechanisms with which to insure themselves against such vagaries.
Collective Action and Community Development: Evidence from Self-Help Groups in Rural India
(Oxford University Press on behalf of the World Bank, 2014-10-02) Desai, Raj M. ; Joshi, Shareen
In response to the problems of high coordination costs among the poor, efforts are underway in many countries to organize the poor through “self-help groups” (SHGs)—membership-based organizations that aim to promote social cohesion through a mixture of education, access to finance, and linkages to wider development programs. We randomly selected villages in one of the poorest districts in rural India in which to establish SHGs for women. Two years of exposure to these programs increased women's participation in group savings programs as well as the non-agricultural labor force. Compared to women in control villages, treated women were also more likely to participate in household decisions and engage in civic activities. We find no evidence however, that participation increased income or had a disproportionate impact on women's socio-economic status. These results are important in light of the recent effort to expand official support to SHGs under India's National Rural Livelihood Mission.
Excluding the Rural Population: The Impact of Public Expenditure on Child Malnutrition in Peru
(Oxford University Press on behalf of the World Bank, 2014-10-02) Gajate-Garrido, Gissele
Why is the urban–rural gap in child malnutrition increasing in Peru despite government efforts to improve the provision of public services? To answer this question, the impact of regional public expenditure in Peru on young children's nutritional outcomes is examined. To account for policy endogeneity, public expenditures are instrumented using unanticipated regional mining revenues. Even after accounting for changes in expenditure composition due to increases in mining revenues, public spending has a significant and positive impact on children's outcomes only in urban areas. However, even in urban areas, barriers exist that diminish the effectiveness of public expenditure, so indigenous and frailer children in these areas do not benefit from public spending. These children face constraints that limit their ability to use public services. This result reveals the paramount importance of initial conditions. In rural areas, possibly because of the lower quantity and quality of public services, there is no positive effect for any children.
Is Small Better?: A Comparison of the Effect of Large and Small Dams on Cropland Productivity in South Africa
(Oxford University Press on behalf of the World Bank, 2014-10-02) Blanc, Elodie ; Strobl, Eric
We estimate and compare the effects of small and large irrigation dams on cropland productivity in South Africa. To this end, we construct a panel data set of South African river basins. The econometric analysis reveals that although large dams increase cropland productivity downstream, they have a negative effect on cropland within the vicinity. However, their existence can enhance the relatively small positive impact of local small dams. Although a cost-benefit analysis of irrigation benefits shows that small dams may be more viable than large ones, large dams can play a potentially important role within a system of both types of dams.