The Heights of Medical Care: Health Insurance and Inequality in Adult Stature (with Jörg Baten, Joan Costa-Font, Laura Radatz).
Health insurance expansions that facilitate access to necessary healthcare can improve health outcomes if they reduce information and financial barriers to health care, especially among poorer people who otherwise cannot afford the costs of new health programmes. We examine whether expanded access to health insurance promotes body growth, allowing individuals to maximise its height potential which we measure by an anthropometric measure of health and well-being—namely human height. We draw our evidence using a panel of countries for which we could measure height inequality retrospectively and control for several relevant control variables, and we produce evidence suggesting that indeed within-country differences in height inequality declined after insurance expansion. Our variable for health insurance explains about 12% of the variation in within-height inequality. We document evidence of a reduction of within-country height inequality following the introduction of health insurance programs.
“An Electoral Model of Political Dynasties” (with Bingyong Zheng, SUFE-SOE; Sam Ghosh, SUFE-SOE; Quan Wen, UWash). Status: New manuscript under preparation
This paper presents an electoral model where each politician has a hidden type, which is positively correlated over time for dynastic politicians. The winning politician privately exerts costly effort to implement the social optimum policy. When the gap between the mean and median voters’ ideal policies is small, having a successful predecessor gives a dynastic politician an electoral advantage; the dynastic politician also exerts more effort. With a large gap, however, past success could drag a dynasty down; a bad reputation effect thus kicks in–a politician may exert lower effort if she cares about her descendant. Our model sheds light on the rise and fall of political dynasties, and shows how bad dynasties persist. Keywords: Political dynasties, political selection, reputational concern.
“The Economic Consequences of the Heilongjiang Scandal: Evidence from Synthetic Control Method” with Jamie Bologna (Texas Tech University) and Yang Zhou (University of North Texas). Status: Under Submission.
In this paper, we exploit a unique event in the Chinese province of Heilongjiang. Seven high-level officials were prosecuted for corruption as an unexpected consequence of an ordinary investigation in 2004. This event exposed a significant amount of corruption and resulted in a substantial anti-corruption initiative within the Heilongjiang province. We use the Synthetic Control Method (SCM) to investigate how this exposition influenced subsequent economic activity. We find that, following the 2004 scandal, GDP per-capita, investment, consumption, and net exports decreased relative to the counterfactual. Government spending, however, increased, suggesting that the government may have been attempting to compensate for the negative economic fallout. While our results are only weakly significant, the persistent lack of subsequent economic growth following this massive anti-corruption initiative is an important finding. Keywords: Corruption, Economic Performance, Chinese Governance, Synthetic Control Method (SCM). JEL: D73, O1, O43.
“Anti-corruption and Investment. Evidence from a Quasi-Natural Experiment in China.” with Bingyong Zheng (SUFE-SOE) and Yen Teik Lee (NUS Business School). Status: Reject & Resubmit: Journal of Law, Finance, and Accounting.
This paper analyzes the impact of the current Chinese anti-corruption campaign (ACC) on firms’ investment in mainland China. There is a wide consensus that one of the most distinctive features of the ACC is the abnormal rate of investigated Tigers, i.e. high-level officials. To identify the ACC effect, we exploit the abnormal rate of investigations due to the increase in anti-corruption monitoring brought by the ACC. We find that the introduction of the ACC has changed the opportunity costs of doing business in China, i.e., the increase in monitoring, proxied by investigations of Tigers, had the effect of changing the relative price of investment projects between more corruption-free and more corruption-intensive sectors of the economy. This change led to an overall short-term decrease in the corporate investment of private firms. We find that the ACC had a negative impact on the overall investment of relatively inefficient companies and the overinvestment of more efficient ones. We also find some evidence of a recovery in investment activity two years after the ACC has started to be implemented. Keywords: Corruption, Anticorruption in China, Firms’ investment behavior, Difference in Difference, Quasi-Natural Experiment. JEL codes: D73, G31, P26