Research

ABSTRACT:  Traditional gender norms can restrict independent long-distance migration by women, thus preventing them from taking advantage of economic opportunities in urban areas. However, women may be able to circumvent such restrictions by marrying migrants. Guided by a theoretical model in which women make marriage and migration decisions jointly, we hypothesize that a decline in the economic cost of migration will increase marital migration – but not independent migration – if social barriers to female independent migration are present. To test our hypotheses, we use the event of the construction of a major bridge in Bangladesh – which dramatically reduced travel time between the economically deprived north-western region and the manufacturing belt located around the capital city Dhaka – as a source of plausibly exogenous variation in migration costs. We find that, among rural women, the bridge increased marital migration, schooling, dowry payments, and work in the manufacturing sector, but had no effect on economic migration, and had limited effects on those coming from families below a poverty threshold. We argue that the evidence is indicative of the presence of social barriers to female migration.

ABSTRACT: Are well-functioning formal judicial institutions important for economic development, or can informal contracting arrangements provide adequate substitutes? This paper aims to answer this question using variation across industries in their reliance on contracts along with variation across Indian states in the average speed of courts. The identification strategy is motivated by theory from the incomplete contracting literature in which it is argued that transactions involving relationship-specific investments are more exposed to post-contractual opportunism and hence have greater need for efficient contract enforcement. The paper finds that the interaction between state level court efficiency and industry level relationship-specificity is highly predictive of future growth in India's formal manufacturing sector. The threat of omitted variable bias is minimized by the inclusion of state and industry fixed effects, while a number of robustness checks and placebo tests rule out competing explanations and provide additional confidence in the hypothesized mechanism. 

• Non-technical summary: Ideas for India

• Media References: Financial Express op-ed by Nirvikar Singh (March 12, 2019); livemint editorial (January 31, 2018)

• Extensions for policy purposes: A Note on Aggregate Economic Benefits From Improving Court Efficiency in India

• Data: the measures of "court efficiency" used in the paper have been posted on justicehub.in here

• Pre-publication version available here

ABSTRACT: In this paper, we estimate the costs associated with an important suite of labor regulations in India by taking advantage of the fact that these regulations only apply to firms above a size threshold. Using distortions in the firm size distribution together with a structural model of firm size choice, we estimate that the regulations increase firms’ unit labor costs by 35%. This estimate is robust to potential misreporting on the part of firms and enumerators. We document a robust positive association between regulatory costs and exposure to corruption, which may explain why regulations appear to be so costly in developing countries. We also document a robust positive association between regulatory costs and exposure to corruption, which may explain why regulations appear to be so costly in developing countries. 

• Non-technical summary: VoxDev

• Media References: The Economist (June 27, 2020)

• Replication Files: REStat Dataverse

• Pre-publication version available here

ABSTRACT: This paper uses a comprehensive new data source to document basic facts about geographic concentration among industries in India from 1998 to 2013. Unlike previous studies, our data allow us to accurately measure industrial concentration at the district level and cover manufacturing and services, as well as the formal and informal sectors. Our most striking finding is that average levels of industrial concentration fell dramatically between 1998 and 2013, driven by steep reductions in capital-intensive manufacturing industries. We provide suggestive evidence that this increasing dispersion may be due to improvements in interregional transportation coupled with inefficient land management policies and limited labor mobility.

ABSTRACT:  The practice of female early marriage is ubiquitous in developing countries, with one in four girls marrying before the age of 18. Recent work has shown that this practice has adverse consequences for the human capital of the brides as well as that of their children. In this paper, we test the hypothesis that child marriage law can influence attitudes and behaviour in a setting in which the laws are not strictly enforced. To do so, we take advantage of the passing of a new law relating to child marriage in Bangladesh and administer a randomized video-based information treatment that accelerates knowledge transmission about the law (e.g. about higher penalties associated with child marriage). We find that our information treatments led to a change in participants’ attitudes and behaviour (including reported attitudes regarding appropriate marriage age and willingness to contribute to a charity that campaigns against child marriage), but did not substantially influence their beliefs about attitudes or practices prevalent in their community. Follow-up surveys conducted 5 and 10 months after the intervention show an increase in early marriage among adolescent girls within treated households. These perverse effects are driven by households in which the father or family elders were informed about the new law but are absent in households where only the mother is informed. The findings highlight a) the existence of informational frictions within households and b) the risk of a backlash effect against a law that contradicts traditional norms and practices when enforcement is imperfect.

• Non-technial summaries: VoxDev;  EDI Research Insight

ABSTRACT:  We study the effects of extreme temperature shocks on political participation using data from Indian elections between 2009 and 2017. Taking advantage of localized, high-frequency data on land surface temperatures, we find that areas with greater cumulative exposure to extreme temperatures experience an increase in voter turnout and a change in the composition of the pool of candidates who stand for election. As a consequence, electoral outcomes are affected. We provide evidence that our results are driven by the negative effect of climate change on agricultural productivity. First, we show that the results are strongest in areas with a larger rural population. Second, we show that there is a non-monotonic relationship between temperatures and turnout which closely mirrors the relationship between temperatures and agricultural productivity. We also find that, following temperature shocks, winning candidates are more likely to have an agricultural background. Finally, we show that politicians with an agricultural background invest more in irrigation, which mitigates the effects of high temperatures, on both agricultural production and on turnout. Our paper provides new evidence about the ways in which political agents in developing countries (including both voters and candidates) may respond to climate change via political channels.

• Non technical summaries: ProMarket (Feb 13, 2023)

• Media References: The Indian Express (April 6 , 2024), Aljazeera (14 May, 2024)

ABSTRACT:  The COVID-19 pandemic has adversely affected the livelihoods of hundreds of millions of households, resulting in widespread poverty and food insecurity. To mitigate these effects, many governments have introduced additional benefits as part of their existing welfare schemes. However, there is often a gap between the introduction of these programs and access to the benefits. To shed light on the source of these gaps, we conduct a field experiment with just over 1,000 slum-dwelling households in Uttar Pradesh, India during the COVID-19 pandemic. The intervention randomly exposed individuals to personalised information about government benefits via cell phones. We find that the simple and low-cost provision of personalised information i) increased the accuracy and precision of participants' knowledge about their entitled benefits, ii) increased access to and utilization of benefits, and iii) improved wellbeing (as measured through consumption, food insecurity and mental health). We do not find significant differences in effects based on whether males or females are targeted. Our findings show that there are large gaps in knowledge of and access to government benefits (despite widespread publicity about the programs) which can be reduced via a simple and low-cost information intervention.

• Non-technical summary: Ideas for India

ABSTRACT: Manufacturing has historically offered the fastest path out of poverty, but there is mounting evidence that this path may be all but closed to developing countries today. Some have suggested that services might provide a new path forward, while others have expressed skepticism about this claim and consequent pessimism over the future growth trajectories of developing countries. We contribute to this debate by using a multi-sector growth framework to establish five important criteria that any sector must exhibit in order to lead an economy to rapid, sustained, and inclusive development. These are: 1) a high level of productivity, 2) “dynamic” productivity growth (i.e., high growth rates coupled with domestic and international convergence), 3) expansion of the sector in terms of its use of inputs, 4) comparative advantage, or alignment between resource requirements of the sector and resource endowments of the country, and 5) exportability. We then compare the performance of manufacturing against specific service subsectors under each of these criteria using India as a case in point. We find that many of the virtues exhibited by the manufacturing sector (such as high productivity and international and domestic convergence in productivity) are shared by some service subsectors (such as Finance, Insurance, and Real Estate). However, in the Indian case, these subsectors also share manufacturing’s flaws: they are all too skill intensive and hence unaligned with India’s comparative advantage. This poses further difficult policy questions for India and other developing countries in similar positions, which we attempt to consider in our conclusion.

• Media References: WSJ Special Report ("Manufacturing Bust" in the "Demographic Destiny" series), November 24th, 2015; The Economist Special Report ("Arrested Development"), October 4th, 2014;