Educational Investment Mistakes and Skill Disparities Among Children  (Job Market Paper)

This paper examines how parents’ preferences and beliefs about their children’s academic performance shape educational investment decisions and skill disparities. Using detailed data on parental beliefs and a randomized information intervention in Malawi (Dizon-Ross, 2019), I estimate a structural model of parental investments that embeds beliefs distortions into parents’ trade-off between own consumption and improvements in children’s academic performance. I find that distortions on parents’ beliefs have sizable impacts on skill formation and in narrowing skill disparities. This conclusion stems from two main findings. First, parents show a strong preference for compensating for initial differences in siblings’ performance: when offered a subsidy for educational inputs they direct investments toward lower scorers, leading to reductions in within household disparities. Second, distortions in parents’ beliefs interfere with their intended investment strategy: while they believe they target lower-performing children, widespread optimistic biases lead to underinvestment. Correcting information frictions increases investments significantly for students at the bottom of the score distribution and is twice as effective at reducing within household inequality compared to a subsidy alone.

Depenalizing Voter Abstention: Effects on Electoral Participation

This paper examines the effect of de-penalizing abstention in the democracy of Peru, where voting is mandatory and abstention is penalized with a monetary fine. I use data from local elections and a field experiment designed by Leon (2017) that introduced exogenous variation in perceived abstention penalties to estimate a model of turnout. In this model, citizens first update their beliefs about the monetary cost of abstention and compare it to the net benefit from voting. I use the estimated model to quantify the effect of eliminating the abstention fine. The counterfactual experiment suggests that this policy would reduce turnout among the sample from 90 to 66 percent, a similar rate to countries where voting is voluntary. In contrast to theoretical predictions, I find that the composition of moderate vs. more extreme voters would not change significantly.