Abstract: High-income and highly-productive countries have pushed their agenda towards environmentally friendly policies. The carbon-leakage hypothesis claims that these policies will increase emissions in unregulated countries, which typically have low-income and low-productivity. We predict that, due to the productivity differential, policies from wealthy countries cause a net positive increase of emissions on global scales. We construct a country-level panel, including emissions and regulations data. We show that, although regulations from high-income countries may decrease their emissions, they also increase the emissions of the average country, causing a net global increase. This result is a call for international coordination and cooperation in order to achieve a sustainable global economy.

Abstract: While gender quotas in politics have been adopted worldwide, evidence on their impact on women's substantive representation is mixed. To examine this issue, we estimate the relative importance of greater demand expressed by female voters under female leadership vis-à-vis female leaders’ differential preference (supply) in driving the gender quota effect. Using data on the household level allocation of toilets for the entire rural population (25 million households) of Uttar Pradesh, India, we establish that the demand mechanism fully explains the heterogeneity in treatment effect. Our results highlight the importance of empowering female voters in making gender quotas a more effective policy.

Abstract: Although vote in modern democracies is secret at the individual level, citizens' behavior is imperfectly revealed through vote counting at precinct levels. I propose a simple principal-agent model to show how politicians can use this information to buy votes. Moreover, the equilibrium predicts a disproportional number of precincts with 100% vote share favoring the winner of the election, which is observed in recent election outcomes.

Abstract: The primary focus of this paper is to examine the link between environmental R&D formation and the strategic use or non-use of a government's ability to pre-commit to an emissions tax rate. The existing literature implicitly omits this important matter. This paper comprehensively evaluates various regulatory contexts separated by the timing of emissions taxation and by environmental R&D formations in a Cournot duopoly. The following three points are revealed. First, an equilibrium occurs in which the government does not strategically use its emissions tax rate pre-commitment ability to enhance social efficiency. Second, if the efficiency of environmental R&D costs is high and if environmental damage is serious, then the government should pre-commit to an emissions tax rate and allow for the cartelization of the two firms' environmental R&D. However, if the environmental R&D cost efficiency and environmental damage are both low, then the government should adopt a time-consistent emissions tax and allow for the cartelization of the two firms' environmental R&D. Third, when the two firms can form an environmental research joint venture (ERJV), ERJV cartelization should be invariably allowed, even if the government is a strategic non-user of its pre-commitment ability.

In first-best economies, the benefit of an infinitesimal transportation improvement is measured as the resource savings from the improvement. The improvement changes the equilibrium allocation. However, by the envelope theorem, this reallocation does not have a first-order effect on welfare; therefore, the resource savings can be measured at the pre-improvement allocation. When the pre-improvement allocation is expressed in terms of physical location, the resource savings equal the reduction in the aggregate transportation costs induced by the improvement. By using a transformation of variables first introduced in Arnott and Stiglitz (1981), this paper derives a new way of evaluating the benefit of a transportation improvement. We express the pre- improvement allocation in terms of the transportation cost location instead of the physical location. From this perspective, the transportation improvement changes the transportation cost shape of the city by essentially generating new land. The benefit of the transportation improvement is then measured by the aggregate differential land rent of the generated land, which is evaluated at the pre-improvement rents. This paper demonstrates the generality of this result, synthesizes and reinterprets the results in the literature from this alternative perspective, and discusses some insights that this result generates.

Abstract: To conduct randomized field experiments while easing the disutility of subjects and concerns of practitioners, I empirically study the ethical concerns held by potential subjects. In the first survey, approximately 2,000 respondents are asked whether they recognize ethical issues in six existing experiments. Among these six experiments, an early childhood intervention is recognized as the most acceptable, while a charitable fund-raising experiment using lotteries is recognized as the least acceptable from an ethical perspective. To investigate methods to ease such ethical concerns, I conduct the second survey in which respondents are randomly assigned to four groups. I find a nonsignificant impact of changing the research methodology from a randomized experiment to an uncontrolled before–after study. However, ethical concerns significantly increase when informed consent is not enough or when subjects are randomly sampled. These findings support an experiment with agreed-upon participants, although it may limit the external validity of the experiment.

The irony of the creative destruction? Dynamic causal effects of the tsunami during the Great East Japan Earthquake

Abstract: The 2011 Great East Japan Earthquake and tsunami is estimated as the most expensive natural disaster to date at $210-235 billion, followed by Hurricane Katrina in the US at about $161 billion. Leveraging the number of tsunami-related monuments as an instrumental variable, this study estimates the short to long-run impacts of the tsunami on the subsequent economic activities proxied by nightlight intensity. The estimation results show the dynamic change of the tsunami impacts: negative in the following 2 years of the tsunami, no robust effect 3 years after that, and positive impacts 7 years after that. Contrary, the results also show the persistent negative impact on the population density. Massive reconstruction funds on public investments are deemed to facilitate the quick physical economic recovery in the affected areas, but ironically, they do not necessarily help people back to the locations.

The long-term causal effect of U.S. bombing missions on economic development: Evidence from the Ho Chi Minh Trail and Xieng Khouang Province in Lao P.D.R.

Abstract: This study investigates the long-term causal effects of U.S. bombing missions during the Vietnam War on later economic development in Laos. Following an instrumental variables approach, we use the distance between the centroid of village-level administrative boundaries and heavily bombed targets, namely, the Ho Chi Minh Trail in southern Laos and Xieng Khouang Province in northern Laos, as an instrument for the intensity of U.S. bombing missions. We use three datasets of mean nighttime light intensity (1992, 2005, and 2013) and two datasets of population density (1990 and 2005) as outcome variables. The estimation results show no robust long-term effects of U.S. bombing missions on economic development in southern Laos but show negative effects in northern Laos, even 40 years after the war. We also found that the results do not necessarily support the conditional convergence hypothesis within a given country, although this result could be unique to Laos.

Abstract: In a world where players are of one of two possible types, we study pairwise stability of stationary networks in which agents bargain in an infinite-horizon game. The cost of forming and sustaining links depends on both the communication ease and complementarities, so that when the latter are strong enough, connections between individuals of different types are cheaper. In this case, several families of bipartite components, such that no two players of the same type are directly connected, become stable. These components are inequitable and so the surplus splits asymmetrically across linked individuals. This outcome differs from the case in which connections between individuals of the same type are cheaper, where the vast majority of stable components are equitable. The result, thus, highlights how complementarities and the relative scarcity of certain types combined follow in more or less unequal bargains.

Abstract:

Auctions with below-bid pricing (e.g. uniform-price, and ascending auctions) have remarkable theoretical properties, but practitioners are skeptical about their implementation. We present a dynamic model of collusion in multiunit auctions that explains this gap between theory and practice. To sustain collusion at the reserve price, bidders submit crank-handle bids. The cost of sustaining crank-handle collusion depends on the degree of below-bid pricing in the auction. Our model predicts that crank-handle collusion is easier to sustain in auctions with more below-bid pricing and when bidders are more symmetric. Evidence from auctions of fishing quota in the Faroe Islands supports our predictions.

Abstract: This paper investigates the impact of receiving extreme information through social media on the formation of normative perceptions of corruption. For this purpose, we developed an original mobile application in which two types of randomizations were built: First, we randomly circulated news and blogs related to corruption to users; second, we randomly deployed other users' comments on each article. We quantify the degree of extremism in individual perceptions of social norms against corruption by employing a lab-in-the-app experiment and supervised machine learning algorithms. Our estimation results show that users respond to both counter- and pro-attitudinal extreme information by shifting their norms to even more radical directions. Further analysis implies that socialized motivation to conform to other people's opinion is the main driver of polarized social norms relative to social-psychological explanations. Finally, we show that polarized social norms coincide with the segregation of online communities. These results suggest that to curb severe social fragmentation and eliminate corruption, we need to reconsider the design of information circulation and communication structures in social media.

Abstract: How does the disruption of traditional communities shape subsequent political outcomes? I argue that the demographic shock to indigenous societies induced by Africa's slave trade influences postcolonial politics by tragically improving ethnic institutions and leadership, thereby affecting the coup-civil war trap and the underlying commitment problems. The empirical analysis leverages the soil suitability for cassava as an instrument to exploit plausibly exogenous variation in the ethnic group-level exposure to the slave trade. The findings are four-fold: Ethnic groups with severer slave trade exposure are (1) less likely to experience battle incidents within their traditional homelands, (2) less likely to fight civil wars against the central government, (3) more likely to be included in state power-sharing schemes, and (4) more likely to stage coups in postcolonial states. Falsification tests exploiting the timing of cassava's arrival in Africa and the regional variation in non-cassava crop suitability lend further credibility to the findings.

Abstract: Using panel data of administrative claims spanning 36 months (2017–2019) and an instrumental variable method, this study examines whether physician-induced demand for hypertension disease care exists in Ghana’s healthcare system where price is regulated, and there is no co-payment. We find that an increase in competition—measured as a high doctor-to-population ratio at the district level—leads to an increase in the number of physician visits, suggesting physician-induced demand exists, and that effects are greater for large hospitals and public health providers. This result is further supported by alternative measures and specifications showing that physicians’ revenue from medication and gross revenue increase as the physician density increases. These pattern suggest that physicians in high density areas, faced with a decrease in number of patients per physician, make up for the decline in income by inducing more patient visits.