Abstract: This paper reports a study on decision-making by borrowers regarding take-up of different loan types in a laboratory microfinance experiment. I show that when prospective borrowers are offered a flexible choice of different loan types (here, individual liability (IL) and joint liability (JL)), take-up increases. This is due to heterogeneous borrowers self-selecting into different loan types. Results suggest that more risk averse borrowers are less willing to take up IL loan and less selfish borrowers show signs of higher inclination to take up JL loan. The results collectively imply that microloan offers need to be customized according to the heterogeneous preferences of borrowers; also, there needs to be enough flexibility in the offered choice-set for better self-selection. This would result in a substantial increase in the take-up rate of microloans by the borrowers.

(an earlier version "Cash incentives to mothers or to community health workers- what contributes better to the health of the mother and the newborn? Evidence from India" was circulated as Aboa Centre for Economics Discussion Paper no.133, 2020) 

Abstract: This paper investigates India’s nationwide health reform to understand its various channels of effect. The reform entitled socio-economically backward mothers with cash transfer if they chose to give birth at public health institutions, and simultaneously employed ASHAs as a direct link between pregnant women and the public healthcare delivery system. Using variations in mothers’ eligibility and differential implementation of ASHAs across states, birth-related outcomes are evaluated in a difference-in-difference framework. Results show that eligible mothers with both cash transfer and ASHA’s guidance outperformed those receiving only cash transfer, in institutional birth rate and timely initiation of breastfeeding. An improved outcome in the ASHA’s presence alongside the conditional cash transfer argues for the vitality of the former’s role in spreading information on the importance of health and the uptake of public healthcare.

(an earlier version "Household shocks and utilization of preventive healthcare for children: Evidence from Uganda" is available as Aboa Centre for Economics Discussion Paper no.121, 2018) [working paper]

Abstract: This paper investigates how poor households in low-income countries trade off time investment in their children’s preventive healthcare vis-`a-vis labour force participation during household-level health shocks. By using the reported illness or death of any household member as the indicator for an adverse health shock, I examine its effect on the intake of Vitamin A Supplementation (VAS) by children. Using four waves of the Uganda National Panel Survey, I find that children between 12-24 months are significantly more likely to get VAS when the household is under a health shock. I argue that this effect works through an economies of scale mechanism, by which the household adult(s) utilise the released time from the labour force during the shock to access remedial care from the healthcare facility and simultaneously obtain VAS for their children during the same visit. This arguably results from the high opportunity cost of time-constrained households, which is exacerbated by a mediocre service delivery side. To distinguish the unique mechanism of the health shock in this context, the effect and channels of an income shock are also explored. By proxying a negative income shock with the household-reported incidence of flood or drought, the study cautiously hints that VAS adoption may increase among the relatively wealthy who experience a dominating substitution effect of the income shock.

Abstract: Favoritism as a mode of corruption is a major concern in public procurement (PP) in many countries. We propose a regression discontinuity design (RDD) test arguing that the winning history of marginal winners and losers can be used to detect favoritism. We apply the empirical test to PP of cleaning services in Finland and find evidence of favoritism even in this relatively low corruption environment. First, winners of close races in terms of win margin tend to have won more also in the past, which is in contrast to competitive environment. Second, to rule out an alternative explanation of collusion based on incumbency, we show that these winners also tend to submit their bids the last, indicating information sharing about rival bids from the buyer to the favored bidder. 

Abstract: We study the extent of a one-size-fits-all approach in the design of public procurement (PP) tenders using comprehensive data from Finland. We show that crucial PP design features related to auction and contract rules tend to have significant lack of variation across different tenders for different industries within a contracting authority. We show that this organizational rigidness is due to both organizational level culture and individual employee level work habit formation with the latter being more important. We find that both greater organizational rigidity and deviating from the national industry norms are associated with lower number of bids and higher probability of zero-bid tenders, pointing to a potential efficiency loss from organizational rigidness in PP, and offering a solution that buyers should mimic how other organizations typically buy similar products rather than how they themselves buy very different products. 

Abstract: This paper examines the relationship between income diversification and various intergenerational well-being outcomes of the second generation (children of baseline households), originating from predominantly rural areas in Kagera, Tanzania, using propensity score analysis. This is the first longitudinal study using a Tanzanian household panel to investigate intergenerational outcomes of income diversification on education attainment, marital and migration choices and living standards. We test the “treatment effects” of the magnitude of household diversification, using a dichotomous model and a dose-response model to reveal whether income diversification is beneficial in the long run and how it is associated with social mobility. Using almost two decades of data, we discover that higher household income diversification in the 1990s gave way to better educational attainment for the second generation and their spouses (through assortative matching), and it increased the likelihood of migration for education. Diversification is also related to higher levels of consumption, both in terms of food and non-food consumption, and higher numbers of professions within household almost two decades later.

[Link to presentation at WIDER Development Conference with UNIANDES in Bogotá, Oct.2022]