Publications by Type: Unpublished

2008
Pande, Rohini, Lori Beaman, Raghabendra Chattopadhyay, Esther Duflo, and Petia Topalova. 2008. “Powerful Women: Does Exposure Reduce Prejudice?”. Abstract
Female leadership remains strikingly low in most democracies, and voter preferences are often suggested as a likely explanation. In this paper, we present experimental evidence from India which suggests that, on average, villagers, especially men, are prejudiced against female leaders. For example, men rate a hypothetical leadership speech more negatively when the speaker's voice is experimentally manipulated to be female, rather than male. However, randomly assigned exposure to a female leader (due to mandated political representation for women) reduces such prejudice by 50-100% depending on the measure. We also provide suggestive evidence that prejudice influences perceptions of actual performance. Despite outperforming their male counterparts on many dimensions of performance, first time women leaders receive worse evaluations. Consistent with our experimental evidence that exposure reduces prejudice, second time female leaders are rated at par with male leaders.
A basic feature of many field experiments is that investigators are only able to randomize clusters of individuals—such as households, communities, firms, medical practices, schools, or classrooms—even when the individual is the unit of interest. To recoup some of the resulting efficiency loss, many studies pair similar clusters and randomize treatment within pairs. Other studies (including almost all published political science field experiments) avoid pairing, in part because some prominent methodological articles claim to have identified serious problems with this "matched-pair cluster-randomized" design. We prove that all such claims about problems with this design are unfounded. We then show that the estimator for matched-pair designs favored in the literature is appropriate only in situations where matching is not needed. To address this problem without modeling assumptions, we generalize Neyman’s (1923) approach and propose a simple new estimator with much improved statistical properties. We also introduce methods to cope with individual-level noncompliance, which most existing approaches assume away. We show that from the perspective of, among other things, bias, efficiency, power, or robustness, and in large samples or small, pairing should be used in cluster-randomized experiments whenever feasible; failing to do so is equivalent to discarding a considerable fraction of one’s data. We develop these techniques in the context of a randomized evaluation we are conducting of the Mexican Universal Health Insurance Program.

A newer version of this paper was published on Demography, August 2008.

This paper investigates how migrant social capital differentially influences individuals’ migration and cumulatively generates divergent outcomes for communities. To combine the fragmented findings in the literature, the paper proposes a framework that decomposes migrant social capital into resources (information about or assistance with migration), sources (prior migrants), and recipients (potential migrants). Analysis of multi-level and longitudinal data from 22 rural villages in Thailand shows that the probability of internal migration increases with the available resources, yet the magnitude of increase depends on recipients’ characteristics and the strength of their ties to sources. Specifically, individuals become more likely to migrate if migrant social capital resources are greater and more accessible. The diversity of resources by occupation increases the likelihood of migration, while diversity by destination inhibits it. Resources from weakly-tied sources, such as village members, have a higher effect on migration than resources from strongly-tied sources in the household. Finally, the importance of resources for migration declines with recipients’ own migration experience. These findings challenge the mainstream account of migrant social capital as a uniform resource that generates similar migration outcomes for different groups of individuals or in different settings. In Nang Rong villages, depending on the configuration of resources, sources and recipients, migrant social capital leads to differential migration outcomes for individuals and divergent cumulative migration patterns in communities.

Over the past two decades, no two economies have averaged more rapid economic growth than China and Vietnam. But while China's income inequality has risen rapidly over that same time frame, Vietnam's has only grown moderately. Structural and socio-cultural determinants fail to account for these divergent pathways. Existing political variables are also unhelpful. China and Vietnam are coded in exactly the same way, even in the path-breaking work on authoritarian regimes. In this paper, we take a deeper look at political institutions in the two countries, demonstrating that profound differences between the polities directly impact distributional choices. In particular, we find that Vietnamese elite institutions require construction of broader coalitions of policymakers, place more constraints on executive decision making, and have more competitive selection processes. As a result, there are stronger political motivations for Vietnamese leaders to provide equalizing transfers that limit inequality growth.

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Also Harvard Business School Working Paper No. 08-099.

Social scientists have long emphasized the importance of institutions in nurturing economic growth and development. Douglass C. North defines institutions as the "rules of the game in a society" which limit the set of choices for individuals and argues that institutions, both formal ones such as laws and constitutions, as well as informal ones such as social norms, are important in determining the transaction costs of production and exchange, and thereby have an impact on economic growth. He goes on to discuss the mostly incremental nature of institutional change and highlights the difficulties in implementing radical institutional change. This line of argument therefore suggests that the impacts of institutions are likely to be felt for a very long time, and hence points to the need for detailed historical analysis over long periods in order to quantify the impact of institutions.

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Also Harvard Business School Working Paper, No. 08-062.
 

We are living through a paradox—or so it seems. Since September 11, 2001, according to a number of neo-conservative commentators, America has been fighting World War III (or IV, if you like to give the Cold War a number). For more than six years, these commentators have repeatedly drawn parallels between the "War on Terror" that is said to have begun in September 2001 and World War II. Immediately after 9/11, Al Qaeda and other radical Islamist groups were branded "Islamofascists". Their attack on the World Trade Center was said to be our generation’s Pearl Harbor. In addition to coveting weapons of mass destruction and covertly sponsoring terrorism, Saddam Hussein was denounced as an Arab Hitler. The fall of Baghdad was supposed to be like the liberation of Paris. Anyone who opposed the policy of pre-emption was an appeaser. And so on. Yet throughout this period of heightened terrorist threats and overseas military interventions, financial markets have displayed a remarkable insouciance.

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Also part of Brooking Papers on Economic Activity.

US objectives during the Cold War were to prevent Soviet attacks on the United States and its allies and to prevent the spread of communism as a political and economic system to other countries, whether by force or by threat, subversion, persuasion, or bribery. The principal instrument to prevent attack was an extensive build-up of defensive and retaliatory military forces, combined with political and military alliances that extended US protection to other countries in exchange for their engagement and support. The principal instruments for preventing the spread of communism by non-military means involved building an international economic system conducive to economic prosperity; engaging in persuasion, providing incentives, and occasionally imposing economic sanctions; and, not least, promoting a robust US economy that could serve as a stimulant to others and as a beacon for the benefits of a free, enterprise-based, market-oriented economy.

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Gopinath, Gita, Mark Aguiar, and Manuel Amador. 2008. “Investment Cycles and Sovereign Debt Overhang”. Abstract

We characterize optimal taxation of foreign capital and optimal sovereign debt policy in a small open economy where the government cannot commit to policy, seeks to insure a risk averse domestic constituency, and is more impatient than the market. Optimal policy generates long-run cycles in both sovereign debt and foreign direct investment in an environment in which the first best capital stock is a constant. The expected tax on capital endogenously varies with the state of the economy and investment is distorted by more in recessions than in booms amplifying the effect of shocks. The government’s lack of commitment induces a negative correlation between investment and the stock of government debt, a "debt overhang" effect. Debt relief is never Pareto improving and cannot affect the long-run level of investment. Further, restricting the government to a balanced budget can eliminate the cyclical distortion of investment.

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Japanese political leaders have become "extrovert" in two ways. First, they have become extrovert in terms of seeking media exposure. They have become much enamored of cameras and sound bites. Although the former Prime Minister Junichiro Koizumi (in office from April 26, 2001 to September 26, 2006) did not create this trend, he definitely turned the new trend into a routine by making twice-daily appearances in front of the TV camera—a practice his successors Prime Ministers Shinzo Abe (from September 26, 2006 to September 26, 2007) and Yasuo Fukuda (from September 26, 2007 to present) have inherited. Second, Japanese political leaders have become more assertive and vocal on security and foreign policy issues. Recent developments in Japanese defense policy, including sending Self Defense Forces to Iraq, would not have happened if it were not for the leadership of Prime Minister Koizumi. More politicians actively debate foreign policy in the media, and try to draw appeal with their foreign policy expertise. Why is this change occurring? What is the source of the increasingly "extrovert" behavior among Japanese political leaders?

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A paper originally prepared for "Japan and the World: The Domestic Politics of How the World Looks to Japan" Conference at Yale University, March 9-10, 2007. The authors are indebted to comments by the fellow conference participants. Special thanks to Michael Thies for his detailed comments.

Sociological research often examines the effects of social context with hierarchical models. In these applications, individuals are nested in social contexts—like school classes, neighborhoods or villages—whose effects are thought to shape individual outcomes. Although applications of hierarchical models are common in sociology, analysis usually focuses on inference for fixed parameters. Researchers seldom study model fit or examine aggregate patterns of variation implied by model parameters. We present an analysis of Thai migration data, in which survey respondents are nested within villages and report annual migration information. We study a variety of hierarchical models, investigating model fit with DIC and posterior predictive statistics. We also describe a simulation to study how different initial distributions of migration across villages produce increasing inter-village inequality in migration.

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Previous working paper version titled "Bayesian Analysis of Comparative Survey Data" dated April 2005.

Clark, William C., Kira J. M. Matus, Paul T. Anastas, and Kai Itameri-Kinter. 2008. “Overcoming the Challenges to the Implementation of Green Chemistry”. Abstract

The Harvard-Yale-ACS GCI Green Chemistry Project is investigating the overall question of the circumstances under which firms can enact innovations that have both economic and environmental benefits, through a focused examination of the implementation of green chemistry. The research project has taken up three fundamental, interrelated questions: What factors act as barriers to the implementation of green chemistry? What actions can be taken by the government, academia, NGO’s and industry that will help alleviate these factors? What are the policy implications of these barriers and potential actions, for all of the involved stakeholders?

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Also published as CID Working Paper No. 155, December 2007.
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Bates, Robert H., and Steven Block. 2008. “The Political Economy of Agricultural Trade Interventions in Africa”. Abstract

In this chapter, we explore patterns of variation in the content of agricultural policies in Africa. We look at the impact of the government’s need for revenues, the incentives for farmers to lobby, and their capacity to affect electoral outcomes. We also explore the political impact of regional inequality, especially insofar as it is generated by cash crop production. These factors operate in ways that deepen our appreciation of the impact of politics on the making of agricultural policies.

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We show that political economy factors play an important role in shaping the exchange rate policies of transition economies. We argue, among other things, that tradables producers prefer a floating rate to allow active exchange rate policy to affect their competitiveness, while internationally exposed sectors prefer a fixed rate to provide currency stability. We carry out a quantitative analysis of the de facto exchange rate behavior of 21 countries over the period 1992-2004. We find support for our arguments, along with some counter-intuitive results, for example associating democracy with a pegged currency and trade concentration with a floating currency. Our empirical results serve as the basis for predictions regarding the adoption of the euro in the EU accession countries and other countries in Central and Eastern Europe.

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This paper demonstrates the utility of a sociology of regional integration by addressing two central questions that have sparked much debate over the welfare state. Is there evidence of long-anticipated retrenchment? Does globalization cause that retrenchment? I redirect these debates by showing that there is evidence of retrenchment in Europe, and that regional integration—not globalization – accounts for it. Regional integration is conceptualized as the construction of supranational political economy in negotiated and bounded regions through political institutionalization and market expansion. I develop the argument that regional political integration should constrain the welfare state through policy feedbacks, the politics of blame avoidance, and the diffusion of classical-liberal policy scripts, while regional economic integration should constrain the welfare state by expanding labor markets and undermining labor unions. I assess these arguments with time-series cross-section models and data from 13 European Union (EU) and non-EU states. The results show that (1) there is evidence of retrenchment, (2) regionalization is significantly associated with retrenchment, and (3) the effect of regional integration is dampened in the strongest welfare states. I draw the general conclusion that regional integration is a new and consequential part of the social context that should receive more attention from sociologists.

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The larger project from which this paper was drawn was awarded the American Sociological Association Dissertation Award in 2006.

Research on the determinants of inequality has implicated globalization in the increased income inequality observed in many advanced capitalist countries since the 1970s. Meanwhile, a different form of international embeddedness—regional integration—has largely escaped attention. Regional integration, conceptualized as the construction of international economy and polity within negotiated regions, should matter for inequality. This paper offers theoretical arguments that distinguish globalization from regional integration, connects regional integration to inequality through multiple theoretical mechanisms, develops hypotheses on the relationship between regional integration and inequality, and reports fresh empirical evidence on the net effect of regional integration on inequality in Western Europe. Three classes of models are used in the analysis: (1) time-series models where region-year is the unit of analysis, (2) panel models where country-year is the unit of analysis, and (3) analysis of variance to identify how the between- and within-country components of income inequality have changed over time. The evidence suggests that regional integration remaps inequality in Europe. Regionalization is associated with both a decrease in between-country inequality, and an increase in within-country inequality. The analysis of variance shows that the net effect is negative, and that within-country inequality now comprises a larger proportion of total income inequality.

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This paper is prepared for the conference on "Inequality Beyond Globalization: Economic Changes and the Dynamics of Inequality," sponsored by the World Society Foundation and the Research Committee on Economy and Society of the International Sociological Association (RC-02), and convened in Neuchatel, Switzerland, June 2008. Please direct comments to Jason Beckfield.

2007
I provide evidence that undervaluation (a high real exchange rate) stimulates economic growth. This is true particularly for developing countries, suggesting that tradable goods suffer disproportionately from the distortions that keep poor countries from converging. I present two categories of explanations as to why this may be so, focusing on (a) institutional/contractual weaknesses, and (b) market failures. A formal model elucidates the linkages between the level of the real exchange rate and the rate of economic growth.
Williamson, Jeffery G, and Timothy J Hatton. 2007. “The Impact of Immigration: Comparing Two Global Eras”. Abstract
This paper asks whether history can inform modern debate about immigration’s impact on high wage economies. It examines the relationship between migration’s labor market impact and capital flows before 1914, the first global era. It then assesses the effects of immigration on wages and employment with and without international capital mobility today, in the second global era. It then explores the links between these economic relationships, welfare burdens, and immigration policy. It concludes with an explanation for the apparent difference in immigration’s impact in the two global eras, and thus on policy.
Williamson, Jeffery G, Branko Milanovic, and Peter H Lindert. 2007. “Pre-Industrial Inequality: An Early Conjectural Map”. Abstract
Did our pre-industrial ancestors have incomes and life expectancies as unequal as they are today? Or is inequality largely the result of the Industrial Revolution? For want of sufficient data, these questions have not yet been answered. This paper infers inequality for 15 ancient, pre-industrial societies using what are known as social tables, stretching from the Roman Empire 14 AD, to Byzantium in 1000, to England in 1688, to Nueva España in 1790, to China in 1880 and to British India in 1947. It applies two new concepts in making those assessments—what we call the inequality possibility frontier and the inequality extraction ratio. Rather than simply offering measures of actual inequality, we compare the latter with the maximum feasible inequality (or rent) that could have been extracted by the elite. The results, especially when compared with modern countries the world round, give new insights in to the connection between inequality and economic development in the very long run.
We consider the effects of the initial assignments of committee seniority on the career outcomes of Democratic members of the House of Representatives from 1949 to 2006. When more than one freshman representative is assigned to a committee, positions in the seniority queue are established by lottery. This ensures that, within these groups of freshmen, queue positions are uncorrelated with other legislator characteristics. This natural experiment allows us to estimate the causal effect of seniority on a variety of outcomes. We find that lower ranked committee members are less likely to serve as subcommittee chairs on their initial committee, are more likely to transfer to other committees than members who receive higher ranks, and have fewer sponsored bills passed in the jurisdiction of their initial committee. On the other hand, we find little evidence that the results of the seniority randomization have a net effect on reelection, the total length of time the members serve in the House, or the total number of sponsored bills passed during their tenure.
Shepsle, Kenneth A, and Abhinay Muthoo. 2007. “Information, Institutions, and Constitutional Arrangements”. Abstract
This paper develops a theory of optimal institutional structure for staggered-term (OLG-type) organizations such as legislative bodies like the US Senate and the Indian Rajya Sabha. Our model is a simple stochastic game of a particular kind of multi-principal, multi-agent dynamic relationship. It captures interactions in each of an infinite number of periods on the one hand, amongst two or more legislators (legislative policy-making), and on the other hand between each legislator and his principal/voters (elections). Two key institutional features of these interactions are jointly determined by the principals (from the distinct electoral districts) when the legislature is founded, at the constitutional moment. We emphasize two main results. First, the principals will agree to institute a mechanism that endows (imperfectly informed) legislators in each period with all the required information about the history of play in the legislature. Transparency of agentactions to agents (in order to enable agents to hold each other to account) is a key and robust feature of the principal-optimal institutional structure. Second, under some circumstances, the principals will be indifferent to the structure of legislative procedures (which determine the allocation of agenda power amongst the agents). We apply our results to the US Senate.

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