Showing papers in "American Economic Journal: Applied Economics in 2009"
TL;DR: The long-term impact for disadvantaged children is large despite "fadeout" of test score gains, and this closes one-third of the gap between children with median and bottom quartile family income.
Abstract: This paper provides new evidence on the long-term benefits of Head Start using the National Longitudinal Survey of Youth. I compare siblings who differ in their participation in the program, controlling for a variety of pre-treatment covariates. I estimate that Head Start participants gain 0.23 standard deviations on a summary index of young adult outcomes. This closes one-third of the gap between chil- dren with median and bottom quartile family income, and is about 80 percent as large as model programs such as Perry Preschool. The long-term impact for disadvantaged children is large despite "fade- out" of test score gains. (
581 citations
TL;DR: The authors show that if less educated foreign and native-born workers specialize in performing different tasks, immigration will cause natives to reallocate their task supply, thereby reducing downward wage pressure.
Abstract: Many workers with low levels of educational attainment immigrated to the United States in recent decades. Large inflows of less educated immigrants would reduce wages paid to comparably-educated native-born workers if the two groups are perfectly substitutable in production. In a simple model exploiting comparative advantage, however, we show that if less educated foreign and native-born workers specialize in performing different tasks, immigration will cause natives to reallocate their task supply, thereby reducing downward wage pressure. We merge occupational task-intensity data from the O*NET dataset with individual Census data across US states from 1960-2000 to demonstrate that foreign-born workers specialize in occupations that require manual and physical labor skills while natives pursue jobs more intensive in communication and language tasks. Immigration induces natives to specialize accordingly. Simulations show that this increased specialization might explain why economic analyses commonly find only modest wage consequences of immigration for
525 citations
TL;DR: In this article, the authors report on an experimental evaluation of strategies designed to improve academic performance among college freshmen, including academic support services, financial incentives for good grades, and a third group combined both interventions.
Abstract: This paper reports on an experimental evaluation of strategies designed to improve academic performance among college freshmen. One treatment group was offered academic support services. Another was offered financial incentives for good grades. A third group combined both interventions. Service use was highest for women and for subjects in the combined group. The combined treatment also raised the grades and improved the academic standing of women. These differentials persisted through the end of second year, though incentives were given in the first year only. This suggests study skills among some treated women increased. In contrast, the program had no effect on men.
504 citations
TL;DR: This paper found that those assigned to the Washington Times treatment group were eight percentage points more likely to vote for the Democratic candidate for governor than those assigned in the control group, and found similar but weaker evidence of shifts in public opinion on specific issues and attitudes.
Abstract: There is substantial evidence that media sources have identifiable political slants, but there has been relatively little study until recently of the effects on political views and behaviors of media bias or access. This paper reports the results of a natural field experiment to measure the effect of exposure to newspapers on political behavior and opinion. The Washington DC area is served by two major newspapers, the Washington Times and the Washington Post. We randomly assigned individuals either to receive a free subscription to the Washington Post, to receive a free subscription to the Washington Times, or to a control group. We then conducted a public opinion survey after the 2005 Virginia gubernatorial election. We find that those assigned to the Post treatment group were eight percentage points more likely to vote for the Democratic candidate for governor than those assigned to the control group. We find similar but weaker evidence of shifts in public opinion on specific issues and attitudes.
450 citations
TL;DR: The authors found that government-owned bank lending in India follows the electoral cycle, with agricultural credit increasing by 5-10 percentage points in an election year and significant cross-sectional targeting, with large increases in districts in which the election was particularly close.
Abstract: This paper integrates theories of political budget cycles with theories of tactical electoral redistribution to test for political capture in a novel way. Studying banks in India, I find that government-owned bank lending tracks the electoral cycle, with agricultural credit increasing by 5-10 percentage points in an election year. There is significant cross-sectional targeting, with large increases in districts in which the election is particularly close. This targeting does not occur in nonelection years or in private bank lending. I show capture is costly: elections affect loan repayment, and election-year credit booms do not measurably affect agricultural output. (JEL D72, 013, 017, Q14, Q18)
361 citations
TL;DR: The authors used random assignment in professional golf tournaments to test for peer effects in the workplace and found no evidence that playing partners' ability affects performance, contrary to recent evi- fence on peer effects from laboratory experiments, grocery scanners, and soft fruit pickers.
Abstract: This paper uses random assignment in professional golf tournaments to test for peer effects in the workplace. We find no evidence that playing partners' ability affects performance, contrary to recent evi- dence on peer effects in the workplace from laboratory experiments, grocery scanners, and soft fruit pickers. In our preferred specifica - tion, we can rule out peer effects larger than 0.043 strokes for a one stroke increase in playing partners' ability. Our results complement existing studies on workplace peer effects and are useful in explain - ing how social effects vary across labor markets, across individuals, and with the form of incentives faced. (
360 citations
TL;DR: This paper found that students have larger test score gains when their teachers experience improvements in the observable characteristics of their colleagues, and that peer quality explains about 20 percent of the own-teacher effect.
Abstract: Using longitudinal elementary school teacher and student data, we document that students have larger test score gains when their teachers experience improvements in the observable characteristics of their colleagues. Using within-school and within-teacher variation, we show that a teacher's students have larger achievement gains in math and reading when she has more effective colleagues (based on estimated value-added from an out-of-sample pre-period). Spillovers are strongest for less experienced teachers and persist over time, and historical peer quality explains away about 20 percent of the own-teacher effect, results that suggest peer learning.
322 citations
TL;DR: In this article, a randomized evaluation in rural Kenya finds that providing textbooks did not raise average test scores of the best students, but had little effect on other students, and that the curriculum in Kenya, and in many other developing countries, tends to be oriented toward academically strong students.
Abstract: A randomized evaluation in rural Kenya finds, contrary to the previous literature, that providing textbooks did not raise average test scores. Textbooks did increase the scores of the best students (those with high pretest scores) but had little effect on other students. Textbooks are written in English, most students' third language, and many students could not use them effectively. More generally, the curriculum in Kenya, and in many other developing countries, tends to be oriented toward academically strong students, leaving many students behind in societies that combine a centralized educational system; the heterogeneity in student preparation associated with rapid educational expansion; and disproportionate elite power.
319 citations
TL;DR: Exploiting birth-weight differences between twins using a newlycreated dataset of twins from 1960-1982 California birth records and the Early Childhood Longitudinal Study Birth Cohort, it is found birth weight is related to educational attainment, later pregnancy complications, and the birth weight of the next generation.
Abstract: The fetal origins hypothesis asserts that nutrient deprivation in utero can raise an individual's chronic disease risk. Within economics, this hypothesis has gained acceptance as a leading explanation for the cross-sectional correlations between birthweight, a proxy for fetal nutrient intake, and adult outcomes such as educational attainment, earnings and health. However, tests of this hypothesis using crosssectional data may not adequately account for the effect of omitted variables such as family background and genetics on these outcomes. To estimate the effects of birthweight while controlling for these factors, I exploit differences in birthweight between twins. I use two datasets of twins: a newly-created dataset, consisting of over 3,000 twin pairs, coming from the universe of 1960-1982 California birth records and the Early Childhood Longitudinal Study-Birth Cohort. Using these data, I find that birthweight is related to educational attainment, later pregnancy complications, and the birthweight of the next generation. With the exception of pregnancy complications, the effects of birthweight are small, especially in relation to recent findings for other countries. However, I find that the protective effects of birthweight vary across the birthweight distribution. For instance, while the effect of higher birthweight on infant mortality is most protective for very low birthweight infants, the effect of birthweight on education is practically zero for babies weighing less than 2500 grams and is largest for births exceeding 2500 grams.
310 citations
TL;DR: In this paper, the authors designed and tested a voluntary commitment product to help smokers quit smoking, which offered smokers a savings account in which they deposit funds for six months, after which they took a urine test for nicotine and cotinine.
Abstract: The authors designed and tested a voluntary commitment product to help smokers quit smoking. The product (CARES) offered smokers a savings account in which they deposit funds for six months, after which they take a urine test for nicotine and cotinine. If they pass, their money is returned; otherwise, their money is forfeited to charity. Eleven percent of smokers offered CARES tookup, and smokers randomly offered CARES were 3 percentage points more likely to pass the 6-month test than the control group. More importantly, this effect persisted in surprise tests at 12 months, indicating that CARES produced lasting smoking cessation.
265 citations
TL;DR: In this article, the authors quantify the labor supply responses of prime-aged adults to the presence of pensioners in their households, using longitudinal data collected in South Africa, and compare households and individuals before and after pension receipt and pension loss, which allows them to control for a host of unobservable household and individual characteristics that may determine labor market behavior.
Abstract: We quantify the labor supply responses of prime-aged adults to the presence of pensioners in their households, using longitudinal data collected in South Africa. We compare households and individuals before and after pension receipt and pension loss, which allows us to control for a host of unobservable household and individual characteristics that may determine labor market behavior. We find large cash transfers to the elderly lead to increased employment among prime-aged adults, which occurs primarily through labor migration. The pension's impact is attributable to the increase in household resources it represents, which can be used to stake migrants until they become self-sufficient, and to the presence of pensioners who can care for small children, which allows prime-aged adults to look for work elsewhere.
TL;DR: The authors used a new database and the spatial discontinuities of colonial investment policy to investigate the extent to which colonial public investments continue to influence current regional inequalities in French-speaking West Africa.
Abstract: To what extent do colonial public investments continue to influence current regional inequalities in French-speaking West Africa? Using a new database and the spatial discontinuities of colonial investment policy, this paper gives evidence that early colonial investments had large and persistent effects on current outcomes. The nature of investments also matters. Current educational outcomes have been more specifically determined by colonial investments in education rather than health and infrastructures, and vice versa. I show that a major channel for this historical dependency is a strong persistence of investments; regions that got more at the early colonial times continued to get more.
TL;DR: In this article, the authors compare learning in Pakistani public and private schools using dynamic panel methods that account for three key empirical challenges to widely used value-added models: imperfect persistence, unobserved student heterogeneity, and measurement error.
Abstract: Evaluations of educational programs commonly assume that what children learn persists over time. The authors compare learning in Pakistani public and private schools using dynamic panel methods that account for three key empirical challenges to widely used value-added models: imperfect persistence, unobserved student heterogeneity, and measurement error. Their estimates suggest that only a fifth to a half of learning persists between grades and that private schools increase average achievement by 0.25 standard deviations each year. In contrast, estimates from commonly used value-added models significantly understate the impact of private schools on student achievement and/or overstate persistence. These results have implications for program evaluation and value-added accountability system design.
TL;DR: The authors found that retention among younger students does not affect the likelihood of high school completion, but retaining low-achieving eighth grade students in elementary school substantially increases the probability that these students will drop out.
Abstract: Low-achieving students in many school districts are retained in a grade to allow them to gain the academic or social skills that teach ers believe are necessary to succeed academically. In this paper, we use plausibly exogenous variation in retention generated by a test-based promotion policy to assess the causal impact of grade retention on high school completion. We find that retention among younger students does not affect the likelihood of high school com pletion, but that retaining low-achieving eighth grade students in elementary school substantially increases the probability that these students will drop out of high school. (JEL121, J13)
TL;DR: In this paper, the authors leverage previously underutilized variation in the date of the county-level original implementation of the Food Stamp Program in the 1960s and early 1970s to estimate the impact of program availability on food spending.
Abstract: Economists have strong theoretical predictions about how in-kind transfer programs – such as providing vouchers for food – impact consumption. Despite the prominence of the theory, there is little empirical work documenting actual responses to in-kind transfers, and most work that does exist finds results that fail to support the canonical theoretical model. In this work, we leverage previously underutilized variation in the date of the county-level original implementation of the Food Stamp Program in the 1960s and early 1970s. Using the Panel Study of Income Dynamics, we employ difference-in-difference methods to estimate the impact of program availability on food spending. Consistent with theoretical predictions, we find that the
TL;DR: In this article, the authors exploit the staggered introduction of tribunals across states and the link between overdues and claim size to implement a differences-in-differences strategy on project loan data.
Abstract: In 1993, the Indian government introduced debt recovery tribunals to speed up the resolution of debt recovery claims larger than a threshold. This paper exploits the staggered introduction of tribunals across states and the link between overdues and claim size to implement a differences-in-differences strategy on project loan data. It finds that the tribunals reduced delinquency for the average loan by 28 percent. They also lowered the interest rates charged on larger loans, holding constant borrower quality. This suggests that the speedier processing of debt recovery suits can lower the cost of credit.
TL;DR: This paper found large and immediate increases in drinking at age 21, including a 21 percent increase in recent drinking days, leading to a discrete 9% increase in the mortality rate at 21, primarily due to motor vehicle accidents, alcohol-related deaths, and suicides.
Abstract: We estimate the effect of alcohol consumption on mortality using the minimum drinking age in a regression discontinuity design. We find large and immediate increases in drinking at age 21, including a 21 percent increase in recent drinking days. We also find a discrete 9 percent increase in the mortality rate at age 21, primarily due to motor vehicle accidents, alcohol-related deaths, and suicides. We estimate a 10 percent increase in the number of drinking days for young adults results in a 4.3 percent increase in mortality. Our results suggest policies that reduce drinking among young adults can have substantial public health benefits. (JEL I12, I18)
TL;DR: A large effect of in utero iodine on cognition and human capital is suggested: treated children attain an estimated 0.35-0.56 years of additional schooling relative to siblings and older and younger peers.
Abstract: Cognitive damage from iodine deficiency disorders (IDD) has impor tant implications for economic growth through its effect on human capital. To gauge the magnitude of this influence, we evaluate the impact on schooling of reductions in IDD from intensive iodine sup plementation in Tanzania. Our findings suggest a large effect of in utero iodine on cognition and human capital: treated children attain an estimated 0.35-0.56 years of additional schooling relative to sib lings and older and younger peers. Furthermore, the effect appears to be substantially larger for girls, consistent with laboratory evi dence indicating greater cognitive sensitivity of female fetuses to maternal thyroid deprivation. (JEL112,121, J16, 015)
TL;DR: In this paper, the authors investigated the impact of exposure to television and radio on social capital in Indonesian villages and found that better signal reception is associated with substantially lower levels of participation in social activities and with lower self-reported measures of trust.
Abstract: In “Bowling Alone,” Putnam (1995) famously argued that the rise of television may be responsible for social capital’s decline. I investigate this hypothesis in the context of Indonesian villages. To identify the impact of exposure to television (and radio), I exploit plausibly exogenous differences in over-the-air signal strength associated with the topography of East and Central Java. Using this approach, I find that better signal reception, which is associated with more time spent watching television and listening to radio, is associated with substantially lower levels of participation in social activities and with lower self-reported measures of trust. I find particularly strong effects on participation in local government activities, as well as on participation in informal savings groups. However, despite the impact on social capital, improved reception does not appear to affect village governance, at least as measured by discussions in villagelevel meetings and by corruption in a village-level road project.
TL;DR: This article examined the presidential opinion ratings of voting-age eligibles and ineligibles two years after the presi dent's election and found that eligibles show two to three times greater polarization of opinions than comparable non-voters.
Abstract: Cognitive dissonance theory predicts that the act of voting for a candidate leads to a more favorable opinion of the candidate in the future. We find support for the empirical relevance of cognitive dis sonance to political attitudes. We examine the presidential opinion ratings of voting-age eligibles and ineligibles two years after the presi dent's election. We find that eligibles show two to three times greater polarization of opinions than comparable ineligibles. We find smaller effects when we compare polarization in opinions of senators elected during high turnout presidential campaign years with senators elected during nonpresidential campaign years. (JEL D72)
TL;DR: This paper examined the influence of psychological responses to debt on career choices from an experiment in which alternative financial aid packages were assigned by lottery to a set of law school admits, but one required the student to take on a loan that would be paid for by the school if he worked in public interest law, while the other covered tuition as long as the student worked in private practice.
Abstract: This paper examines the influence of psychological responses to debt on career choices from an experiment in which alternative financial aid packages were assigned by lottery to a set of law school admits. The packages had equivalent monetary value, but one required the student to take on a loan that would be paid for by the school if he worked in public interest law, while the other covered tuition as long as the student worked in public interest law. If he did not, the student would be required to reimburse the school. Tuition assistance recipients have a 36 to 45 percent higher public interest placement rate and, when lottery results were announced before enrollment, were twice as likely to enroll.
TL;DR: In this article, the authors used a unique panel dataset constructed from 192 self-reported sex worker diaries which include detailed information on sexual behavior, labor supply, and health shocks, finding that sex workers adjust their supply of risky, better compensated sex to cope with unexpected health shocks.
Abstract: Formal and informal commercial sex work is a way of life for many poor women in developing countries. Though sex workers have long been identified as crucial in affecting the spread of HIV/AIDS, particularly in Sub-Saharan Africa, the nature of sex-for-money transactions remains poorly understood. Using a unique panel dataset constructed from 192 self-reported sex worker diaries which include detailed information on sexual behavior, labor supply, and health shocks, the authors find that sex workers adjust their supply of risky, better compensated sex to cope with unexpected health shocks, exposing themselves to increased risk of HIV infection. In particular, women are 3.1 percent more likely to see a client, 21.2 percent more likely to have anal sex, and 19.1 percent more likely to have unprotected sex on days in which a household member falls ill. Women also increase their supply of risky sex on days after missing work due to symptoms from a sexually transmitted infection. Given that HIV prevalence has been estimated at 9.8 percent in this part of Kenya, these behavioral responses entail significant health risks for sex workers and their partners, and suggest that sex workers are unable to cope with risk through other formal or informal consumption smoothing mechanisms.
TL;DR: In this article, the authors investigated the effect of the menstrual cycle on women's absenteeism and found that female absenteeism has a more negative effect on men's earnings and this differce declines with seniority.
Abstract: In most countries, women are absent from work more frequently than men. Using personnel data, we find that the absences of women below the age of 45 follow a 28-day cycle, while the absences of men and of women over the age of 45 do not. We interpret this as evidence that the menstrual cycle increases female absenteeism. To investigate the effect on women's earnings, we use a simple model of statistical discrimination. Consistent with the model, we find absen teeism has a more negative effect on men's earnings and this differ ence declines with seniority. The increased absenteeism induced by the 28-day cycle explains at least 14 percent of the earnings gender differential. (JEL J16, J22, J31)
TL;DR: The authors investigated the role of racial group loyalty on generosity in a broadly representative sample of the US adult population, using an audiovisual presentation to manipulate beliefs about the race, income, and worthiness of Hurricane Katrina victims.
Abstract: We investigate the role of racial group loyalty on generosity in a broadly representative sample of the US adult population. We use an audiovisual presentation to manipulate beliefs about the race, income, and worthiness of Hurricane Katrina victims. Respondents then decide how to divide $100 between themselves and Katrina victims. We find no effects of victims' race on giving on average. However, respondents who report feeling close to their racial or eth - nic group give substantially more when victims are of the same race, while respondents who do not feel close to their group give substan
TL;DR: This paper found that Asian Indian mothers are significantly more likely to have a terminated pregnancy and to give birth to a boy when they have previously only given birth to girls, and the observed boy-birth percentages are consistent with over 2,000 missing" Chinese and Indian girls in the United States between 1991 and 2004.
Abstract: We offer evidence of gender selection within the United States. Analysis of comprehensive birth data shows unusually high boy-birth percentages after 1980 among later children (most notably third and fourth children) born to Chinese and Asian Indian mothers. Based upon linked data from California, Asian Indian mothers are found to be significantly more likely to have a terminated pregnancy and to give birth to a boy when they have previously only given birth to girls. The observed boy-birth percentages are consistent with over 2,000 "missing" Chinese and Indian girls in the United States between 1991 and 2004. (JEL J11, J16)
TL;DR: This paper found that more heterogeneous peer groups have positive effects on individual grades and high-ability peers account for most of the positive effect, while lowability peers have no measureable effect (JEL 123, J24, M54).
Abstract: Understanding how heterogeneity in peer group composition affects academic attainment has important implications for how schools organize students in group settings The random assignment of cadets to companies at West Point affords an opportunity to investigate this issue empirically Estimates of the impact of peer group heteroge neity in math SAT scores on freshmen-year academic performance reveals that more heterogeneous peer groups have positive effects on individual grades High-ability peers account for most of the positive effect, while low-ability peers have no measureable effect (JEL 123, J24, M54)
TL;DR: In this paper, the authors show that a mother's labor market participation is influenced by the sex composition of her two eldest siblings, and that it is also affected by the eldest siblings of the other mothers living in the same close neighborhood.
Abstract: In France, as in the US, a mother's labor market participation is influenced by the sex composition of her two eldest siblings. This paper shows that it is also affected by the sex composition of the eldest siblings of the other mothers living in the same close neighborhood. Using the sex composition of neighbors' eldest siblings as an instrumental variable, we identify a significant elasticity of own labor market participation to neighbors' participation. We present supportive evidence by comparing the estimates under two regimes for family benefits (pre- and post-1994 reform) and using quarter of birth as an alternative instrument.
TL;DR: In this paper, the authors evaluate income tax reforms in China and India and show that the combination of fast income growth and under-indexed tax schedule in China implies the fraction of the Chinese population subject to income tax has increased from less than 0.1 percent in 1986 to about 20 percent in 2008, while it has stagnated around 2-3 percent in India.
Abstract: This paper evaluates income tax reforms in China and India. The combination of fast income growth and under-indexed tax schedule in China implies the fraction of the Chinese population subject to income tax has increased from less than 0.1 percent in 1986 to about 20 percent in 2008, while it has stagnated around 2-3 percent in India. Chinese income tax revenues, as a share of GDP, increased from less than 0.1 percent in 1986 to about 1.5 percent in 2005 and 2.5 percent in 2008, while the constant adaptation of exemption levels and income brackets in India have caused them to stagnate around 0.5 percent of GDP.
TL;DR: It is suggested that HIV/AIDS had very little impact on fertility, both overall and in a sample of HIV-negative women in sub-Saharan Africa.
Abstract: This paper studies the response of fertility to the HIV/AIDS epidemic in sub-Saharan Africa. I use repeated cross sections of the Demographic and Health Surveys for 12 countries in sub-Saharan Africa to examine this question empirically. Using individual birth histories from these data, I construct estimates of the regional total fertility rate over time. In a difference-in-differences approach, I compare regional HIV prevalence to changes in total fertility rates from the 1980s to the present. My results suggest that HIV/AIDS had very little impact on fertility, both overall and in a sample of HIV-negative women.
TL;DR: The authors empirically analyzed the illicit trade in cultural property and antiques by comparing imports recorded in United States' customs data and the (purportedly identical) trade recorded by customs authorities in exporting countries.
Abstract: We empirically analyze the illicit trade in cultural property and antiques, taking advantage of different reporting incentives between source and destination countries. We generate a measure of illicit trafficking in these goods by comparing imports recorded in United States' customs data and the (purportedly identical) trade recorded by customs authorities in exporting countries. This reporting gap is highly correlated with corruption levels of exporting countries. This correlation is stronger for artifact-rich countries. As a placebo test, we do not observe any such pattern for US imports of toys. We report similar results for four other Western country markets. (JEL F14, K42, Z11, Z13)