Working Paper Series

  • Certified to migrate: Property rights and migration in rural Mexico

    Alain de Janvry, Kyle Emerick, Marco Gonzalez-Navarro, Elisabeth Sadoulet

    Goldman School of Public Policy Working Paper (November 2012)

    Improving security of tenure over agricultural land has recently been the focus of a number of large land certification programs. While the main justification for these efforts was to increase productive investments and facilitate land rental transactions, we show that if access rights were tied to actual land use in the previous regime, these programs can also lead to increased outmigration from agrarian communities. We analyze the Mexican ejido land certification program which, from 1993 to 2006, awarded ownership certificates to 3.6 million farmers on about half the country’s agricultural land. Using the program rollout over time and space as an identification strategy, we show that households obtaining land certificates were 30% more likely to have a migrant member. The effect was larger for households with ex-ante weaker property rights and with larger off-farm opportunities. At the community level, certificates led to a 4% reduction in population. We show evidence of certificates leading to sorting, with larger farmers staying and land-poor farmers leaving in high productivity areas. We use satellite imagery to determine that, on average, cultivated land was not reduced because of the program, consistent with increases in agricultural labor productivity. Furthermore, in high productivity areas, the certification program led to an increase in cultivated land compared to low productivity areas.

  • Are land reforms granting complete property rights politically risky?

    Alain de Janvry, Marco Gonzales-Navarro, Elisabeth Sadoulet

    Goldman School of Public Policy Working Paper (November 2012)

    What is the impact on voting behavior of strengthening property rights over agricultural
    land? To answer this question, we use the 14 year nationwide rollout of Mexico’s land
    certification program (Procede) and match affected communities (ejidos) before and after
    the change in property rights with voting outcomes in corresponding electoral sections
    across six federal election cycles. We find that, in accordance with the investor class
    theory, granting complete property rights induced a conservative shift toward the promarket party equal to 6.8 percent of its average share of votes over the period. This shift was strongest where vested interests created larger expected benefits from marketoriented policies as opposed to public-transfer policies. We also find that beneficiaries failed to reciprocate through votes for the benefactor party. We conclude that, in the
    Mexican experience, engaging in a land reform that strengthened individual property
    rights over agricultural land was politically advantageous for the right-wing party.

  • Babu, Barrister, Fixer, or Friend: Intermediaries and Citizen-State Relations in India

    Jennifer Bussell

    Goldman School of Public Policy Working Paper (September 2012)

    How do citizens access the state? While the nature of citizen-state relations is a key element of democracy, most analyses focus on only one element of this interaction, such as the links between citizens and their representatives, the use of an intermediary to facilitate service delivery, or payment of a bribe to a bureaucrat. In this paper, I evaluate the relationship between citizens and the state in India, focusing on the choices citizens make over a range of potential strategies for accessing state resources and the combinations of these strategies. I consider potential demographic, regional, and institutional causes of variation in these choices and find that citizens engage with the state in quite different ways depending on the government department from which they require services and the state in which they live. These analyses highlight the importance of a more comprehensive evaluation of citizen-state interactions that takes into account the spectrum of choices citizens may or may not have for accessing public services, thus providing a more complete view of democratic practice in India today.

  • Social Networks and the Decision to Insure

    Alain de Janvry, Jing Cai, Elisabeth Sadoulet

    Goldman School of Public Policy Working Paper (August 2012)

    Using data from a randomized experiment in rural China, this paper studies the influence of social networks on the decision to adopt a new weather insurance product and the mechanisms through which social networks operate. We provided financial education to a random subset of farmers and found a large social network effect on take-up: for untreated farmers, having an additional friend receiving financial education raised take-up by almost half as much as obtaining financial education directly, a spillover effect equivalent to offering a 15% reduction in the average insurance premium. By varying the information available to individuals about their peers’ take-up decisions and using randomized default options, we show that the positive social network effect is not driven by the diffusion of information on purchase decisions, but instead by the diffusion of knowledge about insurance. We also find that social network effects are larger in villages where households are more strongly connected, and when people who are the first to receive financial education are more central in the social network.

  • The Effects of Residential Segregation during Childhood on Life Chances

    Rucker Johnson

    Goldman School of Public Policy Working Paper (May 2012)

    Human capital accumulation may depend on the neighborhood in which one grows up through a
    variety of channels, including access to school resources, health and social service funding,
    neighborhood crime, peer and role model effects, proximity to a chemical dumping ground or
    related environmental hazards, and connectedness to job networks and informal sources of
    support. This paper provides new causal estimates of the effects of racial residential segregation
    during childhood on subsequent adult attainment outcomes. I account for the potential
    endogeneity of segregation and neighborhood location choice using instrumental variables based
    on 19th Century railroad track configurations, historical migration patterns, political factors, and
    topographical features. Following Ananat (2011), it is shown that cities that were subdivided by
    railroads into a greater number of physically-defined neighborhoods became significantly more
    segregated after the Great Migration of African-Americans to northern and western cities. To
    examine the consequences of segregation during childhood, this study analyzes the life
    trajectories of children born since 1950 and followed through 2009. Data from the Panel Study
    of Income Dynamics (PSID) spanning four decades are linked with information on neighborhood
    attributes and school quality resources that prevailed at the time these children were growing up.
    Results from 2SLS/IV models demonstrate that, for blacks, the level of racial residential
    segregation during childhood negatively impacts subsequent educational attainment, reduces the
    likelihood of high school graduation, increases the probability of incarceration, reduces adult
    earnings and the likelihood of intergenerational mobility, increases the annual incidence of
    poverty in adulthood, and leads to worse health status in adulthood; segregation effects for
    whites were not statistically significant across each of these outcomes but the point estimates were
    in the opposite direction of the corresponding estimates for blacks. The results are consistent
    with prior research that has found that increased segregation leads to more inequality in spending
    across districts of the same MSA, thus worsening the relative position of poorer districts.

  • Economic returns to energy-efficient investments in the housing market: Evidence from Singapore

    John Quigley, Yongheng Deng, Zhiliang Lia

    Goldman School of Public Policy Working Paper: GSPP10-103 (May 2012)

    Since January of 2005, 250 building projects in the City of Singapore have been awarded the Green Mark for
    energy efficiency and sustainability. This paper analyzes the private returns to these investments, evaluating
    the premium in asset values they command in the market. We analyze almost 37,000 transactions in the
    Singapore housing market to estimate the economic impact of the Green Mark program on Singapore's
    residential sector.

    We adopt a two-stage research design; in the first stage, a hedonic pricing model is estimated based on
    transactions involving green and non-green residential units in 697 individual projects or estates. In the
    second stage, the fixed effects estimated for each project are regressed on the location attributes of the
    projects, as well as control variables for a Green Mark rating. Our results suggest that the economic returns to
    green building are substantial.

    This is one of the first analyses of the economics of green building in the residential sector, and the only one
    analyzing property markets in Asia. Our results provide insight about the operation of the housing market in
    one country, but the policy implications about the economic returns to sustainable investments in the
    property market may have broader applications for emerging markets in Asia.

  • The Grandchildren of Brown: The Long Legacy of School Desegregation

    Rucker Johnson

    Goldman School of Public Policy Working Paper (March 2012)

    In the US, there is a high degree of persistence in economic status and health status across
    generations, particularly in the lower and upper tails of the income distribution. For example, it
    has been shown that 42 percent of men raised in the bottom quintile of incomes remain there as
    adults, while only 8 percent of US men at the bottom rise to the top quintile (Jantti et al., 2007).
    While public policies that promote equalization of educational opportunity have been
    emphasized as keys to break the intergenerational cycle of poverty, there exists limited causal
    evidence of the mechanisms that underlie intergenerational immobility. Few studies have
    attempted to isolate the causal effect of education on the next generation’s well-being. This is in
    part due to formidable empirical challenges that arise from the paucity of large nationallyrepresentative data sets with information both on parental and child outcomes over the life cycle, and the difficult search for a credible identification strategy.

    This paper uses the Panel Study of Income Dynamics spanning 4 decades (PSID: 1968-2009) to
    link three generations of adult outcomes. The analyses exploit the historical period and quasirandom timing of court-ordered school desegregation to quantify the extent to which children’s well-being can be improved by increased parental education and document the intergenerational
    returns to education. The first stage of the analysis (using the “parent sample” that consists of
    cohorts born between 1950-1970) builds on prior findings that demonstrate for blacks, school
    desegregation significantly increased educational attainment, with no significant desegregation
    effects on whites’ educational outcomes (Johnson, 2011). The present study provides new
    evidence on the causal influence of parental education across generations by using the timing of
    initial court orders and resultant differences in childhood exposure to school desegregation as an
    instrument for parental education, linked (in the second stage) with their children’s subsequent
    life outcomes (using the “child sample” that consists of cohorts born since 1980). The 2SLS/IV
    framework and intergenerational research design utilized enables this work to assess the impact
    of school desegregation on children and their families into the third generation. I find a
    considerable impact of school desegregation that persists to influence the outcomes of the next
    generation, including increased math and reading test scores, reduced likelihood of grade
    repetition, increased likelihood of high school graduation and college attendance, improvements
    in college quality/selectivity, and increased racial diversity of student body at their selected
    college. The findings demonstrate that part of the intergenerational transmission of inequality
    can be attributable to school quality related influences. The results in turn highlight parental
    education as a causal determinant of generational mobility.

  • School Quality and the Long-run Effects of Head Start

    Rucker Johnson

    Goldman School of Public Policy Working Paper (March 2012)

    This paper contributes to the Head Start literature by providing a unified evaluation of long-run impacts on adult outcomes across several domains. In addition to the extensive literature on the impacts of Head Start on test scores, the present study builds on and contributes to a burgeoning literature investigating long-term impacts of early life interventions (childhood programs in the first decade of life). The paper’s results complement the findings of studies on the long-term impacts of other early childhood interventions, such as the Perry and Abecederian preschool demonstrations, Nurse-Family Partnership, and kindergarten class size in the Tennessee STAR experiment (Chetty et al., 2010), which also find lasting impacts on adult outcomes despite fade-out on test scores.