Publications by Type: Working Paper

Yanagizawa-Drott, David, and Jakob Svensson. Submitted. “Intergenerational Transmission of War”.Abstract
Does war service by one generation affect service by the next generation in later wars? Using data from major U.S. 20th-century wars, we exploit that closeness to age 21 at a time of war is a key determinant of the likelihood of participation. We find that a generation’s war service experience positively affects service by the next generation, with each war having substantially impacted those that followed. The  evidence is consistent with cultural transmission, and indicates that a history of  wars can help overcome the collective action problem of getting citizens to  volunteer for war service.
Yanagizawa-Drott, David, Tessa Bold, Kayuki C. Kaizzi, and Jakob Svensson. Submitted. “Low Quality, Low Returns, Low Adoption: Evidence from the Market for Fertilizer and Hybrid Seed in Uganda”.Abstract
To reduce poverty and food insecurity in Africa requires raising productivity in agriculture. Systematic use of fertilizer and hybrid seed is a pathway to increased productivity, but adoption of these technologies remains low. We investigate whether the quality of agricultural inputs can help explain low take-up. Testing modern products purchased in local markets, we find that 30% of nutrient is missing in fertilizer, and hybrid maize seed contains less than 50% authentic seeds. We document that such low quality results in negative average returns. If authentic technologies replaced these low-quality products, average returns for smallholder farmers would be over 50%.
Hanna, Rema, and Iqbal Dhaliwal. Submitted. “Deal with the Devil: The Successes and Limitations of Bureaucratic Reform in India”.Abstract
Employing a technological solution to monitor the attendance of public-sector health care workers in India resulted in a 15 percent increase in the attendance of the medical staff. Health outcomes improved, with a 16 percent increase in the delivery of infants by a doctor and a 26 percent reduction in the likelihood of infants born under 2500 grams. However, women in treatment areas substituted away from the newly monitored health centers towards delivery in the (unmonitored) larger public hospitals and private hospitals. Several explanations may help explain this shift: better triage by the more present health care staff; increased patients’ perception of absenteeism in the treatment health centers; and the ability of staff in treatment areas to gain additional rents by moving women to their private practices and by siphoning off the state-sponsored entitlements that women would normally receive at the health center at the time of delivery. Despite initiating the reform on their own, there was a low demand among all levels of government–state officials, local level bureaucrats, and locally-elected bodies—to use the better quality attendance data to enforce the government’s human resource policies due to a fear of generating discord among the staff. These fears were not entirely unfounded: staff at the treatment health centers expressed greater dissatisfaction at their jobs and it was also harder to hire new nurses, lab technicians and pharmacists at the treatment health centers after the intervention. Thus, this illustrates the implicit deal that governments make on non-monetary dimensions—truancy, allowance of private practices—to retain staff at rural outposts in the face of limited budgets and staff shortages.
Banerjee, Abhijit, Rema Hanna, Jordan Kyle, Benjamin A. Olken, and Sudarno Sumarto. Submitted. “The Power of Transparency: Information, Identification Cards and Food Subsidy Programs in Indonesia”.Abstract
Can governments improve aid programs by providing information to beneficiaries? In our model, information can change how much aid citizens receive as they bargain with local officials who implement national programs. In a large-scale field experiment, we test whether mailing cards with program information to beneficiaries increases their subsidy from a subsidized rice program. Beneficiaries received 26 percent more subsidy in card villages. Ineligible households received no less, so this represents lower leakage. The evidence suggests that this effect is driven by citizen bargaining with local officials. Experimentally adding the official price to the cards increased the subsidy by 21 percent compared to cards without price information. Additional public information increased higher-order knowledge about eligibility, leading to a 16 percent increase in subsidy compared to just distributing cards. In short, increased transparency empowered citizens to reduce leakages and improve program functioning.
Hanna, Rema, Abhijit Banerjee, Gabriel Kreindler, and Benjamin A. Olken. 2015. “Debunking the Stereotype of the Lazy Welfare Recipient: Evidence from Cash Transfer Programs Worldwide”.Abstract
Targeted transfer programs for poor citizens have become increasingly common in the developing world. Yet, a common concern among policy makers - both in developing as well as developed countries - is that such programs tend to discourage work. We re-analyze the data from 7 randomized controlled trails of government-run cash transfer programs in six developing countries throughout the world, and find no systematic evidence that cash transfer programs discourage work.
Hanna: Debunking Labor Supply WP
Callen, Michael, Saad Gulzar, Ali Hasanain, Yasir Khan, and Arman Rezaee. 2015. “Personalities and Public Sector Performance: Evidence from a Health Experiment in Pakistan”.Abstract
This paper provides evidence that the personality traits of policy actors matter for policy outcomes in the context of two large-scale experiments in Punjab, Pakistan. Three results support the relevance of personalities for policy outcomes. First, doctors with higher Big Five and Perry Public Sector Motivation scores attend work more and falsify inspection reports less. Second, health inspectors who score higher on these personality measures exhibit a larger treatment response to increased monitoring. Last, senior health officials with higher Big Five scores are more likely to respond to a report of an under-performing facility by compelling better subsequent staff attendance.
Callen, Michael, Suresh De Mel, Craig McIntosh, and Christopher Woodruff. 2015. “What are the Headwaters of Formal Savings? Experimental Evidence from Sri Lanka”.Abstract
When households increase their deposits in formal bank savings accounts, what is the source of the money? We combine high-frequency surveys with an experiment in which a Sri Lankan bank used mobile Point-of-Service (POS) terminals to collect deposits directly from households each week. In this context, the headwaters of formal savings are to be found in sacrificed leisure time: households work more, and work more on the wage market when savings options improve. These results suggest that the labor allocation channel is an important mechanism linking savings opportunities to income.
Khan, Adnan Q., Asim I. Khwaja, and Benjamin A. Olken. 2015. “Tax Farming Redux: Experimental Evidence on Performance Pay for Tax Collectors”. Tax Farming Redux: Experimental Evidence of Performance Pay for Tax Collectors Appendix
Yanagizawa-Drott, David, and Thorsten Rogall. 2014. “The Legacy of Political Mass Killings: Evidence from the Rwandan Genocide”.Abstract
We study how political mass killings affect later economic performance, using data from the Rwandan Genocide. To establish causality, we build on and exploit village-level variation in reception of a state-sponsored radio station (RTLM) that explicitly, and successfully, incited killings of the ethnic Tutsi minority population. Our results show that households in villages that experienced higher levels of violence induced by the broadcasts have higher living standards six years after the genocide. They own more assets, such as land, livestock and durable goods. Output per capita from agricultural production is higher, and  consumption levels are greater. These results are consistent with the Malthusian hypothesis that mass killings can raise living standards by reducing the population size and redistributing productive assets from the deceased to the remaining population. However, we also find that the violence affected the age distribution in villages, raised fertility rates among female survivors, and reduced cognitive skills of children. Together, our results show that political mass killings can have positive effects on living standards among survivors in the short run, but that these effects may disappear in the long run.
Hanna, Rema, and Shing-yi Wang. 2014. “Dishonesty and Selection into Public Service”.Abstract
In this paper, we demonstrate that university students who cheat on a simple task in a laboratory setting are more likely to state a preference for entering public service. Importantly, we also show that cheating on this task is predictive of corrupt behavior by real government workers, implying that this measure captures a meaningful propensity towards corruption. Students who demonstrate lower levels of prosocial preferences in the laboratory games are also more likely to prefer to enter the government, while outcomes on explicit, two-player games to measure cheating and attitudinal measures of corruption do not systematically predict job preferences. We find that a screening process that chooses the highest ability applicants would not alter the average propensity for corruption among the applicant pool. Our findings imply that differential selection into government may contribute, in part, to corruption. They also emphasize that screening characteristics other than ability may be useful in reducing corruption, but caution that more explicit measures may offer little predictive power.
Khwaja, Asim Ijaz, Tahir Andrabi, and Jishnu Das. 2014. “

Report cards: the impact of providing school and child test scores on educational markets

We study the impact of providing school and child test scores on subsequent test scores, prices, and enrollment in markets with multiple public and private providers. A randomly selected half of our sample villages (markets) received report cards. This increased test scores by 0.11 standard deviations, decreased private school fees by 17 percent and increased primary enrollment by 4.5 percent. Heterogeneity in the treatment impact by initial school quality is consistent with canonical models of asymmetric information. Information provision facilitates better comparisons across providers, improves market efficiency and raises child welfare through higher test scores, higher enrollment and lower fees.
Iyer, Rajkamal, Asim Ijaz Khwaja, Erzo FP Luttmer, and Kelly Shue. 2014. “

Screening peers softly: Inferring the quality of small borrowers

This paper examines the performance of new online lending markets that rely on non-expert individuals to screen their peers’ creditworthiness. We find that these peer lenders predict an individual’s likelihood of defaulting on a loan with 45% greater accuracy than the borrower’s exact credit score (unobserved by the lenders). Moreover, peer lenders achieve 87% of the predictive power of an econometrician who observes all standard financial information about borrowers. Screening through soft or nonstandard information is relatively more important when evaluating lower quality borrowers. Our results highlight how aggregating over the views of peers and leveraging nonstandard information can enhance lending efficiency
Hanna, Rema, Vivi Alatas, Abhijit Banerjee, Benjamin A Olken, Ririn Purnamasari, and Matthew Wai-Poi. 2013. “

Ordeal mechanism in targeting: theory and evidence from a field experiment in Indonesia

This paper explores whether ordeal mechanisms can improve the targeting of aid programs to the poor ("self-targeting"). We first show that theoretically the impact of increasing ordeals is ambiguous: for example, time spent applying imposes a higher monetary cost on the rich, but may impose a higher utility cost on the poor. We examine these issues by conducting a 400-village field experiment with Indonesia’s Conditional Cash Transfer program (PKH), where eligibility is determined through an asset test. Specifically, we compare targeting outcomes from self-targeting, where villagers came to a central site to apply and take the asset test, against the status quo, an automatic enrollment system among a pool of potential candidates that the village pre-identified. Within self-targeting villages, we find that the poor are more likely to apply, even conditional on whether they would pass the asset test. Exploiting the experimental variation, we find that self-targeting leads to a much poorer group of beneficiaries than the status quo. Selftargeting also outperforms a universal asset-based automatic enrollment system that we construct using our survey data. However, while experimentally increasing the distance to the application site reduces the number of applicants, it does not differentially improve targeting. Estimating our model structurally, we show that there are large unobserved shocks in the decision to apply, and therefore increasing waiting times to 9 hours or more would be required to induce detectable additional selection. In short, ordeal mechanisms can induce self-selection, but marginally increasing the ordeal can impose additional costs on applicants without necessarily improving targeting.
Hanna, Rema, Vivi Alatas, Abhijit Banerjee, Benjamin A Olken, Ririn Purnamasari, and Matthew Wai-Poi. 2013. “

Does Elite Capture Matter? Local Elites and Targeted Welfare Programs in Indonesia

This paper investigates the impact of elite capture on the allocation of targeted government welfare programs in Indonesia, using both a high-stakes field experiment that varied the extent of elite influence and non-experimental data on a variety of existing government transfer programs. Conditional on their consumption level, there is little evidence that village elites and their relatives are more likely to receive aid programs than non-elites. Looking more closely, however, we find that this overall result masks a difference between different types of elites: those holding formal leadership positions are more likely to receive benefits, while informal leaders are actually less likely to. We show that capture by formal elites occurs during the distribution of benefits under the programs, and not during the processes when the beneficiary lists are determined by the central government. However, while elite capture exists, the welfare losses it creates appear quite small: since formal elites and their relatives are only 9 percent richer than non-elites, are at most about 8 percentage points more likely to receive benefits than non-elites, and represent at most 15 percent of the population, eliminating elite capture entirely would improve the welfare gains from these programs by less than one percent.
Yanagizawa-Drott, David, and Andreas Madestam. 2012. “Shaping the Nation: The Effect of Fourth of July on Political Preferences and Behavior in the United States”.Abstract
This paper examines whether social interactions and cultural practices affect political views and behavior in society. We investigate the issue by documenting a major social and cultural event at different stages in life: the Fourth of July celebrations in the United States during the 20th century. Using absence of rainfall as a proxy for participation in the event, we find that days without rain on Fourth of July in childhood shift adult views and voting in favor of the Republicans and increase turnout in presidential elections. The effects we estimate are highly persistent throughout life and originate in early age. Rain-free Fourth of Julys experienced as an adult also make it more likely that people identify as Republicans, but the effect depreciates substantially after a few years. Taken together, the evidence suggests that political views and behavior derive from social and cultural experience in early childhood, and that Fourth of July shapes the political landscape in the Unites States.
Yanagizawa-Drott, David, and Jakob Svensson. 2012. “Estimating Impact in Partial vs. General Equilibrium: A Cautionary Tale from a Natural Experiment in Uganda”.Abstract
This paper provides an example where sensible conclusions made in partial equilibrium are offset by general equilibrium effects. We study the impact of an intervention that distributed information on urban market prices of food crops through rural radio stations in Uganda. Using a differences-in-differences approach and a partial equilibrium assumption of unaffected urban market prices, the conclusion is the intervention lead to a substantial increase in average crop revenue for farmers with access to the radio broadcasts, due to higher farm-gate prices and a higher share of output sold to traders. This result is consistent with a simple model of the agricultural market, where a small-scale policy intervention  effects the willingness to sell by reducing information frictions between farmers and rural-urban traders. However, as the radio broadcasts were received by millions of farmers, the intervention had an aggregate effect on urban market prices, thereby falsifying the partial equilibrium assumption and conclusion. Instead, and consistent with the model when the policy intervention is large-scale, market prices fell in response to the positive supply response by farmers with access to the broadcasts, while crop revenues for farmers without access decreased as they responded to the lower price level by decreasing market participation. When taking the general equilibrium effect on prices and farmers without access to the broadcasts into account, the conclusion is the intervention had no impact on average crop revenue, but large distributional consequences.
Bjorkman-Nyqvist, Martina, Jakob Svensson, and David Yanagizawa-Drott. 2012. “

The market for (fake) antimalarial medicine: evidence from Uganda

Counterfeit and sub-standard antimalarial drugs present a growing threat to public health. This paper investigates the mechanisms that determine the prevalence of fake antimalarial drugs in local markets, their effects, and potential interventions to combat the problem. We collect drug samples from a large set of local markets in Uganda using covert shoppers and employ Raman spectroscopy to test for drug quality. We find that 37 percent of the local outlets sell fake antimalarial drugs. Motivated by a simple model, we conduct a market-level experiment to test whether authentic drugs can drive out fake drugs from the local market. We find evidence of such externalities: the intervention reduced prevalence of substandard and counterfeit drugs in incumbent outlets by half. We also provide suggestive evidence that misconceptions about malaria lead consumers to overestimate antimalarial drug quality, and that opportunistic drug shops exploit these misconceptions by selling substandard and counterfeit drugs. Together, our results indicate that high quality products can drive out low quality ones, but the opposite is true when consumers are less able to infer product quality.
Yanagizawa-Drott, David. 2012. “

Propaganda and conflict: theory and evidence from the Rwandan genocide

This paper investigates the role of mass media in times of conflict and state-sponsored violence. A model of collective violence is presented where mass media has the potential to increase participation in conflict by facilitating coordination, in addition to any direct effect on behavior due to content. Guided by the insights of the model, the paper uses a unique nation-wide village-level dataset from the Rwandan Genocide to estimate the impact of radio broadcasts that called for the extermination of the Tutsi minority, and are commonly believed to have played a signi…ficant role in fueling the violence. The results show that the broadcasts increased participation in the killings. They indicate that approximately 10 percent, or an estimated 51,000 perpetrators, of the participation in the violence during the Rwandan Genocide can be attributed to the effects of the radio. Violence that inherently requires more coordination, such as militia and army violence, was also more affected by the broadcasts. Together with a set of results presented in the paper, the evidence indicates that mass media can in part affect conflict by functioning as a coordination device.
Hanna, Rema, Vivi Alatas, Abhijit Banerjee, Arun G. Chandrasekhar, and Benjamin A. Olken. 2012. “Network Structure and the Aggregation of Information: Theory and Evidence from Indonesia”.Abstract
We use a unique data-set from Indonesia on what individuals know about the income distribution in their village to test theories such as Jackson and Rogers (2007) that link information aggregation in networks to the structure of the network. The observed patterns are consistent with a basic diffusion model: more central individuals are better informed and individuals are able to better evaluate the poverty status of those to whom they are more socially proximate. To understand what the theory predicts for cross-village patterns, we estimate a simple diffusion model using within-village variation, simulate network-level diffusion under this model for the over 600 different networks in our data, and use this simulated data to gauge what the simple diffusion model predicts for the cross-village relationship between information diffusion and network characteristics (e.g. clustering, density). The coefficients in these simulated regressions are generally consistent with relationships suggested in previous theoretical work, even though in our setting formal analytical predictions have not been derived. We then show that the qualitative predictions from the simulated model largely match the actual data in the sense that we obtain similar results both when the dependent variable is an empirical measure of the accuracy of a village’s aggregate information and when it is the simulation outcome. Finally, we consider a real-world application to community based targeting, where villagers chose which households should receive an anti-poverty program, and show that networks with better diffusive properties (as predicted by our model) differentially benefit from community based targeting policies.
Hanna, Rema, Sendhil Mullainathan, and Josh Schwartstein. 2012. “

Learning Through Noticing: Theory and Experimental Evidence in Farming

Existing learning models attribute failures to learn to a lack of data. We model a different barrier. Given the large number of dimensions one could focus on when using a technology, people may fail to learn because they failed to notice important features of the data they possess. We conduct a field experiment with seaweed farmers to test a model of "learning through noticing." We find evidence of a failure to notice: On some dimensions, farmers do not even know the value of their own input. Interestingly, trials show that these dimensions are the ones that farmers fail to optimize. Furthermore, consistent with the model, we find that simply having access to the experimental data does not induce learning. Instead, farmers change behavior only when presented with summaries that highlight the overlooked dimensions. We also draw out the implications of learning through noticing for technology adoption, agricultural extension, and the meaning of human capital.