migration and self protection against climate change a case study of samburu county kenya climate change will affect the livelihoods of pastoralists in arid and semi arid lands using data on agro pastoral households from northern kenya we explore whether migration of household members enhances adoption of agricultural innovations that aim to provide protection against weather shocks specifically we seek to test whether migration and adaptation are complementary mechanisms to protect the household against adverse shocks or whether they are substitutes do remittances relax capital constraints and facilitate the uptake of adaptive measures or do they render adaptation superfluous our data provide suggestive evidence that remittances from migrant household members may relax capital constraints and that remittances are an important mechanism linking migration to adoption enabling the uptake of new technologies that involve change in activities or high costs specifically migrant households adopt more adaptive measures promoting self protection and we document some support for the hypothesis that this is especially the case for high cost adaptations such as the purchasing of drought tolerant livestock these findings suggest that migration and local innovation are complementary rather than substitutive mechanisms of self protection for pastoral households in the semi arid lands of northern kenya households who have at least one member who has migrated are able to overcome barriers to employ high cost agricultural innovations through using remittances received thus enhancing their self protection against climate change related shocks

measuring racial discrimination with fair housing audits caught in the act a survey technique called a fair housing audit provides a direct measure of racial discrimination in housing this paper examines the econometric issues raised by audit data measures the discrimination uncovered by a 1981 boston study and tests hypotheses about the causes of discrimination the estimated level of discrimination is high black housing seekers are told about 30 percent fewer available housing units than are whites the hypothesis tests indicate that the primary cause of this discrimination is that housing agents illegally promote their economic interests by catering to the racial prejudice of their current or potential white customers

new parties and policy outcomes evidence from colombian local governments abstract in many democracies increasing political competition has changed the traditional party system and brought new parties into the political arena this study examines whether the presence of politicians from new parties affects the size of government measured by public spending and tax revenue the study focuses on colombian municipalities where new parties have been numerous and successful in recent years regression discontinuity estimates show that public spending and tax revenues are significantly higher in municipalities governed by a mayor from a new party using information about local politics and the features of the new parties i argue that this result is not associated with new party ideology but instead relates to new parties having lower probability of reelection which raises the incentives to increase short term rent seeking

why small centrist third parties motivate policy divergence by major parties plurality based elections between two major parties or candidates sometimes feature small cen trist third parties we modify the standard two party spatial model of policy seeking parties to incorporate a centrist third party and we show that the presence of such a party even if it has no chance of winning motivates the major parties to propose policies that are much more divergent than without the third party we derive explicit formulas for party locations at a three party equilibrium and provide necessary and sufficient conditions for existence ofthat equilibrium we show that over time the major parties can be expected to shift their policies in the same direction relative to each other but in the opposite direction relative to the minor party the predictions of this model are compared with estimates of party policy locations during appropriate periods in postwar britain for the past half century a small british party first the liberals now the liberal demo crats has occupied a policy position in between the two major british parties labour and the con servatives during much of the same period the free democrats in germany have held a similar posi tion between the social democrats and the christian democrats in addition recent american presidential elections have featured the candidates john anderson in 1980 and ross perot in 1992 and 1996 who had no realistic chance of winning and who were arguably located between the democratic and republican nom inees 1 what are the policy consequences of the existence of such small centrist parties or candidates on what political institutions do these consequences depend do these consequences benefit the policy aspirations of the centrist party or do they undermine these goals under proportional representation it is well known that a small centrist party such as the free democrats in germany may hold the balance of power bargaining with each of the major players as they attempt to form governing coalitions but in a plurality based system as in britain or the united states the consequences are far

extreme weather and civil war does drought fuel conflict in somalia through livestock price shocks climate change leads to more frequent and more intense droughts in somalia in a global context weather shocks have been found to perpetuate poverty and fuel civil conflict by relating regional and temporal variations in violent conflict outbreaks and drought incidence and severity we show that this causality is also valid for somalia at the local level we find that livestock price shocks drive drought induced conflicts through reducing the opportunity costs of conflict participation our estimation results indicate that a temperature rise of around 3 2 degree celcius corresponding to the median ipcc scenario for eastern africa by the end of the century would lower cattle prices by about 4 percent and in turn increase the number of violent conflict by about 58 percent hence climate change will further aggravate somalia s security challenges and calls for decisive action to strengthen both drought and conflict resilience especially in pastoralist and agropastoralist livelihoods

why democracies produce efficient results by applying the standard tools of microeconomic analysis i argue that democratic markets work as well as economic markets in particular i show that previous work has greatly exaggerated the existence of principal agent and informational problems in electoral markets and has drawn incorrect conclusions

field experiment tests for discrimination against hispanics in the u s rental housing market this article tests for discrimination against hispanics in the u s rental housing market using e mail correspondence with landlords advertising units online we divide hispanics into two groups those that appear assimilated into american culture and recent immigrants we find little difference in the treatment of assimilated hispanics and whites however hispanics we portray as recent immigrants receive less favorable treatment with margins of net discrimination as large as 6 89 of landlords we also find discrimination varies significantly at the region level and by the ethnic composition of neighborhoods

the limits of political compromise debt ceilings and political turnover we study the desirability of limits on the public debt and of political turnover in an economy where incumbents have an incentive to set public expenditures above the socially optimal level due to rent seeking motives parties alternate in office and cannot commit to future policies but they can forge a political compromise where each party curbs excessive spending when in office if it expects future governments to do the same in contrast to the received literature we find that strict limits on government borrowing can exacerbate political economy distortions by making a political compromise unsustainable this tends to happen when political turnover is limited conversely a tight limit on the public debt fosters a compromise that yields the efficient outcome if political turnover is vigorous our analysis thus suggests that to sustain good economic policies a society needs to restrict either the extent of political turnover or the ability of governments to issue debt but not both

disability discrimination in the italian rental housing market a field experiment with blind tenants i test discrimination against blind tenants assisted by guide dogs in the italian rental housing market by using fake application letters i compare three fictitious household tenants married couples married couples where the wife is blind and owns a guide dog and married couples where the normal sighted wife owns a normal dog i find that the households with a blind wife are invited less often to visit apartments they applied for because of the presence of their guide dog using the language of italian and e u laws this behavior is called indirect discrimination against disabled people this result is robust jel r21

political economy of public policies insights from distortions to agricultural and food markets the agricultural and food sector is an ideal case for investigating the political economy of public policies many of the policy developments in this sector since the 1950s have been sudden and transformational while others have been gradual but persistent this paper reviews and synthesizes the literature on trends and fluctuations in market distortions and the political economy explanations that have been advanced based on a rich global data set covering a half century of evidence on commodities countries and policy instruments the paper identifies hypotheses that have been explored in the literature on the extent of market distortions and the conditions under which reform may be feasible

nonfarm income diversification and household livelihood strategies in rural africa concepts dynamics and policy implications abstract asset activity and income diversification lie at the heart of livelihood strategies in rural africa this paper introduces a special issue on the topic income diversification and livelihoods in rural africa cause and consequence of change we concentrate on core conceptual issues that bedevil the literature on rural income diversification and the policy implications of the empirical evidence presented in this special issue

divided we reform evidence from us welfare policies abstract divided government is often thought of as causing legislative deadlock i investigate the link between divided government and economic reforms using a novel data set on welfare reforms in us states between 1978 and 2010 panel data regressions show that under divided government a us state is around 25 more likely to adopt a welfare reform than under unified government several robustness checks confirm this counter intuitive finding case study evidence suggests an explanation based on policy competition between governor senate and house

does tax competition tame the leviathan abstract we study the impact of tax competition on equilibrium taxes and welfare focusing on the jurisdictional fragmentation of federations in a representative agent model of fiscal federalism fragmentation among jurisdictions with benevolent tax setting authorities unambiguously reduces welfare if however tax setting authorities pursue revenue maximization fragmentation by pushing down equilibrium tax rates may under certain conditions increase citizen welfare we exploit the highly decentralized and heterogeneous swiss fiscal system as a laboratory for the estimation of these effects while for purely direct democratic jurisdictions which we associate with relatively benevolent tax setting we find that tax rates increase in fragmentation fragmentation has a moderating effect on the tax rates of jurisdictions with some degree of delegated government our results thereby support the view that tax competition can be second best welfare improving by constraining the scope for public sector revenue maximization

poverty traps and index based risk transfer products summary a growing literature suggests that in low income countries households with few assets can be trapped in chronic poverty this article reviews relevant threads of the poverty traps literature to motivate a description of the opportunities presented by innovative index based risk transfer products these products can be used to address some insurance and credit market failures that contribute to the persistence of poverty among households in low income countries applications are considered at the micro meso and macro levels 2008 elsevier ltd all rights reserved

do barriers to candidacy reduce political competition evidence from a bachelor s degree requirement for legislators in pakistan in the 2002 election candidates for pakistan s federal legislature had to possess at least a bachelor s degree this policy disqualified 60 out of the 207 incumbent legislators from running for election again using a difference in differences approach with panel data on all electoral constituencies in pakistan i find that this ballot access restriction does not affect political competition across all constituencies with disqualified incumbents equally stronger political competition is defined as a larger number of candidates contesting election a smaller vote share and vote margin for the winning candidate and a less concentrated candidate field as measured by a herfindahl hirschman index hhi of vote shares competition declined significantly in constituencies where the disqualified incumbent belonged to a small party and where literacy levels were lower signifying a smaller pool of substitute candidates however political competition increased in areas where the disqualified incumbent was stronger in terms of his winning vote margin

do land revenue windfalls create a political resource curse evidence from china abstract by analyzing a panel on the political turnovers of 4390 county leaders in china during 1999 2008 we find that the revenue windfalls accrued to these officials from land sales have undermined the effectiveness of the promotion system for government officials instead of rewarding efforts made to boost gdp growth promotion is positively correlated with signaling efforts and with corruption the robust positive relationship between land revenue windfalls and political turnover or specifically promotion suggests that those who are politically connected to their superiors and those beyond the prime age for promotion are the primary beneficiaries the case for corruption is substantiated by the evidence inferred from anti corruption crackdowns which reveals that the additional effect of land revenue on political turnover and size of bureaucracy a proxy for corruption decreases significantly in crackdowns but that land revenue has no effect on city construction expenditure a proxy for signaling

welfare dynamics in rural kenya and madagascar this paper presents comparative qualitative and quantitative evidence from rural kenya and madagascar in an attempt to untangle the causality behind persistent poverty we find striking differences in welfare dynamics depending on whether one uses total income including stochastic terms and inevitable measurement error or the predictable structural component of income based on a household s asset holdings our results suggest the existence of multiple dynamic asset and structural income equilibria consistent with the poverty traps hypothesis furthermore we find supporting evidence of locally increasing returns to assets and of risk management behaviour consistent with poor households defence of a critical asset threshold through asset smoothing

the effect of the expansion of the voting franchise on the size of government this paper examines the claim that expansion of the voting franchise has been an important factor in the growth of government state government spending and state and local spending are explained using a panel of 46 states for 1950 88 elimination of poll taxes and literacy tests led to higher turnout particularly among the poor and a poorer pivotal voter as predicted we find that these changes a fall in the income of voters relative to state income and the ouster of republicans from state government led to a sharp rise in welfare spending but no change in other spending

a field experiment of discrimination in the norwegian housing market gender class and ethnicity we test for gender class and ethnic discrimination in the norwegian rental housing market by using fake application letters females individuals with high job status and ethnic norwegians are more likely to receive positive responses for example being an arabic man and working in a warehouse is associated with a 25 percentage point lower probability of receiving a positive response when showing interest in an apartment as compared to an ethnically norwegian female economist we conclude that gender class and ethnic discrimination do exist in the norwegian housing market and ethnic discrimination seems to be the most prevalent form of discrimination jel r21

political uncertainty and public financing costs evidence from u s gubernatorial elections and municipal bond markets this research investigates how political uncertainty around u s gubernatorial elections in uences the borrowing costs of public debt measured by yields of municipal bonds our evidence from both the new issuance market and the secondary market shows that yields of municipal bonds increase sharply by 6 to 8 basis points before elections and then reverse afterward elections have more pronounced impact during economic downturns when outcomes are less predictable and when states have more outstanding debt several state institutions such as gaap budgeting spending limits and tax increase limits help to mitigate the adverse impact of political uncertainty

tax limits and local elections this paper exploits variation in tax limits across over 7000 italian municipalities during the 2000s to investigate their impact on voter turnout and local election outcomes the empirical analysis is based on a panel data estimator on about 14 000 municipal elections during the 2001 2010 decade and on a quasi experimental approach focusing on the fiscal limitation treatment of municipalities local income surcharge freeze in the years 2001 and 2006 where the trajectory of local turnout in the concurrent general elections is used as the counterfactual the evidence suggests that tax limits provoke a a modest fall in voter turnout in mayoral elections b a mild decrease in the number of mayoral candidates c a sizeable widening of elected mayors win margins and some improvement in mayors valence proxies the evidence is compatible with the hypothesis that the imposition of tax limits lowers the ideological stakes of local elections favors party line crossing and promotes vote convergence based on the valence of candidates

electoral rules political competition and fiscal expenditures regression discontinuity evidence from brazilian municipalities we exploit a discontinuity in the rules of brazilian mayoral elections to investigate whether political competition has a causal impact on fiscal policy choices in municipalities with fewer than 2

the impact of ballot access restrictions on electoral competition evidence from a natural experiment measuring the effect of ballot access restrictions on electoral competition is complicated because the stringency of ballot access regulations cannot be treated as being exogenous to candidates entry decisions this paper exploits the 1968 u s supreme court decision to strike down ohio s ballot access law as a natural experiment to overcome the endogeneity problem the evidence from difference in difference estimations suggests that the court s decision and the accompanying sharp decrease in ohio s petition requirements resulted in major parties facing a significant increase in competition from third party and independent candidates

pathways into and out of poverty a study of rural household wealth dynamics in kenya this study identifies the factors associated with smallholder farm households that have risen out of poverty or descended into poverty between 1997 and 2007 in kenya the study uses data from a nationwide balanced panel of 1 275 households and data from detailed retrospective life history survey of 84 households that had experienced either an appreciable improvement or decline in their asset wealth over the 10 year panel period the results indicate that household welfare dynamics are associated with a disparate set of idiosyncratic and unexpected shocks such as death and chronic illness demographic factors proximity to infrastructural facilities as well as intergenerational wealth transfers

competition in the political arena and local government performance competition reduces rent extraction in private sector firms in this article we empirically assess whether it similarly disciplines politicians by evaluating local level governments performance in flanders the results indicate that electoral competition measured via the number of parties competing in elections significantly positively affects the productive efficiency of municipal policy intertemporal competition measured as the volatility of election outcomes over time has a similar but weaker positive effect these beneficial effects are mitigated by the fact that competition may lead to more fragmented governments which is shown to work against their productive efficiency overall though the beneficial effects outweigh the unfavourable ones in our sample

does electoral accountability affect economic policy choices evidence from gubernatorial term limits this paper analyzes the behavior of u s governors from 1950 to 1986 to investigate a reputation building model of political behavior we argue that differences in the behavior of governors who face a binding term limit and those who are able to run again provides a source of variation in discount rates that can be used to test a political agency model we find evidence that taxes spending and other policy instruments respond to a binding term limit if a democrat is in office the result is a fiscal cycle in term limit states which lowers state income when the term limit binds

the visible hand race and online market outcomes we examine the effect of race on market outcomes by selling ipods through local online classified advertisements throughout the us each advertisement features a photograph including a dark or light skinned hand or one with a wrist tattoo black sellers receive fewer and lower offers than white sellers and the correspondence with black sellers indicates lower levels of trust black sellers outcomes are particularly poor in thin markets suggesting that discrimination may not survive competition among buyers and those with the most racial isolation and property crime consistent with channels through which statistical discrimination might operate economic outcomes in the us are highly correlated with race but the causal mechanisms underlying these correlations are not well understood in particular it remains unclear how much of the correlation is due to discrimination and how much is due to other characteristics that are correlated with race such as education there is an extensive literature on the effect of race on market outcomes focusing on both labour and goods including housing markets however discrimination is not a monolithic phenomenon and it is important to investigate its extent and causes in a variety of different contexts across which they may differ our study asks the following question when the typical person engages in a consumer transaction usually as a buyer does he or she try to avoid dealing with minority sellers and does she treat minority sellers differently

do landlords discriminate in the rental housing market evidence from an internet field experiment in us cities abstract this paper tests for racial discrimination in the rental housing market using matched pair audits conducted via e mail for rental units advertised on line we reveal home seekers race to landlords by sending e mails from names with a high likelihood of association with either whites or african americans generally discrimination occurs against african american names however when the content of the e mail messages insinuates home seekers with high social class discrimination is non existent racial discrimination is more severe in neighborhoods that are near tipping points in racial composition and for units that are part of a larger building

lobbying political competition and local land supply recent evidence from spain abstract we analyze whether local land supply is influenced by the degree of political competition and interpret the findings as indications of the influence wielded by land developer lobbies we use a new database including both political and land supply data for more than 2 000 spanish municipalities for the period 2003 2007 in spain land use policies are largely a local responsibility with municipalities needing periodically to pass comprehensive land use plans the main policy variable in these plans and the one analyzed here is the amount of land classified for potential development we measure local political competition as the margin of victory of the incumbent government this variable is however potentially endogenous since not only do votes affect policy but also policy is expected to affect votes to deal with this problem we instrument this variable using the votes at the first national legislative elections following the re establishment of democracy and votes actually obtained regionally at the same type of election the results indicate that stiffer political competition does indeed reduce the amount of new land designated for development this effect is found to be most marked in suburbs in towns with a high percentage of commuters and homeowners and in municipalities governed by the left

decomposing producer price risk a policy analysis tool with an application to northern kenyan livestock markets abstract this paper introduces a simple method of price risk decomposition that determines the extent to which producer price risk is attributable to volatile inter market margins intra day variation intra week day of week variation or terminal market price variability we apply the method to livestock markets in northern kenya a setting of dramatic price volatility where price stabilization is a live policy issue in this particular application we find that large variable inter market basis is the most important factor in explaining producer price risk in animals typically traded between markets local market conditions explain most price risk in other markets in which traded animals rarely exit the region variability in terminal market prices accounts for relatively little price risk faced by pastoralists in the dry lands of northern kenya although this is the focus of most present policy prescriptions under discussion

traps and thresholds in pastoralist mobility this article presents a new approach to identifying poverty traps in east african pastoralist communities a flexible semiparametric estimation procedure is used to identify a bifurcation in the propensity to engage in the asset based mobile herding livelihood in comparison to the sedentary alternative as a function of herd size the identified threshold is consistent with previous evidence on poverty traps based on modeling herd stock dynamics the approach contributes to an emerging literature that seeks to identify poverty traps through testing the implications of the posited behavioral mechanism behind the trap as opposed to directly modeling asset dynamics the approach is further employed to provide complementary evidence on the relationship between ability and assets in sustaining mobile pastoralism

housing booms and local spending abstract this paper examines how local governments adjust their spending in response to a temporary revenue windfall generated by a housing boom we focus on spanish local governments because of the intensity of the last housing boom bust experienced there and the large share of construction related revenues they obtain we find that windfall revenues were mostly used to increase expenditures above all current we seek to determine whether this behaviour was due to political myopia incumbents in contested elections increasing expenditures to convince uninformed voters about their competence or to extrapolation bias leading to the overstatement of the persistence of revenue shocks we find evidence for both mechanisms the propensity to spend is higher where local incumbents were elected by a narrow vote margin and lower in places with past volatility experience finally we also examine what happens during the bust and find that governments enjoying large windfalls during the boom had to cut their spending abruptly above all capital and raise taxes the adjustment during the bust was actually greater in those places that overspent more during the crisis

are emily and greg more employable than lakisha and jamal a field experiment on labor market discrimination we study race in the labor market by sending fictitious resumes to help wanted ads in boston and chicago newspapers to manipulate perceived race resumes are randomly assigned african american or white sounding names white names receive 50 percent more callbacks for interviews callbacks are also more responsive to resume quality for white names than for african american ones the racial gap is uniform across occupation industry and employer size we also find little evidence that employers are inferring social class from the names differential treatment by race still appears to still be prominent in the u s labor market jel j71 j64

higher pay worse outcomes the impact of mayoral wages on local government quality in peru abstract in this paper i study how wages earned by local politicians affect local government quality to identify the effects i use caps imposed by the peruvian central government on mayoral wages as an excluded instrument the results show that mayoral wages do not improve government performance in particular there is a negative impact on public investment implementation and on performance goals set by the central government moreover there is no evidence of a positive effect on politician selection municipal bureaucratic capacity and political effort wages do strongly affect the local political landscape increasing political competition and reducing political support for the mayor these changes may help explain the drop in performance as local authorities may face more political obstacles when implementing their policy agenda overall the results show that higher politician wages need not improve local government quality

confronting the risk of asset loss what role do livestock transfers in northern kenya play abstract in many low income high risk environments households participate in informal risk sharing institutions involving inter household transfers this study focuses on asset transfers and asset risk the influence of past behavior on access to transfers and wealth differentiated transfer behavior panel data on livestock transfers in northern kenya are analyzed three explanations of livestock transfers are investigated ex post insurance ex ante precautionary savings and redistribution findings indicate that livestock transfers are of limited effectiveness in addressing asset risk and avoiding poverty the findings have implications for both research on risk sharing institutions and for the design of development policies in pastoral areas

terrorism and attitudes towards minorities the effect of the theo van gogh murder on house prices in amsterdam abstract does fundamentalist islamic terrorism have an effect on the general attitudes towards muslim minorities we use the murder of theo van gogh as an event study to address this question specifically we use the hedonic market model and test for an effect on listed house prices in neighborhoods where more than 25 of the people belong to an ethnic minority from a muslim country type i relative to the other neighborhoods house prices in type i neighborhoods decreased in 10 months by about 3 with a widening gap over time our results are robust to several adjustments including using synthetic control groups finally we find evidence that segregation increased people belonging to the muslim minority were more likely to buy and less likely to sell a house in a type i neighborhood after the murder than before

income and asset poverty among pastoralists in northern kenya abstractin this study we use household panel data collected in marsabit district of northern kenya to analyse the patterns of livelihood sources and poverty among pastoralists in that area we estimate income poverty using imputed household income relative to the adjusted poverty line and asset poverty using a regression based asset index and tropical livestock units tlu per capita our results indicate that keeping livestock is still the pastoralists main source of livelihood although there is a notable trend of increasing livelihood diversification especially among livestock poor households the majority of households over 70 are both income and livestock poor with few having escaped poverty within the five year study period disaggregating income and asset poverty also reveals an increasing trend of both structurally poor and stochastically nonpoor households the findings show that the tlu based asset poverty is a more appropriate measure of asset poverty in a pastoral setting

a drawback of electoral competition in most major democracies there are very few parties compared to the number of possible policy positions held by voters we provide an efficiency rationale for why it might be appropriate to limit the proliferation of parties in our model the larger the number of parties the greater the inefficiency of the outcome of electoral competition the reason is that when the number of parties increases electoral incentives push each party to focus its electoral promises on a narrower constituency and then special interest policies replace more efficient policies that have diffuse benefits the analysis provides a possible explanation for the existence of institutional features that limit the extent of electoral competition thresholds of exclusion runoff electoral systems and majoritarian two party political systems jel d82 l15

political competition policy and growth theory and evidence from the us this paper develops a simple model to analyse how a lack of political competition may lead to policies that hinder economic growth we test the predictions of the model on panel data for the us states in these data we find robust evidence that lack of political competition in a state is associated with anti growth policies higher taxes lower capital spending and a reduced likelihood of using right to work laws we also document a strong link between low political competition and low income growth

independent candidates and political representation in india we estimate the causal effect of independent candidates on voter turnout and election outcomes in india to do this we exploit exogenous changes in the entry deposit candidates pay for their participation in the political process changes that disproportionately excluded candidates with no affiliation to established political parties a one standard deviation increase in the number of independent candidates increases voter turnout by more than 6 percentage points as some voters choose to vote rather than stay home the vote share of independent candidates increases by more than 10 percentage points as some existing voters switch who they vote for thus independents allow winning candidates to win with less vote share decrease the probability of electing a candidate from the governing coalition by about 31 percentage points and ultimately increase the probability of electing an ethnic party candidate altogether the results imply that the price of participation by independents is constituency representation in government

the political economy of government responsiveness theory and evidence from india the determinants of government responsiveness to its citizens is a key issue in political economy here we develop a model based on the solution of political agency problems having a more informed an politically active electorate strengthens incentives for governments to be responsive this suggests that there is a role both for democratic institutions and the mass media in ensuring that the preferences of citizens are reflected in policy the ideas behind the model are tested on panel data from india we show that public food distribution and calamity relief expenditure are greater controlling for shocks where governments face greater electoral accountability and where newspaper circulation is highest

the countervailing effects of competition on public goods provision when bargaining inefficiencies lead to bad outcomes political competition is widely recognized as a mediator of public goods provision through its salutary effect on incumbents electoral incentives we argue that political competition additionally mediates public goods provision by reducing the efficiency of legislative bargaining these countervailing forces may produce a net negative effect in places with weak parties and low transparency typical of many young democracies we provide evidence of a robust negative relationship between political competition and local public goods using panel data from mali tests of mechanisms corroborate our interpretation of this relationship as evidence of legislative bargaining inefficiencies to explore the generalizability of these findings we analyze cross country panel data and show that political competition leads to better worse public goods provision under high low levels of party system institutionalization the paper sheds light on why political competition is only selectively beneficial and underscores the importance of considering both the electoral and legislative arenas

understanding declining mobility and inter household transfers among east african pastoralists we model interhousehold transfers between nomadic livestock herders as the state dependent consequence of individuals strategic interdependen ce resulting from the existence of multiple opposing externalities a public good security ext ernality among individuals sharing a social e g ethnic identity in a potentially hostile en vironment creates incentives to band together self interested interhousehold wealth transfers fro m wealthier herders to poorer ones may emerge endogenously within a limited wealth space as a mea ns to motivate accompanying migration by the recipient the distributional reach and size o f the transfer are limited however by a resource appropriation externality related to the use of com mon property grazing lands when this effect dominates it can induce transfers from households who want to relieve grazing pressures caused by others herds our model augments the extant li terature on transfers and is perhaps more consistent with the limited available empirical evi dence on heterogeneous and changing transfers patterns among east african pastoralists the core principles of our model possibly apply more broadly for example to long distance migrants or e ven among foot soldiers in street gangs

discrimination in a deprived neighbourhood an artefactual field experiment abstract we present a field experiment designed to examine the discriminatory motives of an understudied demographic the poorest people in england subjects are first asked to divide 10 between two strangers and then play a 10 dictator game with another stranger we subtly vary the ethnicity of the receivers by providing subjects with surnames randomly drawn from the electoral register including treatments that allow us to parse behaviour into either in group favouritism or out group negativity an important behavioural distinction that is typically overlooked in the discrimination literature our results suggest that the observed discriminatory attitudes are the result of out group negativity rather than in group favouritism we advance the literature on discrimination through the estimation of a structural model of group contingent social preferences which we exploit to perform counterfactual simulations our results provide insights into the behaviour of this unique demographic and provide a rationale for why they may support discriminatory policies in their voting behaviour

explaining variation in the competitiveness of u s senate elections 1922 2004 we develop and test predictions about the factors determining the competitiveness of elections to the u s senate to do so we deliberately abstract away from candidate specific conditions that have often been used to study political competitiveness in order to focus on basic structural features of the electoral landscape in our framework party specific constraints on the ideological positioning of local candidates linked to the national party organization and its contributors interact with the heterogeneity of state electorates to determine the number of highly competitive senate contests three hypotheses emerge from this model 1 the greater the diversity of a party s national legislative delegation the more highly competitive senate elections we will observe 2 states in which the ideological heterogeneity of the electorate is relatively high will exhibit a greater number of highly competitive elections and 3 highly competitive senate contests will be more common in states with closed primaries than in states with open primaries we provide strong evidence in support of the first two hypotheses and some evidence in support of the third

growth and energy nexus in europe revisited evidence from a fixed effects political economy model this is an empirical study on the causal relationship between economic growth and energy for 26 european countries in a multivariate panel framework over the period 1975 2009 using a two way fixed effects model and including greenhouse gas emissions capital fossil energy consumption herfindahl index political competition and number of years the government chief executive stays in office political stability as independent variables in the model empirical results confirm bidirectional causality between growth and political stability capital and political stability capital and fossil energy consumption whether political stability favors the implementation of growth or leads to corruption demands further research

can discrimination in the housing market be reduced by increasing the information about the applicants we investigate how increasing the information about applicants affects discrimination in the rental housing market we let four fictitious applicants two with typical arab muslim names and two with typical swedish names use application letters containing different amounts of information to apply for apartments over the internet in sweden the arab muslim applicants received fewer responses from the landlords than did the swedish applicants all of the applicants gained by providing more information about themselves but the amount of discrimination against the arab muslim applicants remained unchanged indicating that increasing the amount of information about the applicants will not reduce discrimination

field experiments of discrimination in the market place controlled experiments using matched pairs of bogus transactors to test for discrimination in the marketplace have been conducted for over 30 years and have extended across 10 countries significant persistent and pervasive levels of discrimination have been found against non whites and women in labour housing and product markets rates of employment discrimination against non whites in excess of 25 have been measured in australia europe and north america a small number of experiments have also investigated employment discrimination against the disabled in britain and the netherlands and against older applicants in the united states

when the levee breaks black migration and economic development in the american south abstract in the american south postbellum economic development may have been restricted in part by white landowners access to low wage black labor this paper examines the impact of the great mississippi flood of 1927 on black out migration and subsequent agricultural development flooded counties experienced an immediate and persistent out migration of black population over time landowners in flooded counties modernized agricultural production and increased its capital intensity relative to landowners in nearby similar non flooded counties landowners resisted black out migration however benefiting from the status quo system of labor intensive agricultural production jel j15 j43 n32 n52 n92 q54 r23

do countries compensate firms for international wage differentials we address the role of labor cost differentials for national tax policies modeling a tax competition race between two countries competing for a population of mobile firms we show that in equilibrium the high wage country charges a lower tax than the low wage country moreover under tax competition the high wage country attracts more firms than in a setting without taxation exploiting exogenous variation in labor cost differentials induced by the breakdown of communism in eastern europe we find that tax policies are in line with the model prediction our most conservative estimates suggest that a one dollar increase in the compensation cost differential in prices as of 2000 triggers a cut of the statutory corporate income tax rate by about one percentage point

differential risk exposure and stochastic poverty traps among east african pastoralists in the pastoraland agropastoralsystems of east africa s arid and semi arid lands asal climatic shocks price volatility disease outbreaks and widespread violence beget frequent disruption of already fragile livelihoods last year s drought dramatically demonstrates that intense suffering recurs regularly in the asal in spite of significant humanitarian aid flows this article explores why that might be we draw on preliminary results of an ongoing quarterly survey in six sites in northern kenya seventeen years herd history data collected from boran pastoralists in southern ethiopia desta five years seasonaldata on land use and herd management decisions among gabra pastoralists in northern kenya mcpeak 2000a b and three years transactions level data on livestock markets in northern kenya barrett et al in the interest of brevity we present only a synthesis of findings from these and related studies that suggest how differences in pastoralists ubiquitous risk exposure create and sustain structuralpoverty traps from which many asal pastoralists are having a difficult time escaping

the economic consequences of political donation limits the economic consequences of limits on political donations depend on the degree of political competition donors who are ideologically aligned with candidates decide how much to contribute to their own candidate they may benefit from rent seeking by their own candidate but dislike rent seeking by the opposition increased rent seeking by politicians thus generates campaign contributions for themselves but also mobilizes donations to the opposing candidate potentially to a greater extent this latter effect acts as a deterrent to rent seeking when contributions finance electoral campaigns and positively affect election chances when political competition is low incumbent donors outnumber opposition donors and limits reduce rent seeking when political competition is high donors are equalized and laissez faire reduces rent seeking consistent with these hypotheses data from the us states suggest that limits are associated with better policies and stronger growth performance at low levels of political competition whilst laissez faire is preferred when political competition is high

institutional determinants of new firm entry in russia a cross regional analysis we investigate how the regional institutional environment in particular the political environment affects russian new firm entry across regions industries firm size classes and time we find that entry rates in russia are explained by natural entry rates and the institutional environment industries that are characterized by low entry barriers in developed market economies are found to have lower entry rates in regions subject to greater political fluidity as in the case of gubernatorial change we also find that higher levels of political fluidity and democracy increase relative entry rates for small sized firms but reduce them for medium sized or large ones

income diversification poverty traps and policy shocks in cote d ivoire and kenya abstract this paper presents evidence on the effects of two different sorts of policy shocks on observed income diversification patterns in rural africa in cote d ivoire households with poor endowments were less able to respond to attractive emerging on farm and non farm opportunities due to entry barriers to superior livelihood strategies the benefits of exchange rate reform accrued disproportionately to households that were richer prior to devaluation by contrast food for work transfers to households in kenya significantly reduced liquidity constraints enabling project participants to pursue more lucrative livelihood strategies in non farm activities and higher return agricultural production patterns jointly these two shocks underscore the importance of liquidity market access and skill constraints to skilled non farm income sources to dynamic poverty traps in rural africa

no longer trapped promoting entrepreneurship through cash transfers to ultra poor women in northern kenya we examine the short to medium run impacts of the rural entrepreneur access program a poverty graduation program that promotes entrepreneurship among ultra poor women in arid and semi arid northern kenya a context prone to poverty traps the program relies on cash transfers rather than asset transfers in addition to business skills training business mentoring and savings participation in each of the program s three rounds was randomly determined through a public lottery in the short to medium run we find that the program has a positive and significant impact on income savings and asset accumulation similar to more traditional poverty graduation programs that rely on asset transfers

political competition and economic growth a test of two tales abstract we empirically compare the thesis of acemoglu and robinson 2006 that the impact of political competition on economic growth is non monotonic with that of besley et al 2010 that it is monotonically increasing using data on 119 economies in the period 1980 2010 the results are in accord with acemoglu and robinson 2006

economic backwardness in political perspective government policies and institutions shape economic incentives and via this channel have a first order impact on economic development why then do many societies adopt policies that discourage investment and maintain institutions that cause economic backwardness perhaps politically powerful groups elites are not in favor of economic growth but why it would appear that economic growth would provide more resources for these groups to take over or tax increasing their economic returns so why don t powerful groups always support economic development in this paper we develop a theory of inefficient government policies and institutions all else equal politically powerful groups would welcome superior institutions and technologies but in practice all else is not equal because superior institutions and technologies may reduce their political power and make it more likely that they will be replaced at the center of our theory is therefore the idea that changes in institutions or the introduction of new technologies often create turbulence eroding the political advantages and future economic rents of incumbent elites alternatively new technologies may enrich competing groups increasing their threat to incumbents these considerations make politically powerful groups fear losing power and oppose economic and political change even when such change will benefit society as a whole to understand the mechanism at work and its potential applications consider a concrete example industrialization in the nineteenth century bairoch 1982 estimates that between 1830 and 1913 world manufacturing output increased by a factor of 5 see table 1 panel a nevertheless this process was highly uneven across regions and countries bairoch also calculates that over the same period manufacturing output in developed countries europe and north america increasedbyafactorofover10 whereasitdeclinedinthe third world among developed countries there were

cattle markets integration and price discovery the case of mali abstractthis article analyses the level of integration in 10 cattle markets in mali the results indicate a limited interdependence among markets where in majority of cases more than 70 per cent of price variation is due to own price shocks however the segou market exhibited a high level of interaction with other markets behaving mostly as a price information receiver some markets behaved as sources of price information however without taking a clear price leadership role this low level of market integration may be attributed to limited access to livestock markets and timely price information

stochastic wealth dynamics and risk management among a poor population we use herd history data collected among pastoralists in southern ethiopia to study stochastic wealth dynamics among a poor population although covariate rainfall shocks plainly matter household specific factors including own herd size account for most observed variability in wealth dynamics we find no support for the tragedy of the commons hypothesis past studies may have conflated costly self insurance with stocking rate externalities biophysical shocks move households between multiple dynamic wealth equilibria the lowest suggesting a poverty trap according to nonconvex path dynamics these findings have broad implications for development and relief strategies among a poor population vulnerable to climatic shocks a vast economic literature on risk management rests explicitly or implicitly on the classic friedmanite permanent income hypothesis studies of portfolio management consumption smoothing social insurance and the like all depend on the canonical assumption that stochastic income realisations are drawn from a stationary income distribution leading to consumption smoothing off a stable asset base the possibility of asset accumulation connects this literature to the immense literature on the theory and empirics of economic growth

a field study of rental market discrimination across origins in france abstract discrimination against particular groups in the housing market increases search costs and limits optimal matching thus resulting in economic and social inefficiencies this paper tests for the existence of discrimination in the french rental market against individuals with names which signal their connection to five immigrant groups northern africa sub saharan africa turkey poland portugal spain by implementing an online field study using one of france s largest online advertisements website the results show that applicants with foreign sounding names coming from northern africa sub saharan africa and turkey are 16 to 22 percentage points less likely to receive a response than applicants with french names or names associated with poland portugal or spain in addition when applicants with foreign sounding names from any origin receive a response it is significantly more likely to be negative or include a request for more information than responses to emails including french sounding names finally we find some geographic differences in response rate differentials that are correlated with differences in the local income and share of immigrants this provides evidence that landlords use names as a proxy for economic and other sociodemographic characteristics

when faced with income and asset shocks do poor rural households in vietnam smooth food consumption or assets abstractvietnamese rural households are exposed to severe covariate and idiosyncratic shocks however these households are remarkably resilient and have steadily increased real income and consumption over the survey period 2006 to 2012 to explain household strategies to cope with shocks we test three theoretical models the permanent income hypothesis pih complete market hypothesis cmh and asset smoothing theory ast there is support for ast as households smooth productive assets rather than consumption and for cmh as households smooth consumption against idiosyncratic but not covariate shocks there is no support for pih

political competition with campaign contributions and informative advertising this paper presents a theory of political competition with campaign contributions and informative political advertising policy motivated parties compete by selecting candidates and interest groups provide contributions to enhance the electoral prospects of like minded candidates contributions are used to finance advertising campaigns that provide voters with information about candidates ideologies voters update their beliefs rationally given the information they have received the paper uses the theory to analyze the welfare economics of contribution limits such limits are shown to redistribute welfare from ordinary citizens to members of interest groups jel d72 h40

traps and sustainable development in rural areas a review summary the concept of a poverty trap commonly understood as a self reinforcing situation beneath an asset threshold has been very influential in describing the persistence of poverty and the relationship between poverty and sustainability although traps and the dynamics that lead to traps are defined and used differently in different disciplines the concept of a poverty trap has been most powerfully shaped by work in development economics this perspective is often constraining because as many studies show poverty arises from complex interactions between social and environmental factors that are rarely considered in development economics a more integrated understanding of poverty traps can help to understand the interrelations between persistent poverty and key social and ecological factors facilitating more effective development interventions the aim of this paper is to provide a critical appraisal of existing trap conceptualizations in different disciplines and to assess the characteristics and mechanisms that are used to explain poverty traps in rural contexts thereby broadening the traps concept to better account for social ecological interactions complementarities and tensions among different disciplinary perspectives on traps are identified and our results demonstrate that different definitions of traps share a set of common characteristics persistence undesirability and self reinforcement yet these minimum conditions are not sufficient to understand how trap dynamics arise from complex social ecological interactions to broaden the utility of the concept we propose a more social ecologically integrated definition of traps that includes four additional considerations cross scale interactions path dependencies the role of external drivers and social ecological diversity including these wider dimensions of trap dynamics would help to better account for the diverse social ecological feedbacks that produce and maintain poverty traps and could strengthen strategies to alleviate poverty in a more integrated way

are we witnessing a paradigm shift in the analysis of political competition this presidential address assesses the crisis of the downsian model of political competition in light of the mounting evidence on policy divergence and evaluates the possibility that the new theories of politicians quality and political selection provide an alternative theoretical conceptualization of political competition based on a critical review of the literature and on the author s works on content analysis of policy speeches income redistribution politicians quality and political legislation cycles this address concludes that multidimensional downsian models of political competition are adequate to explain policy divergence and points out the serious theoretical and empirical problems that models of political selection have to solve

government size and growth a survey and interpretation of the evidence the literature on the relationship between the size of government and economic growth is full of seemingly contradictory findings this conflict is largely explained by variations in definitions and the countries studied an alternative approach of limiting the focus to studies of the relationship in rich countries measuring government size as total taxes or total expenditure relative to gdp and relying on panel data estimations with variation over time reveals a more consistent picture the most recent studies find a significant negative correlation an increase in government size by 10 percentage points is associated with a 0 5 to 1 percent lower annual growth rate we discuss efforts to make sense of this correlation and note several pitfalls involved in giving it a causal interpretation against this background we discuss two explanations of why several countries with high taxes seem able to enjoy above average growth one hypothesis is that countries with higher social trust levels are able to develop larger government sectors without harming the economy another explanation is that countries with large governments compensate for high taxes and spending by implementing market friendly policies in other areas both explanations are supported by ongoing research

chiefs economic development and elite control of civil society in sierra leone we study the effect of constraints on chiefs power on economic outcomes citizens attitudes and social capital a paramount chief in sierra leone must come from a ruling family originally recognized by british colonial authorities in chiefdoms with fewer ruling families chiefs face less political competition and development outcomes are significantly worse today variation in the security of property rights over land is a potential mechanism paradoxically with fewer ruling families the institutions of chiefs authority are more highly respected and measured social capital is higher we argue that these results reflect the capture of civil society organizations by chiefs

the political value of land political reform and land prices in chile in this article we argue that when patron client relations are grounded in economic relationships such as between landlord and worker we should expect clientelism to influence not just how public policy the state and the political system work but also how the economy works we develop a simple model of the economic consequences of electoral clientelism when voting behavior can be observed landlords patrons provide economic rents to workers and in exchange workers vote for parties favored by landlords as votes are used by the landlords to accumulate political rents vote control increases the demand for labor and for land the model implies that the introduction of the australian ballot which destroys this form of clientelism should lead to a fall in the price of land in those areas where patron client relationships are strongest we test the predictions of the model by examining in detail the evolution of land prices in chile around may 31 1958 for which we collected original data a characteristic of rural chile at this time were patron client relations based on the inquilinaje system by which a worker the inquilino entered into a long term often hereditary employment relationship with a landlord and lived on his landlord s estate we show that the introduction of the australian ballot in 1958 led to a fall of about 26 in land prices in the areas where these patron client relationships were predominant

discrimination in the rental housing market a field experiment on the internet this paper presents a field experiment on discrimination in the housing market using the internet as a research platform the procedure involved our creating three fictitious persons with distinct

valuing the vote the redistribution of voting rights and state funds following the voting rights act of 1965 the voting rights act of 1965 called one of the most effective pieces of civil rights legislation in u s history generated dramatic increases in black voter registration across the south we ask whether the increase in black voting rights was accompanied by an increase in blacks share of public spending we exploit a key provision of the act removal of literacy tests at registration for identification employing a triple difference framework over a 20 year period we find that counties with higher black population shares in former literacy test states saw greater increases in both voter turnout and state transfers than comparison counties in non literacy test states a finding that is consistent with models of distributive politics jel codes d72 h7 i2 j15 n32 copyright 2014 oxford university press

attention discrimination theory and field experiments with monitoring information acquisition we link two important ideas attention is scarce and lack of information about an individual drives discrimination in selection decisions our model of allocation of costly attention implies that applicants from negatively stereotyped groups face attention discrimination less attention in highly selective cherry picking markets where more attention helps applicants and more attention in lemon dropping markets where it harms them to test the prediction we integrate tools to monitor information acquisition into correspondence field experiments in both countries we study we find that unfavorable signals minority names or unemployment systematically reduce employers efforts to inspect resumes also consistent with the model in the rental housing market which is much less selective than labor markets we find landlords acquire more information about minority relative to majority applicants we discuss implications of endogenous attention for magnitude and persistence of discrimination in selection decisions returns to human capital and potentially for policy