the impact of mandatory disclosure laws on product choices an analysis of the salad dressing market abstract the nutrition labeling and education act nlea requires most food products to include a nutrition label prior to the nlea labeling was voluntary this study uses nutrition label information and supermarket scanner data pre and post nlea to examine the impact of moving from a voluntary to a mandatory labeling regime on consumer product choice the voluntary unraveling of information is shown to be an important market mechanism prior to the nlea all low fat salad dressings had a nutrition label while the majority of the higher fat dressings did not however there remained large variation in fat content among dressings that did not voluntarily label those with the highest fat levels experienced a significant decline in sales after they were required to disclose the results indicate that even in markets with credible low cost mechanisms to disclose mandatory labeling can have an impact on consumer behavior and health

asset inequality matters an assessment of the world bank s approach to poverty reduction the fight against poverty has been adopted by the multilateral development banks as their principal objective almost three decades after robert mcnamara announced that the world bank s fundamental work was to improve the lives of the poor its new president james wolfensohn has reiterated that poverty reduction is the world bank s principal purpose similarly in 1994 the inter american development bank set social progress and social equity as its central objective the emphasis in the international institutions contrasts with disappointing results in the real world although life expectancy school enrollmuent and other indicators of social wellbeing have improved dramatically across the developing world and although the proportion of the poor has declined in the last few decades the absolute number of poor people in the world has actually increased today about 1 3 billion people in less developed countries still subsist on less than 1 per day world bank 1980 1990 1996 the case of latin america is dramatic while in the 1970 s the number of poor fell it nearly doubled in the 1980 s increasing from about 80 to almost 150 million and in the last few years the number of poor now 33 percent of the total population has failed to fall despite economic recovery birdsall and londofio 1997 the contrast between the multilateral banks goals and these disappointing results suggests the need for a critical reassessment of their approach to poverty reduction in this paper we describe the approach reflected in the work of world bank economists and based on new empirical work assess its relevance for latin america

strategic information disclosure the case of multi attribute products with heterogeneous consumers we examine the incentives for firms to voluntarily disclose otherwise private information about quality attributes of differentiated products in particular we focus on the case of differentiated products with multiple attributes and consumers that are heterogeneous in their preferences over these attributes we show that there exist certain configurations of consumer preferences under which a firm producing a high quality product even with zero costs of disclosure may choose not to reveal the quality of its product this failure of firms to voluntarily disclose the quality of their products will arise when providing consumers with more information results in more elastic demands for these products which in turn triggers more intensive price competition and leads to lower prices and profits for all firms as a result the equilibrium in which disclosure is voluntary may diverge from that in which disclosure is mandatory

labour migration and social networks participation in southern mozambique this paper investigates how social networks in poor developing settings are affected by migration using a unique household survey from southern mozambique we test the role of labour mobility in shaping participation in groups and interhousehold cooperation by migrant sending households in village economies at origin we find that migration cum remittances boosts household engagement in community based social networks our findings are robust to alternative definitions of social interaction and to endogeneity concerns suggesting that stable migration ties and higher income stability through remittances may decrease participation constraints and increase household commitment in cooperative arrangements in migrant sending communities

information disclosure policies evidence from the electricity industry i introduction developed nations environmental policies have evolved substantially in the past several decades early pollution control programs involved command and control approaches policies then frequently included pollution charges tradable permits and other market based instruments most recently a third wave of environmental policy has emerged that emphasizes information provision as an integral part of the risk mitigation strategy here government regulation is replaced or augmented by publicly provided information presumed to assist more cost effective private market and legal forces common examples include the toxics release inventory lead paint disclosures drinking water quality notices and eco labels the empirical effects of such programs however remain largely undetermined this paper examines the impact of a prominent mandatory disclosure program on the fuel mix percentages of large electric utility corporations the prominence of mandatory information policies is not restricted to environmental arenas for example developed countries equity markets generally require firm level financial information provision in many countries agricultural goods require country of origin and other health labels domestic colleges and universities are required by law to inform current and prospective students of crime statistics equity data and performance metrics even significant medical errors must now be disclosed to the community there are several potential advantages of information provision policies and theory suggests that disclosure programs may effectively achieve their goals healy and palepu 2001 provided a survey of the evidence in capital markets brouhle and khanna 2007 demonstrated that information provision can improve product quality in the environmental area kennedy laplante and maxwell 1994 arora and gangopadhyay 1995 maxwell lyon and hackett 2000 kirchhoff 2000 and khanna 2001 showed that the provision of information about pollution may correct a market failure improve performance and enhance welfare despite the literature s theoretical findings the empirical effects of disclosure programs remain inconclusive early studies of securities regulation found mixed results see stigler 1964 robbins and werner 1964 and benston 1973 a more recent literature suggested that disclosure programs in financial markets can achieve their desired effects la porta and lopez de silanes 2006 and greenstone oyer and vissing jorensen 2006 found that both market size and market returns were positively influenced by mandatory disclosure programs in product quality settings chipty and witte 1998 established that resource and referral agencies significantly influenced childcare prices but had no impact on the quality of care in contrast jin and leslie 2003 found that mandatory hygiene grade cards positively affected restaurant quality and health outcomes studies of environmental performance yielded similarly mixed results desvousges smith and rink 1992 found that information based programs influenced attitudes favorable to radon testing but testing itself only increased when mass media dissemination was coupled with community based implementation programs konar and cohen 1997 and khanna quimio and bojilova 1998 found that stock movements associated with toxics release inventory tri announcements led to increased abatement and reduced emissions however bui 2005 found that the declines in emissions after tri reporting events may have been attributable to regulation rather than investor pressure bennear and olmstead 2006 found that drinking water quality notices lowered violations for some systems but not others this paper is the first empirical economic study of the impacts of mandatory information provision in the electric utility industry the disclosure programs considered here differ significantly from the tri information programs examined previously

a gravity model analysis of international migration to north america this study examines the influence of political economic and demographic factors on the size and composition of migration flows to north america a modified gravity model is specified and adjusted to include immigration regulations and characteristics specific to the origin and destination countries for empirical test of the model the time period of study is from 1976 1986 and 70 countries are covered for a total of 1540 observations of migration flows to canada and the usa the results reveal that the population of origin countries and the income of destination countries are two major determinants of migration to north america high population areas of asia and latin america provided a large share of the immigrants domestic restrictions on political and civil freedom in origin countries are found to significantly impair migration to north america

do workers remittances reduce the probability of current account reversals the authors combine the literature on financial crises in emerging markets and developing economies with that on international migrations by investigating whether the increasingly large flows of workers remittances can help reduce the probability of current account reversals the rationale for this stands in the great stability and low cyclicality of remittances as compared with other private capital flows these properties combined with the fact that remittances are cheap inflows of foreign currencies might reduce the probability that foreign investors suddenly flee out of emerging markets and developing economies and trigger a dramatic current account adjustment the authors find that remittances can have such a beneficial effect in particular they show that a high level of remittances as a ratio of gdp makes the relationship between a decreasing stock of international reserves over gdp and a higher probability of current account crises less stringent the same occurs though less neatly for the positive relationship between an increasing stock of external debt over gdp and the probability of current account reversals the results point also to a threshold effect of remittances the mechanisms just described are in fact much stronger when remittances are above 3 percent of gdp

stature and the standard of living research on the standard of living now emphasizes alternatives or supplements to the national income accounts this paper reviews the results of two decades of research using stature as a measure of health aspects of human welfare after comparing and contrasting stature with per capita income i consider height patterns discovered by economic historians that challenge traditional beliefs about the past including long term trends cycles in heights and the dreadfully small stature of slave children that was followed by catch up growth the paper concludes with comparisons to work in development economics and suggestions for research

economic growth population theory and physiology the bearing of long term processes on the this lecture sketches a theory of the secular decline in morbidity and mortality that takes account of changes induced in physiological functioning since 1700 the synergism between technological and physiological improvements has produced a form of human evolution biological though not genetic rapid culturally transmitted and not necessarily stable which is still ongoing in both oecd and developing countries thermodynamic and physiological aspects of economic growth are defined and their impact on growth rates is assessed implications of this theory for population forecasting measurement of national income demand for leisure pension policies and demand for health care are considered excerpt

economic growth inequality and poverty estimating the growth elasticity of poverty summary this paper uses a new data set of 126 intervals from 60 developing countries to analyze the growth elasticity of poverty that is how much does poverty decline in percentage terms with a given percentage rise in economic growth the data set is both broader in coverage and more selective in terms of quality controls than those used in the past the study finds that while economic growth does reduce poverty in developing countries the rate of poverty reduction depends very much on how economic growth is defined controlling for changes in income inequality when economic growth is measured by changes in survey mean income consumption the growth elasticity of poverty excluding eastern europe and central asia is 2 79 that is a 10 increase in the survey mean will reduce poverty 1 00 person day by 27 9 but when growth is measured by changes in gdp per capita the growth elasticity of poverty is a statistically insignificant 2 27 which is lower than has previously been estimated

what the seller won t tell you persuasion and disclosure in markets imagine that you are considering an investment in a new public offering of a firm s shares the firm s officers make a presentation that includes an audited financial statement an earnings forecast reviewed by its prestigious investment bankers and an impressive demonstration of its new technology or suppose that you are buying a new furnace to replace an old one that is not working well the salesman displays a chart showing that the projected total life cycle cost of one particular model including capital costs and fuel usage over the projected lifetime of the furnace is lower than that of some competing models you have considered this paper reviews the theoretical arguments about how sellers disclose information in an attempt to encourage buyers and the potential role for regulation in encouraging efficient disclosure of information how well does a system of private reporting work when should we expect all the relevant information to be reported if testing and reporting by the seller are costly will too little testing and reporting be done or too much when some information is withheld what sort of information is withheld how do rational buyers respond to such withholding how are prices and welfare affected what role is there for laws and regulations to improve the functioning of markets we address these questions by studying the theory of persuasion games games in which one or more sellers provide verifiable information to buyers to influence the actions they take

planning and financial literacy how do women fare many older us households have done little or no planning for retirement and there is a substantial population that seems to undersave for retirement of particular concern is the relative position of older women who are more vulnerable to old age poverty due to their longer longevity this paper uses data from a special module we devised on planning and financial literacy in the 2004 health and retirement study it shows that women display much lower levels of financial literacy than the older population as a whole in addition women who are less financially literate are also less likely to plan for retirement and be successful planners these findings have important implications for policy and for programs aimed at fostering financial security at older ages

economic effects of migration on the left behind in cambodia abstractusing propensity score matching this study examines the effects of migration on various indicators of household wellbeing in cambodia the results indicate that migration would reduce poverty headcount rate by 3 7 percentage points and decrease the depth of poverty migration is also found to reduce by 5 10 per cent the hours worked by members left behind the impact of migration on labour participation may be however vulnerable to unobservable factors nevertheless the study suggests that important heterogeneous effects which differ from the average impact exist the analysis is conducted separately by internal and international migration

determinants of workers remittances an empirical investigation for a panel of eleven developing asian economies we explore the key motives of migrant workers remittances from abroad for 11 major asian migrant sending countries using panel regressions we find that relative higher growth rate interest rate and capital market returns of home over the host investment financial deepening at home have significant impact on remittance inflows into asia along with higher per capita incomes and international crude oil prices with incorporation of per capita incomes and lagged impact of remittances we observe an emergence of consumption motives to remit therefore we conclude that both investment and altruistic motives are the driving forces for remittances inflows into the asian economies

transparency in markets for experience goods experimental evidence we propose an experimental design to investigate the role of information disclosure in the market for an experience good the market is served by a duopoly of firms that choose both the quality and the price of their product consumers differ in their taste for quality and choose from which firm to buy we compare four different treatments in which we vary the degree to which consumers are informed about quality contrary to theoretical predictions firms do not differentiate quality under full information rather both tend to offer products of similar high quality entailing more intense price competition than predicted by theory under no information we observe a lemons outcome where quality is low at the same time firms manage to maintain prices substantially above marginal cost in two intermediate treatments quality is significantly higher than the no information level and there is evidence that prices become better predictors of quality taken together these findings suggest that information disclosure is a more effective tool to raise welfare and consumer surplus than theory would lead one to expect jel l15 c91 d82

migrant remittances and fertility abstractthis study examines the role of migrants remittances in developing countries fertility transition employing an unbalanced panel of south asian countries and controlling for various economic and socio demographic factors we find that remittances are significantly associated with a lower number of children born to women of childbearing age this suggests the remittances substitution effect to be at play rather than the income effect and may result from decreased need for children for financing the household s future needs as well as from better access to healthcare and contraceptive methods available to migrant households remittances association with fertility appears to be more important than the transfer of fertility norms from migrants host countries the monetary aspects of international migration may therefore be more important for the region s demographic transition than social remittances

can the world cut poverty in half how policy reform and effective aid can meet international development goals abstract poverty in the developing world will decline by about one half by 2015 if the trends of the 1990s persist most of this poverty reduction will occur in asia however while poverty will decline only slightly in africa effective aid could make a contribution to greater poverty reduction in lagging regions even more potent would be significant policy reform in these countries we develop a model of efficient aid in which flows respond to policy improvements that create a better environment for poverty reduction and effective aid we investigate scenarios of policy reform and efficient aid that point the way to how the world can cut poverty in half in every major region

lessons from the bell curve this paper examines the argument presented in the bell curve a central argument is that one factor g accounts for correlation across test scores and performance in society another central argument is that g cannot be manipulated these arguments are combined to claim that social policies designed to improve social performance cannot be effective a reanalysis of the evidence contradicts this story the factors that explain wages receive different weights than the factors that explain test scores more than g is required to explain either other factors besides g contribute to social performance and they can be manipulated

do international migration and remittances reduce poverty in developing countries summary few studies have examined the impact of international migration and remittances on poverty in the developing world this paper fills this lacuna by constructing and analyzing a new data set on international migration remittances inequality and poverty from 71 developing countries the results show that both international migration and remittances significantly reduce the level depth and severity of poverty in the developing world after instrumenting for the possible endogeneity of international migration and controlling for various factors results suggest that on average a 10 increase in the share of international migrants in a country s population will lead to a 2 1 decline in the share of people living on less than 1 00 per person per day after instrumenting for the possible endogeneity of international remittances a similar 10 increase in per capita official international remittances will lead to a 3 5 decline in the share of people living in poverty

revisiting the threshold effect of remittances on total factor productivity growth in south asia a study of bangladesh and india abstractboth bangladesh and india are among the top recipient of remittances in absolute terms however in relative terms remittances as a per cent of gdp the two countries stand at 6 1 and 2

the failure and promise of mandated consumer mortgage disclosures evidence from qualitative interviews and a controlled experiment with mortgage borrowers policy responses to record rates of mortgage delinquency default and foreclosure will likely affect the cost and availability of consumer credit for decades to come although the current crisis began over two years ago one consumer policy change that surely passes a cost benefit test has yet to be adopted consumers still do not receive one clear disclosure document that conveys the key costs and risks of their mortgages the results of this study based on quantitative testing in a controlled randomized experiment with more than 800 mortgage borrowers and in depth qualitative interviews with several dozen additional borrowers suggests that federally mandated consumer mortgage disclosures failed resulting in many borrowers who did not understand the costs and risks of their loans likely contributing to the mortgage crisis an overhaul of consumer mortgage disclosures culminating in a single disclosure document designed using a combination of qualitative and quantitative consumer research could substantially improve consumer understanding of their mortgage choices the failure of mandated disclosures to convey mortgage terms to borrowers was not due to cognitive limitations or irrationality of consumers nor to an irreducible complexity of new mortgage instruments but to poorly designed disclosures disclosure documents failed to include key loan information and the information disclosed was often confusing and sometimes misleading problems with mandated disclosures were evident across a range of consumers and loan types prime and subprime borrowers were similarly confused confusion the failure and promise of mandated consumer mortgage disclosures evidence from qualitative interviews and a controlled experiment with mortgage borrowers

numeracy and the impact of high food prices in industrializing britain 1780 1850 abstract using census based data on the ability to recall one s age we show that low levels of nutrition impaired numeracy in industrializing england 1780 to 1850 cognitive ability declined among those born during the napoleonic wars the effect was stronger in areas where grain was expensive and relief for the poor an early form of welfare support was limited nutritional shortages had a nonlinear effect on numeracy with severe shortages impairing numeracy more nutrition during childhood also mattered for labor market outcomes individuals born in periods or counties with low numeracy typically worked in occupations with lower earnings

remittances and public finances evidence from oil price shocks we study the effect of inflowing remittances a major source of capital for many countries on tax revenues and tax policy instrumenting remittances with changes in the oil price interacted with a country s distance to oil producing countries we find that remittances have a large positive effect on vat revenues but no effect on income tax revenues this suggests that remittances often escape the income tax but can be taxed via consumption we further show that tax policy is responsive to shocks in incoming remittances remittances make the adoption of vat systems more likely and they lead to lower vat rates and higher income tax rates

harnessing the diaspora dual citizenship migrant return remittances political rights provided to immigrants by host countries have received much attention in the literature less attention however has been paid to the extension of extraterritorial rights by home countries in this article i focus on a common type of right provided by home countries to their expatriates the right of dual citizenship dual citizenship rights i argue help home countries leverage the financial and human resources of their diasporas encouraging both remittances and return migration i test this argument using migrant surveys performed in six host countries and find that migrants from homelands that extend dual citizenship are more likely to both remit and express a desire to return home the micro finding regarding remittances is confirmed using aggregate panel data for a large sample of homelands over the period 1980 2009 the results point to the importance of political rights and policies as extended by the migrant s homeland

the effect of adolescent experience on labor market outcomes the case of height taller workers receive a wage premium net of differences in family background the disparity is similar in magnitude to the race and gender gaps we exploit variation in an individual s height over time to explore how height affects wages controlling for teen height essentially eliminates the effect of adult height on wages for white men the teen height premium is not explained by differences in resources or endowments the teen height premium is partially mediated through participation in high school sports and clubs we estimate the monetary benefits of a medical treatment for children that increases height

what can new survey data tell us about recent changes in distribution and poverty it has been claimed that in recent times the poor have lost ground both relatively and absolutely even when average levels of living have risen this article tests that claim using household surveys for 67 developing and transitional economies over 1981 94 it finds that changes in inequality and polarization were uncorrelated with changes in average living standards distribution improved as often as it worsened in growing economies and negative growth was often more detrimental to distribution than positive growth overall there was a small decrease in absolute poverty although with diverse experiences across regions and countries almost always poverty fell with growth in average living standards and rose with contraction

population technology and growth from malthusian stagnation to the demographic transition and beyond this paper develops a unied growth model that captures the historical evolution of population technology and output it encompasses theendogenous transitionbetween three regimes that have characterized economic development the economy evolves from amalthusianregime wheretechnologicalprogressis slow andpopulationgrowthprevents anysustainedriseinincomepercapita intoapost malthusianregime wheretechnological progress rises and population growth absorbs only part of output growth ultimately a demographic transition reverses the positive relationship between income and population growth andtheeconomyentersamoderngrowthregimewithreducedpopulationgrowth

international migration and nutritional outcomes in tajikistan abstract tajikistan is the country with the largest share of remittances to gdp in the world at the same time it suffers from stubbornly high levels of child malnutrition against which only very slow progress has been made this paper investigates the relationship between international migration and child malnutrition using data from a recent nationally representative household survey there are theoretical reasons to expect that migration may be exerting both positive and negative effects on nutrition and food security so that understanding what the net effect may be is essentially an empirical question our results indicate that migration appears to be playing a positive role in enhancing child growth patterns as measured by height for age z scores in the country we explore some of the possible channels through which this effect might be operating and find that one such channel is by increasing households kilocalorie consumption

can high inequality developing countries escape absolute poverty do the poor face the same prospects for escaping poverty in high inequality developing countries as in low inequality countries is it possible for inequality to be so great as to stifle prospects of reducing absolute poverty even when other initial conditions and policies are favorable to growth household survey data for developing countries suggest that initial distribution does affect how much the poor share in rising average incomes higher initial inequality tends to reduce growth s impact on absolute poverty by the same token higher inequality diminishes the adverse impact on the poor of general economic contraction combining this evidence with that from recent investigations of inequality s effect on growth the author finds that if inequality is high enough countries that would have very good growth prospects at low levels of inequality may see little or no overall growth and little progress in reducing poverty or even a worsening on both counts the data the author uses suggest that such cases do occur the precision with which key parameters have been estimated makes it difficult to say with confidence how common such cases are but they appear to be in the minority what appear to be the best available estimates suggest that about one fifth of the spells between surveys he analyzed were cases in which poverty was rising yet positive growth in the mean and hence falling poverty is predicted at zero inequality inequality can be high enough to result in rising poverty despite good underlying growth prospects