rafmacalaba/datause-encoder-data huggingface dataset:
combined with a panel of population level data. In particular, the ability to look at insured and non-insured service intensity separately allows us to tell a more nuanced story of hospital responses to different incentives generated by multiple payers and payment methods. Given the prevalence of mixed payment arrangements across the globe, the study results apply not only to Vietnam but many other countries which are embarking on or undertaking provider payment reforms.

In the next section, we provide a brief review of existing empirical research on impact of capitation payment with a focus on developing countries. We then describe the context of this study – the development of reforms on the demand and supply sides of the health system in Vietnam. Following the description of data and methods, we present the results of estimating capitation effects on efficiency, quality, and equity, and we discuss the implications of our findings in Vietnam and international contexts.

# **Existing research on the impact of provider capitation payment**

In health care, capitation is defined as a payment method where “the provider is paid, in advance, a predetermined fixed rate to provide a defined set of services for each individual enrolled with the provider for a fixed period” (Langenbrunner, Cashin, and O’Dougherty 2010). The key principle is that the payment to a provider is not linked to the inputs that the provider uses or the volume of services provided. If the provider incurs costs that are greater than the per capita budget, the provider is liable for them. On the other hand, if the provider achieves efficiency gains, it can usually retain and reinvest this surplus. The theoretical impact of capitation has been amply elaborated (Schneider and Hanson 2007): capitation payment imposes financial risks on providers and discourages them from oversupplying care. It provides incentives to produce efficiently, ostensibly by adjusting treatment intensity within a medically 4
important in practice (Jamison et al. 2004). Finally, the detrended measure of infant mortality is regressed on the detrended measure of per capita GDP as shown in equation (6):

* * * (6) D ct = logGDPct + ε ct

We also consider specifications that smooth series with two standard time-series filters— the Hodrick-Prescott filter, and the more recent Baxter-King filter (Hodrick and Prescott 1997; Baxter and King 1999). The Baxter-King filter adopts an approximate medium frequency band pass filter that is constrained to produce stationary outcomes when applied to trending time series.<sup>6</sup> The Hodrick-Prescott filter decomposes a time series into a trend and a cyclical component and then determines the optimal trend component that minimizes a linear combination of deviations from trend and variations in the growth rate of trend.

Our main set of results using the country-year averages is presented in Table 1. Specifications that use the level of infant mortality as the dependent variable are presented in the upper panel of the table, those that use the log of the infant mortality rate, and hence relate proportional changes in infant mortality rather than absolute changes, in the lower panel. Per capita GDP always enters the regression in logs. The sample size in these regressions corresponds to the number of country-year observations for which data on infant mortality can be calculated. Column 1 presents the results from a specification in first differences; in column 2, the first-differenced model is supplemented with lagged levels of per capita GDP and the infant mortality rate; columns 3 through 5 present specifications in which linear, quadratic, or cubic trends are removed from the data; and finally, in columns 6 and 7, the Hodrick-Prescott and Baxter-King filters are used to remove low- and medium-frequencies from the data series.

> 6 We adopt the Baxter-King recommendation of a seven year bandwidth around each time point.

10
# FIGURE 12. NEONATAL MORTALITY TRENDS BY SAVINGS GROUP IN COTE D'IVOIRE, 1970-86 (LSMS 1985/1986)

<!-- Start of picture text --> , Medium savings<br>o ,_<y b; Low savings 0s<br>Ci<br>6 ' All groups s<br>v _ / '> _ _ ,-, _ High savings<br><!-- End of picture text --> <!-- Start of picture text --> Year (1)<br><!-- End of picture text --> NOTE: (1) NNMR 5 - Year Moving Average
and the private sector virtually disappeared (Bahar et al., 2021). Since 2015, social protests and political violence have become rampant, and Venezuelans have been forced to migrate on a scale never seen before in Latin America (Ib ́a ̃nez et al., 2021).

By 2020, the Venezuelan exodus had become one of the world’s largest humanitarian crises with more than five million people having fled the country. Colombia is the primary host of these forced migrants. That same year, the Colombian government reported that more than 1.72 million Venezuelans had registered with the United Nations Refugee Agency to stay in the country. Nonetheless, the real number of Venezuelan migrants in Colombia is likely larger due to irregular migration.

Colombia is also one of the most generous countries in terms of the support it has offered these migrants. In 2018, the government regularized approximately half a million Venezuelans and in 2020, it granted all irregular migrants access to complete health services. Moreover, in 2021, it also offered a temporal regularization (for up to 10 years) to all irregular migrants living there.<sup>7</sup> As in other countries that have experienced large migration inflows in a short period of time, the Venezuelan migration has sparked strong reactions from Colombian natives (Rozo and Vargas, 2021). Some Colombians have welcomed the migrants, but others resent them and blame them for current socioeconomic problems.

# **III THE SURVEY EXPERIMENT**

We conducted an online survey experiment in Bogot ́a with 3,400 Colombian Facebook users. Bogot ́a has a population of 10.7 million, of which 7.8 million use Facebook. As noted above, we recruited respondents through Facebook ads and stratified the experiment by age group and gender. Table A.1 of the Appendix compares sociodemographic characteristics of the survey respondents with those of the Bogot ́a population (as collected by the population census conducted by the Colombian Statistics Agency in 2018). As the table illustrates, our survey respondents were comparable to the rest of the population in terms of age distribution and income (measured as economic strata). Yet, our respondents were more educated than the average inhabitant of Bogot ́a. This aligns with our expectations as Facebook access requires respondents to read, write, and proficiently use digital apps and surveys.

Figure A.1 illustrates our recruiting ads. Without mentioning migrants or the COVID-19 pandemic, these ads invited users to answer questions about the current situation in Bogot ́a. In total, 47,376 individuals in Bogot ́a clicked on the ads and 34,034 went to the first page of the survey. Of these, 5,908 began the survey and 4,333 finished it. These numbers imply a success rate of 12.7 percent of the population exposed to the ads. The actual number

> 7See Ib ́a ̃nez et al., 2022 for details on the impacts of the amnesty offered in 2018.

6
for the period 1966-2003. Using Johansen’s cointegration test, the authors find a long-run relationship between development in insurance market size and economic growth for all insurance components.<sup>7</sup> Regarding causality tests, there is evidence of long-run causality from growth in insurance market size to GDP growth for eight out of nine insurance categories that are considered.<sup>8</sup> Short–run causality exits from life, liability and pecuniary loss insurance. As the authors point out in the paper, these results do not permit to make a definitive conclusion regarding causality.

Adams et al. (2005) examine empirically the dynamic historical relation between banking, insurance and economic growth in Sweden using time-series data from 1830 to 1998 using cointegration and Granger causality tests. Their results indicate that the development of banking, but not insurance (measure by total insurance premiums), preceded economic growth in Sweden during the nineteenth century, while Grangercausality was reverse in the twentieth century. The insurance market appears to be driven more by the pace of growth in the economy rather than leading economic development.

Our paper, as opposed to that of Ward and Zurbruegg and Adams et al., uses not only data on total insurance premiums but also its desegregation into life and non-life insurance premiums in order to assess their potential different effects on economic growth. Also, we use a broader set of countries, industrialized and developing, to evaluate whether there are similar underlying patterns among different groups of income countries. In this sense, our paper is close to that of Webb et al. However, we depart from it given that we use not only cross-country data but also time series data to exploit the additional information provided by the over-time variation in the growth rate and its determinants, which allows for more precise estimates.

# **4. Methodology**

As in Webb et al., this paper evaluates the effect of insurance variables on economic growth within the context of the standard growth regressions specification. The general regression equation to be estimated is the following

# (1)    yi,t = β ’Xi,t + μ t + η i  + ξ i,t

where the subscripts _i,t_ represent country and time period, respectively. _y_ is the dependent variable of interest, that is, economic growth. _X_ is a set of time- and country-varying explanatory variables, proxies of banking, stock market and insurance market development, interaction terms, and control variables, while β is the vector of coefficients to be estimated. Finally, μ _t_ is an unobserved time-specific effect, η i is an unobserved country specific effect, and ξ is the error term.

> 7The authors do not include in the analisis additional explanatory variables as in the paper of Ward and Zurbruegg (2000)

> 8The categories are: life, motor, accident and health, property, liability, pecuniary loss, reinsurance, and Marine-Aviation-Transport insurance.

5
92

# **Box** 6. Singapore: Elements of an Environmentally-Sound Traffic Managenent System

Singapore is an island city-state with a total land area of 623 sq. km and a population of 2.65 mnillion. Its population density of 4,250 per sq. km is one of the highest in the world. Singapore is classified as a high income, advanced developing country.

Land transportation in Singapore is largely road based and a cornerstone of the domestic transportation policy has been to control road congestion. The integrated planning approach has included four key elements: systematic town plannzing, systematic road planning, priority for public transportation, and careful management of the growth and use of private vehicles. This has led to innovative traffic management practices such as the introduction of area licensing scheme in 1975 to manage the use of private road vehicles during peak hours in the central business district.

Singapore's comprehensive traffic management strategy has been quite effective in maintaining journey times and aggregate vehicle pollutant emissions within acceptable limits. The core elements of the traffic management system are:

- _Street usage strategies -_ one-way schemes, bus-bays with designated pedestrian areas, and bus lanes;

- _Signalized traffic control_ - computerized areawide traffic control (ATC), green link determining system (GLIDE);

- _Road pricing and car pools_ - area licensing scheme (ALS), car pools, park-and-ride;

- _Car parking and management of traffic disturbances -_ parking space control, variable parking fees, compulsory vehicle inspection systems, incentives for replacing old automobiles;

- _Public transport management_ - encouraging use of public bus and rail rapid transit systems, discouraging auto ownership through high taxes on private vehicles and gasoline.

- _Other measures -_ such as provision of grade-separated pedestrian crossings, speed limits, and driver informration systems.

Source: B.W . Aug. Traffic Management Systems and Energy Savings: the Case of Singapore.' Department of Industrial and Systems Engineering, National University of Singapore.

automotive traffic. Vehicle free zones usually result in considerable reduction of CO concentrations. The central areas of cities often include many roadways near which CO concentrations are excessive. These areas are usually too large to be converted into vehiclefree zones. However, if a bypass route is available or can be established, then it may be possible to achieve significant reductions in the central area CO concentrations by diverting the through traffic to the bypass. One way of effecting this diversion is to divide the central area into traffic cells, or zones that are accessible to vehicles only from the bypass route. Direct vehicular travel between cells is discouraged or prevented by means of systems of one-way streets, restrictions on turns, or physical barriers. However, the diversion of through traffic to bypass roads that
# Figure 1 The Positive and Nornative Closures: Credit Flows

<!-- Start of picture text --> NORMATIVE CLOSURE POSITIVE CLOSURE<br>| Fix Targets Fix Resources F<br>Investment & Credit Needed Investment & Credit Available<br>Govemment \ ,/ Private<br>s~~~~~~~~~~~s<br>FinancingS I \i S SaviBa<br>L T t I ~~~~~~~~~~Financing<br>GCg<br>GovemmCredit Foeg sesMarket &<br>j 8 r LX gj Central Bank Money Market<br>9 J ~Credit Market<br>Bg<br>DoMrik et - Private Sector<br>CRg Bank Credit Market | CRp<br>9 ~~~(Analysis Banks, Others)<br><!-- End of picture text -->

20
cities of different sizes. Across the urban system, there will be need to meet backlogs in infrastructure, service delivery, and amenity provision, as well as accommodate further growth.

In addition to population increases across the urban system, fiscal and administrative decentralization has increased the role of individual cities in attracting investments and in providing services that are responsive to the needs of local residents. Brazil is one the most decentralized among developing countries. The 1988 Constitution established municipalities as the third level of government, and provided states and municipalities with more revenue raising power and freedom to set tax rates. However many local governments have limited administrative and institutional capacity, and have not been able to effectively use their autonomy to improve service delivery or attract new investment. A recent study by the World Bank (World Bank 2002) identifies that maximizing urban competitiveness from agglomeration economies and minimizing congestion costs from negative externalities are key challenges facing national and local governments in Brazil.

Under this backdrop of rapid population growth and decentralization of administrative and fiscal responsibilities, it becomes essential to identify what types of interventions stimulate growth of individual cities. In addition, we want to find out the consequences of favoring investments in secondary cities on aggregate efficiency and economic growth. There is an ongoing debate in Brazil’s policy circles that the largest agglomerations have become too big leading to significant negative externalities of crime, social conflict, and high land costs, and policies should be designed to actively stem the growth of these large agglomerations and favor investments in secondary cities.

3
<!-- Start of picture text --> \ — = avg. costs in case of mutual recognition<br>_ \ —— avg. costs per export market in case of<br>s regulation heterogeneity<br>8 \<br>co \<br>8<br>>S\<br>i \<br>77)<br>8\<br>2 \ : :<br>eel<br>home market export market 1 export market 2 export market 3<br><!-- End of picture text -->
whether predetermined characteristics are balanced around the threshold. If we plot the density of the predetermined characteristic against the forcing variable, we should be able to detect sorting into treatment (or out of treatment) which would be a strong indication for systematic manipulation of the rule. The panels in Figures 15, 16, 17, 18 and 19 do not indicate such an Table 11 reports the result of a more formalized test. We estimate the same RDD specification as previously specified using the respective predetermined characteristics as dependent variable. We find little indication of unbalanced characteristics around the threshold: most coefficients are insignificant, but there is a significant effect on the number of women in the household. Should this be interpreted as systematic evidence of sorting into or out of treatment? Assuming the characteristics are balanced (null hypothesis that there is no true relation between the predetermined characteristics and participation in the program), the probability that between 0 and 1 coefficients show significant on the five percent level is at 76 percent.<sup>88</sup> Therefore, we cannot reject the hypothesis that the characteristics are balanced around the threshold at the five percent level of significance.

When we have a closer look, there are plausible explanations why the number of women in the household shows up as significant. The program mainly targets women and their children; the cash is transferred to the mother of the children. Hence, it is not surprising that the presence of more women in a household may lead to a higher chance of participation. This should not be of concern to us as long as there is no systematic relation between the number of women and household decisions – a question which we will further investigate in the next section of this essay.

Overall, the assumptions on fertility and access to credit seem in line with the results. We do not find support of the critique that Bolsa Fam ́ılia incentivizes poor women to have more children. When we consider the results on child and young adult pregnancies, we do not find a significant effect of the program on observed fertility. The assumption that BFP does not impact fertility cannot be rejected.

We do find an effect of BFP on access to a bank account but not on access to credit (as proxied by the variable access to credit card). BFP participation stimulates the beneficiaries to open a bank account, which would be expected due to the fact that the cash is directly transferred to beneficiaries through a bank account, but we do not find evidence that this also

> 88According to the Bernoulli rule, _P_ ( _A_ ) =<sup>�</sup><sup>_b_</sup> _i_ = _a_ � _s_ + _t i_ �( _p_ )<sup>_s_+</sup><sup>_i_</sup> (1 _− s_ )<sup>_t−s−i_</sup> =<sup>�1</sup> _i_ =0 �19 _i_ �(0 _._ 05)<sup>_i_</sup> (0 _._ 95)<sup>(19</sup><sup>_−i_)</sup> = �190 � _×_ (0 _._ 05)<sup>0</sup> _×_ (0 _._ 95)<sup>19</sup> + �191 � _×_ (0 _._ 05)<sup>1</sup> _×_ (0 _._ 95)<sup>18</sup> = 0 _._ 38 + 0 _._ 38 = 0 _._ 76, calculated with: http://www.calcul.com/bernoulli-trials-range, Dec 23, 2013.

51
**Table 9** : Time-series regression estimates (fixed effects) of the effect of per capita income, trade, FDI net inflows on the occupational gender wage gap by occupational skill level and country income (standard errors in parentheses)

||**1**<br>**Lo**|**2**<br>**w and lowe**|**3**<br>**r middle in**|**4**<br>**come countr**|**5**<br>**ies**|**6**<br>**Hig**|**7**<br>**h and highe**|**8**<br>**r middle in**|**9**<br>**come countr**|**10**<br>**ies**|
|---|---|---|---|---|---|---|---|---|---|---|
|Trend|-0.0002|||||-0.001|||||
||(0.002)|||||(0.0006)|||||
|Log GDP per capita||-0.01|-0.03|0.05|-0.03||-0.02|-0.03|0.003|-0.02|
|||(0.03)|(0.03)|(0.06)|(0.03)||(0.01)|(0.01)|(0.01)|(0.01)|
|Trade (% GDP)|||||||||||
|* Low skill||-0.002|||||0.0004||||
|||(0.001)|||||(0.0002)||||
|* High skill||-0.001|||||-0.0003||||
|||(0.0006)|||||(0.0002)||||
|Trade (% GDP, constant LCU)|||||||||||
|* Low skill|||-0.001|||||0.0006|||
||||(0.001)|||||(0.0002)|||
|* High skill|||0.0002|||||-0.0001|||
||||(0.001)|||||(0.0002)|||
|Sector Trade (% sector output)|||||||||||
|* Low skill||||-0.0002<br>(0.0001)|||||-0.0001<br>(0.00004)||
|* High skill||||0.0001|||||-0.0001||
|||||(0.0004)|||||(0.0001)||
|FDI net inflows (%GDP)|||||||||||
|* Low skill|||||0.001|||||0.003|
||||||(0.003)|||||(0.001)|
|* High skill|||||-0.003|||||0.001|
||||||(0.003)|||||(0.002)|
|Year dummies|No|Yes|Yes|Yes|Yes|No|Yes|Yes|Yes|Yes|
|Country x Occupation dummies|Yes|Yes|Yes|Yes|Yes|Yes|Yes|Yes|Yes|Yes|
|Observations|2262|2246|2242|334|2244|8799|7424|7236|2359|7187|
|Adjusted R<sup>2</sup>|0.59|0.59|0.59|0.47|0.59|0.81|0.82|0.83|0.84|0.82|

44
Policy Research Working Paper 10048

# **Abstract**

This paper measures trends in factor misallocation in India between 1999 and 2014, using data from a rich panel of Indian firms. The misallocation of a factor is modeled as an adjustment cost, that is, an implicit variable cost incurred by a firm when using that factor. Trends in the adjustment cost are estimated using a new adaptation of the firm-level cost-minimization approach. The paper documents these trends for four factors of production (permanent labor, contract labor, land, and fixed capital) across Indian states and by firm size. Overall, the findings show that adjustment costs declined over time for labor and land but with significant heterogeneity with respect to state growth rate and firm size. Using these stylized facts on trends in factor adjustment costs, as well as in-depth field interviews with firms in two Indian states, the paper also discusses potential policy developments behind these trends, including a preliminary examination of the role of state-level governance in the implementation of relevant factor market policies.

This paper is a product of the Office of the Chief Economist, South Asia Region. It is part of a larger effort by the World Bank to provide open access to its research and make a contribution to development policy discussions around the world. Policy Research Working Papers are also posted on the Web at http://www.worldbank.org/prwp. The authors may be contacted at ssharma1@worldbank.org.

_The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent._ Produced by the Research Support Team
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