Does Africa Need a Rotten Kin Theorem? Experimental Evidence from Village Economies

Abstract

The Impact Evaluation Series has been established in recognition of the importance of impact evaluation studies for World Bank operations and for development in general. The series serves as a vehicle for the dissemination of findings of those studies. Papers in this series are part of the Bank's Policy Research Working Paper Series. 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.

Structural Experimentation to Distinguish between Models of Risk Sharing with Frictions in Rural Paraguay

“…This suggests that the same intervention could have very different impacts in different villages. Suggestive evidence along these lines is provided by Jakiela and Ozier (2016) who show that rates of productive investment and entrepreneurship are lower in villages in which hidden information frictions are strongest, and Angelucci et al (2017) who show that the impact of conditional cash transfers in Mexico depends on network structure. More generally, there is a growing body of research which studies sources of similarities and differences in the impacts of interventions across settings (Brune et al, 2017;Meager, 2016;Vivalt, 2016).…”

“…On the other hand, Ligon (1998) provides evidence that in at least some Indian villages private information may be important, while Ambrus et al (2017) construct a model of risk-sharing in social networks with hidden information and Milán (2016) then shows that bilateral transfers in Bolivia are in accord with that hidden information model. Using a strategy related to ours, Jakiela and Ozier (2016) find that hidden information serves as a significant deterrent to full insurance in experiments in Kenya, while Kinnan (2017) argues that income and consumption survey data fits a model of hidden income better than a model of limited commitment or moral hazard for households in Thailand.…”

Intra-household labor allocation in colonial Nigeria

“…We believe, however, that our work has broader relevance. In finding that illness shocks are compounded by labor complementarities (Adhvaryu and Nyshadham, 2014), in stressing that household bargaining considerations can produce inefficient outcomes (Jakiela and Ozier, 2015), and in highlighting complexities in the dynamics of child labor (Basu, 2006), we show that the considerations motivating the households in our sample parallel those facing many present-day households operating both in Africa and throughout the developing world. Notes: *** Significant at 1%, ** Significant at 5%, * Significant at 10%.…”

“…Existing literature shows that poor households often allocate resources towards unproductive activities for strategic reasons. These include defending property (Field, 2007;Goldstein and Udry, 2008), hiding income (Anderson and Baland, 2002;Jakiela and Ozier, 2015), free-riding on others' efforts (Alger and Weibull, 2010), and concealing assets (Ashraf, 2009). These incentives are particularly strong in West African households like those in our data, where income pooling is incomplete (Duflo and Udry, 2004).…”

How Soon Is Now? Evidence of Present Bias from Convex Time Budget Experiments

“…Harrison, Humphrey, andVerschoor 2010, Jakiela andOzier 2016). 31 The estimation of ω also relies heavily on the functional form assumption regarding u(·).…”