Early-Life Health and Adult Circumstance in Developing Countries

Early-Life Health and Adult Circumstance in Developing Countries

Janet Currie, Tom Vogl

NBER Working Paper No. 18371
Issued in September 2012
NBER Program(s):   AG   CH   HC   HE   LS

A growing literature documents the links between long-term outcomes and health in the fetal period, infancy, and early childhood. Much of this literature focuses on rich countries, but researchers are increasingly taking advantage of new sources of data and identification to study the long reach of childhood health in developing countries. Health in early life may be a more significant determinant of adult outcomes in these countries because health insults are more frequent, the capacity to remediate is more limited, and multiple shocks may interact. However, the underlying relationships may also be more difficult to measure, given significant mortality selection. We survey recent evidence on the adult correlates of early-life health and the long-term effects of shocks due to disease, famine, malnutrition, pollution, and war.

http://www.princeton.edu/~tvogl/currie_vogl_AR.pdf

New NBER Working Papers on Homocide Laws

Using Audit Studies to Test for Physician Induced Demand: The Case of Antibiotic Abuse in China
Janet Currie, Wanchuan Lin, Juanjuan Meng

NBER Working Paper No. 18153
Issued in June 2012
NBER Program(s):   HC   HE

The overuse of medical services including antibiotics is often blamed on Physician Induced Demand. But since this theory is about physician motivations, it is difficult to test. We conduct an audit study in which physician financial incentives, beliefs about what patients want, and desires to reciprocate for a small gift are systematically varied. We find that all of these treatments reduce antibiotics prescriptions, suggesting that antibiotics abuse in China is not driven by patients actively demanding antibiotics, by physicians believing that patients want antibiotics, or by physicians believing that antibiotics are in the best interests of their patients, but is largely driven by financial incentives. Our results also show that physician behavior can be significantly influenced by the receipt of a token gift, such as a pen.

Ungated Version

Stand Your Ground Laws and Homicides
Chandler B. McClellan, Erdal Tekin

NBER Working Paper No. 18187
Issued in June 2012
NBER Program(s):   HE   LE

Since 2005, eighteen states have passed legislation that has extended the right to self-defense, with no duty to retreat, to places a person has a legal right to be, and several other states are debating to introduce similar legislation. The controversies surrounding these laws have captured the nation’s attention recently. Despite significant implications that they may have on public safety, there has been little empirical investigation of the impact of these laws on crime and victimization. In this paper, we examine how Stand Your Ground laws that extend the right to self-defense to areas outside the home affect homicides using monthly data from the U.S. Vital Statistics. We identify the impact of these laws by exploiting the variation in the effective date of these laws across states. Our results indicate that Stand Your Ground laws are associated with a significant increase in the number of homicides among whites, especially white males. According to our estimates, between 4.39 and 7.44 additional white males are killed each month as a result of these laws. We find no evidence to suggest that these laws increase homicides among blacks. Our results are robust to a number of specifications and unlikely to be driven entirely by the killings of assailants. Taken together, our findings raise serious doubts against the argument that Stand Your Ground laws make America safer.

New NBER Working Papers on Development and Behavioural Economics

The Behavioralist Goes to School: Leveraging Behavioral Economics to Improve Educational Performance
Steven D. Levitt, John A. List, Susanne Neckermann, Sally Sadoff

NBER Working Paper No. 18165
Issued in June 2012
NBER Program(s):   ED   PE

A long line of research on behavioral economics has established the importance of factors that are typically absent from the standard economic framework: reference dependent preferences, hyperbolic preferences, and the value placed on non-financial rewards. To date, these insights have had little impact on the way the educational system operates. Through a series of field experiments involving thousands of primary and secondary school students, we demonstrate the power of behavioral economics to influence educational performance. Several insights emerge. First, we find that incentives framed as losses have more robust effects than comparable incentives framed as gains. Second, we find that non-financial incentives are considerably more cost-effective than financial incentives for younger students, but were not effective with older students. Finally, and perhaps most importantly, consistent with hyperbolic discounting, all motivating power of the incentives vanishes when rewards are handed out with a delay. Since the rewards to educational investment virtually always come with a delay, our results suggest that the current set of incentives may lead to underinvestment. For policymakers, our findings imply that in the absence of immediate incentives, many students put forth low effort on standardized tests, which may create biases in measures of student ability, teacher value added, school quality, and achievement gaps. 

http://www.nber.org/papers/w18165.pdf

The European Origins of Economic Development
William Easterly, Ross Levine

NBER Working Paper No. 18162
Issued in June 2012
NBER Program(s):   EFG   POL

A large literature suggests that European settlement outside of Europe shaped institutional, educational, technological, cultural, and economic outcomes. This literature has had a serious gap: no direct measure of colonial European settlement. In this paper, we (1) construct a new database on the European share of the population during the early stages of colonization and (2) examine its impact on the level of economic development today. We find a remarkably strong impact of colonial European settlement on development. According to one illustrative exercise, 47 percent of average global development levels today are attributable to Europeans. One of our most surprising findings is the positive effect of even a small minority European population during the colonial period on per capita income today, contradicting traditional and recent views. There is some evidence for an institutional channel, but our findings are most consistent with human capital playing a central role in the way that colonial European settlement affects development today.

http://www.nber.org/papers/w18162.pdf

The Effects of Health Care Reform

Does Universal Coverage Improve Health? The Massachusetts Experience
Charles J. Courtemanche and Daniela Zapata

NBER Working Paper No. 17893
March 2012

JEL No. I12,I13,I18

ABSTRACT

In 2006, Massachusetts passed health care reform legislation designed to achieve nearly universal coverage through a combination of insurance market reforms, mandates, and subsidies that later served as the model for national health care reform. Using individual-level data from the Behavioral Risk Factor Surveillance System, we provide evidence that health care reform in Massachusetts led to better overall self-assessed health. An assortment of robustness checks and placebo tests support a causal interpretation of the results. We also document improvements in several determinants of overall health, including physical health, mental health, functional limitations, joint disorders, body mass index, and moderate physical activity. The health effects were strongest among women, minorities, near-elderly adults, and those with incomes low enough to qualify for the law’s subsidies. Finally, we use the reform to instrument for health insurance and estimate a sizeable impact of coverage on health. The effects on coverage were strongest for men, non-black minorities, young adults, and those who qualified for the subsidies, while the effects of coverage were strongest for women, blacks, the near-elderly, and middle-to-upper income individuals.

http://www.nber.org/papers/w17893.pdf

Intergenerational Persistence in Income and Social Class

Lindsey presented at the UCD departmental seminar in October. This new IZA working paper is on a similar topic.

IZA DP No. 6202

Jo Blanden, Paul Gregg, Lindsey Macmillan:

Intergenerational Persistence in Income and Social Class: The Impact of Within-Group Inequality

Abstract:
Family income is found to be more closely related to sons' earnings for a cohort born in 1970 compared to one born in 1958. This result is in stark contrast to the finding on the basis of social class; intergenerational mobility for this outcome is found to be unchanged. Our aim here is to explore the reason for this divergence. We derive a formal framework which relates mobility in measured family income/earnings to mobility in social class. Building on this framework we then test a number of alternative hypotheses to explain the difference between the trends, finding evidence of an increase in the intergenerational persistence of the permanent component of income that is unrelated to social class. We reject the hypothesis that the observed decline in income mobility is a consequence of the poor measurement of permanent family income in the 1958 cohort.

http://ftp.iza.org/dp6202.pdf

New IZA Working Papers

Some recent working papers. The last reminded me of an article publised in the Times last week. FG wants appointments freeze. There have already been some "interesting" ones unfortunately. Update: Coalition to install 300 people on State boards before election

Pedro Carneiro, Katrine V. Loken, Kjell G. Salvanes:

A Flying Start? Long Term Consequences of Maternal Time Investments in Children During Their First Year of Life

Abstract:
We study the impact on children of increasing the time that the mother spends with her child in the first year by exploiting a reform that increased paid and unpaid maternity leave in Norway. The reform increased maternal leave on average by 4 months and family income was unaffected. The increased time with the child led to a 2.7 percentage points decline in high school dropout. For mothers with low education we find a 5.2 percentage points decline. The effect is also especially large for children of mothers who, prior to the reform, would take very low levels of unpaid leave.

http://ftp.iza.org/dp5362.pdf

Olivier Bargain, Herwig Immervoll, Heikki Viitamäki:

No Claim, No Pain: Measuring the Non-Take-up of Social Assistance Using Register Data

(forthcoming in: Journal of Economic Inequality)

Abstract:
The main objectives of social assistance benefits, including poverty alleviation and labor-market or social reintegration, can be seriously compromised if support is difficult to access. While recent studies point to high non-take-up rates, existing evidence does not make full use of the information recorded by benefit agencies. Most studies have to rely on interview-based data, with misreporting and measurement errors affecting the variables needed to establish both benefit receipt and benefit entitlement. In this paper, we exploit a unique combination of Finnish administrative data and eligibility simulations based on the tax-benefit calculator of the Finnish authorities, carefully investigating the measurement issues that remain. We find rates of non-take-up that are both substantial and robust: 40% to 50% of those eligible do not claim. Using repeated cross-section estimations for years 1996-2003, we identify a set of stable determinants of claiming behavior and suggest that changes in behavior could drive the observed downward trend in take-up rates during the post-recession period. We discuss the poverty implications of our results.

http://ftp.iza.org/dp5355.pdf

Pedro S. Martins:

Cronyism

Abstract:
Politicians can use the public sector to give jobs to cronies, at the expense of the efficiency of those organisations and general welfare. Motivated by a simple model of cronyism that predicts spikes in appointments to state-owned firms near elections, we regress 1980-2008 monthly hirings across all state-owned Portuguese firms on the country’s political cycle. In most specifications, we also consider private-sector firms as a control group. Consistent with the model, we find that public-sector appointments increase significantly over the months just before a new government takes office. Hirings also increase considerably just after elections but only if the new government is of a different political colour than its predecessor. These results also hold when conducting the analysis separately at different industries and most job levels, including less skilled positions. We find our evidence to be consistent with cronyism and politically-induced misallocation of public resources.

http://ftp.iza.org/dp5349.pdf