Rikhil R. Bhavnani

Counting Chickens when they Hatch: The Short-Term Effect of Aid on Growth

Past research on aid and growth is flawed because it typically examines the impact of aggregate aid on growth over a short period, usually four years, while significant portions of aid are unlikely to affect growth in such a brief time. We divide aid into three categories: (1) emergency and humanitarian aid (likely to be negatively correlated with growth); (2) aid that affects growth only over a long period of time, if at all, such as aid to support democracy, the environment, health, or education (likely to have no relationship to growth over four years); and (3) aid that plausibly could stimulate growth in four years, including budget and balance of payments support, investments in infrastructure, and aid for productive sectors such as agriculture and industry. Our focus is on the third group, which accounts for about 53% of all aid flows. We find a positive, causal relationship between this “short-impact” aid and economic growth (with diminishing returns) over a four-year period. The impact is large: at least two-to-three times larger than in studies using aggregate aid. Even at a conservatively high discount rate, at the mean a

Counting Chickens when they Hatch: Timing and the Effects of Aid on Growth†

1 increase in short-impact aid raises output (and income) by

Do Electoral Quotas 'Work' After They Are Withdrawn? Evidence from a Natural Experiment in India

1.64 in present value in the typical country. From a different perspective, we find that higher-than-average short-impact aid to sub- Saharan Africa raised per capita growth rates there by about half a percentage point over the growth that would have been achieved by average aid flows. The results are highly statistically significant and stand up to a demanding array of tests, including various specifications, endogeneity structures, and treatment of influential observations. The basic result does not depend crucially on a recipient’s level of income or quality of institutions and policies; we find that short-impact aid causes growth, on average, regardless of these characteristics. However, we find some evidence that the impact on growth is somewhat larger in countries with stronger institutions or longer life expectancies (better health). We also find a significant negative relationship between debt repayments and growth. We make no statement on, and do not attempt to measure, any additional effect on growth from other categories of aid (e.g., emergency assistance or aid that might affect growth over a longer time period); four-year panel regressions are not an appropriate tool to examine those relationships.

The Effects of Weather-Induced Migration on Sons of the Soil Riots in India

Recent research yields widely divergent estimates of the cross‐country relationship between foreign aid receipts and economic growth. We re‐analyse data from the three most influential published aid–growth studies, strictly conserving their regression specifications, with sensible assumptions about the timing of aid effects and without questionable instruments. All three research designs show that increases in aid have been followed on average by increases in investment and growth. The most plausible explanation is that aid causes some degree of growth in recipient countries, although the magnitude of this relationship is modest, varies greatly across recipients and diminishes at high levels of aid.

A Reply to “A Replication of “Counting Chickens When They Hatch” (Economic Journal 2012)”

Do electoral quotas for women alter womens chances of winning elections after they are withdrawn? I answer this question by examining an unusual natural experiment in India in which randomly chosen seats in local legislatures are set aside for women for one election at a time. Using data from Mumbai, I find that the probability of a woman winning office conditional on the constituency being reserved for women in the previous election is approximately five times the probability of a woman winning office if the constituency had not been reserved for women. I also explore tentative evidence on the mechanisms by which reservations affect womens ability to win elections. The data suggest that reservations work in part by introducing into politics women who are able to win elections after reservations are withdrawn and by allowing parties to learn that women can win elections.

The Effects of Malapportionment on Cabinet Inclusion: Subnational Evidence from India

Migration is thought to cause sons of the soil conflict, particularly if natives tend to be unemployed. Using data from India, the authors investigate the causal effect of domestic migration on riots by instrumenting for migration using weather shocks in migrants’ places of origin. They find a direct effect of migration on riots, but do not find that this effect is larger in places with more native unemployment. They argue and find evidence that migration is less likely to cause rioting where the host population is politically aligned with the central government. Politically privileged host populations can appease nativists and reduce migration through means that are less costly than rioting. Without these political resources, hosts resort to violence. Beyond furthering the sons of the soil literature, the authors detail a political mechanism linking natural disasters and, possibly, climate change and environmental degradation to riots, and demonstrate a widely applicable strategy for recovering the causal effect of migration on violence.

Local Embeddedness and Bureaucratic Performance: Evidence from India

The regressions in Clemens et al. (2012) are fully replicable with open-access data and code. Roodman (2015) alters the regression specifications in that paper by adding twice-lagged aid, after which he cannot reject the null hypothesis of a zero effect of aid on growth. We show, with Roodman’s data and code, that his altered specifications have very low power to reject the null–roughly 0.1 to 0.2. In other words, there is an 80-90% chance that Roodman’s altered regressions fail to reject the null by construction. This renders the exercise uninformative about the robustness of the findings in Clemens et al. (2012) or, more generally, about the effect of aid on growth.

Ancillary Studies of Experiments: Opportunities and Challenges

Malapportionment doubly penalizes people from relatively large electoral districts or constituencies by under-representing them in the legislature and in the political executive or cabinet. The latter effect has not been studied. This article develops theoretical reasons for large constituency disadvantage in the cabinet formation process, and tests them using a new repeated cross-sectional dataset on elections and cabinet formation in India’s states, from 1977–2007. A one-standard-deviation increase in relative constituency size is associated with a 22 per cent fall in the probability of a constituency’s representative being in the cabinet. Malapportionment affects cabinet inclusion by causing large parties to focus on winning relatively small constituencies. These effects are likely to hold in parliamentary systems, and in other contexts where the legislature influences cabinet inclusion.

The Missing Globalization Puzzle

While locally embedded bureaucrats may be more willing and able to enhance public goods provisioning in the places that they serve, they may also be more likely to be captured by elite interests. We reconcile these two viewpoints by arguing that locally embedded bureaucrats enhance public goods provisioning when they can be held accountable by the public. We test this theory using data from India, examining how changes in public goods provision within districts are related to the embeddedness of the senior bureaucrats who served in them, using the plausibly random initial assignment of bureaucrats to account for the endogeneity of officer assignment. We find that officers from the state they serve increase public goods provision. Consistent with our theory, this effect is only present in districts with conditions that favor accountability. Our findings further the literatures on embeddedness, bureaucracy, leadership, and development.

Using Asset Disclosures to Study Politicians' Rents: An Application to India

Abstract “Ancillary studies of experiments” are a technique whereby researchers use an experiment conducted by others to recover causal estimates of a randomized intervention on new outcomes. The method requires pairing randomized treatments the researchers did not oversee with data on outcomes that were not the focus of the original experiment. Since ancillary studies rely on interventions that have already been undertaken, oftentimes by governments, they can provide a low-cost method with which to identify effects on a wide variety of outcomes. We define this technique, identify the small but growing universe of papers that employ ancillary studies of experiments in political science and economics, and assess the benefits and limitations of the method.