Shamika Ravi

Workfare as an Effective Way to Fight Poverty: The Case of India's NREGS

This paper analyzes the impact of India’s National Rural Employment Guarantee Scheme (NREGS) on poor rural households. In particular, we study the impact of the program on food security, savings, and health outcomes. We have a panel data of 1,064 households from 198 villages of Andhra Pradesh, over two years. In the early stage of the program, several households that applied for work were denied employment due to shortage of work. We exploit this exogenous variation to calculate triple-difference estimates of the impact of the program. Our results indicate that the NREGS significantly increased the monthly per capita expenditure on food and non-food consumables. The program also improved food security by a significant reduction in the number of meals foregone by households per week. The program raised the probability of holding savings and reduced the incidence of depression among rural households.

Substitution Bias and External Validity: Why an Innovative Anti-Poverty Program Showed No Net Impact

The net impact of development interventions can depend on the availability of close substitutes to the intervention. We analyze a randomized trial of an innovative anti-poverty program in South India which provides “ultra-poor” households with inputs to create a new, sustainable livelihood. We find no statistically significant evidence of lasting net impact on consumption, income or asset accumulation. Instead, income from the new livelihood substituted for earnings from wage labor. A very similar intervention made a large difference elsewhere in South Asia, however, where wage labor alternatives were less compelling. The analysis highlights the roles of substitution bias and dropout bias in shaping evaluation results and delimiting external validity.

Elasticity of Intertemporal Substitution in Consumption: Empirical Evidence from a Natural Experiment

This paper estimates the elasticity of intertemporal substitution in consumption (sigma). We exploit a natural experiment provided by a change in the Indian banking legislation which authorized all the deposit collecting institutions to offer a higher interest rate on deposits to citizens above 60 years of age. Using a difference in difference approach we compare the total consumption expenditure of households whose oldest living member is 60 or 61 years old with households whose oldest living member is 59 or 58 years old, before and after the policy change. We find the estimate of sigma to be equal to approx 2.2.

From Microfinance to m-Finance Innovations Case Discussion: M-PESA

there were just 10 telephone lines installed for every 1000 people in the Philippines. In Kenya, the ratio was 7 per thousand. In India, 6 per thousand. Compare that with the United Kingdom with 441 lines per thousand in 1990, or the United States with 545. For decades, public sector telephone companies in developing economies seldom had incentives or budgets to rapidly expand land line networks, and the private sector has had even less motivation to serve the costly-to-reach. The advent of mobile telephones has changed the equation. Mobile technologies allow countries to leapfrog over existing technologies, and they are leaping quickly. In 2006, an industry association counted 800 million telephones sold over the prior three years in developing countries. In January of this year alone, Indian companies added 7 million new subscribers. With cheap mobile telephones widely available, 40 percent of the population of the Philippines now has a telephone and over 200 million text messages are sent daily—at just 2 cents a message. In Africa, cell phone penetration jumped from 2 million subscribers in 1998 to 82 million by 2004, and the market continues to expand rapidly. One estimate places penetration in Africa in mid-2007 at 160 million subscribers. The spread of mobile technology offers more than a cheaper way to provide telephones. The technology also involves, in part, an expansion of human interaction, changing the nature of interaction as well as its level. The “mobile” element allows you to call your spouse when you’re stuck in traffic and running late; to keep track of your teenagers when they go out with friends; to form a potentially lifeMudit Kapoor, Jonathan Morduch, and Shamika Ravi

Determinants of Corruption: Government Effectiveness vs. Cultural Norms

This paper analyzes the parking behavior of United Nations diplomats in New York City and highlights the key limitation of an earlier work which claims cultural norms to be the significant determinant of corruption. We show that after controlling for Government Effectiveness index, which measures the quality of civil services and quality and quantity of public infrastructure in a country, the effect of culture on corruption becomes insignificant. However, the Country Corruption index and the Government Effectiveness index are strongly correlated which makes it difficult to identify the causal determinant of corruption. It is important to keep this correlation in mind before arriving at conclusions from empirical studies, because Country Corruption index could be proxying for other influences such as Government Effectiveness index, and ignoring this might lead us to falsely attribute the observed behavior to cultural or social norms alone. Understanding the relative importance of these potential causes of corruption is fundamental to policy recommendations.

The Current and Future State of the Sharing Economy

This paper finds that the sharing economy is “the peer-to-peer based activity of obtaining, giving, or sharing access to good and services”. Alternative names for this phenomenon include gig economy, platform economy, access economy, and collaborative consumption. The sharing economy is estimated to grow from

What explains childhood violence? Micro correlates from VACS surveys

14 billion in 2014 to

Are Publicly Financed Health Insurance Schemes Working in India

335 billion by 2025. This estimate is based on the rapid growth of Uber and Airbnb as indicative. Data shows that private vehicles go unused for 95 per cent of their lifetime. Together with the fact that there are fewer requirements to drive for Lyft, Ola and Uber than for a taxi company means greater supply of rides. Prices of shared services are also falling as indicated by Airbnb rates that are between 30 and 60 per cent cheaper than hotel rates around the world. More information shared on an online platform can lead to greater trust between users, but it can also lead to racial and gender bias. Sharing economy companies must work to combat bias on their platforms, both in their algorithms and their users. Removing some identifying information from profiles lowers risk of bias. It is difficult for any one company to form a monopoly since the cost for customers to switch between sharing economy services is quite low.

The Effect of Interest Rate on Household Consumption: Evidence from a Natural Experiment in India

Abstract Violence in childhood is a serious health, social and human rights concern globally, there is, however, little understanding about the factors that explain the various forms of violence in childhood. This paper uses data on childhood violence for 10,042 individuals from four countries. We report Odds Ratios from pooled logit regression analysis with country fixed effects model. There is no gender difference in the overall incidence of childhood violence. The data shows that 78% of girls and 79% of boys have suffered some form of violence before the age of 18 years. Odds of violence are higher among richer households, among individuals who have attended school and among individuals who have been married or in marriage-like arrangements. Individuals who justify wife beating have significantly higher likelihood of having faced violence themselves. Most perpetrators of violence against children – physical, emotional and sexual – are people known to them in their homes and community, and not strangers. There is limited understanding of the factors that explain violence in childhood. This study highlights some key factors that can explain this phenomenon.

The Impact of NREGS on Urbanization in India

Since 2003, various government-sponsored health insurance schemes have been implemented in India to offer financial protection against catastrophic health shocks to the poor. Several state governments took the initiative to roll outb their own state-financed health insurance schemes and these were followed by the national government, rolling out the largest of such schemes, the Rashtriya Swasthya Bima Yojna (RSBY) in 2008. These schemes provide fully subsidized cover for a limited package of secondary and tertiary inpatient care, targeting the population below poverty line. This paper analyzes the impact of these state-sponsored health insurance schemes through a literature review and some illustrative empirical work. We find limited impact of these government-sponsored health insurance schemes and provide rationales for this. We also discuss the policy implications of these findings.