Cities of Workers, Children or Seniors? Age Structure and Economic Growth in a Global Cross-Section of Cities

August 2019

Remi Jedwab, Daniel Pereira, and Mark Roberts

IIEP working paper 2019-13

Abstract: A large literature documents the positive influence of a city’s skill structure on its rate of economic growth. By contrast, the effect of a city’s age structure on its economic growth has been a hitherto largely neglected area of research. We hypothesize that cities with more working-age adults are likely to grow faster than cities with more children or seniors and set out the potential channels through which such differential growth may occur. Using data from a variety of historical and contemporary sources, we show that there exists marked variation in the age structure of the world’s largest cities, both across cities and over time. We then study how age structure affects economic growth for a global cross-section of mega-cities. Using various identification strategies, we find that mega-cities with higher dependency ratios – i.e. with more children and/or seniors per working-age adult – grow significantly slower. Such effects are particularly pronounced for cities with high shares of children. This result appears to be mainly driven by the direct negative effects of a higher dependency ratio on the size of the working-age population and the indirect effects on work hours and productivity for working age adults within a city.

JEL: R10; R11; R19; J11; J13; J14; O11; N30

Keywords: Urbanization; Cities; Age Structure; Dependency Ratios; Children; Ageing; Demographic Cycles; Agglomeration Effects; Human Capital; Growth; Development

Divorce among European and Mexican Immigrants in the U.S

August 2019

Barry Chiswick and Christina Houseworth

IIEP working paper 2019-12

Abstract: This paper analyzes the status of being currently divorced among European and Mexican immigrants in the U.S., among themselves and in comparison to the native born of the same ancestries. The data are for males and females age 18 to 55, who married only once, in the 2010-2014 American Community Surveys.

Among immigrants, better job opportunities, measured by educational attainment, English proficiency and a longer duration in the U.S. are associated with a higher probability of being divorced. Those who married prior to migration and who first married at an older age are less likely to be divorced. Those who live in states with a higher divorce rate are more likely to be divorced. Thus, currently being divorced among immigrants is more likely for those who are better positioned in the labor market, less closely connected to their ethnic origins, and among Mexican immigrants who live in an environment in which divorce is more prevalent.

Key Words: Marriage, Divorce, Minorities, Immigrants, Gender, Human Capital

JEL Codes: J12, J15, J16, J24

12th Annual Conference on China’s Economic Development and U.S.-China Relations

Friday, November 8th, 2019

Lindner Family Commons, 6th Floor

Elliott School for International Affairs

1957 E Street, NW Washington DC 20052

Schedule of Events

08:15-08:50:  Coffee and Registration

08:50-09:00:  Welcoming Remarks: James Foster (IIEP Director, GWU)


09:00-09:45: Keynote:

Daniel Xu (Duke University): “Fiscal Policies and Firm Investment in China”

09:45-10:45: The Political Economy of Protests

Moderator: Bruce Dickson (GWU)

David Yang (Harvard University): “Persistent Political Engagement: Social Interactions and the Dynamics of Protest Movements”

Davin Chor (Dartmouth College): The Political Economy Consequences of China’s Export Slowdown”. Chor’s work is available here.

10:45-11:15: Coffee Break

11:15-12:15: Capital Market Liberalization and Industrial Policy

Moderator: Chao Wei (GWU)

John Rogers (Federal Reserve Board): “The Effect of the China Connect”

Wenli Li (Federal Reserve Bank of Philadelphia): “Demographic Aging, Industrial Policy, and Chinese Economic Growth”. Li’s work is available here.

12:15-13:15: Lunch and Poster Session

13:15–14:30: Policy Keynotes:

Chad Bown (Peterson Institute for International Economics): “The U.S.-China trade relationship under the Trump administration”. Bown’s work is available here 

David Shambaugh (GWU): “Stresses and Strains in U.S.-China Relations: Origins, Consequences, and Outlook”

14:30-15:00: Coffee Break

15:00-16:00: Industrial Policy, Technology Transfer, and Financial Access

Moderator: Maggie Chen (GWU)

Jie Bai (Harvard University): “Quid Pro Quo, Knowledge Spillovers and Industrial Quality Upgrading”

Jing Cai (University of Maryland): “Direct and Indirect Effects of Financial Access on SMEs”

16:00-17:00: The Belt and Road Initiative

Moderator: Stephen Kaplan (GWU)

Jamie P. Horsley (Brookings Institution): “Belt & Road Governance Challenges and Developments”

Scott Morris (Center for Global Development): “Belt & Road’s Debt and Project Risks”

An archive of all previous Annual Conferences on China’s Economic Development and U.S.-China Economic Relations is available here.

For more information, please contact Kyle Renner at iiep@gwu.edu or 202-994-5320.

Cosponsored by:

How Should We Measure City Size? Theory and Evidence Within and Across Rich and Poor Countries

August 2019

Remi Jedwab, Prakash Loungani, and Anthony Yezer

IIEP working paper 2019-11

Abstract: It is obvious that holding city population constant, differences in cities across the world are enormous. Urban giants in poor countries are not large using measures such as land area, interior space or value of output. These differences are easily reconciled mathematically as population is the product of land area, structure space per unit land (i.e., heights), and population per unit interior space (i.e., crowding). The first two are far larger in the cities of developed countries while the latter is larger for the cities of developing countries. In order to study sources of diversity among cities with similar population, we construct a version of the standard urban model (SUM) that yields the prediction that the elasticity of city size with respect to income could be similar within both developing countries and developed countries. However, differences in income and urban technology can explain the physical differences between the cities of developed countries and developing countries. Second, using a variety of newly merged data sets, the predictions of the SUM for similarities and differences of cities in developed and developing countries are tested. The findings suggest that population is a sufficient statistic to characterize city differences among cities within the same country, not across countries.

JEL Codes: R13; R14; R31; R41; R42; O18; O2; O33

Keywords: Urbanization; Cities; Urban Giants; Population; Standard Urban Model; Measurement; Urban Technology; Building Heights; Sprawl; Housing; Transportation

The Economics of Missionary Expansion: Evidence from Africa and Implications for Development

May 2019

Remi Jedwab, Felix Meier zu Selhausen, and Alexander Moradi

IIEP Working Paper 2019-10

Abstract: How did Christianity expand in sub-Saharan Africa to become the continent’s dominant religion? Using annual panel data on all Christian missions from 1751 to 1932 in Ghana, as well as cross-sectional data on missions for 43 sub-Saharan African countries in 1900 and 1924, we shed light on the spatial dynamics and determinants of this religious diffusion process. Missions expanded into healthier, safer, more accessible, and more developed areas, privileging these locations first. Results are confirmed for selected factors using various identification strategies. This pattern has implications for extensive literature using missions established during colonial times as a source of variation to study the long-term economic effects of religion, human capital and culture. Our results provide a less favorable account of the impact of Christian missions on modern African economic development. We also highlight the risks of omission and endogenous measurement error biases when using historical data and events for identification.

JEL Codes: N3, N37, N95, Z12, O12, O15

Keywords: Economics of Religion; Religious Diffusion; Path Dependence; Economic Development; Compression of History; Measurement; Christianity; Africa

Economic and Political Factors in Infrastructure Investment: Evidence from Railroads and Roads in Africa 1960–2015

September 2017

Remi Jedwab and Adam Storeygard

IIEP Working Paper 2019-9

Abstract: Transport investment has played an important role in the economic development of many countries. Starting from a low base, African countries have recently initiated several massive transportation infrastructure projects. However, surprisingly little is known about the current levels, past evolution, and correlates of transportation infrastructure in Africa. In this paper, we introduce a new data set on the evolution of the stocks of railroads (1862-2015) and multiple types of roads (1960-2015) for 43 sub-Saharan African countries. First, we compare our estimates with those from other available data sets, such as the World Development Indicators. Second, we document the aggregate evolution of transportation investments over the past century in Africa. We confirm that railroads were a “colonial” transportation technology, whereas paved roads were a “post-colonial” technology. We also highlight how investment patterns have followed economic patterns. Third, we report conditional correlations between 5-year infrastructure growth and several geographic, economic and political factors during the period 1960-2015. We find strong correlations between transportation investments and economic development as well as more political factors including pre-colonial centralization, ethnic fractionalization, European settlement, natural resource dependence, and democracy. This suggests that non-economic factors may have a significant role in the ability of countries to invest in these public goods.

JEL Codes: O11; O18; O20; H54; R11; R12; R40; N77

Keywords: Transportation Infrastructure; Public Investment; Railroads; Roads; Paved Roads; Africa; Growth; Institutions; Comparative Development; History

The Average and Heterogeneous Effects of Transportation Investments: Evidence from sub-Saharan Africa 1960-2010

March 2019

Remi Jedwab and Adam Storeygard

IIEP Working Paper 2019-8

Abstract: Previous work on transportation investments has focused on average impacts in high- and middle-income countries. We estimate average and heterogeneous effects in a poor continent, Africa, using roads and cities data spanning 50 years in 39 countries. Using changes in market access due to distant road construction as a source of exogenous variation, we estimate an 30-year elasticity of city population with respect to market access of 0.06–0.18. Our results suggest that this elasticity is stronger for small and remote cities, and weaker in politically favored and agriculturally suitable areas. Access to foreign cities matters little.

JEL Codes: R11; R12; R4; O18; O20; F15; F16

Keywords: Transportation Infrastructure; Paved Roads; Urbanization; Cities; Africa; Market Access; Trade Costs; Highways; Internal Migration; Heterogeneity

Boom-Bust Capital Flow Cycles

May 2019

Graciela Laura Kaminsky

IIEP Working Paper 2019-7

Abstract: This paper examines the new trends in research on capital flows fueled by the 2007-2009 Global Crisis. Previous studies on capital flows focused on current-account imbalances and net capital flows. The Global Crisis changed that. The onset of this crisis was preceded by a dramatic increase in gross financial flows while net capital flows remained mostly subdued. The attention in academia zoomed in on gross inflows and outflows with special attention to cross border banking flows before the crisis erupted and the shift towards corporate bond issuance in its aftermath. The boom and bust in capital flows around the Global Crisis also stimulated a new area of research: capturing the “global factor.” This research adopts two different approaches. The traditional literature on the push-pull factors, which before the crisis was mostly focused on monetary policy in the financial center as the “push factor,” started to explore what other factors contribute to the comovement of capital flows as well as to amplify the role of monetary policy in the financial center on capital flows to the periphery. This new research focuses on global banks’ leverage, risk appetite, and global uncertainty. Since the “global factor” is not known, a second branch of the literature has captured this factor indirectly using dynamic common factors extracted from actual capital flows or movements in asset prices.

Keywords: The Global Crisis, Capital flow cycles, global banks, “push” and “pull” factors, corporate borrowing, global factors, dynamic latent factor models.

JEL Codes: F30, F34, F65

 

Applied Micro Seminar

Wednesday, May 8, 12:30-2:00

John W. Kendrick Seminar Room
Room 321 at 2115 G Street NW
Washington, DC 20052

Yao Pan (Aalto University)
“Aladdin’s Lamp Unleashed: Successful Social Programs over Local Political Cycles”


Abstract: A social program can achieve great success in one case but not in another, and the reason is far from clear. This paper tests a new hypothesis that timing of program introduction relative to local political cycle greatly affects a program’s impact, using a government-implemented village fund program in China. Combining household-level panel data from a random experiment on loan provision and the exogenous variation in the timing of the program introduction relative to the village Party secretary’s reselection cycle, we show that the program achieves a higher loan take-up rate, better poor targeting, fewer violations, and a higher overall performance score if it is introduced in the year prior to reappointment. These divergencies are most likely driven by differences in effort levels the village fund committees put into the program and in loan terms set by them. Finally, we show villages with the program introduced in the year prior to reappointment experience higher levels of agricultural income, agricultural production assets, and food consumption. Taken together, these results signify the importance of politician’ incentives for successful social program implementation.

9th Washington Area International Trade Symposium (WAITS) Conference

The 9th Annual Washington Area International Trade Symposium (WAITS) will be held on:

Friday, April 26, 2019
8:15 a.m. – 5:15 p.m.
Lindner Family Commons (6th Floor)
Elliott School of International Affairs
1957 E Street, NW

The Washington Area International Trade Symposium (WAITS) is a forum that highlights trade research at institutions in the Washington D.C. area. Its primary activity is sponsoring an annual research conference where scholars present their latest academic work. Researchers from George Washington University, American University, the Census Bureau, the Federal Reserve Board, Georgetown University, the Inter-American Development Bank, Johns Hopkins University (SAIS), the U.S. International Trade Commission, the University of Maryland, and the World Bank have all participated in the symposium.

Conference Program

08:15-08:55

Breakfast
08:55-09:00  Opening Remarks: Maggie ChenDirector, Institute for International Economic Policy, George Washington University
9:00-9:45

“Regional Spillovers through Multi-Market Firms: The Product Replacement Channel”

  • Presenter: Ryan KimSchool of Advanced International Studies, Johns Hopkins University
  • Discussant: Ana FernandesWorld Bank
9:45-10:30

“Non-Tariff Barriers and Bargaining in Generic Pharmaceuticals”

  • Presenter: Sharat GanapatiGeorgetown University
  • Discussant: Gloria SheuDepartment of Justice
10:30-11:00 Coffee Break
11:00-11:45

“Training and Labor Adjustment to Trade”

  • Presenter: Marisol Rodriguez ChatrucInter-American Development Bank
  • Discussant: Claire BrunelAmerican University
11:45-12:30

“Trade, Jobs, and Worker Welfare”

  • Presenter: Eunhee LeeUniversity of Maryland
  • Discussant: Ricardo Reyes-HerolesFederal Reserve Board
12:30-13:15 Lunch
13:15-14:00

“Family Leave Law and the Demand for Female Labor: Evidence from a Trade Shock”

  • Presenter: Fariha KamalU.S. Census Bureau
  • Discussant: Mina KimBureau of Labor Statistics
14:00-14:45

“Robots, Tasks, and Trade”

  • Presenter: Erhan ArtucWorld Bank
  • Discussant: Heiwai TangJohns Hopkins University
14:45-15:00 Coffee Break
15:00-15:45

“Testing Stolper-Samuelson with a Natural Experiment”

  • Presenter: Dan BernhofenAmerican University
  • Discussant: Colin HottmanFederal Reserve Board
15:45-16:30

 “What are the Price Effects of Trade: Evidence from the U.S. and Implications for Quantitative Trade Models”

  • Presenter: Erick SagerFederal Reserve Board
  • Discussant: Paul PiveteauJohns Hopkins University
 16:30-17:15

“Your (Country’s) Reputation Precedes You: Information Asymmetry, Externalities and the Quality of Exports”

  • Presenter: Yingyan ZhaoPenn State University and George Washington University
  • Discussant: Paulo BastosWorld Bank

 

Shared Values in U.S.- Taiwan Relations: Strengthening Democracy Through Open Governance

Tuesday, April 23, 2019
12 – 2 p.m.
Lindner Family Commons (6th Floor)
Elliott School of International Affairs – GWU
1957 E Street, NW

Open. Collective. Experimental. Sustainable. Taiwan’s first Digital Minister Audrey Tang will address what happens when people who grew up on the internet get their hands on the building blocks of government. As a self-described “conservative anarchist” and a so-called “white-hat hacker,” Minister Tang will show how she works with her team to channel greater combinations of intelligence into policy-making decisions and the delivery of public services. Minister Tang will also discuss “tech for good” and how Taiwan is “SDG

(Sustainable Development Goals) indexing everything.” This event is free and open to the public and the media. This event will be live streamed on the Sigur Center’s YouTube channel. During the moderated Q&A session, Minister Tang will use the Sli.do polling platform to include audiences on the internet in the discussion.

 

Agenda

12 – 12:05 p.m. Welcome Remarks by Sigur Center for Asian Studies Director Benjamin Hopkins

12:05 – 12:25 p.m. Keynote Address by Minister Audrey Tang

12:25 – 12:45 p.m. Commentary by Dr. Susan Aaronson and Dr. Scott White

12:45 – 1:15 p.m. Moderated Q&A Discussion by Dr. Deepa Ollapally

1:15 – 1:45 p.m. Conclusion and Lunch

Earth Day: The Ethics of Climate Change

The Leadership, Ethics and Practice (LEAP) Initiative, the Institute for
International Economic Policy (IIEP), and the Masters of Arts in International
Affairs (MAIA) program present:

Earth Day:
The Ethics of Climate Change
A lunch discussion with Dr. Andrew Steer, President and CEO of World
Resources Institute

 

Monday, April 22, 2019
12:00pm to 1:00p

Elliott School of International Affairs
Room 505,  5th floor
1957 E Street NW Washington, DC 20052

About the Speaker

Dr. Andrew Steer is the President and CEO of the World Resources Institute, a global research organization that works in more than 50 countries, with offices in the Brazil, China, Europe, India, Indonesia, Mexico and the United States. WRI’s more than 500 experts work with leaders to address six urgent global challenges at the intersection of economic development and the natural environment: food, forests, water, climate, energy and cities.Dr. Steer joined WRI from the World Bank, where he served as Special Envoy for Climate Change from 2010 – 2012. From 2007 to 2010, he served as Director General at the UK Department of International Development (DFID) in London. Dr. Steer is a Global Agenda Trustee for the World Economic Forum, and is a member of the China Council for International Cooperation on Environment and Development (CCICED), the Leadership Council of the Sustainable Development Solutions Network, the Energy Transitions Commission, the Champions 12.3 Coalition to reduce food loss and waste, the Sustainable Advisory Groups of both IKEA and the Bank of America, and he serves on the Executive Board of the UN Secretary General’s Sustainable Energy For All Initiative. In earlier years, Andrew held several senior posts at the World Bank, including Director of the Environment Department. He also has directed World Bank operations in Vietnam and Indonesia and served as Chief of the Country Risk Division and Director and Chief Author of the 1992 World Development Report on Environment and Development.

IMF Sub-Saharan Africa Regional Economic Outlook (REO)

Thursday, May 9, 2019
10:00am to 12:00pm

 
Elliott School of International Affairs
Lindner Commons, 6th floor
1957 E Street NW
Washington, DC 20052

Schedule:

10 a.m.

Welcome Remarks by Maggie Chen and Jennifer Cooke 

10:05 a.m. Opening remarks and REO summary – Mahvash S. Qureshi 
10:20 a.m. “The Economic Consequences of Conflict” – Shanta Devarajan
10:40 a.m. Discussant remarks and presenter response 
10:55 a.m. Audience Q&A
11:10 a.m.

“Is the African Continental Free Trade Area a Game Changer for the Continent?” – Jason Weiss and Yunhui Zhao

Florie Liser, President and CEO of the Corporate Council on Africa

11:30 a.m. Discussant remarks and presenter response – Discussant (TBD)
11:45 a.m. Audience Q&A
12:00 p.m.   Event conclusion

 

SUMMARY Chapter – Presented by Mahvash S. Qureshi - IMF

The economic recovery in sub-Saharan Africa continues. Regional growth is set to pick up from 3.0 percent in 2018 to 3.5 percent in 2019, before stabilizing at about 4.0 percent over the medium term. These region‑wide statistics mask considerable heterogeneity in the growth performance and prospects of countries across the region. About half of the countries—mostly non-resource-intensive—are expected to grow at 5 percent or more, implying that their per capita incomes over the medium term would rise faster than the average for the rest of the world. For other countries (mostly resource intensive), improvements in living standards will be slower. Notwithstanding these different economic prospects, countries share the challenge of strengthening resilience and creating higher, more inclusive and durable growth. Addressing these challenges requires enhancing resilience to shocks by building fiscal space including through revenue mobilization, boosting productivity, and spurring private investment.

 

The two analytical chapters in the REO focus on the economic costs of conflicts in the region and the implications of the African Continental Free Trade Agreement (AfCFTA).

THE ECONOMIC CONSEQUENCES OF CONFLICT: presented by Siddharth Kothari

This chapter explores the challenges faced by conflict-affected countries in sub-Saharan Africa, providing a comprehensive analysis of the trends and economic consequences of conflicts. Although the intensity of conflicts in recent years is lower than that observed in the 1990s, the region remains prone to conflicts, with around 30 percent of the countries affected in 2017. Moreover, the nature of conflicts has changed, with traditional civil wars being replaced by non-state-based conflicts, including the targeting of civilians through terrorist attacks. Conflicts in the region are associated with a large and persistent decline in per capita GDP and have significant spillover effects on nearby regions and countries. They also pose significant strains on countries’ public finances, lowering revenue, raising military spending, and shifting resources away from development and social spending, which further aggravates the conflicts’ economic and social costs. The findings highlight the significant costs and formidable challenges faced by countries suffering from conflict and underscores the need to prevent conflicts, including by promoting inclusive economic development, building institutional capacity, and social cohesion. For countries in conflict, efforts should focus on limiting the loss of human and physical capital by protecting social and development spending. While this may be especially daunting given fiscal pressures, well-targeted and coordinated humanitarian aid and concessional financial assistance can provide some relief.

Is The African Continental Free Trade Area A Game Changer For The Continent?

potential benefits and challenges of implementing the AfCFTA. The AfCFTA agreement envisions elimination of tariffs on most goods, liberalization of trade of key services, addressing nontariff obstacles that hamper intraregional trade, and eventually creating a continental single market with free movement of labor and capital. The AfCFTA will likely have important macroeconomic and distributional effects. It can significantly boost intra-African trade, particularly if countries tackle nontariff bottlenecks to trade, including physical infrastructure, logistical costs, and other trade facilitation hurdles. The picture is not uniform. More diversified economies and those with better logistics and infrastructure will benefit relatively more from trade integration. Fiscal revenue losses from tariff reductions are likely to be limited on average, with a few exceptions. Moreover, deeper trade integration is associated with a temporary increase in income inequality. The findings suggest that, in addition to tariff reductions, policy efforts to boost regional trade should focus on reforms to address country-specific nontariff bottlenecks. To ensure that the benefits of regional trade integration are shared by all, policymakers should be mindful of the adjustment costs that integration may entail. For less developed and agriculture-based economies, trade policies should be combined with structural reforms to improve agricultural productivity and competitiveness. Furthermore, governments should facilitate the reallocation of labor and capital across sectors (for example, active-labor market programs such as training and job-search assistance, and measures that enhance competitiveness and productivity) and bolster safety nets (income support and social insurance programs) to alleviate the temporary adverse effects on the most vulnerable.

IMF World Economic Outlook

Schedule

9:30 – 9:45  Opening Remarks: Maggie Chen, Director, Institute for International Economic Policy, George Washington University 
9:45 – 10:15 

Chapter 1: Global Prospects and Policies 

• Presenter: Malhar Nabar, Deputy Division Chief, WEO Division, Research Department, International Monetary Fund 

10:15 – 10:30  Coffee Break 
10:30 – 11:15 

Chapter 2: The Rise of Corporate Market Power and Its Macroeconomic Effects 

• Presenter: Romain Duval, Advisor to the Chief Economist, Research Department, International Monetary Fund

• Discussant: Zia Qureshi, Visiting Fellow, Global Economy and Development, Brookings Institution

11:15 – 11:30  Coffee Break 
11:30 – 12:15 

Chapter 3: The Price of Capital Goods: A Driver of Investment Under Threat? 

• Presenter: Natalija Novta, Economist, WEO Division, Research Department, International Monetary Fund
• Discussant: Paulo Bastos, Senior Economist, DECTI, World Bank

12:15  Concluding Remarks

 

Maggie Chen

George Washington University 

Maggie Chen is a professor of economics and international affairs at The George Washington University. Her areas of research expertise include foreign direct investment, international trade, and regional trade agreements and her work has been published extensively in academic journals such as American Economic Journal: Applied Economics, American Economic Journal: Economic Policy, and Journal of International Economics. She has worked as an economist in the research department of the World Bank, a trade policy advisor at the U.S. Congressional Budget Office leading policy analysis on the Trans-Pacific Partnership Agreement, and a consultant for various divisions of the World Bank and the International Finance Corporation advising issues ranging from foreign direct investment and technical trade barriers to the Belt and Road Initiative and contributing to various World Bank flagship studies and the World Development Report. She is a co-editor of the Economic Inquiry. Professor Chen received her Ph.D. and M.A. in Economics from the University of Colorado at Boulder and her B.A. in Economics from Beijing Normal University. 

Malhar Nabar 

International Monetary Fund 

Malhar Nabar is Deputy Division Chief in the World Economic Studies Division, where he is part of the core team that produces the WEO. In previous roles at the IMF, Malhar has covered China and Japan, and was Mission Chief to Hong Kong SAR. Prior to joining the IMF, Malhar taught at Wellesley College. His research interests are in investment and productivity growth, and he has published in various journals including Journal of Development Economics, Economic Inquiry, and Journal of Macroeconomics. He holds a PhD from Brown University and a BA from Oxford University. 

Romain Duval 

International Monetary Fund 

Romain Duval is an advisor to the Chief Economist in the IMF Research Department, where he also leads the Structural Reforms Unit. Previously he was the division chief for Regional Studies of the IMF Asia Pacific Department and led the Regional Economic Outlook. Prior to joining the Fund, he was the division chief for Structural Policies Surveillance at the OECD Economics Department, where he was also the editor of the flagship publication Going for Growth. He has published extensively in leading academic and policy-oriented journals on a wide range of topics including the economics and political economy of labor and product market regulations, growth, productivity, trade, monetary policy, equilibrium real exchange rates, and climate change economics. Over the years his research has also been profiled numerous times in leading global newspapers and magazines such as The Economist, Financial Times, Wall Street Journal and Bloomberg. 

Zia Qureshi 

Brookings Institution 

Zia Qureshi is a Visiting Fellow at the Brookings Institution. He also advises and consults for several other organizations. His research and commentary cover a broad range of global economic issues, including a recent focus on how technology is reshaping the economic agenda. He has published widely on these issues. Prior to joining Brookings, he worked at the World Bank and the IMF for thirty-five years, holding several leadership positions, including serving as Director, Development Economics, at the Bank and as Executive Secretary of the Joint Bank-Fund Ministerial Development Committee. He represented the Bank at major international forums, including the G20. He led a number of Bank and Fund flagship publications. He holds a DPhil in Economics from Oxford University, where he was a Rhodes Scholar. 

Natalija Novta 

International Monetary Fund 

Natalija Novta is an Economist at the IMF’s Research Department, where she works on the World Economic Outlook. She previously worked in the Western Hemisphere and the Fiscal Affairs Departments contributing to the Regional Economic Outlook and the Fiscal Monitor, respectively. Before joining the Fund, she worked at the Fiscal Council of Serbia, the Serbian Ministry of Finance, and the National Bureau of Economic Research. She holds a PhD in Economics from New York University, and a BA from Harvard University. Her research has focused on economic development, conflict, climate change, trade flows, and public sector employment. She has published at the Quarterly Journal of Economics, Journal of the European Economic Association, Journal of Conflict Research and International Tax and Public Finance. 

Paulo Bastos 

World Bank 

Paulo Bastos is a Senior Economist with the Development Research Group of the World Bank in the Trade and International Integration Unit (DECTI). His research interests include the drivers of firm performance in export markets, links between globalization and technological change, and the distributional impacts of trade and FDI. His recent research exploits large administrative data sets to address these topics. He has published in scholarly journals such as the American Economic Review, Journal of International Economics, Journal of Development Economics, Journal of Industrial Economics and International Journal of Industrial Organization. Prior to joining the World Bank, he held positions at the Research Department of the Inter-American Development Bank, the European Commission and the University of Nottingham. He holds a Ph.D. in Economics from the University of Nottingham and a B.A. in Economics from the University of Porto. 

Financing the Sustainable Development Goals

Wednesday, April 10th 2019 8:00 AM – 9:30 AM

Lindner Family Commons

 

Information: The last few years have witnessed a seismic shift in investors’ attitudes and demand for social and economic investments in emerging markets. Impact investing, ESG, Green Finance and SDGs are among many of the words that have recently populated investment committees and investor conferences as well as boardrooms. Leveraging GWU’s IIEP Visiting Scholar’s work on Assessing and Monitoring the Addis Ababa Action Agenda (AAA) and Citi’s GPS research, UN’s SDG: Pathways to Success- A Systemic Framework for Aligning Investment, the event will provide the opportunity to evaluate the progress of SDG financing and to appraise the degree of mobilization of private sector capital in support of the SDGs. Within this analytical context, market participants — issuers, investors, Development Financial Institutions (DFIs) and donors — will discuss the advances and challenges of financing sustainable development. The forum will seek to address the means to scale private sector capital investment, the need to institutionalise SDG financing instruments and structures and the critical contributions that public sector actors, such as donor agencies, can make to realize the “disruption” of the development aid paradigm. The discussion will also touch upon the importance of data capture and disclosure as it relates to the impact and outcomes of the SDG’s investments.  

Agenda

7:30–8:00am: Breakfast and Registration 8:00–8.05am: Welcome Remarks

  • Maggie Chen, Director, Institute for International Economic Policy, GWU
  • Julie Monaco, Managing Director, Global Head Public Sector Group, Corporate and Investment Bank, Citi

8:058:20am: Setting the Stage (Presentations of Relevant Research)

  • Ajay Chhibber, Visiting Scholar, Institute for International Economic Policy, GWU
  • Jason Channell, Head of Social & Responsible Investment Research, Citi

 8:209:30am: High-Level Panel Discussion and Audience Q&A Panelists

  • Denis Duverne, Chairman, Board of Directors, AXA
  • Mahmoud Mohieldin, Senior Vice President, 2030 Development Agenda, United Nations Relations, and Partnerships, World Bank
  • Donna Sims Wilson, President, Smith Graham & Co.
  • Sean Jones, Senior Deputy Assistant Administrator, Food Security, USAID
  • Tim Turner, Group Chief Risk Officer, African Development Bank

 

Organizing Committee: Peter Sullivan (Citi), Ajay Chhibber, Kyle Renner, Sunil Sharma (all George Washington University), and Andreas (Andy) Jobst (World Bank)

Economic Diversification in the Post-Oil Era

Friday, April 12, 2019
9:00 am – 10:30 am

Hosting Kuwait’s Minister of Finance 

Elliott School of International Affairs
State room, 7th floor
1957 E Street NW
Washington, DC 20052


Schedule

09:00-09:30 a.m

Registration, Light Refreshments, and Networking

09:30-09:40 a.m.

Welcome Remarks by Amb. Ghnem

09:40-10:20 a.m 

one -on-one discussion with H.E. Dr. Nayef F. Al-Hajraf moderated by Prof. Robert Weiner

10:20 a.m.-10:30 a.m

Audience Q&A

Drug Money and Bank Lending: The Unintended Consequences of Anti-Money Laundering

March 2019

Tomas Williams, Pablo Slutzky, and Mauricio Villamizar-Villegas

IIEP Working Paper 2019-5

Abstract: We explore the unintended consequences of anti-money laundering (AML) policies. For identification, we exploit the implementation of the SARLAFT system in Colombia in 2008, aimed at controlling the flow of money from drug trafficking into the financial system. We find that bank deposits in municipalities with high drug trafficking activity decline after the implementation of the new AML policy. More importantly, this negative liquidity shock has consequences for credit in municipalities with little or nil drug trafficking. Banks that source their deposits from areas with high drug trafficking activity cut lending relative to banks that source their deposits from other areas. We show that this credit shortfall negatively impacted the real economy. Using a proprietary database containing data on bank-firm credit relationships, we show that small firms that rely on credit from affected banks experience a negative shock to investment, sales, size, and profitability. Additionally, we observe a reduction in employment in small firms. Our results suggest that the implementation of the AML policy had a negative effect on the real economy.

JEL Classification: K42, G18, G21

Keywords: money laundering; organized crime; financial system; bank lending; liquidity; economic growth

Agricultural extension, intra-household allocation and malaria

March 2019

Yao Pan and Saurabh Singhal

IIEP Working Paper 2019-4

Abstract: Can agricultural development programs improve health-related outcomes? We exploit a spatial discontinuity in the coverage of a large-scale agricultural extension program in Uganda to causally identify its effects on malaria. We find that eligibility for the program reduced the proportion of household members with malaria by 8.9 percentage points, with children and pregnant women experiencing substantial improvements. An examination of the underlying mechanisms indicates that an increase in income and the resulting increase in the ownership and usage of bednets may have played a role. Taken together, these results signify the importance of financial constraints in investments for malaria prevention and the potential role that agricultural development can play in easing it.

Keywords: Malaria, Intra-household Allocation, Agricultural Extension, Regression Discontinuity, Uganda

JEL Classification: I15, I12, D13, O12, Q16.

Washington Area Labor Economics Symposium

Friday, March 29th 2019

8:30 AM – 5:00 PM

Lindner Family Commons

Information:

  • WALES is a one-day labor economics conference that brings together researchers from several DC institutions. The goal is to provide an outlet to share work in progress and get to know other researchers. Researchers from the George Washington University, American University, the Census Bureau, the Federal Reserve Board, Georgetown University, the University of Maryland, the Urban Institute and the World Bank will be participating in the symposium. Breakfast, lunch and coffee will be served.

 

8:30-8:50                    Light breakfast

 

8:50-9:00                    Opening remarks

 

9:00-9:40                    Tomas Monarrez (Urban Institute). “The Effect of Charter Schools on School Segregation”

 

9:40-10:20                  Nolan Pope (Maryland). “Timing is Everything: Evidence from College Major Decisions”

 

10:20-10:40                Coffee Break

 

10:40-11:20                Claire Brunel (American). “Climate Change and Internal Migration in Brazil: The Role of Geography and Road Infrastructure” (with Yuanyuan Maggie Liu)

 

11:20-12:00                Mary Ann Bronson (Georgetown). “The Wage Growth and Within-Firm Mobility of Men and Women: New Evidence and Theory” (with Peter Skogman)

 

12:00-1:00                  Lunch

 

1:00-1:40                    John Coglianese (Federal Reserve). “Household Adaption to Seasonal Earnings Losses” (with Brendan Price)

 

1:40-2:20                    Ana Fernandes and Joana Silva (World Bank). “Transmission of Foreign Business Cycles and Financial Shocks through the Lens of Individual Firms and Workers”

 

 

2:20-2:30                    Coffee Break

 

2:30-3:10                    Bryan Stuart (GWU). “Recessions and Local Labor Markets” (with Brad Hershbein)

 

3:10-3:50                    James Spletzer (Census). “The Gig Economy and the Future of Work” (with Katharine Abraham, John Haltiwanger, and Kristin Sandusky)

 

3:50-4:00                    Mini coffee break

 

4:00-4:15                    Remi Jedwab (GWU). “Returns to Experience and Economic Growth” (with Asif Islam and Paul Romer)

 

4:15-4:30                    Xavier Gine (World Bank). “Breaking the Glass Ceiling? Evidence from Female Mobile Money Agents in Bangladesh”

 

4:30-4:45                    Austin Davis (American). “Missing Skills and Mobility Frictions: An Experiment in Urbanizing India”

 

4:45-5:00                    Fredric Blavin (Urban Institute). “The Long-Term Effects of Childhood Exposure to the Earned Income Tax Credit on Outcomes”

India and USA: Shared Prosperity, Opportunities, and Challenges

Tuesday, March 19th, 2019

10:30 AM – 12:00 PM

Location: City View Room

About the Event:

This event is hosted by the Institute for International Economic Policy (IIEP), the Federation of India’s Chambers of Commerce and Industry (FICCI), and the Sigur Center for Asian Studies. Elliott School Dean Reuben Brigety III will provide welcoming remarks, which will be followed by a fireside chat with H.E. Amb. Shringla moderated by IIEP Visiting Scholar and FICCI Chief Economic Advisor, Ajay Chhibber. A panel of experts on education, infrastructure investments, and pharmaceuticals will conclude the event.

Schedule:

Welcome remarks………………… Professor Maggie Chen
                                                                   Director, Institute for International Economic Policy, GWU
                                      ………………… Ambassador Reuben E. Brigety II
                                                                  Dean, Elliot School of International Affairs, GWU
Fireside chat………………………… H.E. Harsh Vardhan Shringla
                                                                  Ambassador of India to the United States of America
                          …………………………. Ajay Chhibber
                                                                  Visiting Scholar, Institute for International Economic Policy, GWU
                                                                  Chief Economic Advisor, Federation of Indian Chambers of
                                                                  Commerce and Industry
Expert panel……………………..… Subir V. Gokarn
                                                           Executive Director for Bangladesh, Bhutan, India and SriLanka, International Monetary  Fund
                           …………………..…… Sofia Mumtaz
                                                                President, Lupin Limited
                          ……..………………… Adrian Mutton
                                                               Founder & CEO, Sannam S4 Group of companies & U.S.
                                                              Business Centers
Moderated by………………….… Ridhika Batra
                                                              Country Head / Director, Federation of Indian Chambers of
                                                             Commerce and Industry, U.S.

Do Constraints on Women Worsen Child Deprivations? Framework, Measurement, and Evidence from India

March 2019

Stephen C. Smith, Alberto Posso and Lucia Ferrone

IIEP Working Paper 2019-2

Abstract: This paper provides a framework for analyzing constraints that apply specifically to women, which theory suggests may have negative impacts on child outcomes (as well as on women). We classify women’s constraints into four dimensions: (i) domestic physical and psychological abuse, (ii) low influence on household decisions, (iii) restrictions on mobility, and (iv) limited information access. Each of these constraints are in principle determined within households. We test the impact of women’s constraints on child outcomes using nationally representative household Demographic and Health Survey data from India, including 53,030 mothers and 113,708 children, collected in 2015-16. Outcomes are measured as multidimensional deprivations, utilizing UNICEF’s Multidimensional Overlapping Deprivation Analysis index, incorporating deficiencies in children’s access to water, sanitation, housing, healthcare, nutrition, education and information. Our preferred specification follows Lewbel, constructing internal heteroskedasticity-based instruments; and we present an array of additional econometric strategies and robustness checks. We find that children of women who are subjected to domestic abuse, have low influence in decision making, and limited freedom of mobility are more likely to be deprived. Specifically, our causal analysis uncovers a robust impact of women experiencing constraints in emotional abuse, restrictions on the use of household earnings, and freedom of movement to access health facilities, on child deprivation. We conclude that societal changes that relax constraints on women may have potential complementary benefits for their children. We recommend that analyses showing welfare gains of relaxing constraints on women account for potential additional intra-household benefits, examining other channels through which they operate.

JEL Classifications: I15, I25 I32, O15

Key Words: child deprivations, MODA, child health, child nutrition, education, bargaining, empowerment, domestic abuse, mobility restrictions, information access, gendered constraints, multidimensional measurement, Lewbel estimation, instrumental variables, matching

A mHealth Voice Messaging Intervention to Improve Infant and Young Child Feeding Practices in Senegal

February 2019

Shauna Downs, Jessica Fanzo, Jozefina Kalaj, Joachim Sackey, and Stephen C. Smith

IIEP Working Paper 2019-6

Abstract: Mobile health (mHealth) interventions have the potential to improve infant and young child feeding (IYCF) practices; however, gaps in the literature remain regarding their design, implementation and effectiveness. The aims of this study were to: design a mHealth voice messaging intervention delivered to mothers and fathers targeting IYCF practices and examine its implementation and impact in households with children 6-23 months in three rural villages in Senegal. We conducted focus groups (n=6) to inform the intervention development. We then conducted a pilot study (n=47 households) to examine the impact of the intervention on IYCF practices of children 6-23 months. Voice messages were sent to the children’s mothers and fathers over a period of four weeks (2 messages/week; 8 messages in total), and 24-hour dietary recalls and food frequency questionnaires (FFQs) were conducted before and immediately after the implementation of the mHealth intervention to examine its impact on IYCF practices. Overall, 3 of the 8 behaviors increased and one decreased. There was a significant increase in the number of children that consumed fish (60% vs 94%; p=0.008) as measured by the 24-hour recall after the completion of the intervention. We also found significantly higher frequency of egg (p=0.026), fish (p=0.004) and thick porridge (p=0.002) consumption in the previous 7-days measured by the FFQ. Our findings suggest that voice messaging IYCF interventions in Senegal have the potential to improve IYCF behaviors among young children in the short term. Future research should entail scaling-up the intervention and examining its sustainability over the long-term.

JEL Classification: I15, O15; Q12

Keywords: Infant and young child feeding, mHealth, behavior change communication, nutrition, horticulture, farming groups

Pandemics, Places, and Populations: Evidence from the Black Death

February 2019

Remi Jedwab, Noel D. Johnson, and Mark Koyama

IIEP Working Paper 2019-3

Abstract: The Black Death killed 40% of Europe’s population between 1347-1352, making it one of the largest shocks in the history of mankind. Despite its historical importance, little is known about its spatial effects and the effects of pandemics more generally. Using a novel dataset that provides information on spatial variation in Plague mortality at the city level, as well as various identification strategies, we explore the short-run and long-run impacts of the Black Death on city growth. On average, cities recovered their pre-Plague populations within two centuries. In addition, aggregate convergence masked heterogeneity in urban recovery. We show that both of these facts are consistent with a Malthusian model in which population returns to high-mortality locations endowed with more rural and urban fixed factors of production. Land suitability and natural and historical trade networks played a vital role in urban recovery. Our study highlights the role played by pandemics in determining both the sizes and placements of populations.

JEL: R11; R12; O11; O47; J11; N00; N13

Keywords: Pandemics; Black Death; Mortality; Path Dependence; Cities; Urbanization; Malthusian Theory; Migration; Growth; Europe

Should Leaders Focus on Poverty or Inequality? Ethical and Policy Perspectives

The Leadership, Ethics, and Practice Initiative and the Institute for International Economic Policy Presents:

 
Should Leaders Focus on Poverty or Inequality?
Ethical and Policy Perspectives 
 

Monday, February 25, 2019

5:00pm to 6:00pm 

Elliott School of International Affairs
Lindner Commons, 6th floor
1957 E Street NW
Washington, DC 20052
 
Join us for an evening discussion on the topic:
“Should Leaders Focus on Poverty or Inequality? : Ethical and Policy Perspectives”
 with Dr. Douglas Hicks Professor of Religion and Dean of Oxford College at the Emory University.

This event is on the record and open to media. 

 

Do Fed Forecast Errors Matter?

August 2018

Tara Sinclair, Pao-Lin Tien, & Edward N. Gamber 

IIEP Working Paper 2016-14

Abstract: In order to make forward-looking policy decisions, the Fed relies on imperfect forecasts of future macroeconomic conditions. If the Fed’s forecasts are rational, then the difference between the actual outcome and the Fed’s forecast can be treated as an exogenous shock. We investigate the effect of the Fed’s forecast errors on output and price movements under the assumption that the Fed intends to implement policy through a forward-looking Taylor rule with perfect foresight. Our results suggest that although the absolute magnitude of the Fed’s forecast error shock is large, the impact of the shock on the macroeconomy is reassuringly small.

Keywords: Federal Reserve, Taylor rule, forecast evaluation, monetary policy shocks

JEL Classification: E32; E31; E52; E58

Can Differences Deceive? The Case of “Foreclosure Externalities”

July 2017

Anthony Yezer and Yishen Liu

IIEP Working Paper 2017-29

Abstract: Foreclosure externalities, in which recent foreclosures proximate to a housing unit depress its sales price, are well accepted in the literature. These papers use a geographic differencing strategy to eliminate the problem of selection into treatment. They also assume that the partial and total derivatives of the outcome (house value) with respect to the treatment (foreclosure) are constant and equal. This paper relaxes these assumptions producing very different results. These findings likely generalize to a larger body of research where differencing often in the form of regression discontinuity, propensity score matching, or synthetic controls is used to achieve identification while assuming total and partial derivatives of the outcome with respect to the treatment are constant and equal.

JEL: R23, R30, R31.

Keywords: Foreclosure; Specification error; Loan-to-value ratio; Externalities.

Unilateral and Multilateral Sanctions: A Network Approach

November 2017

Sumit Joshi and Ahmed Saber Mahmud 

IIEP Working Paper 2017-28 

Abstract: The extensive literature on efficacy of sanctions has been mainly focused on a dyadic interaction between sender and target. In contrast, this paper examines sanctions when the sender and target are embedded in a network of linkages to other agents and each agent’s utility is a function of the size of the agent’s component. Efficacy of sanctions is then a function of two factors: the network structure binding the sender and target, and the concavity/convexity of utility in the component size. We consider both unilateral sanctions and multilateral sanctions. We demonstrate how the network architecture, together with the specification of utility, qualifies and sometimes reverses the main tenets of the dyadic approach. We add to the recent work on identifying network architectures that sustain cooperation via the threat of exclusion by showing that the utility specification matters. Thus the same network can be efficacious for sanctions if utility is convex in component size but not if it is concave.

JEL: C72, D74, D85

Keywords: Unilateral sanctions, Multilateral sanction,  Sender, Target, Networks, Spanning trees, Cutsets

Network Formation with Multigraphs and Strategic Complementarities

November 2017

Sumit Joshi, Ahmed Saber Mahmud and Sudipta Sarangi

IIEP Working Paper 2017-27

Abstract: Economic agents are typically connected to others in multiple network relationships, and the architecture of one network could be shaped by connections in other networks. This paper examines the formation of one network when connections in a second network are inherited under two scenarios: (i) the inherited network is asymmetric allowing for a wide range of graphs called nested split graphs, and (ii) the inherited network is a symmetric type of network belonging to a subclass of regular graphs. Both the inherited and endogenously formed networks are interdependent because the respective actions in each are (weak) strategic complements. This property is su¢ cient to show that those who inherit high centrality will continue to have high centrality. Additionally, the network formed by the agents induces a coarser partition than the inherited network, suggesting the possibility of being able to improve network centrality, but only in a limited manner. Thus, our analysis explains preferential attachment and why inequality is often entrenched in society, how asymmetries in one network may be magnified or diminished in another, and what determines the identity of players occupying the various vertices of asymmetric equilibrium networks.

JEL: C72, D85

Keywords: Network formation, multigraphs, strategic complementarities, Katz-Bonacich centrality, nested split graphs.

Migration Networks and Location Decisions: Evidence from U.S. Mass Migration

September 2017

Bryan Stuart and Evan Taylor 

IIEP Working Paper 2017-26

Abstract: This paper examines the effects of birth town migration networks on location decisions. We study over one million long-run location decisions made during two landmark migration episodes by African Americans from the U.S. South and whites from the Great Plains. We develop a new method to estimate the strength of migration networks for each receiving and sending location. Our estimates imply that when one randomly chosen African American moves from a birth town to a destination county, then 1.9 additional black migrants make the same move on average. For white migrants from the Great Plains, the average is only 0.4. Networks were particularly important in connecting black migrants with attractive employment opportunities and played a larger role in less costly moves.

JEL: J61, N32, O15, R23, Z13

Keywords: migration networks, location decisions, social interactions, Great Migration

The Long-Run Effects of Recessions on Education and Income

August 2017

Bryan Stuart

IIEP Working Paper 2017-25

Abstract: This paper examines the long-run effects of the 1980-1982 recession on education and income. Using confidential Census data, I estimate difference-in-differences regressions that exploit variation across counties in recession severity and across cohorts in age at the time of the recession. For individuals age 0-10 in 1979, a 10 percent decrease in earnings per capita in their county of birth reduces four-year college degree attainment by 9 percent and income in adulthood by 3 percent. Simple calculations suggest that, in aggregate, the 1980-1982 recession led to 1-3 million fewer college graduates and $64-$145 billion less earned income per year.

JEL Classification Codes: E32, I20, I30, J13, J24

Keywords: human capital, education, income, recessions

The Effect of Social Connectedness on Crime: Evidence from the Great Migration

August 2017

Bryan Stuart and Evan Taylor

IIEP Working Paper 2017-24

Abstract: This paper estimates the effect of social connectedness on crime across U.S. cities from 1960- 2009. Migration networks among African Americans from the South generated variation across destinations in the concentration of migrants from the same birth town. Using this novel source of variation, we find that social connectedness considerably reduces murders, robberies, assaults, burglaries, larcenies, and motor vehicle thefts, with a one standard deviation increase in social connectedness reducing murders by 13 percent and motor vehicle thefts by 9 percent. Our results appear to be driven by stronger relationships among older generations reducing crime committed by youth.

JEL Classification Codes: K42, N32, R23, Z13

Keywords: crime, social connectedness, Great Migration

Governance Spillovers of Labour Provisions in Free Trade Agreements

by Susan Ariel Aaronson (George Washington University)

IIEP Working Paper 2017-2

Most people know that governments such as the US, EU, and Canada use labour rights provisions in trade agreements to improve labour rights. They believe that policymakers in the developing world will be willing to improve labour rights governance with the incentive of the trade agreement. But in this paper, Aaronson argues that these provisions have broader and equally important spillover effects upon governance. These provisions:

  • empower workers and other citizens;
  • facilitate a feedback loop between the developing country government and its citizens on a broad range of issues affecting trade;
  • promote wage and income equality, which is conducive to development, social stability and democracy;
  • help policy-makers to better integrate labour rights with other public policies (such as fiscal policy, anti-corruption policies, or criminal laws); and
  • can help citizens and policy-makers gradually improve governance, increase productivity and advance social cohesion in the community.

Aaronson used a comparative case study approach, examining both the language and studies of the effects of the provisions. For example, she finds that since 2005, U.S. agreements have included provisions in the labour rights chapter related to procedural guarantees and public awareness. The provisions require parties to encourage public participation in the development of labour rights policies. They also require that all persons have “appropriate access to tribunals”, that the “proceedings are fair, equitable, and transparent … open to the public”, give all parties the right to seek review, and educate their public about the law. Taken in sum, these provisions could empower workers (on the demand side of labour rights) through rules on public awareness, public participation, and due process rights. The EU and Canada have begun to adopt similar policies.

Aaronson provides several examples of improved governance. In Guatemala, policymakers learned to coordinate labour rights and fiscal policy so that companies could not get subsidies or avoid taxes if they were found to violate labor rights. Mexican officials learned to protect the rights of Mexican guest workers in the U.S. In 2013, with help from U.S. and Mexican civil society groups, guest workers came together to form the Sinaloa Temporary Workers’ Coalition to defend the rights of guest workers in Mexico and abroad. In 2014, the group complained to the Mexican Ministry of Labor regarding recruitment fees. The Ministry investigated and found 27 violations of the law, resulting in fines. In this example, Mexicans held their government accountable for violations of the law at home.

Aaronson notes that no one has yet done a study as to whether these provisions and consultative bodies actually empower workers. Nonetheless, in a 2016 study of trade and labour rights, the ILO noted that “the impact of labor provisions depends crucially on, first, the extent to which they involve stakeholders, notably social partners such as unions and NGOs.” Workers who are aware of their rights and able to challenge executives and government officials’ decisions are empowered. Over time, empowered workers can promote greater income equality through improved productivity and better share in profits through wage increases. Some analysts argue that this process can advance development, social cohesion and democracy, and can ensure that more people meet their potential. Moreover, these provisions may help to legitimize trade agreements and help them to gain a base of public support.

Negative Shocks and Mass Persecutions: Evidence from the Black Death

March 2017

by Remi Jedwab (George Washington University), Mark Koyama (George Mason University) & Noel Johnson (George Mason University)

IIEP Working Paper 2017-4

The authors of this paper examine the Black Death persecutions committed against the Jewish people to demonstrate the factors that determine when a minority group will face persecution. A theoretical framework is developed that predicts that there is an increased probability that minorities are scapegoated and persecuted when negative shocks occur. However, if the shocks become more severe, the probability of persecution may decrease when economic complementarities exist between the majority and minority groups. To accomplish this, the authors gathered data on a city-level on Black Death mortality and Jewish persecution. An aggregate level showed that scapegoating led to an increase in the baseline probability of persecution. On the city-level, high plague mortality rates did not align with increased persecutions. Persecutions were found to be more likely in cities with a history of antisemitism and less likely in locations where Jews were featured in important economic roles.

The Black Death had wide-ranging social effects, and historians and economists often look to the Black Death as a direct cause of scapegoating and persecution of Jewish communities. The authors contradict this view using city-level Black Death mortality rates and Jewish persecution, demonstrating that the higher the mortality in a city, the less likely persecution would occur. This was accentuated in cities where Jews played important economic roles. They show that, while the Black Death shock was the initial impetus for antisemitic persecution in Europe, it was mainly patterns of differences in economic standing between minority and majority groups that explain local variation in persecution.

Their work contributes to several literatures, such as recent work on the economics of mass killings. They also add to literature on the relationship between shocks and the persecution of minorities, which emphasizes the role played by economic complementarities between groups, and literature on antisemitism. Their study provides a unique perspective, as well, as the Black Death provides a very well suited setting to examine the causes of mass killings.

In their framework, negative shocks can increase both the incentive to persecute a minority and to raise that minority’s economic value. The authors conclude that the decision to persecute the minority is dependent upon how the intensity of the shock interacts with the benefit one gains from persecution and the economic benefits gained from the presence of the minority. While their research suggested there are underlying biases against minorities, it also demonstrated that complementary economic activities between minority groups and majority groups could reduce inter-group aggression.

How Sustainable Are Benefits from Extension for Smallholder Farmers? Evidence from a Randomised Phase-Out of the BRAC Program in Uganda

January 2017

by Stephen C. Smith (George Washington University), Vida Bobić (George Washington University), Ram Fishman (Tel Aviv University), & Munshi Sulaiman (Save the Children)

IIEP Working Paper 2017-1

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