Collective Action: Experimental Evidence.
We conducted a laboratory experiment to test the comparative statics predictions of a new approach to collective action games based on the method of stability sets. We find robust support for the main theoretical predictions. As we increase the payoff of a successful collective action (accruing to all players and only to those who contribute), the share of cooperators increases. The experiment also points to new avenues for refining the theory. We find that, as the payoff of a successful collective action increases, subjects tend to upgrade their prior beliefs as to the expected share of cooperators. Although this does not have a qualitative effect on comparative static predictions, using the reported distribution of beliefs rather than an ad hoc uniform distribution reduces the gap between theoretical predictions and observed outcomes. This finding also allows us to decompose the mechanism that leads to more cooperation into a “belief effect” and a “range of cooperation effect”.
Climate change in Latin America and the Caribbean: policy options and research priorities.
With Sebastián Galiani, 2015. Latin American Economic Review, vol. 24(1) p. 14. (Publication)
Although climate change is filled with uncertainties, a broad set of policies proposed to address this issue can be grouped in two categories: mitigation and adaptation. Developed countries that are better prepared to cope with climate change have stressed the importance of mitigation, which ideally requires a global agreement that is still lacking. This paper uses a theoretical framework to argue that in the absence of a binding international agreement on mitigation, Latin America should focus mainly on adaptation to cope with the consequences of climate change. This is not a recommendation that such economies indulge in free-riding. Instead, it is based on cost–benefit considerations, all else being equal. Only in the presence of a global binding agreement can the region hope to exploit its comparative advantage in the conservation and management of forests, which are a large carbon sink. The decision of which policies to implement should depend on the results of a thorough cost–benefit analysis of competing projects, yet very little is known or has been carried out in this area to date. Research should be directed toward cost–benefit analysis of alternative climate change policies. Policymakers should compare other investments that are also pressing in the region, such as interventions to reduce water and air pollution, and determine which will render the greatest benefits.
Direct and Spillover Impacts of Enforcing Labor Standards: Evidence from Argentina.
This paper studies how increases in labor standards and enforcement affect workers and their families. Using a policy in Argentina that targeted domestic workers and their employers, I find a 30% increase in formality rates of domestic workers and a 4% increase in monthly earnings, despite a 5% reduction in hours of work per week. The policy also had effects on the labor supply decisions of other members of the domestic workers' households: hours worked by spouses of domestic workers and the labor force participation of young adult children of domestic workers decrease after the reform, an effect driven mostly by girls. The reform also helped close the educational gender gap: school attendance and years of education increased by approximately 3% among boys of secondary school age, and secondary school completion increased by 18% among older boys. Taken together, the results suggest that higher labor standards and their enforcement can have sizable impacts among low-skilled workers as well as their families.
Immigration and its Effects Crime, Violence and Social Unrest.
With Marieke Kleemans (Draft)
We estimate the causal effect of internal migration on crime in Indonesia by combining detailed migration data with reports of crime and violence from over 2 million local newspapers, and from individual victimization reports from nationally representative surveys. To address endogeneity in the choice to migrate, we instrument the share of migrants in a destination with rainfall shocks at the migrant origin locations. We find that a 1 percent increase in the proportion of migrants in the population leads to a 3.9 percent increase in the number of economically motivated crimes reported by local media. This is consistent with the existing literature on the effect of international migration to developed countries, but larger in magnitude. However, when using data on individual victimization from household surveys, we instead find that an increase in the share of migrants leads to a reduction in the probability that a person is a crime victim at the destination. The reduction in crime victimhood is particularly large for migrants and for women. We explore various reasons for these competing results, including reporting bias in newspapers as a source of increased crime coverage in areas with an influx of migrants, even though the number of crime victims decreases.
What do Jobseekers Want? Comparing Methods to Estimate Reservation Wages and the Value of Job Attributes.
With AbdelRahman Nagy and Adam Osman (Draft)
Understanding jobseeker preferences---including their reservation wages and how much they value different non-wage amenities---is difficult because they are unobservable. We test four different methods for estimating these preference parameters using an experiment in a job-matching center. We find large and important differences between methods. We also estimate jobseekers' valuations of several job attributes, and explore how those valuations differ by characteristics like gender, education and length of unemployment. Among other findings, we show that in our sample of jobseekers in Egypt, women are more sensitive to long commutes, and value flexible schedules and on-site daycare more than men.
Work in Progress
Shocks to child labor demand in rural Mexico and the role of Progresa.
With Mateo Arbeláez Parra y Karen Atis Ortega