Services reform and manufacturing performance : evidence from India

The growth of India's manufacturing sector since 1991 has been attributed mostly to trade liberalization and more permissive industrial licensing. This paper demonstrates the significant impact of a neglected factor: India's policy reforms in services. The authors examine the link between those reforms and the productivity of manufacturing firms using panel data for about 4,000 Indian firms from1993 to 2005. They find that banking, telecommunications, insurance and transport reforms all had significant, positive effects on the productivity of manufacturing firms. Services reforms benefited both foreign and locally-owned manufacturing firms, but the effects on foreign firms tended to be stronger. A one-standard-deviation increase in the aggregate index of services liberalization resulted in a productivity increase of 11.7 percent for domestic firms and 13.2 percent for foreign enterprises.Transport Economics Policy&Planning,Banks&Banking Reform,Emerging Markets,E-Business,Economic Theory&Research

Agricultural Productivity and Deforestation: Evidence from Brazil

When agricultural productivity improves, farmers may react by expanding farming and further encroach on forest lands, or they may choose to intensify and produce more output with less land. We specify the conditions under which agricultural productivity can have such ambiguous effects on deforestation. We then examine the predictions of that model using county-level data from five waves of the Brazilian Census of Agriculture and satellite-based measures of land use. We identify productivity shocks using exogenous variation in rural electrification in Brazil during 1960-2000. We show that locations suitable for hydropower generation experienced improvements in crop yields, and that credit-constrained farmers subsequently shifted away from land-intensive cattle-grazing and into cropping. As a result, agricultural land use declines, more native vegetation is protected, and these effects persist 25 years later in both census and satellite data. Brazil’s deforestation rate would have been almost twice as large between 1970 and 2000 without that increase in agricultural productivity. That makes the conservation benefits of productivity improvements comparable to the most prominent conservation packages ever implemented in Brazil

Decentralization and Water Pollution Spillovers: Evidence from the Redrawing of County Boundaries in Brazil

We examine the effect of political decentralization on pollution spillovers across jurisdictional boundaries. Upstream water use has spillover effects on downstream jurisdictions, and greater decentralization (i.e. a larger number of political jurisdictions managing the same river) may exacerbate these spillovers, as upstream communities have fewer incentives to restrain their members from polluting the river at the border. We use GIS to combine a panel dataset of 9,000 water quality measures collected at 321 monitoring stations across Brazil with maps of the evolving boundaries of the 5500 Brazilian counties to study (a) whether water quality degrades across jurisdictional boundaries due to increases in pollution close a river’s exit point out of a jurisdiction, and (b) what the net effect of a centralization initiative on water quality is, once the opposing impacts of inter-jurisdictional pollution spillovers and increased local government budgets for cleaning up the water are taken into account. We take advantage of the fact that Brazil changes county boundaries at every election cycle, so that the same river segment may cross different numbers of counties in different years. We find evidence of strategic enforcement of water pollution regulations; there is a significant increase in pollution close to the river’s exit point from the upstream county, and conversely a significant decrease in pollution when the measure is taken farther downstream from the point of entrance. Pollution increases by 2.3% for every kilometer closer a river gets to the exiting border, but in the stretch within 5 kilometers of the border this increase jumps to 18.6% per kilometer. Thus the greatest polluting activity appears to be very close to the exiting border. Our theoretical model coupled with the empirical results are strongly suggestive that these results are evidence of strategic spillovers rather than spurious correlation between county splits and pollution stemming from changing population density. Even in the presence of such negative externalities, the net effect of decentralization on water quality is essentially zero, since some other beneficial by-products of decentralization (in particular, increased local government budgets) offsets the negative pollution spillover effects.http://deepblue.lib.umich.edu/bitstream/2027.42/61166/1/IPC-working-paper-067-Mobarak.pd

Scalable whole-exome sequencing of cell-free DNA reveals high concordance with metastatic tumors

Whole-exome sequencing of cell-free DNA (cfDNA) could enable comprehensive profiling of tumors from blood but the genome-wide concordance between cfDNA and tumor biopsies is uncertain. Here we report ichorCNA, software that quantifies tumor content in cfDNA from 0.1× coverage whole-genome sequencing data without prior knowledge of tumor mutations. We apply ichorCNA to 1439 blood samples from 520 patients with metastatic prostate or breast cancers. In the earliest tested sample for each patient, 34% of patients have ≥10% tumor-derived cfDNA, sufficient for standard coverage whole-exome sequencing. Using whole-exome sequencing, we validate the concordance of clonal somatic mutations (88%), copy number alterations (80%), mutational signatures, and neoantigens between cfDNA and matched tumor biopsies from 41 patients with ≥10% cfDNA tumor content. In summary, we provide methods to identify patients eligible for comprehensive cfDNA profiling, revealing its applicability to many patients, and demonstrate high concordance of cfDNA and metastatic tumor whole-exome sequencing

Decentralization and Water Quality: Evidence from the Re-drawing of County Boundaries in Brazil

We examine the effect of political decentralization on pollution spillovers across jurisdictional boundaries. Upstream water use has spillover effects on downstream jurisdictions, and greater decentralization (i.e. a larger number of political jurisdictions managing the same river) may exacerbate these spillovers, as upstream communities have fewer incentives to restrain their members from polluting the river at the border. We use GIS to combine a panel dataset of over 10,000 water quality measures collected at 372 monitoring stations across Brazil with maps of the evolving boundaries of the 5500 Brazilian counties to study (a) whether water quality degrades across jurisdictional boundaries due to increases in pollution close a river’s exit point out of a jurisdiction, and (b) what the net effect of a decentralization initiative on water quality is, once the opposing impacts of inter-jurisdictional pollution spillovers and increased local government budgets for cleaning up the water are taken into account. We take advantage of the fact that Brazil changes county boundaries at every election cycle, so that the same river segment may cross different numbers of counties in different years. We find evidence of strategic enforcement of water pollution regulations; there is a significant increase in pollution close to the river’s exit point from the upstream county, and conversely a significant decrease in pollution when the measure is taken farther downstream from the point of entrance. Even in the presence of such negative externalities, the net effect of decentralization on water quality is essentially zero, since some other beneficial by-products of decentralization (in particular, increased local government budgets, and possibly the creation of more homogenous jurisdictions) offsets the negative pollution spillover effects.

Externalities and Spillovers from Sanitation and Waste Management in Urban and Rural Neighborhoods

Proper sanitation and waste management has important health benefits, both directly for the household making the decision and indirectly for its neighbors due to positive externalities. Nevertheless, construction and use of improved sanitation systems in much of the developing world continues to lag. Many recent interventions such as Community Led Total Sanitation (CLTS) have attempted to harness the power of social interactions to increase take-up of improved sanitation. Most evidence to date mobilizes social pressure in rural areas, yet evidence is more scarce in urban neighborhoods where high population density may lead to larger externalities from poor sanitation decisions. We review the recent literature on how sanitation decisions are inter-related within neighborhoods: the health externalities that sanitation decisions have on neighbors, and the social decision spillovers that drive take-up. We explore potential explanations for the low take-up and maintenance of sanitation systems, including the possibility of nonlinearities and thresholds in health externalities; the roles of social pressure, reciprocity, learning from others, and coordination in decision spillovers; and differences between urban and rural contexts

Services Reform and Manufacturing Performance: Evidence from India

Conventional explanations for the post-1991 growth of India’s manufacturing sector focus on goods trade liberalization and industrial de-licensing. We demonstrate the powerful contribution of a neglected factor: India’s policy reforms in services. The link between these reforms and the productivity of manufacturing firms is examined using panel data for about 4,000 Indian firms for the period 1993-2005. We find that banking, telecommunications, insurance and transport reforms all had significant positive effects on the productivity of manufacturing firms. Services reforms benefited both foreign and locally-owned manufacturing firms, but the effects on foreign firms tended to be stronger. A one-standard-deviation increase in the aggregate index of services liberalization resulted in a productivity increase of 11.7 percent for domestic firms and 13.2 percent for foreign enterprises.foreign direct investment; liberalization; productivity; services reform

Privatization of public goods: Evidence from the sanitation sector in Senegal

Privatization of a public good (the management of sewage treatment centers in Dakar, Senegal) leads to an increase in the productivity of downstream sewage dumping companies and a decrease in downstream prices of the services they provide to households. We use the universe of legal dumping of sanitation waste from May 2009 to May 2018 to show that legal dumping increased substantially following privatization—on average an increase of 74%, or an increase of about 1640 trips to treatment centers each month. This is due to increased productivity of all trucks, not just those associated with the company managing the privatized treatment centers. Household-level survey data shows that downstream prices of legal sanitary dumping decreased by 5% following privatization, and DHS data shows that diarrhea rates among children under five decreased in Dakar relative to secondary cities in Senegal following privatization with no similar effect on respiratory illness as a placebo