The power of information : the impact of mobile phones on farmers'welfare in the Philippines

The authors explore the impact of access to information on poor farmers’ consumption. The analysis combines spatially coded data on mobile phone coverage with household panel data on farmers from some of the poorest areas of the Philippines. Both the ordinary least squares and instrumental variable estimates indicate that purchasing a mobile phone has a large, positive impact on the household-level growth rate of per capita consumption. Estimates range from 11 to 17 percent, depending on the sample and the specification chosen. The authors perform a range of reliability tests, the results of which all suggest that the instruments are valid. They also present evidence consistent with the argument that easier access to information allows farmers to strike better price deals within their existing trading relationships and to make better choices in terms of where they choose to sell their goods.E-Business,Access to Finance,Rural Poverty Reduction,Debt Markets,Poverty Lines

A road to trust

The authors explore the relationship between transaction costs and generalized trust. Using panel data from 2,100 households in 135 rural communities of the Philippines, the paper shows that where transaction costs are reduced (proxied by road construction), there is an increase in generalized trust. Consistent with the argument that generalized trust is built through repeated interactions, the authors find that the individuals most likely to engage in exchange exhibit an increase in trust after road construction. These results suggest that, rather than being an input to economic growth, trust might be a product of reduced transaction costs (which also favors growth).Post Conflict Reconstruction,Transport Economics Policy&Planning,Rural Roads&Transport,Social Capital,Corporate Law

Do community-driven development projects enhance social capital ? evidence from the Philippines

This paper explores the social capital impacts of a large-scale, community-driven development project in the Philippines in which communities competed for block grants for infrastructure investment. The analysis uses a unique data set of about 2,100 households collected before the project started (2003) and after one cycle of sub-project implementation (2006) in 66 treatment and 69 matched control communities. Participation in village assemblies, the frequency with which local officials meet with residents and trust towards strangers increased as a result of the project. However, there is a decline in group membership and participation in informal collective action activities. This may have been because households were time-constrained, so that in order to participate in project activities, they needed to temporarily reduce their participation in informal activities. An alternative explanation is that the project improved the efficiency of formal forms of social capital and thus households needed to rely less on informal forms. Finally, the results indicate that, in the short run, the project might have reduced the number of other investments.Housing&Human Habitats,Access to Finance,Social Accountability,Social Capital,Banks&Banking Reform

Labor Market Discrimination During Post-Communist Transition: A Monopsony Approach to the Status of Latvia's Russian Minority

Conventional wisdom suggests that during communism, tastes for discrimination were suppressed. In partial explanation for ethnic tensions observed following central planning, economic liberalization allows those tastes to be expressed. This paper explores the feasibility of monopsony as an economic structure supportive of discrimination during transition, using Latvia's ethnic Russians as a case study. Measuring employment concentration and earnings differentials across regions, monopsony appears prevalent in the country. A monopsony explanation requires Russians to have lower labor supply elasticity than Latvians, a condition which estimates for participation probability confirm. Earnings decompositions show that though Russians are paid more than Latvians on average, given their human capital characteristics, they suffer earnings discrimination of between 5.5 and 7.3 percent. In addition, compared with Latvians the likelihood that Russians will be unemployed is greater, though Russians are less likely to register for unemployment services. This evidence suggests that lack of integrated, flexible labor markets in Latvia, and the monopsony which results, have supported labor market discrimination against Russians during transition.http://deepblue.lib.umich.edu/bitstream/2027.42/39765/3/wp381.pd

Labor Market Discrimination During Post-Communist Transition: A Monopsony Approach to the Status of Latvia's Russian Minority

Conventional wisdom suggests that during communism, tastes for discrimination were suppressed. In partial explanation for ethnic tensions observed following central planning, economic liberalization allows those tastes to be expressed. This paper explores the feasibility of monopsony as an economic structure supportive of discrimination during transition, using Latvia's ethnic Russians as a case study. Measuring employment concentration and earnings differentials across regions, monopsony appears prevalent in the country. A monopsony explanation requires Russians to have lower labor supply elasticity than Latvians, a condition which estimates for participation probability confirm. Earnings decompositions show that though Russians are paid more than Latvians on average, given their human capital characteristics, they suffer earnings discrimination of between 5.5 and 7.3 percent. In addition, compared with Latvians the likelihood that Russians will be unemployed is greater, though Russians are less likely to register for unemployment services. This evidence suggests that lack of integrated, flexible labor markets in Latvia, and the monopsony which results, have supported labor market discrimination against Russians during transition.

Markets for Communist Human Capital: Returns to Education and Experience in the Czech Republic and Slovakia

This research examines differences in earnings structure between Communist and post-Communist Czech Republic and Slovakia using four sets of similar micro-data. It presents hypotheses about how earnings dispersion returns to education and returns to experience will change across regimes and tests those hypotheses using earnings equations. From approximately 2.5 percent in 1984, the return to education increased to approximately 5 percent by 1993. During that period, returns to experience fell. Though women have higher returns to education, returns for men increased more across regime change. Those with academic secondary education experienced a particularly large earnings increase. Earnings structure changes appear larger in the Czech Republic than in Slovakia.Post-Communist Transition, Czech Republic, Slovakia, Returns to Education, Returns to Experience

Baby Boom or Bust? Changing Fertility on Post-Communist Czech Republic and Slovakia

Transition from a centrally planned to a market oriented economy alters the incentives individuals face as they make consumption and time allocation decisions. Families must reevaluate their fertility plans as a result of new wage structures, reduced government subsidies of the costs of raising children, and uncertainty from a changed economic environment. Using micro-data from 1984 and 1993 in the Czech Republic and Slovakia, this paper estimates a dynamic stock adjustment model, relating observed drops in fertility post-Communism to new wages, prices, and risks. Because transition will have affected only those born in the three years prior to the 1993 data, considering children under age three isolates these effects. Earnings influence total demand for children during Communism through substitution effects for women's earnings and income effects for men's. In all four data sets, earnings levels have little effect on fertility timing, though age and job uncertainty do effect the probability of having young children, particularly following Communism. Earnings changes across regime also impact fertility timing decisions, though the effects are different in the Czech Republic and Slovakia.http://deepblue.lib.umich.edu/bitstream/2027.42/39545/3/wp157.pd