Readings

Nutrition and productivity: interrelationships

a) Theoretical model
Poor nutrition leads to low productivity. Low productivity leads to unemployment and low incomes. Low income leads to poor nutrition. This theoretical model can be applied to education, health, nutrition, gender and inter-generational discrimination, and many other issues: Ray, pp. 272-279 and 489-504

b) Empirical evidence

i) From income to nutrition:

(1) Income to nutrition: a study of Maharashtra, India: Subramanian and Deaton (1996)

(2) Monetary transfer to the elderly can lead to better nutrition for children. A study of old age pension in South Africa: Duflo (2003)

ii) From nutrition to income:

(1) Ray, chapter 8. In particular, sections 8.3 and 8.4

(2) Thomas et al. (2004)

*[Ray] pp. 272-279.

———, pp. 489-504.

Subramanian, S., and A. Deaton. "The Demand for Food and Calories." Journal of Political Economy 104, no. 1 (1996): 133-162.

Duflo, E. "Grandmothers and Granddaughters: Old-Age Pensions and Intrahousehold Allocation in South Africa." World Bank Economic Review 17, no. 1 (2003): 1-25.

*[Ray] chapter 8, especially sections 8.3 and 8.4.

*Thomas, D., E. Frankenberg, J. Friedman, J.-P. Habicht, N. Jones, C. McKelvey, G. Pelto, B. Sikoki, J. P. Smith, C. Sumantri, and W. Suriastini. "Causal Effect of Health on Labor Market Outcomes: Evidence from a Random Assignment Iron Supplementation Intervention." California Center for Population Research On-Line Working Paper Series (April 1, 2004). Paper CCPR-022-04.

Health: a case study from Rajasthan

Health status in Rajasthan: A case study (and a movie) that looks at various aspects of health delivery and health status: Banerjee, Deaton, and Duflo (2003)

*Banerjee, Abhijit V., Angus Deaton, and Esther Duflo. "Wealth, Health, and Health Services in Rural Rajasthan." American Economic Review 94, no. 2 (2003): 326-330.

Bargaining within families

a) Income is not spent in the same way by women and by men: evidence from Brazil (Thomas (1990)), the United Kingdom Child Benefit allowance (Lundberg, Pollak, and Wales (1996)), a pension program in South Africa (Duflo (2003))

b) Competition within the family is not limited to sharing the resources. It leads to lower productivity and lower welfare for all members in the family: Udry (1996); Duflo and Udry (2004)

Thomas, D. "Intra-Household Resource Allocation: An Inferential Approach." Journal of Human Resources 25, no. 4 (1990): 635-664.

Lundberg, S. J., R. A. Pollak, and T. J. Wales. "Do Husbands and Wives Pool Their Resources? Evidence from the United Kingdom Child Benefit." Journal of Human Resources 32, no. 4 (1996): 463-480.

Duflo, E. "Grandmothers and Granddaughters: Old-Age Pensions and Intrahousehold Allocation in South Africa." World Bank Economic Review 17, no. 1 (2003): 1-25.

*Udry, C. "Gender, Agricultural Production, and the Theory of the Household." Journal of Political Economy 101, no. 5 (1996): 1010-1045.

*Duflo, E., and C. Udry. "Intrahousehold Resource Allocation in Cote d'Ivoire: Social Norms, Separate Accounts and Consumption Choices." National Bureau of Economic Research Working Paper No. 10498, May 2004.

Land

a) Theoretical background: Ray, chapter 12

b) Why land reform?: Banerjee (1999)

c) A successful limited land reform in India: Banerjee, Gertier, and Ghatak (2002)

[Ray] chapter 12.

*Banerjee, A. V. "Land Reforms: Prospects and Strategies." Mimeograph, Massachusetts Institute of Technology, 1999.

Banerjee, Abhijit V., Paul Gertier, and Maitreesh Ghatak. "Empowerment and Efficiency: Tenancy Reform in West Bengal." Journal of Political Economy 110, no. 2 (April 2002): 239-280.

Insurance

Agricultural incomes fluctuate enormously during the year and from year to year. Do consumption and investments fluctuate as well, or are households protected from these fluctuations?

a) Ray, chapter 15

b) Insurance is only partial: the consumption of household members in Cote d'Ivoire is linked to their income: Deaton (1997), pp 372-383

c) In bad times are children taken out of school, and given less to eat? An example from Cote d'Ivoire: Jensen (2000)

d) In West Africa, villagers lend to each other and achieve a certain degree of insurance: Udry (1990)

e) Mutual insurance in the village does not happen in the void. It depends on the strength of local institutions: Townsend (1995)

*[Ray] chapter 15.

Deaton, Angus. The Analysis of Household Surveys: A Microeconometric Approach to Development Policy. Washington, DC: World Bank, International Bank for Reconstruction and Development, 1997, pp. 372-383. ISBN: 9780801852541. [Preview in Google Books]

Jensen, R. "Agricultural Volatility and Investments in Children." American Economic Review 90, no. 2 (2000): 399-405.

*Udry, C. "Credit Markets in Northern Nigeria: Credit as Insurance in a Rural Economy." World Bank Economic Review 4, no. 3 (1990): 251-269.

Townsend, R. "Financial Systems in Northern Thai Villages." Quarterly Journal of Economics 110, no. 4 (1995): 1011-1046.

Formal and informal institutions

a) Collective action: Banerjee, Iyer, and Somanathan (2007)

b) Social networks: no policy happens in the void. What role do informal institutions and norms play?

i) Norms helped to sustain long distance trade among Maghribi traders: Greif (1993)

ii) However, successful informal institution can be an obstacle to the development of formal institutions: Greif (1994)

iii) Social norms as an obstacle to the demographic transition: Munshi (2000)

c) Formal institutions

i) Institutions differ widely around the world: La Porta, de Silanes, Shleifer, and Vishny (1998)

ii) Good institutions are important for economic performance: aggregate approach: Acemoglu, Johnson, and Robinson (2001)

iii) Historical approach: In India, colonial history continues to impact today's outcomes: Banerjee and Iyer (2002); Iyer (2003)

iv) The mechanics of why institutions matter. A poor institutional environment may makes business difficult. A study of contracting and reputation in the Indian Software industry: Banerjee and Duflo (2000)

Banerjee, A., L. Iyer, and R. Somanathan. "Public Action for Public Goods." National Bureau of Economic Research Working Paper No. 12911, February 2007.

Greif, A. "Contract Enforceability and Economic Institution in Early Trade: The Maghribi Traders Coalition." American Economic Review 83, no. 3 (1993): 525-548.

———. "Cultural Beliefs and the Organization of Society: A Historical and Theoretical Reflection on Collectivist and Individualist Societies." Journal of Political Economy 102, no. 5 (1994): 912-950.

Munshi, K. "Social Norms and Individual Decisions During a Period of Change: An Application to the Demographic Transition." Mimeograph, University of Pennsylvania, 2000.

La Porta, R., F. L. de Silanes, A. Shleifer, and R. Vishny. "Law and Finance." Journal of Political Economy 106, no. 6 (1998): 1113-1155.

*Acemoglu, D., S. Johnson, and J. Robinson. "The Colonial Origins of Comparative Development: An Empirical Investigation." American Economic Review 91, no. 5 (2001): 1369-1401.

Banerjee, A. V., and L. Iyer. "History, Institutions and Economic Performance: The Legacy of Colonial Land Tenure Systems in India." American Economic Review 95, no. 4 (2005): 1190-1213. (PDF)

Iyer, L. "The Long-term Impact of Colonial Rule: Evidence from India." Mimeograph, Massachusetts Institute of Technology, 2003. (PDF)

Banerjee, A. V., and E. Duflo. "Reputation Effects and the Limits of Contracting: A Study of the Indian Software Industry." Quarterly Journal of Economics 115, no. 3 (2000): 989-1017.