New and interesting working papers

I just came across several new working papers that look checking out.

1. The untold story of the Mexican debt crisis: Domestic banks and external debt, 1977-1989 by Sebastian Alvarez
Scholars have thus far neglected the role played by Mexican banks in international capital markets and in the country’s external indebtedness process. This paper argues that the imbalances which Mexican banks incurred in running their international operations eventually brought them to the brink of bankruptcy once the crisis began. Given that the banks that were at risk represented a large share of the domestic market, this paper argues the whole Mexican banking system was threatened with collapse. The improved understanding of the banking system’s exposure to and dependence on foreign finance provides new insights into Mexico’s debt renegotiation outcomes and the nationalization of the banking system in the aftermath of the crisis. —

2. Two Centuries of International Migration by Tim Hatton
We focus principally on long-distance migration to rich destination countries, the settler economies in the nineteenth century and later the OECD. The chapter describes the structure, direction and determinants of migration flows and the assimilation experience of migrants. It also examines the impact of migration on destination and source countries, and explores the political economy behind the evolution of immigration policy. We provide an historical context for current debates on immigration and immigration policy and we conclude by speculating on future trends.

3. The Long-Term Effects of Protestant Activities in China by Yuyu Chen
Combining county-level data on Protestant presence in 1920 and socioeconomic indicators in 2000, we find that the spread of Protestantism has generated significant positive effects in long-term economic growth, educational development, and health care outcomes. To better understand whether the relationship is causal, we exploit the fact that missionaries purposefully undertook disaster relief work to gain the trust of the local people. Thus, we use the frequency of historical disasters as an instrument for Protestant distribution. When we further investigate the transmission channels over the long historical period between 1920 and 2000, we find that although improvements in education and health care outcomes account for a sizable portion of the total effects of missionaries’ past activities on today’s economic outcomes, Protestant activities may have also contributed to long-term economic growth through other channels, such as through transformed social values. If so, then a significant amount of China’s growth since 1978 is the result not just of sudden institutional changes but of human capital and social values acquired over a longer historical period.

4. Why didn’t economists predict the Great Depression? by Leon Taylor

I’m sure this paper is worth checking out too, but I included it because my first thought was that you could replace the words “Great Depression” with almost anything else and still be accurate.  It would have been way more surprising if economists actually did predict something that actually happened (we’re good at predicting things that don’t happen or things that happened in the past!).

Educating humanity, really?

A website called Educating Humanity had the following headline yesterday about Mexico! “UFO Descends Over Airport in Mexico.”  Here’s the description of the video: “Yohanna Diaz explains on national TV that these UFOs are fairly common over airports in Mexico.” (my emphasis)

I guess I have a really different idea of what it means to educate humanity because here is the website’s “about us” page:

Educating Humanity has become a major resource to a global audience for UFO cases, it currently contains more than 4000 quality post and is one of the few sites that continues to grow by being updated daily.

Educating Humanity’s objective is to increase the level of understanding about the UFO phenomena, to bring a higher level of awareness regarding government knowledge, involvement and cover-up of these historical events.

As well as being a reference and research site, we attempt to keep things interesting by posting the best daily UFO sightings (without showing you every shaky light in the sky). We endeavor to include all major stories and articles on space exploration and news of extraterrestrial discoveries.

One of the more popular features has become the ‘Breaking UFO News’ section, which is updated throughout the day with news from around the world. Each story is highlighted only once (usually from the source). Our aim is to bring you relevant and meaningful news from reputable news sources. We make it a point to edit out the superficial and meaningless stories that are many in the world of the Ufology.

We are working hard to report on and bring about disclosure of the facts concerning UFOs, extraterrestrial contact, intelligence and technology that our governments have had under a truth embargo for more than sixty years.

Nice touch with the “truth embargo” at the end!

Bad Teacher(s)

Seema Jayachandran has a new paper in the JDE called “Incentives to Teach Badly: After-School Tutoring in Developing Countries.”  I’ve heard anecdotal tales of this phenomena in developing countries and it certainly seems plausible, but it is exciting that someone is testing whether it is actually true.  Sadly, it seems to be true, at least in Nepal.  Here is the abstract:

Schools in developing countries frequently offer for-profit tutoring to their own students. This potentially gives teachers a perverse incentive to teach less during school to increase demand for their tutoring. Through this mechanism, the market for tutoring can adversely affect student learning, especially for students who do not participate in tutoring. I model and present empirical evidence on these effects, using survey and test score data from Nepal. The evidence suggests that when schools offer for-profit tutoring, teachers teach less during the regular school day. As a consequence, performance on the national secondary-school exam appears to suffer among students with a low propensity to enroll in tutoring. An implication is that discouraging teachers from tutoring their own students or reducing entry barriers for third-party tutors could increase student achievement.

Latin American News Round-Up

1. Mexico’s main opposition party quits energy talks amid graft scandal

2. Yelp launches in Mexico to Extend Latin American Footprint

3. Is Latin America’s IT Startup Scene Stuck in Neutral?

4. San Hugo Chavez and San Naza Moreno: Latin America’s Newest Saints

5. Soaring Prices Fuel Frustrations Among Weary Argentines


Development studies as a cure for unfailing optimism

My development students often tell me that they really like the class but that the material is so depressing.  Nothing seems to work, especially the dramatic, large-scale, end-all-poverty in 5 years types of projects that are so initially exciting.  I’m not teaching development per se this semester but I am teaching a class on Global Political Economy and I included a section on aid.  We just finished reading Nina Munk’sThe Idealist, which is an amazing book that my students both loved and found depressing.  Not so much that the MVPs didn’t work as planned, but that anyone as smart and accomplished as Sachs would have thought that they would.  I asked them to think about the theoretical channels by which these villages would be able to be self-sustaining after 5 years.  Even in theory we couldn’t identify how that would exactly work.

By the end of the book you get the distinct impression that the MVP cannot possibly be sustained.  Given all the problems and the criticism, who would give additional money to fund these villages?  Turns out we were too cynical.  I hadn’t realized that the MVP is expanding to 8 more villages with a new infusion of $ from the Islamic Development Bank and Sach’s own Earth Institute!.  And Sachs has further plans to extend into the “stans” and south Asia.  Wow, it’s hard to know what to even say to that news.

And in case they weren’t depressed enough, I had them read Easterly‘s introduction to Reinventing Foreign Aid, where he writes that “In a survey of govt health centers in Tanzania, new mothers reported what they least liked about their birthing experiences, and these were being “ridiculed by nurses for not having baby clothes (22%) and nurses hitting them during delivery (13%).” I have to admit that this result seriously depressed me as well.

Map of the Day: Indian Toilet Edition


It’s not surprising which regions have the most indoor plumbing, but it is still surprising how low these percentages are across much of the country.  The overwhelming percentage of households in the interior of the country do not have toilets, which has to be an impediment to improving health.

This is consistent with an article I read this morning on the lack of women’s toilets in Delhi and the effect it has on women’s health and safety.  The author writes of a recent conversation she heard in a McDonalds in Delhi:  “Two ladies were planning their shopping itinerary…[and it]…hit me that the whole expedition was centered on one thing – clean toilets.”   This seems rational, given the fact that there are only 5,383 public toilets in Delhi, a city of 17 million people.  Of these 5,000+ toilets, only 391 were designated for women.  And as the author points out, who knows whether these toilets are even in a usable condition.

The author makes one fascinating comment, writing that “more money has been spent by the government on airing advertisements urging women to marry someone who has a toilet at home than on building toilets in public spaces.”   Of all the ways the government could use public money to help citizens, why in the world is it running campaigns to urge women to marry someone with indoor plumbing?  Wouldn’t that already be common sense?  Do women need to be told this by their government?