June 01, 2015
News /
Posted by NCID

The first day of the IV Development Week, organized by the NCID of the University of Navarra, focused on issues related to Human Capital in developing countries from a microeconomic perspective. Studies carried out in china, Mexico, India, Ecuador and Macedoinia among others were presented. This event took place June 1st and 2nd at the IESE Business School in Madrid.

After the opening session by Luis Ravina, director of the NCID, Jere Behrman, professor of the University of Pennsylvania, presented his paper: ‘Aligning Learning Incentives of Students and Teachers: Results from a Social Experiment in Mexican High Schools'. His presentation evaluated the impact of three different performance incentives schemes using data from a social experiment that randomized 88 Mexican high schools with over 40,000 students into three treatment groups and a control group. The first Treatment provided individual incentives for performance on curriculum-based mathematics tests to students only, the second treatment did the same but to teachers only and the third treatment gave both individual and group incentives to students, teachers and school administrators. Program impact estimates revealed the largest average effects for treatment three, smaller impacts for treatment one and no impact for treatment two.

Marcos Vera Hernández, from University College London gave a lecture titled: ‘Can Bureaucrats Really be Paid Like CEOs? Performance Incentives for Improving Child Nutrition in Rural Chinese Schools'. In his presentation he explained his research on incentives for school administrators and how the response to these incentives would vary the quantity of resources under their control. He focused to reduce childhood anemia in rural China.

The paper explains a random assignment of 170 schools to three levels of performance pay for reductions in student anemia. In the results three key findings were emphasized. First, with a smaller block grant, large incentives were effective, but smaller incentives (10% of the size) were ineffective in reducing anemia. Second, absent explicit anemia-based incentives, increasing the size of block grants under the control of school administrators lead to sizeable reductions (but was nearly twice as costly as incentives alone). Third, they found that incentives crowd out the effect of additional resources (or vice-versa). Their evidence suggested that this crowding-out is attributable, at least in part, to risk avoidance and the nature of existing ‘bureaucratic incentives’ facing school administrators.

Firm responses and the unintended consequences of piecemeal regulation' was the title of of the presenation given by Gianmarco Leon (Pompeu Fabra University). According to his research, when state capacity is limited, regulations are often designed piecemeal, thus it raises the possibility that new regulations can worsen ignored externalities generated up- or downstream in the production chain. Using daily administrative and survey data, his research showed that in Peru’s industrial fishing sector, the world’s largest, air pollution from downstream (fishmeal) manufacturing plants caused 55,000 additional respiratory hospital admissions per year as a consequence of the introduction of tradable fishing vouchers. By removing suppliers’ incentive to “race” for the resource and enabling market share to move from inefficient to efficient firms, the reform spread production across time, as predicted by his model. Gianmarco showed that longer periods of moderate air pollution are worse for health than shorter periods of higher intensity exposure. His findings exposed the risks of piecemeal regulatory design in linked production chains and the importance of the often-ignored time profile of production.

Oliver Vanden Eynde, from the Paris School of Economics, presented his research: ‘Military Service and Human Capital Accumulation: Evidence from Colonial Punjab'. He explored the impact of military recruitment on human capital accumulation in colonial Punjab. The empirical strategy exploited the exogenous increase in recruitment by the Indian Army during the First World War. Higher military recruitment is found to be associated with increased literacy at the district-religion level. The results indicate that 10 additional WWI recruits per 1,000 of the 1911 male population are on average associated with 3 more literate males per 1,000 in 1931. Further analysis indicates that the observed improvement in the human capital stock was mainly driven by the direct acquisition of literacy skills by illiterate soldiers. Finally, a political economy mechanism is not supported in this context: military recruitment was not associated with increased investment in public education.

Alex Armand, research at the NCID, presented his research ‘Who Wears the Trousers in the Family? Intra-household Resource Control, Subjective Expectations and Human Capital Investment'. His paper studied how the interaction between intra-household allocation of resources and parental beliefs about the returns to education influences human capital investment among poor households. For this purpose, he studied a conditional cash transfer program in the Republic of Macedonia, aimed at improving secondary school enrollment among children in poor households. For identification he exploited the random allocation of payments either to mothers or household heads, together with unique information on parental subjective expectations of returns to schooling. He showed that targeting mothers leads to an increase in secondary school enrollment only for children whose parents’ expected returns on education are sufficiently high at the beginning of the program.

The last session of the first day was given by Pedro Carneiro, from University College London and was titled: ‘A Helping Hand? Teacher Quality and Learning Outcomes in Kindergarten'.

In this work they used randomized assignment to assign two cohorts of kindergarten students, totaling more than 23,000 children, to teachers within schools. They collected data on children at the beginning of the school year, and applied 12 tests of math, language and executive function (EF) at the end of the year. All teachers were filmed teaching for a full day, and the videos were coded using a recently-developed measure of teacher behaviors (the Classroom Assessment Scoring System, or CLASS). They reached significant conclusions on teachers: the behaviors of teacher are more significant that their individual characteristics IQ or personality) in order to achieve higher learning outcomes.

The NCID is a research group of the Institute for Culture and Society (ICS) of the University of Navarra that aim to research on scientific, viable and effective solutions to poverty issues in Sub-Saharan Africa, Asia and Latin America.