Thesis (Ph. D.)--Massachusetts Institute of Technology, Dept. of Economics, 2004. / Includes bibliographical references. / (cont.) social activities. These results are unlikely to be driven by omitted environmental variables: social violence increases fastest where participation in Koran study also increases the fastest, and this is not true for state or industrial violence. Religious intensity is more strongly linked with social violence in regions that are more economically distressed. Credit availability mitigates this effect. These results support the ex-post social insurance model of religious intensity. High marginal utilities during economic distress increase incentives to enact sanctions. With volatility, religions with harsher punishment or violence are more stable and successful. As volatility declines, benign groups and religions become relatively successful. Chapter 3 During the early 20th century, France initiated an unusual tax policy to promote marriage and fertility, regressive in that fertility incentives were so large and greatest among the rich. Eugenic interest in family allowances was substantial during this time due to fear of depopulation and changing ratios of uneducated to educated. Family incomes were divided by family size to determine a final tax bracket. A number of countries have begun promoting similar tax incentives. Economic theory is ambiguous as to what such incentives do. This paper uses variation in tax policy with differential impact for different population groups to disentangle economic incentives from propaganda that often accompany such country-wide initiatives. Evidence using synthetic cohorts constructed from aggregate tax return data suggests ... / Chapter 1 exploits relative price shocks induced by the Indonesian financial crisis to demonstrate a causal relationship between economic distress and religious intensity and investigate why it exists. Rapid inflation favored growers of staple crops and disfavored sticky wage-earners. I use pre-crisis wetland hectares and government occupation as instruments and dryland hectares and service occupation as "placebo instruments" to estimate the impact of economic distress on religious intensity. Economic distress stimulates Koran study and Islamic school attendance but does not stimulate other social activities or secular school attendance. The results seem attributable to the role of religion as ex-post social insurance: credit availability reduces the effect of economic distress on religious intensity by roughly 80%, religious intensity alleviates needing alms or credit to meet basic needs at the peak of the crisis, and religious institutions facilitate consumption smoothing among villagers. I explain these findings in a model where religious intensity represents the degree of social insurance. in which people participate and social sanctions facilitate religion's function as ex-post insurance. Together, these results provide evidence that religious intensity responds to economic forces and suggest alleviating risk may mitigate fundamentalist tendencies. Chapter 2 exploits differences in religious intensity across Indonesia before and during the Indonesian financial crisis to identify the effect of religious intensity on social violence. In high religious intensity areas, violence is more likely to arise. Stronger measures of religious intensity are more strongly associated with social violence. Social violence is negatively associated with other / by Daniel L. Chen. / Ph.D.

Thesis (Ph. D.)--Massachusetts Institute of Technology, Dept. of Economics, 2007. / Includes bibliographical references (p. 137-143). / This thesis consists of three theoretical essays that examine the role of organizational architecture in facilitating organizational adaptation to a changing environment. Chapter 1 develops a model of coordinated adaptation where .an organization needs to respond to incoming information about its environment while at the same time retaining coordination between its activities. It analyzes how the allocation of decision rights inside the organization impacts the quality of decision-making and the accuracy of information transmission when information is both soft and distributed inside the organization. The results show that, contrary to the common intuition, the performance differential between centralized and decentralized decision-making is non-monotone in the importance of coordination. Further, both of these common structures are dominated by asymmetric structures in sufficiently asymmetric environments. Finally, if the incentive conflicts between the participants can be made sufficiently small, centralized decision-making is always dominated by decentralized decision-making. Chapter 2 extends the model developed in Chapter 1 to account for the endogeneity of incoming information and the use of monetary incentives to manage incentive conflicts inside the organization. / (cont.) Focusing on the distinction between centralized and decentralized decision-making, the chapter examines how monetary incentives and the allocation of decision rights can be used to together to motivate information acquisition, support accurate communication and to guide decision-making. The results illustrate the robustness of the conclusions of Chapter 1 to the introduction of monetary incentives. In particular, centralization of decision-making authority is preferred only when coordination is sufficiently important and incentive alignment is too costly in terms of the compromised quality of incoming information. Chapter 3 analyzes a simplified two-party decision-making problem with a single decision and examines how environmental uncertainty, quality of available performance measures and interim access to information influence the joint determination of the allocation of authority, use of performance pay and direct controls. It uses the results from the model to cast light on (i) the conflicting empirical evidence on the risk-incentives trade-off found in work on executive compensation and franchising, (ii) complementarities in organizational design and (iii) the determinants of the choice to delegate. / by Heikki Rantakari. / Ph.D.

Thesis (Ph. D.)--Massachusetts Institute of Technology, Dept. of Economics, 2011. / Cataloged from PDF version of thesis. / Includes bibliographical references. / In this thesis, I study the relationship between macroeconomic risks and asset prices. In the first chapter, I establish that inflation risk is priced in the cross-section of stock returns: stocks that have low returns during inflationary times command a risk premium. I estimate a market price of inflation risk that is comparable in magnitude to the price of risk for the aggregate market. Inflation is therefore a key determinant of risk in the cross-section of stocks. The inflation premium cannot be explained by either the Fama-French factors or industry effects. Instead, I argue the premium arises because high inflation lowers expectations of future real consumption growth. To formalize and test this hypothesis, I develop a consumption-based general equilibrium model. The model generates a price of inflation risk consistent with my empirical estimates, while simultaneously matching the joint dynamics of consumption and inflation, the aggregate equity premium, and the level and slope of the yield curve. In the second chapter, with L. Kogan and Dmitry Livdan, we study the relation between returns on the aggregate stock market and aggregate real investment. While it is well known that aggregate investment rate is negatively correlated with subsequent excess stock market returns, we find that it is positively correlated with future stock market volatility. Thus, conditionally on past aggregate investment, the mean-variance tradeoff in aggregate stock returns is negative. We interpret these patterns within a general equilibrium production economy. In our model, investment is determined endogenously in response to two types of shocks: shocks to productivity and preference shocks affecting discount rates. Preference shocks affect expected stock returns, aggregate investment rate, and stock return volatility in equilibrium, helping model reproduce the empirical relations between these variables. Thus, our results emphasize that the time-varying price of aggregate risk plays and important role in shaping the aggregate investment dynamics. In the third chapter, with S. Parsa, we show a novel relation between the institutional investors' intrinsic trading frequency-a commonly used proxy for the investors's investment horizon- and the cross-section of stock returns. We show that the 20% of stocks with the lowest trading frequency earn mean returns that are 6 percentage points per year higher than the 20% of stocks that have the highest trading frequency. The magnitude and predictability of these returns persist or even increase when riskadjusted by common indicators of systematic risks such as the Fama-French, liquidity or momentum factors. Our results show that the characteristics of stockholders affect expected returns of the very securities they hold, supporting the view that heterogeneity among investors is an important dimension of asset prices. JEL classification: E31, E44, G12. / by Fernando Manuel Duarte. / Ph.D.

Thesis: Ph. D., Massachusetts Institute of Technology, Department of Economics, 2015. / Cataloged from PDF version of thesis. / Includes bibliographical references (pages 85-91). / This thesis is a compilation of three empirical studies exploring significant but underexamined health and development challenges of the late 20th and early 21st centuries in South Asia. Chapter One investigates the effects of the expansion of ultrasound technology throughout India in the 1980s on the childbearing decisions of parents and the marriage market dynamics of exposed children. While ample work has documented the relationship between access to sex selection technology and heavily male-skewed child sex ratios, we know little about how such exposure translates into later life marriage market outcomes of children in highly sex-skewed regions, nor about how parental choice regarding sex selection is affected by such shifts in their children's marital prospects. I build on a theory proposed by Edlund (1999) that, in environments where hypergamy is practiced and parents derive utility from married children, a male-skewed sex ratio can generate a permanent female underclass. By examining the relationship between the child sex ratio of couples of childbearing age and that of their contemporaneous marriage market, I offer evidence that parents do indeed internalize the marriage prospects of their unborn children and adjust their use of sex selection technology accordingly. Importantly, this adjustment occurs significantly more amongst poor families than wealthy families. By exploiting spatial and temporal variation in exposure to ultrasound technology, I then examine the implications of such socioeconomically skewed ultrasound use on the marital outcomes of children in regions with high ultrasound access. I find that, relative to her unexposed counterpart, the average exposed married female has significantly poorer health and less education; there exists a wider marriage and education gap between herself and her husband; and she reports lower autonomy, less decision making power, and more abuse, among other bargaining outcomes. While existing literature suggests that scarcity of females in a marriage market should increase their bargaining power, I offer evidence to the contrary in this nationwide setting of endogenous and socioeconomically stratified sex selection. This exercise underscores the intergenerational welfare consequences of poorly regulated access to sex selection technology: not only upon the millions of 'missing women' lost to sex selection, but upon surviving females as well. Chapter Two explores the impact of a 1999 public health campaign in Bangladesh, which sought to protect millions of individuals from exposure to arsenic-contaminated water, on infant and child mortality. The study was motivated by the dearth of literature on the effects of arsenic exposure on children (whereas its effects on adults, often manifested in the cancer arsenicosis, are well known). It quickly evolved into an examination of the unintended consequences of a highly influential but poorly planned public health campaign. Exploiting the local random nature of arsenic contamination of groundwater in Bangladesh, paired with the timing of child births and thus exposure to such contaminated water, we find that households in which children were exposed to arsenic for a shorter duration (because the household responded to the health campaign by switching away from arsenic-contaminated groundwater sources) in fact experience significantly higher rates of infant and child mortality relative to their counterparts. We present evidence that this unanticipated rise in mortality is due to the quality of alternatives that a switching household faced: households had to choose between arsenic-laden but easily accessible shallow tubewell water, which was protected from fecal bacteria; arsenic-free and easily accessible surface water, which was heavily exposed to fecal bacteria; or distant and inconvenient potable water, which was more likely to be exposed to bacteria at the point-of-use. As bacterial contamination is a leading cause of infant and child death in Bangladesh, we argue through a series of exercises that this is a likely driver of the rise in mortality rates amongst young children whose families switched away from arsenic-contaminated tubewells. In determining their water source, households were essentially trading off arsenic exposure and the resulting rise in old-age mortality with bacterial exposure and the resulting rise in the mortality of their young. The study motivates caution in the execution of large-scale public health and behavioral change campaigns when alternatives to the discouraged behavior are poorly understood. While my first two chapters investigate household health behavior, a demand-side component of the healthcare market, the next chapter explores a critical player on the supply side. Chapter Three studies the impact of a nine-month generalized training program on the knowledge and performance of private informal healthcare providers in West Bengal, India. These providers, colloquially referred to as "quacks" and described here as "informal providers" (IPs), constitute nearly 80% of the Indian healthcare provider market. However, none possess medical degrees and few have any formal certification to practice medicine. They have been the focus of considerable debate in recent years, with many pushing for their elimination while others propose their integration into the public healthcare system. To inform the debate, it is important to understand whether the quality of healthcare provided by IPs can be improved sufficiently for effective and welfare-increasing integration. The training program examined in this study was the first of its kind to be rigorously evaluated for its impact on IP knowledge and quality of care. We employ a randomized controlled trial (RCT) design, in which we randomly assigned 152 IPs to treatment and 152 IPs to control. Treatment IPs were invited to attend the program, which was taught by certified doctors and consisted of two two-hour classes per week over nine months. Endline data was collected twelve to fourteen months after the start of training. Standardized patient data, corroborated by clinical observations, demonstrate that those IPs offered the program spent significantly more time with their patients, completed a more thorough set of history questions and examinations, and provided more effective treatments. However, we see no shift in the frequency with which they practiced polypharmacy nor the dispensation of unnecessary antibiotics, two harmful practices which plague both the private and public healthcare system. We conclude that training offers a low cost, highly effective method to improve the quality of care delivered by IPs, but that deeper knowledge failures or misaligned incentives may be driving practices such as polypharmacy, for which training may not be a sufficiently powerful intervention. / by Reshmaan Nahar Hussam. / Ph. D.

Massachusetts Institute of Technology. Dept. of Economics. Thesis. 1974. Ph.D. / MICROFICHE COPY ALSO AVAILABLE IN DEWEY LIBRARY. / Vita. / Includes bibliographical references. / Ph.D.

Thesis (Ph. D.)--Massachusetts Institute of Technology, Dept. of Economics, 2008. / Includes bibliographical references. / Essay 1: Allies and Adversaries: The Roles of Appointees in Administrative Policymaking under Separation of Powers. In a system of divided power, public sector agencies are an important front in the day-to-day battle for political supremacy between the executive and the legislature. The executive's key agents in this conflict are his appointees, who are observed playing two broad roles: allies, where they work to help Congress implement policy and adversaries, where they fight with Congress to shift policy strongly in the executive's direction. This paper studies how these two roles arise and what implications they have for the interaction of Congress and the executive, in administrative policymaking. Thereby, it highlights how intrinsically motivated bureaucrats combined with hierarchical control affect the ability of the political principals to control the execution of policy. Furthermore, I explore how this interaction shifts under alternative institutional forms, and how it leads appointees to "marry the natives." The model makes several predictions concerning Congressional oversight of bureaucratic agencies. These predictions are broadly supported by an empirical analysis of audit reports released by the Government Accountability Office. Essay 2: State Parties and State Policies: A Double Regression Discontinuity Approach. This paper identifies the causal effect of partisan power on tax and labor policies in the context of U.S. state legislatures from 1970 to 2000. Using a two dimensional regression discontinuity design, I identify the effect of Democratic control of the state legislature, as compared to divided control or Republican control, on tax burden and the state minimum wage. / (cont.) Using a novel instrumental variables approach, where the instrument is derived from the outcome of close legislative election, I also identify the effect of a marginal shift in the share of Democrats in the legislature on these same policies. To my knowledge this is the first paper to cleanly identify these pure partisan effects. In contrast to its prominence in popular discussions, the resulting estimates for control are quite small, suggesting that the pure partisan effect of control is relatively unimportant in understanding changes in these fiscal and labor policies. The estimates for party mix, however, are larger, suggesting this may be the more important channel by which party affects policy in this setting. Essay 3: Third-Party Auditors and Political Accountability. The most important tool that citizens have to police the decisions of their elected representatives is the ballot box. But the effectiveness of this tool depends crucially on the citizens' ability to correctly judge whether the politicians they select are doing their best to act in the interests of their constituents. This paper asks when and how specialist third-party auditors, people whose incentives come from outside the particular citizen-politician relationship under consideration, can nonetheless improve the ballot box as a tool of political accountability. I will look at three sorts of auditors: journalist, bureaucrat, and the opposition party, and show that because of the way that they respond to career-concern incentives, by auditing asymmetrically, auditors with incentives similar to journalists are particularly well suited to this role. / by Patrick L. Warren. / Ph.D.

Thesis (Ph. D.)--Massachusetts Institute of Technology, Dept. of Economics, 1988. / Includes bibliographical references. / by Daniel Barlow Nelson. / Ph.D.

Thesis (Ph. D.)--Massachusetts Institute of Technology, Dept. of Economics, 1993. / Includes bibliographical references. / by Charles Irving Jones. / Ph.D.

abstract: This dissertation consists in two chapters. In the first chapter I collected and digitized historical tax records from the Spanish colonial regime in Ecuador to estimate the long-run effects of a forced labor institution called concertaje on today’s economic performance. This institution allowed landlords to retain indigenous workers due to unpaid debts, and forced them to work as peasants in rural estates known as haciendas. In order to identify the causal effects of concertaje, I exploit variation in its intensity caused by differences in labor requirements from the crops a region could grow. I first report that an increase in 10 percentage points in concertaje rates is associated with a 6 percentage points increase in contemporary poverty. I then explore several channels of persistence. Districts with higher concertaje rates have been historically associated with higher illiteracy rates, lower school enrollment, and populations with fewer years of education. I also report that concertaje is associated with a higher fraction of people working nowadays in the agricultural sector. In the second chapter I use administrative data on the ownership, management, and taxes for the universe of all firms in Ecuador to study the role of family management in firm dynamics and its implications for aggregate productivity. A novel finding I document is that family-managed firms grow half as quickly as externally-managed firms. This growth differential implies that family-managed firms account for half of employment, despite comprising 80% of firms. I construct a general equilibrium model of firm dynamics that is consistent with these facts. Entrepreneurs choose whether to utilize family members as managers or hire external managers. External managers allow firms to scale up production, but their efficiency is a affected due to contractual frictions. Changes in the contractual environment that lead to a drop in the presence of family-managed firms by half could increase output on the order of 6%, as firms that abandon family management enjoy rapid growth. / Dissertation/Thesis / Doctoral Dissertation Economics 2019

abstract: This dissertation consists of two chapters. The first chapter studies children's skill formation technology while endogenizing the maternal age and child investments. I estimate the effect of a mother's age at childbirth on her child's health, skill level, educational attainment, and adulthood earnings. There is a tradeoff between delaying childbirth to provide a more secure economic environment for mother and child versus the potential negative biological consequences for a child of having an older parent. I quantify this tradeoff. The results indicate that a five-year decrease in the maternal age of educated women, ceteris paribus, results in over 0.50 std increase in the child’s skill level due to an increase in the child’s ability to acquire skills. However, if one adjusts child investment according to individuals’ wage profile conditional on reduced maternal age, the average child’s skill level decreases by 0.07 std. This reduction in children’s skill highlights the impact of lower inputs that children of younger mothers receive. The negative effect of foregone wages may be reduced through policy approaches. My policy analysis indicates implementing a two-year maternity leave policy that freezes mothers’ wages at the level before childbirth would reduce average maternal age at the first birth by about two years, while also increasing the average child’s skill level by about 0.22 std and future earnings by over 6%. In chapter two, I study the impact of females' perceptions regarding their future fertility behavior on their human capital investments and labor market outcomes. I exploit a natural experiment to study the causal effect of fertility anticipation on individual's investments in human capital. I use the arguably exogenous variation in gender mix of children as an exogenous shock to the probability of further fertility. I document that having two children of the same gender is associated with about 5% lower wages for the mother compared to having two children of the opposite sexes. Mothers with same-sex children perceive themselves as more likely to bear one more child, and so less attached to the labor market, so invest less in human capital, and this is reflected in wages today. / Dissertation/Thesis / Doctoral Dissertation Economics 2019