New approaches to studying weakly institutionalized states

IMG00037A market on the road between Matadi & Kinshasa

I’ve come across the work of Raul Sanchez de la Sierra several times, mostly for his job market paper on state building by armed groups in eastern DRC and the evaluation of a community-driven reconstruction program in the same area (with Macartan Humphreys and Peter van der Windt).  He’s clearly got a good line going in doing extensive data collection in difficult settings, and has started the data collection firm to prove it.  Looking through his other papers recently, I was struck by two more with highly innovative experimental approaches to studying state capacity in weakly institutionalized countries.

The first looks at the effects of introducing state-enforced contracts into informal market relationships which typically operate without them.  The innovation?  He opened his own delivery business in eastern DRC in order to create a new set of relationships between traders and customers, and then varied which customers were asked to sign a contract with consequences for non-payment.  Here’s the abstract:

State capacity has recently become the workhorse of development scholarship. One reason why state capacity matters is that expanding the state legal capacity may increase trade where social institutions cannot govern agency relations (Greif, 1993). However, the state itself may be captured, and thus expanding the state could generate adverse results. Furthermore, the state may crowd-out pre-existing informal mechanisms of contract enforcement. Estimating the impact of the state is challenging, because state formation is endogenous, and because in the absence of a functioning state, there is usually no data. I create a delivery business in the Democratic Republic of the Congo, involving traders and customers who learned to operate without the state, and randomly introduce state contracts. I find that state contracts strongly reduce shirking. However, the results uncover an ethnic bias in contract enforcement by the state: only some ethnic groups can draw on the state’s legal capacity, and customers anticipate this bias. Furthermore, ex-ante, I nd that state contracts, when they are enforceable, and coethnicity are substitutes to solve commitment problems that prevent trade in the presence of agency relations. These results suggest that while social institutions govern some agency relations, they also govern the state administration, therefore distorting the impact of state legal capacity.
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A second project is still ongoing, but I’ve heard of some interesting results being discussed around Berkeley development circles.  This is a study with Kristof Titeca on the organization of bribery within the Congolese police force.  From their PEDL application:
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The researchers will combine novel data with satellite imagery and traffic data to document the types of contracts determining the sharing of bribes among policemen, as well as their assignments and rotations. They will also collect data on key intersections at which trade from rural areas occurs to investigate the issue of bribery. Additionally, they will estimate the welfare costs of organized bribery to trade, while concurrently analysing the ‘pricing practices’ of police extortion by looking at the police administration as a monopoly with a firm-maximization problem.

By creating this unique dataset on informal taxation, this study can have significant impacts on future policy design that seriously considers corruption and taxation in developing countries and provide a different lens for this pervasive issue. For example, by focusing on individual state officials, most corruption analysis would conclude that a promising intervention would be to provide greater wages to street policemen. However, as this study aims to show (and the previously-funded pilot has shown), such wages would likely be absorbed by the hierarchy as a function of the relative bargaining power of individual policemen within the hierarchy.

In other words, demand for bribes may be driven not only by the income needs of officers on the street, but also by the necessity of passing a large share of any bribes collected up the chain of command.  The working paper addresses this more explicitly.  It doesn’t seem to be available yet, but it’s definitely one to keep an eye out for.

Links I liked


  • African Arguments is running a fantastic ten-part series on African political thought, complete with reading lists and videos
  • Helicopter parenting in the US can’t just be attributed to a status-obsessed culture; it’s more fundamentally driven by our lack of economic mobility
  • Just for Berkeley grad students: are you beginning an original research project soon?  Do you want to learn more about the logistics and ethics of doing research?  Justine Davis and I are launching the Research in Practice Working Group at the D-Lab with a kickoff meeting on Thursday next week.  Come to talk about your research design, stay for the wine!
  • Song of the Week: it might be too early to conclude that this is the video of the year, but Blitz the Ambassador’s video for Shine is a perpetual favorite.  A gorgeous meditation on tradition and contemporary culture, race and vulnerability, familial love, and exuberant confidence.

Do cash transfer programmes foster dependency?

At the FAO’s blog, Ben Davis argues that they don’t.  Some key quotes, drawing on recent research on several African projects:

Along with the increase in productive activities, the cash transfers programmes have given households more flexibility with their time. In most countries of sub-Saharan Africa, low paying casual agricultural wage labour is an activity of last resort, when households are desperate for cash.  In Zambia, women in beneficiary households reduced their participation in agricultural wage labour by 17-percentage points and 12 fewer days a year. Both men and women increased the time they spent on family agricultural and non-agricultural businesses. … As one elderly beneficiary said, “I used to be a slave to ganyu (low-paid wage labour) but now I am free.”

Cash transfer programmes also have allowed beneficiary households to better manage risk. Fieldwork in Kenya, Ghana, Lesotho, Zimbabwe, Ethiopia and Malawi has found that the programmes increased social capital and allowed beneficiaries to ’re-enter’ existing social networks and/or to strengthen informal social protection systems and risk-sharing arrangements.

One of the important points that I take from this is that the idea of “welfare dependency” as transfer-induced withdrawal from the labor market is overly simplistic.  Selecting a livelihood strategy rarely comes down to a binary decision to work or depend on the state, be it in rural sub-countries in Kenya or poor neighborhoods in Chicago.  Instead, people  choose from a portfolio of livelihood options, often combining various sources of income at the same time.  These might include agricultural production, self-employment, waged labor, salaried labor, support from family or friends, and support from the government.  Davis’ point suggests that state-provided transfers don’t substitute for all the other livelihood choices here, but rather give people enough of a buffer that they don’t have to resort to the most poorly paid or abusive options quite so often.

An ethnography of economics

Sorting through the articles I’m reading for my comparative politics exam, I rediscovered an old favorite – Mike McGovern’s 2011 review of Paul Collier’s The Bottom Billion and War, Guns and Votes. It’s a wide-ranging critique of quantitative studies of civil war which is quite broadly applicable beyond these two books.  I agree with a number of his points, but wanted to highlight here one that’s not made often enough: that the sharply drawn divide between quantitative and qualitative methods collapses when looked at more closely.

As McGovern puts it,

What is striking to me as an anthropologist, however, is that much of the fundamental intellectual work in Collier’s analyses is, in fact, ethnographic. Because it is not done very self-consciously and takes place within a larger econometric rhetoric in which such forms of knowledge are dismissed as ‘subjective’ …  it is often ethnography of a low quality. (p. 346)

He goes on to read both books in this light, looking for the places where Collier imputes his respondents’ motivations or understandings of the world in order to interpret his quantitative results.

At one point, while summarizing Jeremy Weinstein’s work on rebel group recruitment in Mozambique and Sierra Leone, he lapses into an imaginary account of would-be rebels’ states of mind:

‘Others will be attracted by the prospects of power and riches, however unlikely; if the reality of daily existence is otherwise awful, the chances of success do not have to be very high to be alluring. Even a small chance of the good life as a successful rebel becomes worth taking, despite the high risk of death, because the prospect of death is not so much worse than the prospect of life in poverty.’ (BB: 29)

How do we know these things to be true? They must either come from conversations with the fighters themselves, a type of source that is usually excluded from Collier’s account … or from the author’s own imagination. There are many aspects left unexplored, and no justification given for privileging one explanation over another. [Based on McGovern’s own work, he knows that in] Liberia, Sierra Leone, and Côte d’Ivoire, some young men joined ‘prophylactically,’ trying to protect their home communities from attack. Others joined one militia group to avenge the deaths of loved ones at the hands of that group’s enemies. Others, including some women, joined by their own accounts partly for the fun and adventure of being fighters. (p. 349)

After the de rigeur swipe at taxi cab anthropology, he concludes with a very strong call to restore the role of ethnography in policy-making:

Ethnographic nuance is neither a luxury nor the result of a kind of methodological altruism to be extended by the soft-hearted. It is, in purely positivist terms, the epistemological due diligence work required before one can talk meaningfully about other people’s intentions, motivations, or desires. The risk in foregoing it is not simply that one might miss some of the local color of individual ‘cases.’ It is one of misrecognition. Analysis based on such misrecognition may mistake symptoms for causes, or two formally similar situations as being comparable despite their different etiologies. To extend the medical metaphor one step further, misdiagnosis is unfortunate, but a flawed prescription based on such a misrecognition can be deadly. Policy interventions are already risky in the best circumstances. (p. 353)

If you need me I’ll be memorizing this quote in its entirety for the obligatory large-N vs small-N question on my upcoming exam.

(Update: Ed Carr also makes a good point about how establishing causality is not the same thing as understanding causal mechanisms.  Qualitative research is well-suited to the latter task.)

The paternalism of behavioral economics

G. Sampath has written a trenchant critique of behavioral economics in The Hindu that’s worth a read if you do work related to this field.  I’m not fully in agreement with it, but he raises some important points.

Behavioural economics uses insights from psychology, anthropology, sociology and the cognitive sciences to come up with more realistic models of how people think and make decisions. Where these decisions tend to be flawed from an economic point of view, governments can intervene with policies aimed at ‘nudging’ the targeted citizens towards the right decision.

All this seems fairly unobjectionable. However, things change when behavioural economists focus their attention exclusively on the behaviour of the poor. Till date, there is no evidence that monitoring and ‘nudging’ the behaviour of the world’s poor is a better route to alleviate poverty than, say, monitoring and ‘nudging’ the behaviour of the financial elite. Surely the latter cannot be deemed as altogether rational economic agents — not after the 2008 crisis?


The report states in all earnestness that poverty “shapes mindsets”. From here, it is a hop, skip, and jump to holding, as the leading behavioural economists of the day do, that the poor are poor because their poverty prevents them from thinking and acting in ways that can take them out of poverty.

Thus the focus as well as the burden/responsibility of poverty-alleviation would shift from the state — from macroeconomic policy, from having to provide employment, health and education — to changing the behaviour of the poor. The structural causes of poverty — rising inequality and unemployment — as well as the behaviour of the owners of capital are evicted from the poverty debate, and no longer need be the focus of public policy.

The point about paternalism here is well-taken.  I don’t think the nudges he references here are harmful or problematic, since they tend to be things like offering people lentils or cash transfers in exchange for vaccinating their children, but it’s also true that these are programs designed by privileged academics and carried out on the bodies of poor people.  This is always, inherently, something to think carefully and critically about.

That said, there are several points on which I would disagree.  The first is that this academic focus on micro-behaviors has somehow silenced conversations on macro-level policies about unemployment and inequality.  There are huge English-language academic literatures on both of these topics in low income countries.  From the policy side, one could also point to the rapid spread of cash transfer programs which are meant to reduce inequality.  These have grown largely on the strength of the microeconomic evidence that people tend to use the money well.  (For two good overviews of this topic, check out the World Bank’s State of Social Safety Nets 2015, and James Ferguson’s Give a Man a Fish: Reflections on the New Politics of Distribution.)

The second issue is Sampath’s reading of the causal links between behaviors related to poverty (like high discount rates) and the incidence of poverty itself.  As indicated by the example of the Indian sugarcane farmers, there’s plenty of evidence that living in extreme poverty is very stressful, and tends to change the way that people think and act.  This is quite different to saying that people stay poor because they think and act a certain way.  Severe poverty of the type found in low income countries persists because of market failures, bad institutions, and (in some places) the absence of the type of stable elite bargains which constrain outright war.   Even if you were a benevolent dictator and could nudge people into making lots of small behavioral changes, like saving more and vaccinating their children, this wouldn’t touch most of the structural causes of poverty.  I don’t think any behavioral economist would disagree with this statement.

So why, then, do people keep studying the behavioral correlates of poverty?  For many researchers, I think the goal of their studies is not actually to reduce poverty rates, but rather to find low-cost interventions that can make life slightly easier for people who are still poor.  The goal is to nudge people into having less debt, or vaccinating their children against the most common diseases, or buying weather insurance for their crops.  None of these things, individually or together, is going to pull a family living on less than US$1.25 per day above that poverty line.  But they are still steps towards a slightly better life – and from a policy perspective, they’re often more feasible than making sustained, multi-million dollar investments in electrical and transport infrastructure, or bringing a civil war to a durable close.  These latter two topics are also active areas of research, but we still know very little about how to solve these complex types of coordination problems.

Returning to the second point, though, I’d also differ with the way that Sampath read the study about the sugarcane farmers in particular.  I should say first that I completely understand why he was so offended by it.  IQ research is always politically charged, and concluding that “poor people are stupid” is a recipe for terrible policies that strip people of their agency (which is very different to nudging them to save a bit more).  The only reason I differ here is because I saw Sendhil Mullainathan present this work at PacDev last year, and his interpretation ran in the opposite direction entirely.  The main finding of the study was that the cognitive stress of extreme poverty is considerable, equivalent to experiencing a 10-point drop in IQ, or pulling all-nighters for days on end.  But Sendhil’s point was not that poor people shouldn’t be allowed to make major decisions or anything similar.  Instead, it was a call to empathy.  He pointed out that most people are trying as best they can to provide good lives for their families, and asked his audience of privileged Northern academics to think seriously through the challenges of doing that if you started each day feeling like you hadn’t slept at all.  The interpretation, then, was not that “poor people are stupid” but “poor people are highly stressed,” which seems to me like it would lead to a different set of policy prescriptions aimed at giving reducing that stress by giving people higher and more stable incomes.

More books on development for the interested generalist

I’ve read quite a few fine books on on international development since I last wrote about books on development for the interested generalist.  I still stand by books 1 -4 and 6 on that list.  I suspect that 5, 7 and 8 may now be outdated.  Here’s what I would add to the list.  Please send your suggestions in as well!

  1. Violence and Social Orders: A Conceptual Framework for Interpreting Recorded Human History, by Douglass North, Jim Wallis and Barry Weingast.  A succinct and compelling discussion of why some states become rich and stay rich over the long run, while most remain relatively poor.  Does a great job getting past arguments focused on geography or technology to look at the politics of economic growth.
  2. Scarcity: Why Having Too Little Means so Much, by Sendhil Mullainathan.  A fascinating look at the cognitive effects of poverty, which are considerable.  The brief version of the argument is that people who face constant stress about whether they can afford to meet their basic needs often find it difficult to focus on making longer-term investments, such as making sure their children attend school regularly.  Could be read along with James Scott’s Weapons of the Weak as a short course on why behaviors that might look confusing to outside observers are often quite rational.
  3. Seeing Like a State: How Certain Schemes to Improve the Human Condition have Failed, by James Scott.  Essentially a treatise on standardization (of names, languages, railway gauges, what have you) and the role that this has played in many ambitiously large but ultimately unsuccessful development schemes.  Scott is a wonderful writer, and he has a gift for taking topics that might be dull in the hands of a lesser writer (like the standardization of basket sizes for paying grain taxes in medieval Europe) and finding the human drama within them.
  4. More than Good Intentions: Improving the Ways the World’s Poor Borrow, Save, Farm and Stay Healthy, by Dean Karlan & Jacob Appel, and Poor Economics: A Radical Rethinking of the Way to Fight Global Poverty, by Esther Duflo & Abhijit Banerjee.  Both books offer a great introduction to a new type of research in economics aimed at finding effective policies to reduce poverty.  What I appreciate about this type of research is that it represents to me a type of hopeful pragmatism.  It isn’t geared toward identifying the type of big push policies that might lift a whole country out of poverty in a generation (which few states besides China have the capacity to carry out anyway), but it takes an experimental, iterative approach to finding new products and services that are useful to ordinary people in low income countries.
  5. Montaillou: The Promised Land of Error, by Emmanuel Le Roy Ladurie.  A truly remarkable book about daily life in a small town in the mountains of southern France in the early 14th century.  Many people in the town held Albigensian beliefs, and were subject to an inquisition by the Catholic Church, which produced exhaustive records of their interactions with their neighbors and with visiting Albigensian holy men.  Le Roy Ladurie used these records to reconstruct a richly detailed portrait of personal, political and economic life in rural France nearly 700 years ago.  It’s a poignant reminder that even today’s high income countries were once basically just as poor as anywhere else – but also that poverty doesn’t inherently have to mean isolation, deprivation, or constant unhappiness.
  6. The Zenith, by Duong Thu Huong.  A fantastic recent novel by one of Vietnam’s leading authors.  It’s an imaginative retelling of the end of Ho Chi Minh’s life in an isolated mountain villa, and how it comes to intersect with the daily lives of the people living in the small towns nearby.  Rather like Montaillou, this is a much more complex, interesting, and deeply felt portrayal of rural life in a low income country than people from high income countries are usually exposed to.

Recent conference highlights

It’s been a busy few months of conference attendance recently, and I wanted to share some of the papers that really stood out to me.  At ISA:

  • Lior Lehrs had a very interesting presentation on what he calls “private peace entrepreneurs” – people who act without state support to reach out to the opposing side in a conflict and promote peace.  It doesn’t appear that the paper is public, but Ynetnews has a short summary of his work.
  • Olukunle Owolabi also presented a fascinating comparative study on the extension of political rights to former slaves in the US South and the French Antilles.  It’s currently under review, so keep an eye out for it!

Next up was a workshop on “clientelism in comparative perspective,” organized by the Center on the Politics of Development at Berkeley.

  • Nancy Hite discussed her current book project on how economic development changes citizens’ perceptions of the state in the Philippines, building on an earlier microfinance RCT by Dean Karlan and Jonathan Zinman.  No public paper yet, but I’d definitely look for this book when it comes out – it’s a really interesting micro-level look at how growth affects political behavior.
  • Another highlight for the sheer quantity of data used was Pablo Querubin‘s work with Cesi Cruz and Julien Labonne on political family networks in the Philippines.  Because Filipino surnames contain the family names of both parents (for unmarried people) or a father’s family name plus a husband’s name (for married women), they constructed a database of more than 20 million people and traced family and marriage relationships of everyone in 15,000 villages.  Perhaps unsurprisingly, they found that politicians tended to come from disproportionately well-connected families.

Finally, I had a great time (as always) at PacDev.

  • Berk Özler presented joint work with Sarah Baird, Ephraim Chirwa and Craig McIntosh on a five-year follow-up to a program in Malawi which offered young women cash transfers aimed at getting them to stay in school.  The program had offered conditional grants to women who were already in school, and unconditional grants to women who had already dropped out, both of which were effective in getting them back into school.  Five years later, however, the women who got the CCTs (who might have stayed in school anyway) had marital and economic outcomes that looked similar to the control group, while the UCT group (who otherwise would have dropped out) did have persistently better outcomes.
  • David Yang and Yuyu Chen had a fascinating paper on how people perceive the credibility of the Chinese government in trying to shift the narrative around the Great Leap Forward.  The government blamed the famine of that period on drought, and Yang and Chen find that people living in famine-affected areas where there was in fact a drought reported higher levels of trust in the state than those who didn’t observe drought in their region.  The effects persisted for more than half a century, and tended to get reinforced by marriage, as people who didn’t trust the state disproportionately married each other.