American Economic Association Nashville, TN 1945-7782 1945-7790 American Economic Journal: Applied Economics http://www.aeaweb.org/aej-applied/ 4 2 April 2012 http://www.aeaweb.org/issue.php?journal=APP&volume=4&issue=2 Journal Article Front Matter i iv http://www.aeaweb.org/articles.php?doi=10.1257/app.4.2.i 10.1257/app.4.2.i American Economic Association Nashville, TN 1945-7782 1945-7790 American Economic Journal: Applied Economics http://www.aeaweb.org/aej-applied/ 4 2 April 2012 http://www.aeaweb.org/issue.php?journal=APP&volume=4&issue=2 Journal Article What Linear Estimators Miss: The Effects of Family Income on Child Outcomes Katrine V.LokenU Bergen MagneMogstadU College London MatthewWiswallNYU 1 35 We assess the implications of nonlinearity for IV and FE estimation when the estimated model is inappropriately assumed to be linear. Our application is the causal link between family income and child outcomes. Our nonlinear IV and FE estimates show an increasing, concave relationship between family income and children's outcomes. We find that the linear estimators miss the significant effects of family income because they assign little weight to the large marginal effects in the lower part of the income distribution. We also show that the linear IV and FE estimates differ primarily because of different weighting of marginal effects. (JEL C26, D14, J12, J13) http://www.aeaweb.org/articles.php?doi=10.1257/app.4.2.1 10.1257/app.4.2.1 http://www.aeaweb.org/aej/app/data/2011-0041_data.zip American Economic Association Nashville, TN 1945-7782 1945-7790 American Economic Journal: Applied Economics http://www.aeaweb.org/aej-applied/ 4 2 April 2012 http://www.aeaweb.org/issue.php?journal=APP&volume=4&issue=2 Journal Article What Makes Firm-Based Vocational Training Schemes Successful? The Role of Commitment ChristianDustmannU College London UtaSchonbergU College London 36 61 This paper studies a possible market failure in the firm-based vocational training market: training may be too complex to be specified in a contract so that it is legally enforceable, resulting in the inability of firms to commit to training provision. We present a model of firm provided training and show that training is substantially lower in the no commitment than in the commitment case. Thus, firm-based vocational training schemes are more successful in countries where commitment to training provision is more widespread. (JEL J24, L25, M12, M53) http://www.aeaweb.org/articles.php?doi=10.1257/app.4.2.36 10.1257/app.4.2.36 http://www.aeaweb.org/aej/app/data/2010-0097_data.zip American Economic Association Nashville, TN 1945-7782 1945-7790 American Economic Journal: Applied Economics http://www.aeaweb.org/aej-applied/ 4 2 April 2012 http://www.aeaweb.org/issue.php?journal=APP&volume=4&issue=2 Journal Article Reexamining the Impact of Family Planning Programs on US Fertility: Evidence from the War on Poverty and the Early Years of Title X Martha J.BaileyU MI 62 97 Almost 50 years after domestic US family planning programs began, their effects on childbearing remain controversial. Using the county-level roll-out of these programs from 1964 to 1973, this paper reevaluates their shorter and longer term effects on US fertility rates. I find that the introduction of family planning is associated with significant and persistent reductions in fertility driven both by falling completed childbearing and childbearing delay. Although federally funded family planning accounted for a small portion of the post-baby boom US fertility decline, my estimates imply that they reduced childbearing among poor women by 19 to 30 percent. (JEL I38, J12, J13, J18) http://www.aeaweb.org/articles.php?doi=10.1257/app.4.2.62 10.1257/app.4.2.62 American Economic Association Nashville, TN 1945-7782 1945-7790 American Economic Journal: Applied Economics http://www.aeaweb.org/aej-applied/ 4 2 April 2012 http://www.aeaweb.org/issue.php?journal=APP&volume=4&issue=2 Journal Article The Impact of Credit on Village Economies Joseph P.KaboskiU Notre Dame Robert M.TownsendMIT 98 133 This paper evaluates the short- and longer term impact of Thailand's "Million Baht Village Fund" program, among the largest scale government microfinance iniatives in the world, using pre- and post-program panel data and quasi-experimental cross-village variation in credit per household. We find that the village funds have increased total short-term credit, consumption, agricultural investment, and income growth (from business and labor), but decreased overall asset growth. We also find a positive impact on wages, an important general equilibrium effect. The findings are broadly consistent qualitatively with models of credit-constrained household behavior and models of intermediation and growth. (JEL D14, G21, O12, O16, O18) http://www.aeaweb.org/articles.php?doi=10.1257/app.4.2.98 10.1257/app.4.2.98 http://www.aeaweb.org/aej/app/data/2009-0115_data.zip http://www.aeaweb.org/aej/app/app/2009-0115_app.pdf American Economic Association Nashville, TN 1945-7782 1945-7790 American Economic Journal: Applied Economics http://www.aeaweb.org/aej-applied/ 4 2 April 2012 http://www.aeaweb.org/issue.php?journal=APP&volume=4&issue=2 Journal Article Risk Pooling, Risk Preferences, and Social Networks OrazioAttanasioU College London AbigailBarrU Nottingham Juan CamiloCardenasU Andes, Bogota GaranceGenicotGeorgetown U CostasMeghirYale U 134 67 Using data from an experiment conducted in 70 Colombian communities, we investigate who pools risk with whom when trust is crucial for enforcing risk pooling arrangements. We explore the roles played by risk attitudes and social networks. Both empirically and theoretically, we find that close friends and relatives group assortatively on risk attitudes and are more likely to join the same risk pooling group, while unfamiliar participants group less and rarely assort. These findings indicate that where there are advantages to grouping assortatively on risk attitudes those advantages may be inaccessible when trust is absent or low. (JEL C93, O12, O18, Z13) http://www.aeaweb.org/articles.php?doi=10.1257/app.4.2.134 10.1257/app.4.2.134 http://www.aeaweb.org/aej/app/data/2010-0118_data.zip http://www.aeaweb.org/aej/app/app/2010-0118_app.zip American Economic Association Nashville, TN 1945-7782 1945-7790 American Economic Journal: Applied Economics http://www.aeaweb.org/aej-applied/ 4 2 April 2012 http://www.aeaweb.org/issue.php?journal=APP&volume=4&issue=2 Journal Article Productivity Spillovers across Firms through Worker Mobility AndreyStoyanovYork U NikolayZubanovErasmus U Rotterdam 168 98 Using matched firm-worker data from Danish manufacturing, we observe firm-to-firm worker movements and find that firms that hired workers from more productive firms experience productivity gains one year after the hiring. The productivity gains associated with hiring from more productive firms are equivalent to 0.35 percent per year for an average firm. Surviving a variety of statistical controls, these gains increase with education, tenure, and skill level of new hires, persist for several years after the hiring was done, and remain broadly similar for different industries and measures of productivity. Competing explanations for these gains, knowledge spillovers in particular, are discussed. (JEL D24, J24, J62, L60, O33) http://www.aeaweb.org/articles.php?doi=10.1257/app.4.2.168 10.1257/app.4.2.168 http://www.aeaweb.org/aej/app/data/2011-0024_data.zip http://www.aeaweb.org/aej/app/app/2011-0024_app.pdf American Economic Association Nashville, TN 1945-7782 1945-7790 American Economic Journal: Applied Economics http://www.aeaweb.org/aej-applied/ 4 2 April 2012 http://www.aeaweb.org/issue.php?journal=APP&volume=4&issue=2 Journal Article Indirect Effects of a Policy Altering Criminal Behavior: Evidence from the Italian Prison Experiment FrancescoDragoU Naples "Federico II" RobertoGalbiatiCNRS, EconomiX and Sciences Po, Paris 199 218 We exploit the 2006 Italian prison pardon to evaluate peer effects in criminal behavior. The pardon randomly commutes actual sentences to expected sentences for 40 percent of the Italian prison population. Using prison and geographical origin to construct reference groups for former inmates, we find large indirect effects of this policy. In particular, we find that the reduction in the individuals' recidivism due to an increase in their peers' residual sentence is at least as large as their response to an increase in their own residual sentence. From this result we estimate a social multiplier in crime of two. (JEL D12, K42, Z13) http://www.aeaweb.org/articles.php?doi=10.1257/app.4.2.199 10.1257/app.4.2.199 http://www.aeaweb.org/aej/app/data/2010-0361_data.zip American Economic Association Nashville, TN 1945-7782 1945-7790 American Economic Journal: Applied Economics http://www.aeaweb.org/aej-applied/ 4 2 April 2012 http://www.aeaweb.org/issue.php?journal=APP&volume=4&issue=2 Journal Article The Effect of Shift Structure on Performance TanguyBrachetU PA GuyDavidCharles River Associates, Washington, DC Andrea M.DrechslerU PA 219 46 The effect of shift structure on worker performance and productivity is of increasing interest to firms and regulatory bodies. Using approximately 743,000 emergency medical incidents attended by 2,381 paramedics in Mississippi, we evaluate the extent that paramedics' performance toward the end of shifts is impacted by shift length. We find evidence that performance deteriorates toward the end of long shifts, and argue that fatigue is the mediating factor. Our calculations imply that such deterioration may result in a 0.76 percent increase in 30-day mortality. These findings have implications for workforce organization, calling attention to regulation designed to limit extended work hours. (JEL J22, J24, J28, J45, M12) http://www.aeaweb.org/articles.php?doi=10.1257/app.4.2.219 10.1257/app.4.2.219 http://www.aeaweb.org/aej/app/data/2010-0246_data.zip American Economic Association Nashville, TN 1945-7782 1945-7790 American Economic Journal: Applied Economics http://www.aeaweb.org/aej-applied/ 4 2 April 2012 http://www.aeaweb.org/issue.php?journal=APP&volume=4&issue=2 Journal Article Cash Transfers, Behavioral Changes, and Cognitive Development in Early Childhood: Evidence from a Randomized Experiment KarenMacoursParis School of Economics and INRA NorbertSchadyInter-American Development Bank RenosVakisWorld Bank 247 73 Cash transfer programs have become extremely popular in the developing world. A large literature analyzes their effects on schooling, health and nutrition, but relatively little is known about possible impacts on child development. This paper analyzes the impact of a cash transfer program on early childhood cognitive development. Children in households randomly assigned to receive benefits had significantly higher levels of development nine months after the program began. There is no fade-out of program effects two years after the program ended. Additional random variation shows that these impacts are unlikely to result from the cash component of the program alone. (JEL H23, I15, J13, O15) http://www.aeaweb.org/articles.php?doi=10.1257/app.4.2.247 10.1257/app.4.2.247 http://www.aeaweb.org/aej/app/data/2008-0172_data.zip http://www.aeaweb.org/aej/app/app/2008-0172_app.pdf American Economic Association Nashville, TN 1945-7782 1945-7790 American Economic Journal: Applied Economics http://www.aeaweb.org/aej-applied/ 4 2 April 2012 http://www.aeaweb.org/issue.php?journal=APP&volume=4&issue=2 Journal Article Castes and Labor Mobility ViktoriaHnatkovskaU British Columbia AmartyaLahiriU British Columbia SourabhPaulNational Council of Applied Economic Research, New Delhi 274 307 We examine the relative fortunes of the historically disadvantaged scheduled castes and tribes (SC/ST) in India in terms of their education attainment, occupation choices, consumption and wages. We study the period 1983-2005 using household survey data from successive rounds of the National Sample Survey. We find that this period has been characterized by a significant convergence of education, occupation distribution, wages and consumption levels of SC/STs toward non-SC/ST levels. Using various decomposition approaches we find that the improvements in education account for a major part of the wage and consumption convergence. (JEL I24, O15, O17, Z13) http://www.aeaweb.org/articles.php?doi=10.1257/app.4.2.274 10.1257/app.4.2.274 http://www.aeaweb.org/aej/app/data/2011-0156_data.zip