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The Aggregate Productivity Effects of Internal Migration: Evidence from Indonesia

Journal of Political Economy 2019 127(5), 2229-2268 open access
We estimate the aggregate productivity gains from reducing barriers to internal labor migration in Indonesia, accounting for worker selection and spatial differences in human capital. We distinguish between movement costs, which mean workers will move only if they expect higher wages, and amenity differences, which mean some locations must pay more to attract workers. We find modest but important aggregate impacts. We estimate a 22 percent increase in labor productivity from removing all barriers. Reducing migration costs to the US level, a high-mobility benchmark, leads to a 7.1 percent productivity boost. These figures hide substantial heterogeneity. The origin population that benefits most sees a 104 percent increase in average earnings from a complete barrier removal, or a 25 percent gain from moving to the US benchmark.

Underinvestment in a Profitable Technology: The Case of Seasonal Migration in Bangladesh

Econometrica 2014 82(5), 1671-1748 open access
Hunger during pre-harvest lean seasons is widespread in the agrarian areas of Asia and Sub-Saharan Africa. We randomly assign an $8.50 incentive to households in rural Bangladesh to out-migrate during the lean season. The incentive induces 22 % of households to send a seasonal migrant, their consumption at the origin increases significantly, and treated households are 8-10 percentage points more likely to re-migrate 1 and 3 years after the incentive is removed. These facts can be explained qualitatively by a model in which migration is risky, mitigating risk requires individual-specific learning, and some migrants are sufficiently close to subsistence such that failed migration is very costly. We document evidence consistent with this model using heterogeneity analysis and additional experimental variation, but calibrations with forward-looking households that can save up to migrate suggest that it is difficult for the model to quantitatively match the data. We conclude with extensions to the model that

Randomizing Religion: the Impact of Protestant Evangelism on Economic Outcomes

Quarterly Journal of Economics 2020 136(1), 293-380 open access
We study the causal impact of religiosity through a randomized evaluation of an evangelical Protestant Christian values and theology education program delivered to thousands of ultrapoor Filipino households. Six months after the program ended, treated households have higher religiosity and income; no statistically significant differences in total labor supply, consumption, food security, or life satisfaction; and lower perceived relative economic status. Exploratory analysis suggests that the income treatment effect may operate through increasing grit. Thirty months after the program ended, significant differences in the intensity of religiosity disappear, but those in the treatment group are less likely to be Catholic and more likely to be Protestant, and there is some mixed evidence that their consumption and perceived relative economic status are higher.

Big Loans to Small Businesses: Predicting Winners and Losers in an Entrepreneurial Lending Experiment

American Economic Review 2024 114(9), 2825-2860 open access
We experimentally study the impact of relatively large enterprise loans in Egypt. Larger loans generate small average impacts, but machine learning using psychometric data reveals “ top performers” (those with the highest predicted treatment effects) substantially increase profits, while profits drop for poor performers. The large differences imply that lender credit allocation decisions matter for aggregate income, yet we find existing practice leads to substantial misallocation. We argue that some entrepreneurs are overoptimistic and squander the opportunities presented by larger loans by taking on too much risk, and show the promise of allocations based on entrepreneurial type relative to firm characteristics.