To what extent do tropical diseases contribute to the poverty characteristic of tropical countries? Estimates of the impact of health on income are difficult to obtain because health is a normal good-countries with higher income will buy more of it-and third factors such as remoteness and bad government might impede both productivity and public health. In the Abuja Declaration of 2005, African heads of states claim that malaria has depressed income growth in Subsaharan Africa since the 1960s, so much so that GDP in the region today is 40% lower because of malaria. Estimates of this magnitude have been mocked at cocktail parties and clambakes. But how ridiculous is this number?

Emerging markets firms often carry foreign-currency debt on their balance sheets. Following a depreciation, the expanding “peso” value of “dollar” liabilities could, via a net-worth effect, offset the expansionary competitiveness effect. To assess which effect dominates, we use accounting data (including the currency composition of liabilities) for 450+ nonfinancial firms in five Latin American countries in the 1990s. We find that firms holding more dollar debt do not invest less than their peso-indebted counterparts following a depreciation. We also show that these firms match the currency denomination of their liabilities with the exchange rate sensitivity of their profits.

Does the lack of wealth constrain parents' investments in the human capital of their descendants? We conduct a nearly fifty-year followup of an episode in which such constraints would have been plausibly relaxed by a random allocation of substantial wealth to families. We track descendants of participants in Georgia's Cherokee Land Lottery of 1832, in which nearly every adult white male in Georgia took part. Winners received close to the median level of wealth - a large financial windfall orthogonal to participants' underlying characteristics that might have also affected their children's human capital. Although winners had slightly more children than non-winners, they did not send them to school more. Sons of winners have no better adult outcomes (wealth, income, literacy) than the sons of non-winners, and winners' grandchildren do not have higher literacy or school attendance than non-winners' grandchildren. This suggests only a limited role for family financial resources in the formation of human capital in the next generations in this environment and a potentially more important role for other factors that persist through family lines.

Many cities in North America formed at obstacles to water navigation, where continued transport required overland hauling or portage . Portage sites attracted commerce and supporting services, and places where the falls provided water power attracted manufacturing during early industrialization. We examine portage sites in the U.S. South, Mid-Atlantic, and Midwest, including those on the fall line , a geomorphological feature in the southeastern United States marking the final rapids on rivers before the ocean. Although their original advantages have long since become obsolete, we document the continuing importance of historical portage sites. We interpret these results as path dependence and contrast explanations based on sunk costs interacting with decreasing versus increasing returns to scale.

This study considers the eradication of hookworm disease from the American South as a test of the quantity-quality (Q-Q) framework of fertility. Eradication was principally a shock to the price of quality because of three factors: hookworm (i) depresses the return to human-capital investment, (ii) had a very low case-fatality rate, and (iii) had negligible prevalence among adults. Consistent with the Q-Q model, we find a significant decline in fertility associated with eradication. Relative sizes of fertility and human-capital responses to hookworm indicate that the Q-Q mechanism is of a similar magnitude to secular co-movements in these same variables.

Research on the effect of language skills on earnings is complicated by the endogeneity of language skills. This study exploits the phenomenon that younger children learn languages more easily than older children to construct an instrumental variable for language proficiency. We find a significant positive effect of English proficiency on wages among adults who immigrated to the United States as children. Much of this effect appears to be mediated through education. Differences between non-English-speaking origin countries and English-speaking ones that might make immigrants from the latter a poor control group for nonlanguage age-at-arrival effects do not appear to drive these findings.

We contrast evidence of urban path dependence with efforts to analyze calibrated models of city sizes. Recent evidence of persistent city sizes following the obsolescence of historical advantages suggests that path dependence cannot be understood as the medium-run effect of legacy capital but instead as the long-run effect of equilibrium selection. In contrast, a different, recent literature uses stylized models in which fundamentals uniquely determine city size. We show that a commonly used model is inconsistent with evidence of long run persistence in city sizes and propose several modifications that might allow for multiplicity and thus historical path dependence.