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Although forests have diminished globally over the past 400 years, forest cover has increased in some areas, including India in the last two decades. Aggregate time-series evidence on forest growth rates and income growth across countries and within India and a newly-assembled data set that combines national household survey data, census data and satellite images of land use in rural India at the village level over a 29-year period are used to explore the hypothesis that increases in the demand for forest products associated with income and population growth lead to forest growth. The evidence is consistent with this hypothesis, which also shows that neither the expansion of agricultural productivity nor rising wages in India increased local forest cover Download Paper
We use survey-based data on siblings to assess the potential role of bequests in either redistributing income among siblings or affecting offspring behavior as implied by prominent models. The data are not focused on the upper tail of the wealth distribution and include both own and sib reports on own bequests and on sib's bequests, enabling the use of a flexible measurement model. Our results indicate tha bequests are received by almost two-thirds of eligible decedents, average bequest amounts are a significant fraction of annual earnings, and there are significant differences between siblings with respect to schooling, earnings, and visits with parents. However, there are not significnat sib differences in bequests once measurement error is incorporated into the analysis. Download Paper
In this paper we exploit a unique panel data set describing village governance, public goods allocations, and economic circumstances in India over the past twenty years to examine the consequences of democratization and fiscal decentralization within a model that highlights landownership-based interest groups. We first construct a simple model of two-party representative democracy with probabilistic voting in which local governments must choose to allocate public resources among three different goods representing the principal local public goods in Indian villages: roads, which primarily benefit the poor by raising wages; irrigation facilities, which differentially benefit landowners; and schools which have neutral effects. We embed the voting model in a general-equilibrium model of the rural economy in order to capture the general-equilibrium effects of changes in the landless share on the economic returns to the public goods. The model yields predictions about how the landless share affects allocations of the specific public goods under democracy relative to an alternative regime in which the local elite have a disproportionate effect on outcomes relative to that dictated by democracy. The model also has implications for the effects of ceding revenue-generating authority to the local governing body that permit an assessment of the differential burden of taxation on the rich and poor. Based on specifications consistent with the model, we then find evidence consistent with the two-party model of democracy in which increasing the population weight of the poor induces public resource allocations that increase the welfare of the poor. However, we also find that local taxes, where they are permitted, are regressive - the (landless) poor pay a higher tax rate on consumption than do the rich. Finally, we assess the growth implications of local democratization. Our evidence is consistent with almost-perfect substitution of public and private irrigation investment. Our findings thus suggest that the shift in the portfolio of local public goods associated with local democratization in part represents a transformation of a local welfare program from one that serves the rich to one that increases the welfare of the poor with possibly a net gain in total output. Download Paper
Two major health-related policy objectives are to increase the birthweights of children in low-birthweight populations and to reduce weight or body mass among most adults. There have been a number of previous studies on these topics. However, the literatures concerned with the consequences of weight gain at birth or in adulthood generally do not provide a clear interpretation of the observed linkages between physical characteristics, adult human capital investments and adult earnings. A problem with prior studies of the consequences of birthweight variation, for example, is that the policy-relevant effects of increasing the nutrition received by a fetus and possible genetic influences on fetal development are not distinguished. Moreover, generally researchers are inattentive to estimation problems that arise from endowment heterogeneity in assessing the effects of anthropometrics on adult human capital. Three recent exceptions to this generalization use data on relatives, but their resolutions of these estimation problems are incomplete. For example, the sibling-based studies ignore the responsiveness of resource allocations in the family to endowment differences.  This paper obtains improved estimates of the impacts of anthropometrics at birth and in adulthood on critical outcomes over the life cycle within a context in which individuals are born with health and earnings endowments that may be correlated with each other and across generations and optimally invest in health and earnings capacity. A simple three-period optimizing model is constructed that determines investments in human capital and physical characteristics and that incorporates endowment heterogeneity. The model (i) illustrates the difficulties in identifying the effects of at-birth and adult physical characteristics in the labor market and (ii) shows how both the distinct roles of endowments and of early health investments can be identified using data on identical twins. Estimates using use new survey data on female twins collected by the authors from a sample from the Minnesota Twins Registry provide a number of clear results. (1) Increasing fetal growth, for given endowments, has a significant positive effect on subsequent schooling attainment. The effect of increasing birthweight on schooling, moreover, is underestimated by 50% if there is no control for genetic endowments as is the case for cross-sectional estimates. This suggests that either nutrient consumption is negatively correlated with genetic endowments or that health and ability endowments are negatively correlated. (2) Intrauterine nutrient consumption does not have effects that persist to affect significantly adult BMI - increasing birthweight is not a cause of adult obesity. (3) The genetic birthweight endowment also is the component of birthweight that plays the dominant role in the intergenerational correlation of birthweights. (4) In contrast, intrauterine nutrient consumption plays the dominant role in determining adult height, consistent with the literature that makes use of height statistics to gage childhood nutritional investments over time and across countries. (5) The significant inverse association between adult BMI and wages found in cross-sectional estimates solely reflects a correlation between unmeasured earnings endowments and BMI, and disappears with control for endowments common to monozygotic (MZ) twins. (6) The significant positive association between adult height and wages found in cross-sectional estimates is increased substantially with control for endowments. There is thus evidence that augmenting birthweight in low-birthweight populations, which evidently increases both adult schooling attainment and height, has real labor-market payoffs, while the returns to controlling adult body mass in high-income settings may be illusory, at least in terms of labor market consequences for adults of prime labor-force age. Download Paper
New data on identical female and male twins are used to estimate the impact of increasing parental schooling on child schooling that incorporates the existence of unmeasured heritable traits and marital sorting. These data yield cross sectional estimates that are consistent with previous studies of the impact of parental schooling on child schooling attainment. However, when twinning is exploited to estimate intergenerational schooling effects, the results are strikingly different. Controlling for women's earnings and childrearing endowments and husband's endowments and schooling leads to a marginally negative rather than a significantly positive coefficient for mother's schooling in the determination of child schooling. Download Paper
The recent availability of longitudinal data from low-income countries makes possible for the first time the identification of the consequences of growth-augmenting innovations for household income change. However, it has become increasingly recognized that both the analysis and design of panel surveys is importantly affected by the break-up of households over time. In this paper we formulate, test, and estimate a structural model of household division. The model yields implications for how household size and intra-household inequality interact with exogenous income growth to affect (i) the amount of the household public good that is consumed, (ii) which households divide, (iii) the exact divisions of the assets among the new households and (iv) the evolution of the incomes of the new configurations of households. The model is estimated using panel data describing Indian farm households starting from the onset of the Indian "green revolution" in the late 1960's through 1982. The estimates indicate that inattention to the consequences of technical change for household division can lead to a substantial overestimate of the extent to which better-off households differentially benefit from technical change and demonstrate that the amount of within-household inequality can have important effects on the evolution of land assets over time and for the interhousehold distributional consequences of economic growth. Download Paper
In this paper we develop a two-strata general-equilibrium model of human capital acquisition with endogenous school construction that permits an assessment of the relative impacts of technological change and school availability on schooling investments in landless and landed households and illuminates how these choices interact through the adult and child labor markets. A key distinction is made between changes in current levels of agricultural productivity, which directly affect the demand for labor in both landless and landed households, and changes in expected agricultural technology, which only affect the contemporaneous schooling decisions and thus the labor supply of landed children. The implications of the model are assessed using a household-level panel data set which constitutes a representative sample of rural India during the peak period of agricultural innovation associated with the green revolution, 1968-1982. We establish that land prices capitalize expected future technologies and use the spatial and temporal variation in land prices to determine how household schooling decisions by land status are influenced by expected technological change. We find that higher expected future technology and increases in the number of schools, for given current productivity, raise schooling in landed households. However, although increased school availability also increases schooling in landless households we find that, consistent with the operation of a child labor market, high rates of expected technology for given school availability and for given current agricultural productivity tends to substantially decrease schooling investment in landless households. Download Paper
</p> A newly-assembled data set that combines national household survey data, census data and satellite images of land use in rural India over a 29-year period is used to obtain estimates of economic growth and population effects on forests, to identify the mechanisms by which these factors affect land use, and to address whether forest areas are efficiently managed where community land management is present.  The evidence suggests that increases in the returns to alternative uses of land induced by agricultural technical change and population growth, combined with the difficulty of monitoring forest-resource extraction, are the major contributing factors to deforestation.   Download Paper
Increased investment in schooling is often promoted as a key development strategy aimed at promoting economic growth. Most of the micro evidence that has been used to support the importance of schooling in augmenting incomes in low-income countries comes mainly from data describing the returns to schooling for men (e.g, Psacharopolous, 1994).  Given the relatively low rates of participation by women in formal-sector labor markets in such countries, information on the potential contribution of women’s schooling to income is less available and where found problematical to interpret due to labor market selectivity. Download Paper