Dear readers, you may have noticed a decline in the frequency of blogging. Work on the dissertation is taking up all my time these days. As a result I am taking a break from blogging, for now.
Dear readers, you may have noticed a decline in the frequency of blogging. Work on the dissertation is taking up all my time these days. As a result I am taking a break from blogging, for now.
The Kenyan Cabinet Secretary in charge of Transport recently announced a 22% decline in accidents on Kenyan roads in the first quarter of 2014 compared to the same period last year (resulting in 201 fewer deaths). Following the end of year holiday season uptick in road deaths (more people travel then; presumably more drink and drive as well) the government instituted strict traffic regulations, some of which have been struck down by the courts. But do these top-down rule changes work in reducing road accidents?
Probably not as well as we think, according to a new paper by Habyarimana and Jack:
This paper compares the relative impact of two road safety interventions in the Kenyan minibus or matatu sector: a top down set of regulatory requirements known as the Michuki Rules and a consumer empowerment intervention. We use very detailed insurance claims data on three classes of vehicles to implement a difference-in-difference estimation strategy to measure the impact of the Michuki Rules. Despite strong political leadership and dedicated resources, we find no statistically significant effect of the Michuki Rules on accident rates. In contrast, the consumer empowerment intervention that didn’t rely on third party enforcement has very large and significant effects on accident rates. Our intent-to-treat estimates suggest reductions in accident rates of at least 50%. Our analysis suggests that in institutionally weak environments, innovative consumer-driven solutions might provide an alternative solution to low quality service provision.
The Michuki Rules, which required retrofitting of vehicles with certain safety devices and other reforms as outlined in the net section, were widely believed to have led to an immediate and sustained improvement in the safety of Kenya’s roads. However despite this view, we find that most of the perceived effects were driven by short-run compliance costs imposed on vehicle owners and drivers, as opposed to their behavior, and that a month after the rules were introduced there was no discernible effect on insurance claims. In contrast, the consumer empowerment campaign we examine, which encouraged passengers to actively complain directly to their drivers when they felt unsafe, led to a remarkably large reduction in insurance claims of between a half and two-thirds.
Eng. Kamau and his team should take a look at this paper.
Also, the lesson here is not that we should not legislate against insanity on Kenya’s roads, just that those efforts should be complemented by fire-alarm enforcement mechanism as opposed to using the Chai-Culture-crippled police system.
1. As usual, great career advice for those in the academy from Chris Blattman.
2. Boring Development asks some interesting questions re RCTs, and questions the internal validity assumption many of them trumpet. Which raises the question, if RCTs are cannot guarantee internal validity can results so obtained be useful for policy development? My general response here is that not all RCTs are useful for policy development. The obvious incentives to publish clearly skew the design and implementation of studies in a way that makes only a fraction of them useful for policymakers (the IRB process notwithstanding). But all things considered, randomistas have probably made the world a better place.
3. An unfolding case in Guinea could drastically change what is permissible in the process of acquiring concessions from dubious governments. Benny Steinmetz of BSGR bought the Simandou concession in late 2008 during the last days of the administration of ailing dictator Lansana Conte (allegedly with the help of Mr. Conte’s fourth wife). According to FT, BSGR spent a mere $160m for the rights to mine in Simandou. Less than two years later, the company sold 51% of its rights to the Brazilian mining giant Vale for $2.5 billion, $500m of which was in cash. Last week a government committee investigating the Conte-BSGR deal found evidence of corruption and recommended that BSGR and Vale be stripped of their rights to Simandou. If the ruling sticks, lots of contracts in several resource rich states in Africa will become open for legal review thereby drastically lowering the costs of renegotiation (even for the dictators who singed them).
Ever wondered why so many charitable campaigns often lack contextual information on their aid recipients? Well, it turns out charitable groups might just be responding to some of their contributors’ need for as little information as possible, the result of which are the often simplistic silly campaigns to help starving people in nameless war-torn countries in the developing world.
According to Karlan and Wood in a paper on donor responses to information on aid effectiveness (it is a direct mail experiment):
We test how donors respond to new information about a charity’s effectiveness. Freedom from Hunger implemented a test of its direct marketing solicitations, varying letters by whether they include a discussion of their program’s impact as measured by scientific research. The base script, used for both treatment and control, included a standard qualitative story about an individual beneficiary. Adding scientific impact information has no effect on whether someone donates, or how much, in the full sample. However, we find that amongst recent prior donors (those we posit more likely to open the mail and thus notice the treatment), large prior donors increase the likelihood of giving in response to information on aid effectiveness, whereas small prior donors decrease their giving. We motivate the analysis and experiment with a theoretical model that highlights two predictions. First, larger gift amounts, holding education and income constant, is a proxy for altruism giving (as it is associated with giving more to fewer charities) versus warm glow giving (giving less to more charities). Second, those motivated by altruism will respond positively to appeals based on evidence, whereas those motivated by warm glow may respond negatively to appeals based on evidence as it turns off the emotional trigger for giving, or highlights uncertainty in aid effectiveness.
They also add that:
Our finding that smaller prior donors respond to information on charitable effectiveness by donating less frequently and in smaller amounts is consistent with other research showing that emotional impulses for giving shut down in the presence of analytical information. Indeed, controlled laboratory experiments have produced insights that suggest that emotionally triggered generosity may be dampened by appeals that include statistical or deliberative information. For example, people donate less to feed a malnourished child when statistics that put this child in the larger context of famine in Africa are mentioned.
H/T Marginal Revolution.
According to Doctors Without Borders (MSF):
We are talking about up to one million IDPs and refugees, out of a population of 4.6 million. This accounts for 20% of the population, which is outrageous when we take into consideration these communities were already very fragile in a disrupted country, where health services outside Bangui would be practically non-existent if not for the presence of MSF in seven different regions. This past year has pushed the population to the edge of the abyss. The deployment of MSF has been huge, spectacular and swift in order to respond rapidly and provide emergency medical care. However the population is still in dire need of more assistance, including medical care. And above all, the population needs safety and security.
CAR is scheduled to hold elections either later this year or early next to speed up the transition to normalcy (France wants out ASAP). The hope, I presume, is that whoever wins the election will bring political order to the former Central African Empire. Fingers crossed?
On a related note, the US recently announced new military aid to Uganda, including four CV-22 Ospreys and an additional 150 Special Operation troops (to join the 100 deployed in 2011) in an effort to step up the hunt for Joseph Kony, leader of the Lord’s Resistance Army (LRA). Kony is suspected to be in hiding in the border regions CAR, the DRC, Sudan and South Sudan. Of course this rather bizarre decision (is Kony really that much of a priority right now in the Great Lakes Region?) is motivated by the need to keep the Ugandan military in top shape and ready to fight in places the US doesn’t want to set foot.
What if the US and the EU also had a humanitarian equivalent of Uganda? You know, a country that could be just as well funded with cash and equipment to wade into troubled places like CAR and South Sudan and provide humanitarian assistance backed by credible firepower. What if? It might even help shore up some of the soft power the US (and the West in general) is haemorrhaging fast on account of the developmental interventions from the East in the wider region.
Yesterday Nigeria unveiled new GDP figures following the rebasing that catapulted the country of 170 million to become Africa’s biggest economy (GDP US$509b). Below is the ranking of the top sixteen economies in SSA. Mineral economies (10/16) still predominate (Source: The Economist).
Caution: This is not an apology for President Kagame and his autocratic tendencies that have resulted in carnage and death in the DRC, Rwanda and elsewhere.
At a conference last year a US State Department official told a group of us that Rwanda was so polarizing that even at the Consulate in Nairobi the DRC crowd did not get along well with the Rwanda crowd.
It is not surprising why that might have been the case, or why the present analysis on the commemoration of the 20th anniversary of the 1994 genocide remains polarized.
If one just looks at the improvements made in advancing human welfare since President Paul Kagame and the RPF took power (see graph, data from the World Bank) it is hard not to arrive at the conclusion that ordinary Rwandese are unambiguously better off. The country is the least corrupt in the region and has also been consistently ranked top in the ease of doing business. But there is also the side of the Kigali government that most reasonable people love to hate: the murderous meddling in the DRC and the oppression and occasional murder of dissidents at home and abroad. Those who admire what President Kagame has done tend to emphasize the former, while his critics tend to emphasize his autocratic tendencies which have made Rwanda the least democratic country in East Africa (see below, data from Polity). Many wonder if the post-1994 achievements are sustainable enough to outlast President Kagame’s rule.
So is Mr. Kagame a state-builder or your run of the mill autocrat whose achievements will vanish as soon as he relinquishes power?
In my view, I think that Rwanda is the best success story of state-building in Africa in the last 20 years. I also think that this (state-building) should be the paramount consideration for those who care about the Rwandese people and want to help them achieve greater freedoms. The fundamental problem in states like CAR, Sierra Leone or Liberia has never been the insufficiency of democracy. Rather, it has been the problem of statelessness. The contrast between Rwanda and Burundi is instructive (see both graphs, the two are neighbors with similar ethno-political histories. Rwanda has historically had a stronger state, though. See here and here). Despite the latter being the second most democratic state in the region, it has consistently performed the worst on nearly all human development indicators. Part of the reason for this is that Burundi remains a classic papier mache state confined to Bujumbura and its environs.
May be I am too risk averse. But I am scared stiff of anything that could lead to a recurrence of the horrors of the early 1990s stretching from the Mano River region to the Horn. As a result I am always skeptical of activism that takes state capacity (including coercive capacity) for granted.
With this in mind, the fight against autocratic rule in Rwanda should not come at the expense of the state-building achievements of the last 20 years. The international community and those who genuinely care about Rwandese people should be careful not to turn Rwanda into “democratic” Burundi in the name of democracy promotion. Interventions will have to be smart enough to push President Kagame and the ruling elite in the right direction, but without gutting the foundations of political order in Rwanda.
Absent a strong state (even after Kagame), the security dilemmas that occasioned the 1994 “problem from hell” would ineluctably resurface.
Lastly, I think the level of discourse in the “Rwanda Debate” could be enhanced by the extension of the privilege of nuance to the case. For example, if all we focused on were drones killing entire families at weddings in Yemen or the horror that is the South Side of Chicago we would probably get mad enough to ask for regime change in Washington. But we don’t. Because people tolerate the “complications and nuance of American politics.” The same applies to less developed countries. Politics is complicated, everywhere. And those who approach it with priors of good-or-bad dichotomies are bound to arrive at the wrong conclusions. One need not be a Kagame apologist to realize the need for a delicate balance in attempts to effect political change in Kigali.
Before you hit the comment button, notice that this is neither an apology nor an endorsement of autocracy in Rwanda. It is a word of caution regarding the choices outsiders make to accelerate political change in Rwanda.
Tyranny is not the panacea to underdevelopment. But neither is stateless democracy.
For background reading on the 1994 genocide in Rwanda see Samantha Power’s Problems From Hell; Mahmood Mamdani’s When Victims Become Killers; and Philip Gourevitch’s We Wish to Inform You That Tomorrow We Will be Killed With Our Families.
As Grossman and Lewis show in this paper, a lot of decentralization efforts in the developing world have not resulted in greater capacity or control of policy by the devolved units. But there are exceptions, like in Kenya where since early last year 47 subnational units (Counties) have come into existence with a constitutionally mandated (at least 15%) sharing of ordinary revenue between Nairobi and the counties. In the 2014/5 financial year about 32.4% of the most recently audited ordinary revenues (2011/12) will go to the Counties. The revenue sharing is governed by a strict formula (with population, geographic size, and poverty rate weights) in order to limit the discretionary powers of officials at Treasury. More crucially, the County heads – a governor and a County Assembly – are directly elected, not appointed as is the case in most of the instances of “fake decentralization” noted by Grossman and Lewis.
Yes, in the interim there will be massive corruption, insufficient absorption, weak capacity for implementation and the like.
But the important point is that Kenya’s new government structure has 47 capitals handling billions of shillings each year. If all else fails, the system will at least create strong politically autonomous regional elites with sufficient power to check Nairobi. And that is a fantastic thing. Already a few governors (including Nairobi, Machakos and Bomet) have broken ranks with their sponsoring parties, evidence that the interests of the national parties and County governments will not always be aligned. And if the last two fiscal years are any indication, the political pressure on the national government to overshoot the 15% minimum requirement will continue to hold. Those perceived to be enemies of devolution will be punished at the polls.
The new system also has another plus: Kenya now has 47 training centres for the job of chief executive. Governors who do well – like the Governor of Machakos – will become very strong contenders for State House in the not so distant future (Also more work for me to study inter-governmental political careers!!)
My biggest concern about the new devolved system of government is its potential impact on the coercive capacity of the Kenyan state (recently the state has been at sixes and sevens in response to rising insecurity and sporadic terror attacks). If there was ever Kenyan exceptionalism in Africa it was on account of its post-colonial inheritance of a strong state. Since for political reasons security cannot be devolved (latent centrifugal tendencies still exist at the periphery), the centre must still guarantee security of life and property. My hope is that the ongoing restructuring of the Provincial Administration will not be as large a swing as to completely gut a system (reviled or not) that helped hold the country together over the last 50 years.
William Easterly’s new book, The Tyranny of Experts, argues that positive changes in freedoms are the causes of stable long run growth. But as he admitted to me recently on an Al-Jazeera talk show, the book does not present any rigorous evidence to back the claim, partly because thus far research findings have been mixed on the question of how democracy/autocracy impacts economic growth.
Well, Easterly’s book tour just got a boost thanks to Acemoglu et al. who have a new paper (see their blog post on it here) showing that democracy does indeed cause growth (boosting long run per capita income by as much as 20%):
Here is the paper’s abstract:
We provide evidence that democracy has a significant and robust positive effect on GDP. Our empirical strategy relies on a dichotomous measure of democracy coded from several sources to reduce measurement error and controls for country fixed effects and the rich dynamics of GDP, which otherwise confound the effect of democracy on economic growth. Our baseline results use a linear model for GDP dynamics estimated using either a standard within estimator or various different Generalized Method of Moments estimators, and show that democratizations increase GDP per capita by about 20% in the long run. These results are confirmed when we use a semi-parametric propensity score matching estimator to control for GDP dynamics. We also obtain similar results using regional waves of democratizations and reversals to instrument for country democracy. Our results suggest that democracy increases future GDP by encouraging investment, increasing schooling, inducing economic reforms, improving public good provision, and reducing social unrest. We find little support for the view that democracy is a constraint on economic growth for less developed economies [emphasis mine].
The full paper is available here.
Daron Acemoglu and James Robinson wrote the classic Economic Origins of Dictatorship and Democracy. The book is thin on empirics and analytical narratives, but is an amazing formal take on the subject of democratization. To balance Economic Origins you should probably also read Barrington Moore’s magnum opus Social Origins of Dictatorship and Democracy.