Affirmative action policies are widely used to tackle the underrepresentation of certain groups. However, the efficiency of these policies is fiercely debated. This column uses novel data from India to explore how affirmative action quotas affect everyday discrimination. Local political council quotas for marginalised castes are found to reduce caste-based discrimination by around one fifth, but the effect disappears when the quotas are removed.
Coen Teulings, Ioulia Ossokina, 23 April 2018
Concerns are often raised about increasing spatial segregation by education level in societies. This column uses a study in the Netherlands to show that as preferences for locally provided public goods with a high fixed cost, such as train stations, differ widely between educational groups, spatial sorting by education and an increase in local density can actually raise the social benefits from investments in such infrastructure. However, since the highly educated benefit disproportionally, this leads to serious political economy problems.
Carl-Johan Dalgaard, Nicolai Kaarsen, Ola Olsson, Pablo Selaya, 10 April 2018
Although spatial differences in economic development tend to be highly persistent over time, this is not always the case. This column combines novel data on Roman Empire road networks with data on night-time light intensity to explore the persistence and non-persistence of a key proximate source of growth – public goods provision. Several empirical strategies all point to the Roman road network as playing an important role in the persistence of subsequent development.
Gabriel Ahlfeldt, Nancy Holman, 24 September 2016
Good architectural design is a public good, but economists and policymakers lack robust evidence on the impact of well designed architecture on location value when planning spaces. This column verifies the worth of preserving and designing good architectural spaces by analysing the changes in property prices across conservation and non-conservation areas in England. It finds that good design in buildings has a substantial positive impact on location value.
Jeremiah Dittmar, Ralf R Meisenzahl, 26 April 2016
Throughout history, most states have functioned as kleptocracies and not as providers of public goods. This column analyses the diffusion of legal institutions that established Europe’s first large-scale experiments in mass public education. These institutions originated in Germany during the Protestant Reformation due to popular political mobilisation, but only in around half of Protestant cities. Cities that formalised these institutions grew faster over the next 200 years, both by attracting and by producing more highly skilled residents.
Lars Ivar Oppedal Berge, Kjetil Bjorvatn, Simon Galle, Edward Miguel, Daniel Posner, Bertil Tungodden, Kelly Zhang, 11 February 2016
Ethnic divisions have been shown to adversely affect economic performance and political stability, particularly in Africa. However, the underlying mechanisms remain poorly understood. Using experimental data from Kenya, this column studies whether one potential mechanism – co-ethnic bias – affects altruism. Strikingly, most tests yield no evidence of co-ethnic bias, suggesting that other mechanisms must be driving the negative association between ethnic diversity and economic and political outcomes in Africa.
Dean Karlan, John List, 02 April 2012
With governments strapped for cash, charities are stepping up to provide public goods. But how can charities mobilise support from small donors to fund their work? CEPR DP8922 investigates whether altruists would donate more if they knew more about a charity’s quality. In the authors’ experiment, Bill and Melinda Gates matched donations to a particular charity. Small donors saw this as a signal of the charity’s quality – and donations soared.
Arik Levinson, 09 September 2009
If governments supply public goods that market forces will not, they ought to assign monetary values to those goods so that they can prioritise projects. This column discusses the difficulties of estimating those values using happiness surveys. Using a new method, it estimates that people value a one-standard-deviation improvement in air quality at $40.
Mirre Stallen, Richard Ridderinkhof, Frans van Winden, 13 October 2008
Ethnically diverse groups are less successful in providing public goods. This column suggests that affective interpersonal relationships may be a critical component in cooperative behaviour and outlines the evidence – from brain scans to experimental games – of their importance.
Scott Barrett, 15 August 2008
Scott Barrett of Johns Hopkins University talks to Romesh Vaitilingam about his research programme on disease eradication and other global public goods. He discusses the enormous benefits from the eradication of smallpox in 1977 and the constraints on current efforts to eradicate polio; as well as the economics of global public goods more generally, including protecting the Earth from asteroids and climate change. The interview was recorded at the American Economic Association meetings in New Orleans in January 2008.
Indraneel Dasgupta, Ravi Kanbur, 02 July 2007
Rich individuals are encouraged to make large contributions to the provision of public goods in return for tax exemptions, a policy that appears to endorse the claim that philanthropy can be considered a substitute for the direct income redistribution brought about through taxation. The authors of CEPR DP6362 address the question of how voluntary provision affects welfare inequality and find that (1) philanthropy can in fact increase inequality among the non-rich, but (2) income redistribution can be more effective in reducing inequality when accompanied by philanthropy. Automatic exemption from expropriation for rich philanthropists is therefore not the right policy.
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