Week of May 24, 2019

1. India: This year I resolved to make sure I was paying more attention to events in countries with large populations that aren't the United States, and not just treating them like an instance of a broader class. Given the elections in India, and the somewhat surprising strength of the BJP's performance, this seems like an opportune moment. Here's a Vox explainer on the elections for those of you who, like me, may have been only vaguely aware of the elections as a referendum on Modi vs. (Rahul) Gandhi. Here's an interesting essay on the most important feature of Indian politics not being the rivalry between parties but the generally uncontested move toward closing off civil liberties and a more authoritarian state. Here's 12 reasons why the BJP won, with perhaps the most interesting point being the BJP's efficiency at actually delivering welfare programs rather than just vague promises about future welfare programs. For those of you following along in the US or Australia, or any other country where right-wing populism has experienced a rebirth, there are clear parallels throughout. Here's Shamika Ravi on policy priorities for the new government (written before the election).
There is more than the election going on. So here's a couple of things that may be more of traditional interest to faiV readers. Demonetization was three years ago. And everything is back to where it was--maybe this should make programs with "null effects" feel better. And here's a fascinating study of the social lives of married women in Uttarakhand, with a particular emphasis on how "empowerment shocks" spread through social networks and decay over time. 

2. Causality and Publishing Redux: A few things popped up related to last week's focus on causality. One point I touched on was spillovers and general equilibrium effects. Here's a note from Paddy Carter of CDC on the tension for DFIs attempting to invest in ways that are "transformative" (read, lots of spillover effects) and measuring their causal impact. I also noted JDE now accepting papers based on per-analysis plans. Pre-registration isn't going so well in psychology where a new study looked at 27 preregistered plans and the ultimate papers and found all of them deviated from the plan, and only one of those noted the change. Brian Nosek's money quote: "preregistration is a skill and not a bureaucratic process." Which could serve as a theme of Berk Ozler's discussion of using pre-registration to boost the credibility of results, not just for an experiment. Very useful for those interested in developing the pre-registration skill.
This may be stretching it a bit, but Raj Chetty's incipient attempt to replace Ec10 at Harvard got a lot of attention this week. There's a lot to recommend his approach, but there are plenty of people who are concerned about the apparent glossing over of causality. I'm honestly worried that some of these things may cause Angus Deaton and other critics of causal claims from RCTs to go into apoplectic fits. Just when you thought some of the messages might be getting through, along comes a new toy. So I should probably not mention that there's an update to the oldDonohue and Levitt paper on abortion and crime that claims it has better evidencewithout dealing with any of the problems in the underlying model.
  
3. Micro-Digital Finance: Microfinance can be pretty confusing when you get beyond the simple statements and start to worry about how it actually all works, and how it's changing, and what we do and don't know. Hudon, Labie and Szafarz have a nice little primer on those issues with a microfinance alphabet. I wish I had thought of doing this.
I complained last week about "mobile money" not including payment cards, which dominate the United States. But a telecom-driven mobile money product is now available in the US. Well sort of. Not sure what to make of this yet. 
Caribou Digital and Mastercard Foundation have a new study of Kenyan microentrepreneurs "platform practices." I also don't know what to make of this, but that's probably because I haven't read it yet, but I figured many of you would be interested. 
Among other things it's hard to know what to make of, there's Earnin, a sort-of payday lender, health care cost negotiator, fintech something. It's confusing. And New York State regulators are confused too, which is probably not a good sign for Earnin. But that's nothing new--I have to point again to City of Debtors, a book that documents New York city and state regulators confusion over how to regulate small dollar lending for more than a century. 

4. US Inequality: The history of exploitative finance in New York continues to write new chapters, which unfortunately often seem to be just remixes of the old chapters. For instance, the oft-heard story of New York taxi drivers being driven to despair by the entry of Uber and Lyft, misses a big part of the story: those drivers are often operating in deep, deep predatory debt that was going to drown them whether ride-sharing came along or not. For those of you who have followed the supposed stories of microfinance driving Indian farmers to suicide, this should all sound familiar. 
One of the reasons that those loans were unsustainable is the skyrocketing cost of housing in US cities. And that's driving people out of cities, particularly the people with just enough to be able to move away. Why? It's the zoning stupid. Well it's more than that--it's economic rationality. The higher wages for unskilled workers in cities in the US have totally disappeared along with the rise in housing costs.
Overall, though the financial situation of Americans is getting better along with the job market. The new Survey of Household Economic Decisionmaking is out, and the oft-(mis)-quoted statistic about how many Americans would pay for a $400 unexpected expense with cash or a cash-equivalent is at an all time high (for the survey, which is only 6 years old). Still that's only 60%.
And so, many people feel insecure. Here's Jacob Hacker's essay on why, building on his classic book, The Great Risk Shift. Another reason is the continued increase in student debt (I'll tackle the Morehouse/Johnson/Philanthropic angle another week). Helaine Olen has a great policy prescription on that front: make student loans dischargeable in bankruptcy again (MSLDBA?). Though the mobility effects of college degrees may be substantially overstated, which makes the student debt problem even worse. And finally, what should be another reason, even if it isn't, is the many ways that the economy is corrupted by things like this

5. Three Day Weekends: Go enjoy yourself away from a screen, wherever you are.

L-IFT , a diaries research firm, is a proud sponsor of the faiV. See our video on  diaries research with 800 women microentrepreneurs in Myanmar .

L-IFT, a diaries research firm, is a proud sponsor of the faiV. See our video on diaries research with 800 women microentrepreneurs in Myanmar.

From  Alfred Twu , an illustration of "It's the Zoning Stupid" and a nice application for discussing tax incidence theory.  Source .

From Alfred Twu, an illustration of "It's the Zoning Stupid" and a nice application for discussing tax incidence theory. Source.

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