Eventos

Seminario CEDE - Socorro Martinez

Effective government leadership demands skills in planning, budgeting, and personnel management, areas where business experience may be valuable. Business owners could apply their management skills in public administration to optimize resources, enhance public service delivery, or promote private sector growth. However, these skills may not translate to the public sector, where different rules prevail, and a lack of political expertise could ultimately undermine the delivery of public services. This paper studies the impact of electing business owners as mayors in Brazilian municipalities. By leveraging a national business registry from the Brazilian Federal Revenue Agency that includes information on the owners, merged with candidates data from the Electoral High Court, I identify business candidates. Using a regression discontinuity design for close elections, I find that electing a business mayor reduces municipal revenue by 7.5% and spending by 8%. Evidence suggests that the reduction in revenue may be due to challenges in accessing intergovernmental transfers, indicating that managerial experience may come at the expense of political skills. Despite the decrease in spending, business mayors do not negatively affect public service delivery or local economic activity. I find no impact on health outcomes and a small but positive effect on private sector employment. These results indicate improvement in cost-effectiveness by achieving equivalent service levels with fewer resources. I examine management as a driver of increased effectiveness and find that business mayors do not improve personnel management outcomes, suggesting a limited ability to transfer or adapt their management experience to the public sector.

12:30 pm

Universidad de los Andes

Activo

Seminario CEDE - Vinicius Cicero

This paper investigates the impact of resource booms on export value, concentration, composition, and sophistication in resource-rich developing economies. Using a shift-share instrument that leverages heterogeneous exposure to Chinese demand after Chinas 2001 WTO accession and the ex-ante composition of export baskets, I examine the causal effects on export baskets and sectoral employment of Brazilian local economies. The findings reveal increased export values and concentration in more exposed regions, with a shift from resource-based manufactures to primary products and declining export sophistication. Despite wage growth in primary and service sectors, primary employment remained stable while manufacturing jobs contracted, resembling a Dutch disease pattern. These results underscore the trade-offs of resource booms, where short-term gains in export value and sectoral wages may be offset by long-term development challenges. Given Brazils similarities to other commodity exporters, these findings may indicate similar trends emerging across developing economies.

12:30 pm

Universidad de los Andes

Activo

Seminario CEDE - Francisco Eslava

This paper examines whether female leadership can reduce violence in the context of the Colombian conflict. To identify the effect, I leverage closely contested local elections between male and female candidates, alongside a novel dataset with the location and gender of guerrilla unit commanders. I find that female leadership has a negative effect on conflict violence that amounts to a 60% reduction in the most demanding specification. I document even larger reductions in violence when both a female mayor and a female guerrilla commander are present, revealing that synergies between female leaders on opposing sides of the conflict further contribute to de-escalation. To understand the reasons behind this reduction in violence, I use text analysis on a novel dataset of campaign statements, revealing that female mayors employ less confrontational language when addressing the conflict. Additionally, I leverage timing of conflict events to show that guerrilla units with female commanders are less likely to retaliate following unilateral attacks. I interpret these patterns as evidence of a genderbased preference for de-escalation. Finally, to study how these preferences translate into lower violence, I build a simple theoretical model to show that gender differences in negotiation skills can account for the observed empirical patterns. Testing the models predictions and ruling out alternative explanations, I conclude that female leaders consistently opt for de-escalation over violent confrontation whenever possible.

12:30 pm

Universidad de los Andes

Activo

Seminario CEDE - Maddalena Totarelli

This paper examines the impact of the Rehabilitation & Reintegration initiative, a prison-based job training and skills development program, on recidivism, labor market, and social outcomes. I use a difference-in-differences strategy to assess the causal impact of the program, introduced in the Netherlands in 2007. Drawing on rich administrative data from Statistics Netherlands and the Dutch Ministry of Justice and Security, I find that prisoners eligible in the program are 4.5 percentage points (14%) less likely to reoffend over a period of three years. The program also increases earnings, though only for native and older prisoners, and enhances stable housing and personal relationships. My results highlight the potential of rehabilitation programs in facilitating the successful reintegration of former prisoners into society.

12:30 pm

Universidad de los Andes

Activo

Seminario CEDE - Edoardo Tolva

The transport sector is the backbone of international trade and has faced multiple disruptions in recent years. I study the substitutability between different transport modes and how mode-specific trade cost shocks affect international trade flows. I use the closure of Russian airspace in 2022 as an exogenous change in transport costs to provide novel estimates of the elasticity of substitution between transport modes. To quantify the importance of this margin of adjustment in equilibrium, I develop a Ricardian model of international trade with multiple transport modes. Modes are substitutable but endogenous congestion forces limit substitutability. I apply this framework to quantify the effects of recent trade cost shocks such as the closure of Russian airspace and the Suez Canal blockage. Transport mode substitution reduces welfare losses by 4% relative to a non-substitution scenario. However, substitution has potentially negative consequences for the carbon footprint of international trade. Higher sea transport costs can lead to increased carbon emissions due to substitution toward more carbon-intensive air transport.

12:30 pm

Universidad de los Andes

Activo

Seminario CEDE - Carmen Villa

Youth clubs are community-based after-school programmes, typically offeredfree of charge to teenagers in underprivileged neighbourhoods. I provide the firstcausal estimates of their effects on education and crime, leveragingquasi-experimental variation from austerity-related cuts, which led to the closureof 30% of youth clubs in London between 2010 and 2019. I usedifference-in-differences research designs and novel data to compareneighbourhoods affected by closures with those unaffected. Teenagers in areasaffected performed nearly 4% worse in national high-school exams. Youths aged10 to 17 became 14% more likely to commit crimes. Youth clubs provide keysupport in a lasting manner, particularly to teenagers from low-incomebackgrounds. The effects are due to youth clubs offering unique amenities thatsupport positive behaviours rather than mere incapacitation. Closing youth clubswas not cost-effective; for every£1 saved from closures, there are associated lossesof nearly£3 due to forgone returns to education and crime costs.

12:30 pm

Universidad de los Andes

Activo

Seminario CEDE - Sebastián Montaño

Public sector jobs have regulated pay structures that commonly tie wage growth to promotions. This paper leverages novel data and quasi-experimental variation in the allocation of promotions to examine how credit utilization and household labor supply respond to wage increases. We exploit the sharp discontinuity from an exambased promotion policy to compare the outcomes of nearly identical police officers in Colombia before and after they receive a 25 percent pay raise. Four years after promotion, officers accumulate debt for about 160 percent of their annual pay increase. This response is driven by mortgages and personal loans, two types of installment credit. As a result, officers need only one-third of the raise to repay their quarterly financial obligations. Using household data, we show a significant reduction in wives employment after their police husbands are promoted. This effect is more pronounced among couples with school-age children, but cannot be explained by changes in fertility decisions. Our findings suggest that households rely on credit instruments to adjust their time and consumption allocation in response to a pay increase.

12:30 pm

Universidad de los Andes

Activo

Seminario CEDE - Nicolás Rodríguez

This paper investigates communication with multiple, identically informed Senders with a single, uninformed Receiver. Players have common interests, the state space is infinite, and Senders message spaces are finite. Thus, while players prefer full information revelation, their language does not allow for it. Efficient communication requires Senders to use language heterogeneously, assigning non-convex meanings to individual messages, while ensuring that message profiles convey convex information. Achieving efficiency, hence, hinges on solving a delicate coordination problem among the players.

12:30 pm

Universidad de los Andes

Activo

Seminario CEDE - Pedro Pichetti

The instrumental variables (IV) method has been widely studied in cross-sectional settings. However, many practical applications involve panel data, in settings where a units treatment status may turn on or off over time. I show that in the presence of dynamic treatment effects, i.e., if past treatments affect current potential outcomes, standard methods are no longer valid if the instruments are serially correlated. This paper shows the nonparametric identification of dynamic causal effects in a potential outcomes framework in which potential outcomes depend on the treatment path taken by a unit through time but the first stage is static, in the sense that at each period the IV only instruments its contemporary treatment. I provide a nonparametric estimator that is consistent over the randomization distribution and derive its finite-population limiting distribution as the sample size increases. Monte Carlo Simulations illustrate the desirable finite-sample properties of the estimators. An application of the estimator show that law enforcement curbs illegal deforestation until two years after the actual detection of illegal practice, but effects fade out afterwards.

12:30 pm

Universidad de los Andes