Working Papers
with Abhijit Banerjee, Esther Duflo, and Nina Singh
Revise and resubmit, Econometrica
Sept. 2022 Draft
Should police activity be narrowly focused and high force, or widely-dispersed but of moderate intensity? Critics of intense "hot spot" policing argue it primarily displaces, not reduces, crime. But if learning about enforcement takes time, the police may take advantage of this period to intervene intensively in the most productive location. We propose a multi-armed bandit model of criminal learning and structurally estimate its parameters using data from a randomized controlled experiment on an anti-drunken driving campaign in Rajasthan, India. In each police station, sobriety checkpoints were either rotated among 3 locations or fixed in the best location, and the intensity of the crackdown was cross-randomized. Rotating checkpoints reduced night accidents by 17%, and night deaths by 25%, while fixed checkpoints had no significant effects. In structural estimation, we show clear evidence of driver learning and strategic responses. We use these parameters to simulate environment-specific optimal enforcement policies.
A Division of Laborers: Identity and Efficiency in India
with Guilhem Cassan and Tatjana Kleinberg
Revise and resubmit, Econometrica
Sept. 2022 Draft
Workers' social identity affects their occupation, and therefore the structure and prosperity of the aggregate economy. We estimate a general equilibrium Roy model of this phenomenon in the Indian caste system, where work and identity are particularly intertwined. New data on occupation, wages, and caste’s traditional occupations and social status show that workers are over-represented in their traditional occupations and under-represented in socially higher or lower occupations. We consider counterfactuals removing castes' hierarchical and occupational links. Despite more efficient human capital allocation, aggregate output gains are small–in some counterfactuals negative–due to weaker caste networks and reduced learning across generations.
Fairness in Incomplete Information Bargaining
with Bradley Larsen, Shengwu Li, J.J. Prescott, Bernardo Silveira, and Chuan Yu
Submitted
This paper documents a robust pattern from diverse sequential bargaining settings: agents favor offers that split the difference between the previous two offers. Our settings include price negotiations, insurance claims, trade tariffs, and even a TV game show. We argue that classical game theory cannot convincingly explain these findings. Instead, we propose a robust-inference argument under which the two last offers might bound potential surplus. Split-the-difference offers can then be viewed as a fair division. Consistent data patterns in each setting point to split-the-difference offers as a strong bargaining norm.
Dynamics of a Malthusian Economy: India in the Aftermath of the 1918 Influenza
with Dave Donaldson
Sept. 2021 Draft
The 1918 influenza epidemic struck India when the subcontinent was mired in its long-term Malthusian equilibrium of low population growth and stable per-capita con-sumption. Its terrible death toll left survivors with additional agricultural land, which we show they rapidly put to agricultural use with no decrease in yields. We explore the extent to which this increased per-capita wealth gave rise, over the ensuing decades, to heightened investments in both child quantity as well as child quality. Consistent with most Malthusian unified growth theories, we find that individuals in heavily affected districts had more children in the aftermath of the influenza. We also find that these children were taller and better educated. Our results suggest that the preference for child quality existed even in societies that appeared Malthusian both to contemporary observers and modern historians.
Chat Over Coffee? Diffusion of Agronomic Practices Through Information Networks in Rwanda
with Esther Duflo, Tavneet Suri, and Celine Zipfel
Sept. 2022 Draft
This paper studies the role of social learning in farmers’ adoption of agronomic practices, in the context of an RCT that trained farmers on coffee agronomy in Rwanda. While the program improved knowledge of all trained best practices and strengthened social networks, detailed tree audits reveal limited impacts on adoption. We find no evidence of diffusion through farmers’ networks; instead, control households experienced negative spillovers in high treatment concentration areas. These explain much of the 7% higher yields of treatment farmers compared to the control group at endline. Our results highlight the challenges of information diffusion in agricultural extension programs.
Bargaining and Welfare: A Dynamic Structural Analysis of the Autorickshaw Market
January 2017 Draft
Bargaining for retail goods is ubiquitous in developing countries, where traders spend substantial amounts of time haggling over purchases. Would welfare be higher if trade was conducted at fixed prices instead? The answer is theoretically ambiguous: if bargaining is a low cost form of price discrimination, it may lead to greater trade and welfare and even approximate the optimal incentive compatible outcome. However, if bargaining imposes large utility costs on the participants, then a fixed price may be preferable. I develop the tools to resolve this question, specifying a model of repeated trade with hidden valuations adapted to the context of bargaining, and developing a dynamic structural estimation technique to infer the underlying parameters of the market. I then apply these techniques to bargaining data I collected from the market for local autorickshaw transportation in Jaipur, India.