By Jessica McCann
Welcome to Working Papers of the Week! Our goal is to highlight the valuable and interesting research Kennedy School faculty members are doing here and abroad by featuring new working papers recently uploaded to the site.
Last week, the following working papers were posted:
Securing Property Rights
Glaeser, Edward L., Giacomo A.M. Ponzetto, and Andrei Shleifer
A central challenge in securing property rights is the subversion of justice through legal skill, bribery, or physical force by the strong—the state or its powerful citizens—against the weak. We present evidence that the less educated and poorer citizens in many countries feel their property rights are least secure. We then present a model of a farmer and a mine which can pollute his farm in a jurisdiction where the mine can subvert law enforcement. We show that, in this model, injunctions or other forms of property rules work better than compensation for damage or liability rules. The equivalences of the Coase Theorem break down in realistic ways. The case for injunctions is even stronger when parties can invest in power. Our approach sheds light on several controversies in law and economics, but also applies to practical problems in developing countries, such as low demand for formality, law enforcement under uncertain property rights, and unresolved conflicts between environmental damage and development.
To read the full working paper, click here.
Searching for the Devil in the Details: Learning about Development Program Design
Searching for the Devil in the Details: Learning about Development Program Design
Nadel, Sara, and Lant Pritchett
Motivated by our experience in designing a particular social program, skill set signaling for new entrants to the labor market in Peru, we articulate the need for, and explore the empirical consequences of, alternative learning approaches to the design of development projects. Using a simulation, we demonstrate that even with only modest dimensioned design space and even modest “ruggedness” of the outcome with respect to design a naive iterative approach of “crawling the design space” dominates an RCT learning strategy. We suggest that the empirical results of RCTs to date are consistent with social programs having high dimensional design space and outcomes sensitive to design and hence project/program/policy design must depend on more robust learning strategies than the attempt to directly apply results from “systematic reviews” or move prematurely to an RCT.
To read the full working paper, click here.
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