Featured development papers of the day

"Investment, institutions, and governance in Asia" (de Dios, Ducanes)

We investigate the extent to which the investment slowdown in many Asian countries since the Asian Financial Crisis is attributable to changes in governance institutions. In the process we test the more general hypothesis that different aspects of governance will become relevant constraints to investment and growth at differing levels of countries’ development. This hypothesis is validated and explains a standing paradox that finds certain governance aspects – notably voice and accountability and control of corruption – do not apparently figure as explanations in the average growth record. We show that in fact they do, though only at certain levels of development.

Funnily enough, I think the empirical strategy for their paper was inspired by the one in my thesis, namely quantile regression. I remember Dean de Dios asking me about it last year in the ISIP office, during the time they were writing this, and whether there was a way to choose quantiles of interest endogenously. So happens they wanted to explore the effect of institutions on Asean countries based on ex ante hypotheses (i.e., certain institutions affected certain countries more).

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"What has really happened to poverty in the Philippines? New measures, evidence, and policy implications" (Balisacan)

That poverty is a multidimensional phenomenon is no longer debatable. What remains a contentious issue is whether the various dimensions of individual deprivation should be aggregated--and how these are to be aggregated--into a summary measure of poverty.This study employs the Alkire-Foster aggregation methodology, which preserves the "dashboard" of dimensions of poverty, to systematically assess the magnitude, intensity, and sources of multidimensional poverty over the past two decades and across subpopulation groups in the Philippines. It finds that what is generally known about the country's performance in poverty reduction in recent years, as seen in income measures of poverty, is quite different from what the lens of multidimensional poverty measures reveal. While income-based poverty remained largely unaffected by economic growth during the past decade, multidimensional poverty did actually decline. This finding is robust to sources of nationally-representative household survey data and to assumptions about the poverty cutoff. From a policy perspective,this result reinforces the view that nothing less than economic growth, even in the short term, is required to reduce poverty (broadly interpreted to include individual deprivations beyond income). Moreover, the diversity of both deprivation intensity and magnitude of poverty across geographic areas and sectors of the Philippine society is enormous, suggesting that, beyond growth, much needs to be done to make development more inclusive.

Particularly instructive for students of development, especially with its focus on the multidimensionality of poverty, as well as its comparison and assessment of existing household level datasets and the available variables related to poverty and deprivation. A related paper is "Why does poverty persist in the Philippines? Facts, fancies, and policies" (Balisacan).

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"Poverty, vulnerability and family size: evidence from the Philippines" (Orbeta Jr.)

This paper shows how large family size can be an important contributor to household poverty. It presents results from recent research by the author using nationally representative household survey data that demonstrate clearly how large family size can contribute to poverty and vulnerability through its impact on household savings, labor supply, and parental earnings and education of children. The paper is the most systematic attempt to date to show the links between family size and poverty in the Philippines using household survey data. The clear implication of the results is that, in the case of the Philippines, an active population policy aimed at restricting family size could have an important impact on poverty reduction.

What I think is a landmark study on the relationship between family size and different aspects of poverty and human development, presenting a strong case for a comprehensive family planning program in the country. It also showcases the powers and limits of the APIS dataset, and emphasizes the usefulness of cross-tabulations as a complement to typical regression analysis.