Working Papers:

Environment and Human Capital: The Effects of Early-Life Exposure to Pollutants in the Philippines

Human capital, a determining factor in individual labor market and macroeconomic outcomes, is malleable to early-life investments and insults. This study examines the long-term human capital impacts of early-life exposure to air pollution in the developing economy context of Metropolitan Cebu, Philippines. A three- decade, longitudinal survey provides frequent measures of human capital and the combination of a macro- and a micro-environmental database characterizes exposure to carbon monoxide and ozone. An instru- mental variable strategy corrects the bias from unobserved heterogeneity and measurement error. Findings indicate that carbon monoxide exposure is consistently detrimental to both height and cognition while the effects of ozone exposure grow over time and are highly detrimental to cognition and earnings. In present value terms, a nationwide 10% reduction in carbon monoxide and ozone levels would annually generate approximately $5.15 billion in discounted lifetime earnings per annual birth cohort.

Are Rural Markets Complete? Prices, Profits and Recursion with Daniel LaFave and Duncan Thomas

The agricultural household model under complete markets allows the simultaneous production and consumption decisions faced by farm households to be modeled recursively. To assess the validity of the recursive framework, a number of papers have tested if production may be treated independently from consumption, and find mixed results. This paper empirically assesses a previously unexamined restriction of complete markets on consumption choices rather than production. Recursion implies production and consumption are linked only through an income effect from the farm business. When this condition holds, the prices of farm inputs affect consumption demands solely through a farm-profit income effect. This implies a restriction on how farm input prices relate to consumption allocations that we test using new, detailed longitudinal data from Indonesia. The data includes transaction prices for farm inputs and consumption goods collected in local shops and markets over a six-year period that we use in estimating a flexible household demand system while accounting for time invariant household and farm heterogeneity. We find strong evidence to reject complete markets, providing complementary evidence to previous findings in the literature examining separation from only the production side. We further show that those households at the bottom of the socioeconomic status distribution face market incompleteness, while those at the top are able to operate as if markets are complete.

Decision-making by Households with V. Joseph Hotz and Duncan Thomas

This paper investigates the validity of the unitary and collective models in describing household behavior in Central Java, Indonesia. The conclusions of utility theory apply to individuals yet many empirical studies apply them to households. In developing countries, where it is common to find many adults living under the same roof or extended families living in close proximity, describing the behavior of households becomes more complex. The results support the use of the unitary model in describing single adult households while rejecting its use for multiple adult homes. Furthermore, there is little evidence that allocations made by households composed of couples with and without children are Pareto efficient, as assumed in the collective model.

Early childhood developmental delay in low- and middle-income countries: National, regional and global estimates with Dana C. McCoy, Günther Fink, Wafaie Fawzi and others

Early childhood development influences life course health and wellbeing. Existing estimates of unmet developmental potential in low- and middle-income countries (LMICs) are generally based on proxy measures such as stunting and poverty. Our aim was to estimate the number of children who are experiencing developmental delays in LMICs. We used data from the Early Childhood Development Module of the fourth round of the Multiple Indicator Cluster Survey (MICS4) programme, the Human Development Index (HDI), and the Nutrition Impact Model Study (NIMS) to analyze the relationship between country-level prevalence of early childhood developmental delay and stunting, education, income per capita, and life-expectancy in 17 MICS4 countries. A total of 125.7 million children (95% CI 119.1, 132.3) in LMIC contexts were estimated to experience developmental delay in 2010. The largest number of children with developmental delay came from the WHO Africa region, followed by South East Asia and the Western Pacific. The results indicate that targeted and context-specific interventions are needed in LMICs to reduce exposure to adversity in early childhood and to directly stimulate the early development of cognitive, motor, and social-emotional skills.

Returns to Education in Low and Middle-Income Countries: Evidence from the Living Standards and Measurement Surveys with Günther Fink and Wafaie Fawzi, 2014

While a large literature has investigated the returns to education in high-income countries, evidence on returns in less developed countries is relatively scarce. We pool 61 nationally representative household surveys conducted between 1985 and 2012 in order to address this evidence gap and to estimate average national and regional returns to education. We find a return of 6.5% in the pooled data, with lower returns in rural areas, higher returns for females, higher returns in the years prior to 2000, and lower rates of return in Asian countries compared to Africa, Latin America, and Eastern Europe. With respect to schooling levels, we find lowest returns for primary education, and highest returns to tertiary education, consistent with recent evidence from developed countries. Overall, returns to education in developing countries seem to be similar or lower than those in high-income countries with remarkably large amounts of heterogeneity across countries, time, and regions.

Early-Child Development and Schooling Attainment: Longitudinal Evidence from British, Finnish and Philippine Birth Cohorts with Günther Fink and others, 2014

While a growing recent literature has highlighted the importance of early childhood development (ECD) for later life outcomes, relatively little is known regarding the relative importance of the various domains of ECD. This study uses three of the most comprehensive cohort studies to examine the associations between multiple domains of ECD and educational attainment. We used longitudinal data from three birth cohorts: the 1970 British Cohort Study (BCS70), the Northern Finnish Birth Cohort (NFBC) and the Cebu Longitudinal Health and Nutrition Survey (CLHNS). The results indicate that both physical and cognitive ECD are important for children’s subsequent educational attainment. Physical ECD is shown to be an incomplete proxy for the relationship between cognitive ECD and schooling. The association between both physical and cognitive ECD and later-life completed years of schooling is strongest in the low-income contexts.

Current Projects:

Obesity, Bisphenol A and Epigenetics: A Natural Experiment in Epigenetic Responses to Bisphenol A

Research proposes obesogens – xenobiotic chemicals that produce obesity – as key drivers of expanding obesity rates. A potential obesogen is the endocrine disruptor BPA. One of the highest volume chemicals produced worldwide and present in over 90% of individuals in the United States, relatively little is known about its effect on childhood obesity. Animal studies demonstrate that gestational BPA exposure alters the epigenome to increase the expression of genes related to obesity, alterations that are counteracted by methyl donor nutrients like folic acid. The 1998 US folic acid fortification of enriched grains was designed to reduce neural tube defects yet also created a natural experiment of temporal variation in human folic acid intake. This study utilizes the natural experiment of folic acid fortification to examine the links between gestational bisphenol A (BPA) exposure, folic acid intake, and childhood obesity. Additionally, the study examines how BPA and folic acid influence the body size of children predisposed to obesity, and elucidates the roles of BPA and folic acid in the disparity and economic burden of the global obesity epidemic.

Examining the Health Consequences of Simultaneous Exposures to Pollution and Elevated Stress

Animal studies have revealed developmental delays due to the simultaneous exposures of environmental toxins and elevated stress in utero. This paper examines the health impacts throughout life of simultaneous fetal exposures to elevated stress and environmental contamination in the developing world. To examine development this study employs a long-running health and nutrition survey containing a variety of physical and cognitive development indicators in Metropolitan Cebu, Philippines. Additionally, unique data characterizing the local sources of pollution and the transport of pollutants from the source to the individual is used to describe exposures to multiple environmental toxins with spatial and temporal variation generated by influences on the transport of the contaminant. Finally, records of local natural disasters, namely typhoons, produce variation in maternal stress levels.

Assessing the Effectiveness of the Acid Rain Program Emissions Control Strategies with Corwin Zigler, Francesca Dominici, and others

The passage of future environmental policies and implementation of effective air quality management systems require performance tracking of existing policies and results accountability.  The 1990 Clean Air Act Amendments (CAAA) and resulting Acid Rain Program (ARP) coincided with a dramatic reduction in the targeted pollutants and large human health improvements.  Although studies have described the changes in emissions coinciding with the ARP, the costs and effectiveness of control strategies employed throughout both phases of the ARP on unit-level emissions remains unclear because of concurrent changes to input prices and technologies.  Using data of unprecedented accuracy, geographic and temporal coverage, the impact to emissions of each control strategy are determined. Additionally, estimates of the marginal abatement costs are coupled with the emissions impacts of each control strategy in order to assess the temporally varying costs of emissions reductions and the cost feasibility of each control strategy.

Factors for Child Development and Human Capital: Comparative National and Global Assessment with Wafaie Fawzi, David Canning, Majid Ezzati, Jack Schonkoff and others

Child survival has improved significantly over the past few decades, yet progress in reducing early life risk factors that affect the subsequent health, growth, and development of young children who do not die has been less impressive. An estimated 20 million low-birth-weight babies are born each year globally and recent work has shown that more than half of low-and-middle-income countries have less than a 50% chance of achieving the Millennium Development Goal 1 on reducing hunger and undernutrition.  Adversities and illnesses in early childhood affect children’s development and have potentially long term educational and economic effects. However, there is limited information about the educational and economic impacts of these risk factors at the national level, and no comparable global analysis that covers all countries. This project will investigate the impacts of early childhood adverse experiences for all developing countries. The results of this project are intended to influence policy and practice related to children throughout the world.

Returns to Schooling: A Systematic Review and Meta-Analysis with Günther Fink

The economic return to an additional year of schooling is one of the most widely studied topics in the field of economics.  A wide variety of methods, data, and contexts have been used to explore this question with often vastly different results.  The objective of this study is to systematically review the existing evidence from this large and rapidly growing literature aiming to identify the causal effect of schooling on labor market outcomes. The results demonstrate that the return to a year of education is not a single parameter, rather heterogeneity in regions, time periods, population and research methodologies yield patterns which place previous research in context and and identifies areas to be addressed by future research.