This week we featured research on Indian farms, Chinese universities, Brazilian inequality and more!
Agriculture remains central to livelihoods in India with more than half its population still engaged in this sector, yet productivity on Indian farms lags far behind global benchmarks. Marijn Bolhuis, Swapnika Rachapalli, and Diego Restuccia present new evidence on the barriers in India’s land-rental markets that represent a major source of misallocation. They show that relaxing these barriers could deliver large gains in agricultural productivity.
In the early 1950s, the Chinese government performed one of the largest reorganisations of higher education in modern history. Entire university departments – faculty, students, and equipment – were uprooted and reassigned across the country to build a Soviet-style specialised system. Jianyong Fan, Wei Tang, and Feng Zhang use this shock to show that universities can generate powerful and persistent local industrial growth – but only when markets allow knowledge and skills to be used productively, i.e. after China’s economic reform since 1978.
In the early 2000s, Brazilian exports to China surged as the country became a major buyer of soybeans, iron ore, and other primary goods. The produced one of the largest external demand shocks in recent decades, local incomes rose but the gains were far from evenly distributed – instead the China boom reshaped consumption patterns and demand for imported goods across Brazil. Vinicius C. Cícero and Laura Heras-Recuero find that when income gains accrued disproportionately to higher-income households, local demand shifted sharply towards luxury goods and technologically sophisticated imports.
In the late 1990s, India increased R&D tax credits for firms with in-house R&D units registered with the Ministry of Science and Technology. Pavel Chakraborty, Sankalp Mathur, Sujaya Sircar, and Rubina Verma discuss how the R&D tax rebate generate meaningful welfare gains across firms in targeted industries by enhancing both product quality and variety.
In Wednesday’s article, Pinelopi Goldberg, Charles Gottlieb, Somik Lall, Meet Mehta, Michael Peters, and Aishwarya Lakshmi Ratan proposed a new Global Gender Distortions Index (GGDI) that quantifies the impact of gender gaps in the labour market, shedding light on how much higher economic activity would be if women had the same opportunities as men.
In this week’s episode of VoxDevTalks, Robin Burgess and Rohini Pande discuss their draft proposal for a unified carbon market, explaining why today’s patchwork of systems may be insufficient for the scale and speed of decarbonisation required, and outlining how a single, opt-in global compliance market could work in practice.
We need to reduce deforestation, protect standing forests, and incentivise reforestation at scale – the climate depends on it. Juliano Assunção sets out a proposal that can achieve all three.
Each year, the central government in Ecuador allocates a fixed share of national tax revenues and oil income to local governments using a formula, which assigns resources based on seven attributes of each subnational government; however, in 2017, it quietly altering the weights assigned to existing criteria. Leonardo Sánchez-Aragón, Gonzalo E. Sánchez, and Wladimir Zanoni find that municipalities receiving large increases in central transfers experienced sharp and economically meaningful growth in business sales.
Increases in Brazil’s national minimum wage between 2000 and 2009 moved the country from a regime of low minimum wage bite to one of high bite. Ellora Derenoncourt, Lorenzo Lagos, Francois Gerard, and Claire Montialoux show that minimum wage policy can positively affect living standards for workers thought beyond the reach of labour law, with limited reallocation effects towards the informal sector.
Around the world, governments are under pressure to improve learning outcomes. There is now an unprecedented wealth of research, yet this rarely reaches the people making decisions. Samuel Kembou, Aashti Zaidi Hai, and Juan Hernández-Agramonte explain that the education sector needs to shift from producing evidence for governments to generating it with them – building systems that learn, adapt, and implement at scale.
The data ecosystem is flawed. Fixing it requires hard work to overcome many barriers. Ricardo Dahis discusses how Data Basis has done exactly that by building a public good that puts data in people’s hands.
Elsewhere in development, there was a lot to catch up on:
- The excellent Lauren Gilbert is launching a new magazine - In Development - to explore how progress takes place in the developing world. Their first call for pitches is now live.
- Saloni's guide to data visualisation is a must read.
- On econimate's amazing YouTube channel - Intergenerational Impacts of Secondary Education.
- Recordings from BII's event with CEPR on climate tech in Africa and Asia.
- GiveWell have a great blog answering questions from their recent event on responding to aid cuts. GiveWell's president was also on the Ezra Klein Show.
- On CGDEV, Seema Jayachandran makes the case for counterfactual thinking in nonprofit fundraising, Euan Ritchie appeals for the public release of FCDO's best buys, and Anthony McDonnell and Asti Shafira assess global vaccine manufacturing capacity.
- What would it cost to end extreme poverty? Just 0.3% of global GDP.
- How many have died due to USAID cuts? New estimates by Charles Kenny and Justin Sandefur.
- A cool attempt to rank and visualise the biggest changes to the world in 2025.