Research

Radical nation-building under the Communist Party of Kampuchea resulted in approximately 2 million deaths, i.e. between 20-25% of the Cambodian population between 1975-79. How did this human capital destruction impact long-term economic development? Satellite data on the regime’s failed irrigation projects provide a source of exogenous variation in mass graves. Spatial power relations between moderate and extremist administrative zones can be further exploited as a border discontinuity. My analysis finds persistent impacts of historical genocide on household wealth and village-level poverty, driven by lower human capital, limited structural transformation, restricted public goods provision and private investment flows. Directly impacted households and age-cohorts are significantly worse-off, while there are no differences in wealth for survivors with higher pre-genocide human capital. Political repression measured by proximity to Khmer Rouge prisons predicts significantly worse outcomes. There are no significant differences in internal migration rates among survivors. This paper contributes novel, country-level evidence on how the worst genocide since the Holocaust impacts economic development in Cambodia.

Discriminatory social norms drive high levels of gender inequality in India. However, there is a paucity of evidence on how gender discrimination manifests in economic decision-making. In this paper, I present a lab-in-the-field experiment using incentivized trust and dictator games to distinguish between statistical and taste-based gender discrimination. Negative stereotypes that manifest as low trust is interpreted as statistical discrimination. Prejudice that manifests as lower trust and social preferences is interpreted as taste-based discrimination. Next, I evaluate whether a behavioural nudge can influence discriminating individuals’ preferences over gender versus previous trustworthiness. The evaluation nudge tests whether moving from separate (single-choice) to joint (multiple-choice) evaluation setting triggers a shift from gender-biased to pay-off maximizing decision-making. Results indicate that participants demonstrate statistical discrimination. Signalling higher trustworthiness leads to gender unbiased decision-making under joint evaluation, but not under separate evaluation.

Social identity formation has critical economic and political implications. A significant existing literature has demonstrated that fragmented societies experience increased levels of violence. However, less is known about the origins of social cleavages in diverse societies. In this paper, I evaluate the causal impact of quasi-natural experiment on social identity formation on inter-group conflict in colonial-era British India. The first Census of British India was implemented between 1866-71 and historians have illustrated that its core enumeration and classification exercise led to an empiricalisation of traditional social identities, i.e. previously diffuse and overlapping identities based on local communities or jati were manipulated into a standardised, hierarchical taxonomy comprised of mutually distinct social groups along caste and religion. Using a heterogeneity-robust difference-in-differences framework, I exploit temporal and regional variation in the Census implementation across British-administered provinces and self-governed princely states to analyze its impact on inter-group conflict. I construct an original historical conflict events database using historical newspaper archives for this analysis. Results indicate that the colonial-era Census implementation led to a significant increase in inter-group riots, especially in territories characterised by high levels of religious fractionalisation. This research aims to contribute novel historical evidence to disentangle the origins of social fragmentation and inter-group conflict in diverse societies.

Christian missionaries in Vietnam are credited with the creation of chữ Quốc ngữ – the modern Latin writing script for the Vietnamese alphabet, that became widely adopted under the French colonial administration in the 19th and 20th centuries. In this research, I use archival sources from the Société des Missions Etrangères de Paris to create novel geospatial databases on the locations of French missionaries in 19th century Vietnam. My analysis indicates a persistent impact of proximity to historical French Christian missions on contemporary human capital in Vietnam a century later.

Can an individual leader impact the course of a nation’s history? Mohandas Karamchand Gandhi emerged as the pre-eminent leader of the Indian freedom movement against British colonialization in the early-20th century. He was granted the honorific title of Mahatma, or great soul, due to his advocacy for religious harmony and non-violent resistance against the colonial administration. This project constructs novel historical databases to investigate Gandhi’s impact on religious violence and self-sacrifice by Indian freedom fighters killed during the freedom struggle. This research contributes new evidence on the impact of charismatic leaders in building national identity.

According to economic theory, repeated interactions can play a crucial role in shaping trust. We randomly allocated people to treatments that promote interactions with bankers. Next, these people played incentivized trust games with their own banker and with an anonymous other banker. While the effect on trust in their own banker is limited, the impact on trust in other bankers is important. We also find that account savings strongly associate with trust in one’s own banker. Our experiment suggests that trust in one’s banker matters for savings but that it is more difficult to influence than trust in bankers in general.

We analyze the 2007 European financial crisis’ impact on the demand for new language skills. The crisis affected German-speaking regions less. Learning German became relatively more attractive for migration and trade. We construct a sub-national database for German as a foreign language exam (TestDaF) participation rates between 2001–2013 and define regional crisis indicators. Using a multiple-group, multiple-period difference-in-differences framework with propensity score matching, we find that TestDaF participation increased significantly in crisis-affected regions, driven by youth and severely-affected Hellenic and Latin linguistic regions.

Mispricing of international trade in natural resources poses a significant risk for tax base erosion from resource-rich, developing countries, while also contributing to regulatory and financial risks for commodity trading hubs. This paper presents a novel empirical approach which combines statistical price-filter analysis methods with commodity market research to provide evidence on the magnitude of abnormally priced Swiss commodity imports. Our analysis compares transaction-level import prices to an arm’s length price range representing fair market value and defined using contemporaneous benchmark prices from commodity exchanges, adjusted for product-specific factors. We find a significant magnitude of abnormally under-valued unwrought gold doré imports as well as relatively smaller magnitudes of abnormally under-valued cocoa and coffee imports. Next, we contrast our new estimates with traditionally used proxies for trade mispricing based on aggregate mirror trade statistics to highlight the unreliability of widely used methods and data sources. Finally, we discuss the limitations in our analysis even using the best available administrative data which reinforces the urgency to improve the statistical infrastructure used to record international commodity trading in order to promote transparency and improve international trade governance.

Mispricing of international trade in natural resources contributes to significant tax base erosion from developing countries but is difficult to measure using aggregate trade statistics. In this paper, we apply a novel approach motivated by legal rules for trade and transfer mispricing to estimate abnormal pricing in gold and cocoa exports from Ghana, i.e., exports valued outside an assumed arm’s length price range that indicates fair market values. Using daily frequency, transaction-level data from Ghana Customs, our results indicate abnormally undervalued exports of gold and cocoa from Ghana equalled USD 8.8 billion in constant prices (base year 2011) or USD 4.1 billion in current prices between 2011 and 2017. Approximately 11% of gold doré exports, 1% of cocoa bean exports, and 7.2% of cocoa paste exports appear abnormally undervalued. The implied corporate tax base erosion equals USD 2.2 billion in constant prices (base year 2011), corresponding to an average annual decrease of 0.3% in Ghana’s tax-to-GDP ratio.

Trade mispricing is a significant channel for tax base erosion from developing countries; however, evidence based on aggregated annual trade data remains limited. This article combines statistical price filter methods based on legal rules for customs valuation and transfer pricing analysis with extensive commodity sector research to present new evidence of commodity trade mispricing from Laos. Our analysis of transaction-level export data finds significant undervaluation in exports of coffee beans and identifies multiple risks of trade mispricing in copper exports. We identify trade between related firms, regulatory loopholes, and lack of customs valuation capacity as the main drivers of this phenomenon.

The health, economic and security impacts of the Covid-19 pandemic are playing out in volatile and potentially catastrophic ways, especially in conflict-affected states. The disease arrived in India during a period of heightened public protests, riots and religious polarization. In this paper, I document early evidence of the causal impact of Covid-19 proliferation on conflict risks across Indian districts. I use text-mining of conflict event descriptions to define two new measures of religious and pandemic-related conflict in addition to the standard measures of real-time conflict events provided by The Armed Conflict Location & Event Data Project (ACLED). Event study analysis indicates a sustained decline in conflict after the first Covid-19 case is reported, driven by a decrease in religious conflict and public protests. However, I also document a countervailing increase in the probability of Covid-19 related conflict. Poor districts and districts with low health infrastructure in particular demonstrate an increase in riots. These real-time findings are of first-order importance for policymakers and public administrators straddling a narrowing stringency corridor between maintaining public health and tolerance of containment policies.

International trade and taxation are inextricably linked and have been high-priority issues within the Group of Twenty (G20) agenda. However, the interconnections between international trade and tax expenditures—that is, benefits granted through preferential tax treatment—have been overlooked. This brief calls for a better design of tax expenditures, particularly those that have implications for international trade such as a) tax incentives for investment, b) tax incentives implemented within the digital economy, c) tax benefits for energy-intensive and trade-exposed sectors, and d) export-related tax incentives, which are among the main determinants of trade misinvoicing and illicit financial flows.

This research proposes an integrated conceptual framework on IFFs by distinguishing between the various, overlapping channels contributing to aggregate IFFs according to the source of their illicitness – illicitly generated, transferred, or used. Next, we connect these channels to corresponding empirical measurement techniques, data sources, political economy and regulatory drivers, and proposed national and international policy reform initiatives. Finally, we review the existing empirical methods and evidence on commodity trade related-IFFs, focusing on the most prominent channels identified by the literature including: trade misinvoicing and transfer pricing. We also consider the related literature on profit shifting focusing on tax motivated financial flows across jurisdictions by multi-national firms.

Transboundary and intercultural research partnerships are critical for evidence-based collective action towards solving global challenges that transcend national borders and epistemic communities. Global challenges related to economic development, climate change and environmental sustainability have direct impacts on low- and middle-income countries in the global South, while also affecting industrialized donor countries in the North through complex socio-environmental linkages. However, researchers and institutions face prominent local challenges in achieving established principles guiding fair and impactful research partnerships. In this paper, we present evidence from a new international survey of researchers and collaborators involved in Swiss transboundary research partnerships to identify their most prominent local challenges and experiences. Based on our analysis of detailed findings, we conclude with a brief summary of key takeaways and their policy implications.

Is the current knowledge production and management model for experimental development research in developing countries fair towards participants in poor and vulnerable locations? This essay aims to review the rich literature on research ethics and epistemic injustice in order to evaluate current trends in experimental development research. Focusing on lab-in-the-field experiments, I aim to analyse: epistemic injustice in agenda-setting and knowledge management, incentive structures and power asymmetries, personal and community consent, and finally, data protection and ownership. Finally, I review potential measures for enhancing ethical robustness in experimental research. This includes ‘soft’ measures including oversight by local community councils, disclosure requirements in local languages, participants’ right to withdraw consent at any stage, control over personal data, as well as ‘hard’ data protection regulations and ombudsman to protect the rights of research subjects.