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Safety net programs, common in settings with high informality like Latin America, often use a means test to establish eligibility. We ask: in settings in which organised crime provides lucrative opportunities in the informal market, will discouraging formal employment via benefits eligibility criteria increase criminal enterprise activity? We link administrative socioeconomic microdata with the universe of arrests in Medellín over a decade, and exploit exogenous variation in formal-sector employment around a socioeconomic-score cutoff, below which individuals receive generous benefits if not formally employed. Regression discontinuity estimates confirm this policy reduced formal-sector employment and generated a corresponding increase in arrests associated with organised crime. We do not find increases for crimes unlikely to be associated with organised entities, such as crimes of impulse or opportunity. Effects on arrests are strongest in neighbourhoods where organised crime is most prevalent.

Enabling worker voice could improve worker retention and effort by providing workers the chance to improve their situation or an outlet to express discontent. We provide a test of this hypothesis via a randomised controlled trial in Indian garment factories. Just after what proved to be a disappointing wage hike, workers were chosen at random to participate in an anonymous survey in which they were asked for feedback on job conditions, supervisor performance and overall job satisfaction. Enabling voice in this manner reduced turnover and absenteeism after the hike, particularly for the most disappointed workers.

Mental health disorders are a substantial portion of the global disease burden, yet their determinants are understudied, particularly in developing countries. We find that temperature shocks in utero increase depressive symptoms in adulthood in Africa. A ten percent increase in heat exposure increases our depression indices .05 to .07 standard deviations. We find no evidence that the effects of these shocks are smaller for more recent birth cohorts, nor do shocks predict greater treatment of depressive symptoms. Temperature fluctuations, increasingly frequent due to climate change, worsen the mental health disease burden and health care systems in Africa do not mitigate these impacts.

Economic development can be driven by large, high-performing firms that provide safe, dignified jobs with living wages. The garment manufacturing industry is a large, economically important sector concentrated in low- and middle-income countries; however, it has been characterized by persistent neglect of workers’ concerns and working conditions. This case study explores whether digital communication platforms, combined with improvements in management, can empower garment factory workers to voice their concerns and have their grievances addressed. We describe a series of randomized experiments testing the effectiveness of different grievance reporting solutions, finding that access to an anonymous complaint service improves worker satisfaction and reduces absenteeism. However, these simple solutions do not adequately address issues around management trust, accountability, and quality. An ongoing experiment explores whether grievance reporting technology, combined with team-based performance incentives for management, can further improve outcomes for workers.

Do productivity and managerial quality vary within the firm? If so which managerial traits and practices matter most for team productivity? Combining granular garment production data with survey data on managers across 120 production lines in India, we document substantial productivity dispersion both across teams producing overlapping products and within team over the course of production runs, and structurally link this variation to a comprehensive assessment of supervisor quality. We find that factors related to managerial attention and control are the most important for enabling line productivity, both more impactful than traditionally emphasized dimensions like cognitive skills and tenure. We document that one mechanism by which specific managerial practices contribute to productivity is by way of enabling faster learning-by-doing. In-sample pay patterns suggest potential net gains from screening for or training in less readily measured dimensions of managerial quality, as pass-through of productivity contributions to pay is incomplete.

We study the adoption of energy-efficient LED lighting in garment factories around Bangalore, India. Combining daily production line–level data with weather data, we estimate a negative, nonlinear productivity-temperature gradient. We find that LED lighting raises productivity on hot days. Using the firm's costs data, we estimate that the payback period for LED adoption is less than one-third the length after accounting for productivity co-benefits. The average factory in our data gains about $2,880 in power consumption savings and about $7,500 in productivity gains.

Smallholder agricultural commodity suppliers in developing countries are often vulnerable to global commodity price fluctuations. Using panel data on farmers from an area of Tanzania where most farmers grow coffee, this study finds that global coffee prices matter for household outcomes, through their effects on farmgate prices, coffee sales and revenues, and household expenditures. The article documents that households cope with coffee price busts by increasing enterprise ownership, an effect that is greater for households without access to other means of coping. Comparisons of mean outcomes of enterprises operated by coper households (which operated an enterprise only in periods of low coffee price) with those of stayer households (which operated an enterprise throughout the sample period) indicate that the former are less likely to be profitable or to hire workers.

Evidence suggests that natural resources have driven conflict and underdevelopment in modern Africa. We show that this relationship exists primarily when neighboring regions are resource-rich. When neighbors are resource-poor, own resources instead drive economic growth. To motivate the empirical study of this set of facts, we present a simple model of parties engaged in potential conflict over resources, revealing that economic prosperity is a function of equilibrium conflict prevalence, determined not just by a region's own resources but also by the resources of its neighbors. Structural estimates confirm the model's predictions, and reveal that conflict equilibria are more prevalent where institutional quality is worse.

Se estiman los efectos de la perdida del empleo como resultado de un despido masivo, sobre la probabilidad de ser arrestado, utilizando una novedosa base que parea datos de empleados, empleadores y arrestos en Medellin, Colombia. La perdida del empleo genera una reduccion inmediata en los ingresos, y un incremento en la probabilidad de ser arrestado tanto para el empleado despedido, como para otros familiares jovenes. Nosotros explotamos la variacion en las oportunidades de re-emplearse formalmente y en el acceso a credito formal de consumo, para estudiar los mecanismos detras de la relacion entre la perdida del empleo y el crimen. Los trabajadores en sectores en auge, con mayores oportunidades de re-emplearse, ven menos afectada su probabilidad de ser arrestados. Una mayor exposicion a una expansion en la oferta de credito de consumo tambien debilita la respuesta de los arrestos al choque en el mercado laboral.

Background: Dispelling misinformation during crises is of critical importance. But information can also induce distress, which can lead to poor decision-making. We ask whether delivering correct information hurts or improves mental health during the Covid-19 pandemic. Methods: We randomly assigned a sample of low-income migrant workers to receive Covid-19-related information through text messages, a pre-recorded audio message, or (live) phone calls. Results: Misinformation was rampant at baseline. Phone calls led to the greatest increase in Covid-19-related knowledge, particularly among those without smartphones. They also reduced depression and anxiety substantially. The amount of information delivered explains gains in knowledge, but not improvements in mental health. Conclusions: These results suggest that governments reconsider the dependence on text messages and pre-recorded audio given the mental health improvements created by live phone calls. Trial Registration: The trial was pre-registered with the American Economic Association's Trial Registry (doi: 10.1257/rct.5947). Funding: Good Business Lab funded the data collection and interventions. Declaration of Interests: Adhvaryu and Nyshadham disclose that they are members of the Board of Directors and serve as Chief Development Officer and Chief Strategy Officer, respectively, at Good Business Lab. None of the authors has any financial interest in GBL. Ethics Approval Statement: This study was approved by Good Business Lab's Ethics Committee in India (Identifier: GBL0520) and University of Michigan Human Subjects Research Committee in the United States (Office of Human Research Protections Registration Number: IRB00000246). We obtained informed consent from all study participants.

How do firms pair workers with managers, and which constraints affect the allocation of labor within the firm? We characterize the sorting pattern of managers to workers in a large readymade garment manufacturer in India, and then explore potential drivers of the observed allocation. Workers in this firm are organized into production lines, each supervised by a manager. We exploit the high degree of worker mobility across lines, together with worker-level productivity data, to estimate the sorting of workers to managers. We find negative assortative matching (NAM) -that is, better managers tend to match with worse workers, and vice versa. This stands in contrast to our estimates of the production technology, which reveal that if the firm were to positively sort, productivity would increase by 1 to 4 percent across the six factories in our data. Coupling these findings with a survey of managers and with data on multinational brands and the orders they place, we document that NAM arises, at least in part, because the value of buyer relationships imposes minimum productivity constraints on each production line. Our results emphasize that suppliers to the global market, when they are beholden to a small set of powerful buyers, may be driven to allocate managerial skill to service these relationships, even at the expense of productivity. Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.

We study the role of household enterprise as a coping mechanism after health shocks. Using variation in the cost of traveling to formal sector health facilities to predict recovery from acute illness in Tanzania, we show that individuals with prolonged illness switch from farm labor to enterprise activity. This response occurs along both the extensive (entry) and intensive (capital stock and labor supply) margins. Family members who are not ill exhibit exactly the same pattern of responses. Deriving a simple extension to the canonical agricultural household model, we show that our results suggest complementarities in household labor.

Dust pollution in West Africa increases infant and child mortality. Employing differences in differences, we make three contributions. First, using data from 12 poor countries, we highlight the vulnerability of people with few resources, fragile health, and limited capacity to adopt avoidance behavior. Second, we examine prenatal and post-natal parental investment responses, and show evidence consistent with compensating behaviors. However, despite these efforts, the health of surviving children is still adversely affected. Third, we investigate differential impacts over time and across countries. We find declining effects over time, implying in the absence of reductions in dust itself that societies are adapting in some way. Using national-level measures of macroeconomic conditions and public health resources, we find suggestive evidence that both economic development and public health improvements have contributed to this adaptation, with health improvements seemingly playing a stronger role.

Which managerial skills, traits, and practices matter most for productivity? How does the observability of these features affect how appropriately they are priced into wages? Combining two years of daily, line-level production data from a large Indian garment firm with rich survey data on line managers, we find that several key dimensions of managerial quality, like attention, autonomy, and control, are important for learning-by-doing as well as for overall productivity, but are not commensurately rewarded in pay. Counterfactual simulations of our structural model show large gains from screening potential hires via psychometric measurement and training to improve managerial practices.

We study how managers mitigate the negative impacts of environmental shocks. Pairing productivity data from a garment firm with granular measures of air pollution, we show that productivity suffers...

Hirschman's (1970) seminal thesis that enabling worker “voice” prevents exit from the employment relationship has played a foundational role in labor economics. We provide the first experimental test of this hypothesis in a real-world setting via a randomized controlled trial in Indian garment factories. Just after what proved to be a disappointing wage hike, workers were chosen at random to participate in an anonymous survey in which they were asked for feedback on job conditions, supervisor performance, and overall job satisfaction. Enabling voice in this manner reduced turnover and absenteeism after the hike, particularly for the most disappointed workers. Institutional subscribers to the NBER working paper series, and residents of developing countries may download this paper without additional charge at www.nber.org.

In 1924, the Morton Salt Company began nationwide distribution of iodine-fortified salt. Access to iodine, a key determinant of cognitive ability, rose sharply. We compare outcomes for cohorts exposed in utero with those of slightly older, unexposed cohorts, across states with high versus low baseline iodine deficiency. Income increased by 11%, labor force participation rose 0.68 percentage points, and full-time work went up 0.9 percentage points due to increased iodine availability. These impacts were largely driven by changes in the economic outcomes of young women. In later adulthood, both men and women had higher family incomes due to iodization.

Canonical models of crime emphasize economic incentives. Yet, causal evidence of sorting into criminal occupations in response to individual-level variation in incentives is limited. We link administrative socioeconomic microdata with the universe of arrests in Medellin over a decade. We exploit exogenous variation in formal-sector employment around a socioeconomic-score cutoff, below which individuals receive benefits if not formally employed, to test whether a higher cost to formal-sector employment induces crime. Regression discontinuity estimates show this policy generated reductions in formal-sector employment and a corresponding spike in organized crime, but no effects on crimes of impulse or opportunity.

Can investing in children who faced adverse events in early childhood help them catch up? We answer this question using two orthogonal sources of variation – resource availability at birth (local rainfall) and cash incentives for school enrollment – to identify the interaction between early endowments and investments in children. We find that adverse rainfall in the year of birth decreases grade attainment, post-secondary enrollment, and employment outcomes. But children whose families were randomized to receive conditional cash transfers experienced a much smaller decline: each additional year of program exposure during childhood mitigated more than 20 percent of early disadvantage.

We evaluate the causal impacts of on-the-job soft skills training on the productivity, wages, and retention of female garment workers in India. The program increased women’s extraversion and communication, and spurred technical skill upgrading. Treated workers were 20 percent more productive than controls post-program. Wages rise very modestly with treatment (by 0.5 percent), with no differential turnover, suggesting that although soft skills raise workers’ marginal products, labor market frictions are large enough to create a substantial wedge between productivity and wages. Consistent with this, the net return to the firm was large: 258 percent eight months after program completion.

Do parents invest more in higher quality children, or do they compensate for lower quality by giving more to children with lower endowments? We answer this question in the context of a large-scale iodine supplementation programme in Tanzania. We find that children with higher programme exposure were more likely to receive necessary vaccines and were breastfed for longer. Siblings of treated children were also more likely to be immunised. Fertility behavior and investments at the time of birth were unaffected.

We study the effects of accessing better healthcare on the schooling and labor supply decisions of sick children in Tanzania. Using variation in the cost of formal-sector healthcare to predict treatment choice, we show that accessing better healthcare decreases length of illness and changes children’s allocation of time to school and work. Children attend school for more days per week—but not for more hours per day—as a result of accessing better healthcare. There are no significant effects on child labor, but the results suggest that time spent in physically strenuous activities such as farming and herding increases.

Improving access to the formal health care sector is a primary public health goal in many low-income countries. But the returns to this access are unclear, given that the quality of care at public health facilities is often considered inadequate. We exploit temporal and geographic variation in the cost of traveling to formal sector health facilities to show that treatment at these facilities improves short-term health outcomes for acutely ill children in Tanzania. Our results suggest that these improvements are driven in part by more timely receipt of and better adherence to antimalarial treatment. (JEL I11, I12, I15, I18, J13, O15)

We show that psychological well-being in adulthood varies substantially with circumstance in early life. Combining a time series of real producer prices of cocoa with a nationally representative household survey in Ghana, we find that a one standard deviation rise in the cocoa price in early life decreases the likelihood of severe mental distress in adulthood by 3 percentage points (or half the mean prevalence) for cohorts born in cocoa-producing regions relative to those born in other regions. Impacts on related personality traits are consistent with this result. Maternal nutrition, reinforcing childhood investments, and adult circumstances are operative channels of impact.

Standard theories of resource allocation within the household posit that parents’ investments in their children reflect a combination of children’s endowments and parents’ preferences for child quality. We study how changes in children’s cognitive endowments affect the distribution of parental investments amongst siblings, using data from a large-scale iodine supplementation program in Tanzania. We find that parents strongly reinforce the higher cognitive endowments of children who received in utero iodine supplementation, by investing more in vaccinations and early life nutrition. The effect of siblings’ endowments on own investments depends on the extent to which quality across children is substitutable in parents’ utility functions. Neonatal investments, made before cognitive endowments become apparent to parents, are unaffected. Fertility is unaffected as well, suggesting that inframarginal quality improvements can spur investment responses even when the quantity-quality tradeoff is not readily observable.

We estimate the effects of higher quality healthcare usage on health, labor supply and schooling outcomes for sick individuals in Tanzania. Using exogenous variation in the cost of formal sector healthcare to predict treatment choice, we show that using better quality care improves health outcomes and changes the allocation of time amongst productive activities. In particular, sick adults who receive better quality care reallocate time from non-farm to farm labor, leaving total labor hours unchanged. Among sick children, school attendance significantly increases as a result of receiving higher quality healthcare, but labor allocations are unaffected. We interpret these results as evidence that healthcare has heterogeneous effects on marginal productivity across productive activities and household members.

Self-selection into healthcare options on the basis of severity likely biases estimates of the effects of healthcare choice on health outcomes. Using an instrumental variables strategy which exploits exogenous variation in the cost of formal-sector care, we show that using such care to treat acute sickness decreases the incidence of fever and malaria in young children in Tanzania. Compared to the instrumental variables estimates, ordinary least squares estimates significantly understate the effects of formal-sector healthcare use on health outcomes. Improved information and more timely treatment, rather than greater access to medicines, seem to be the primary mechanisms for this effect.

Models of the agricultural household have traditionally relied on assumptions regarding the complementarity or substitutability of family labor inputs. We show how data on time allocations, health shocks and corresponding treatment choices can be used to test these assumptions. Data from Tanzania provide evidence that complementarities exist and can explain the pattern of labor supply adjustments across household members and productive activities following acute sickness. In particular, we find that sick and healthy household members both shift labor away from self-employment and into farming when the sick recover more quickly. Infra-marginal adjustments within farming activity types provide further evidence of farm-specific complementarities.