Friday, 14 October 2011

Banco de Portugal - Lisbon Meeting Best Paper Award for Oliver Vanden Eynde

Oliver Vanden Eynde, PhD student at EOPP has won the "Banco de Portugal - Lisbon Meeting Best Paper Award" for his paper titled "Targets of violence: Evidence from India's Naxalite Conflict".

This work was presented at the "Lisbon Meeting on Institutions and Political Economy". This is Oliver's second award, after

winning the "Economic History Society New Researchers' Prize" for his paper "Military Service and Human Capital

Accumulation: Evidence from Colonial Punjab" presented at the "2011 Economic History Society Annual Conference".

You can find more about Oliver's research on his personal website.

Recent Publication by Maitreesh Ghatak: The Land Acquisition Bill: A Critique and a Proposal

The paper is joint work with Parikshit Ghosh and was published in Economic and Political Weekly of India, October 8, 2011, Vol. XLVI, No 41, it is available here. A shorter version can be accessed here.

Abstract: The 2011 Land Acquisition and Rehabilitation and Resettlement Bill on land acquisition recently tabled in Parliament is well-intentioned but seriously flawed. Its principal defect is that it attaches an arbitrary mark-up to the historical market price to determine compensation amounts. This will guarantee neither
social justice nor the efficient use of resources. The Bill also places unnecessary and severe conditions on land acquisition, such as restrictions on the use of multicropped land and insistence on public purpose, all of which are going to stifle the pace of development without promoting the interests of farmers.

We present an alternative approach that will allow farmers to choose compensation in either land or cash, determine their own price instead of leaving it to the government’s discretion, and also reallocate the remaining farmland in the most efficient manner. Our proposed method involves a land auction covering not only the project site but also the surrounding agricultural land.

Tuesday, 11 October 2011

Recent Publication by Tim Besley, Maitreesh Ghatak and Konrad Burchardi: Incentives and the de Soto Effect

The paper is forthcoming in Quarterly Journal of Economics. The paper can be found here.

Abstract: This paper explores the consequences of improving property rights to facilitate the use of fixed assets as collateral, popularly attributed to the influential policy advocate Hernando de Soto. We use an equilibrium model of a credit market with moral hazard to characterize the theoretical effects, and also develop a quantitative analysis using data from Sri Lanka.
We show that the effects are likely to be non-linear and heterogeneous by wealth group. They also depend on the extent of competition between lenders. There can be significant increases in profts and reductions in interest rates when credit markets are competitive. However, since these are due to reductions in moral hazard, i.e. increased effort, the welfare gains tend to be modest when cost of effort is taken into account. Allowing for an extensive margin where borrowers gain access to the credit market, can make these effects larger depending on the underlying wealth distribution.

Thursday, 17 February 2011

Recent Publication by Johannes Spinnewijn: Capital Income Taxes with Heterogeneous Discount Rates

The paper (joint with Peter Diamond) is forthcoming in AEJ: Economic Policy

Abstract: With heterogeneity in both skills and discount factors, the Atkinson-Stiglitz theorem that savings should not be taxed does not hold. In a model with heterogeneity of preferences at each earnings level, introducing a savings tax on high earners or a savings subsidy on low earners increases welfare, regardless of the correlation between ability and discount factor. Extending Saez (2002), a uniform savings tax increases welfare if that correlation is sufficiently high. Key for the results is that types who value future consumption less are more tempted by a lower paid job. Some optimal tax results and empirical evidence are presented.

The paper can be found here