Predicting the expected impact of values on behavior in the medium to long run remains difficult nevertheless, since
sharing norms may not be independent from the current social environment of those who subscribe to them. Specifically,
sharing norms may either be fully internalized or domain-specific to a particular informational environment, two options
between which I discriminate in the second chapter of my dissertation. In this chapter, which together with the first
chapter forms the basis of my first job market paper, I extend the experimental framework of the first chapter using
imperfect information regarding the size of the pie and share taken by the dictator on the side of the receiver. The purpose
is to investigate the origins of the high prevalence of equal sharing of effort-generated income that I found among the
subjects of my first chapter, and, more generally, to understand how subjects balance their behavior between self-interest
and norm-adherence if their degree of norm-adherence can no longer be fully judged by others.
I find that dictators act more selfishly under incomplete information, i.e. deviate further from the various norms of
distributive justice in situations where their social image cannot be damaged by such action. This finding is significant for
two reasons, which help us gain perspective on the findings of the first chapter: a) when norms are domain-specific to a
particular informational environment, changes in community structures arguably lead to more abrupt changes in sharing
behavior, and b) community structures are rapidly changing in the developing world (think, for example, internal
migration, out-migration and remittances, but also increased financial infrastructure such as the introduction of bank
accounts).
The third chapter of my dissertation, which is co-authored with my colleagues at the University of Michigan, the IPA, and
the World Bank, draws lessons from a randomized field experiment in rural Malawi that temporarily increased access to
markets for previously isolated areas through regular subsidized transport. The cost of being isolated is a growing subject
of research in development economics. Rural road investments have been pointed out to be critical for households to
overcome spatial poverty traps. Over the past decades, many such investments in Sub-Saharan Africa seem to have been
built on donors’ and governments’ assumption that the provision of roads that are passable for motorized vehicles will
automatically lead to market provision of such transport and thus, poverty reduction and income generation. There is,
however, a lack of rigorous evidence on these assumptions; namely the lack of randomized field studies evaluating the
profitability of routes.
The randomized experiment summarized in this paper is the first of this kind in Sub-Saharan Africa and illustrates that
improving the condition of roads does not necessarily generate transport provision at an affordable price for villagers. In
other words, based on take-up, this experiment demonstrates that a bus provider cannot, at any price, break-even on these
routes. This result is strengthened by the fact that subsidized transport was provided on a regular basis over a period of
sixth months. This contrasts sharply to an often encountered situation in real life in which a bus provider often does not
possess the required funds to scout out a new area for more than a few days. Potential customers cannot predict the supply
of transport well in such a case and hence (depending on the specifics of the area and its population), observed demand
during such a scouting period may seem lower than actual demand would be if regular supply of transport was available,
leading the bus provider to underestimate potential demand for transport service and not provide services to potentially
profitable routes. Given that in our study a regular bus schedule was communicated to all potential customers and this
schedule was honored by the transport provider, we can conclude that in our case true demand was revealed and yet a bus
provider cannot make a profit on these routes.
This explains why many rural roads in relatively good condition are currently not being used by motorized vehicles and
has important public policy implications. It helps policy makers design solutions that actually increase access to markets
through a) an increased understanding of why, despite massive investments in infrastructure, the expected outcomes on
access to markets have often not materialized, and hence, b) an increased understanding about which data to collect in
order to be able to assess whether rural road investments may crowd out investments in other sectors that may have a
greater impact on economic and social development.
Future work:
A related paper I am currently working on with my co-authors is based on the same field experiment and looks at income,
health, and time-allocation effects of the transport subsidy (including spill-over effects) over a period of six months.
I view all of the above-mentioned papers as works in progress that I intend to complete and submit for publication within
the next eight months, and that may lead to further related projects. I have been to Malawi for a total of 1.5 years and have
access to a large logistical network. I intend to harness this research capital, as well as my personal contacts with
government officials and villagers, during the next years of my career for several additional projects.