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News Archive 2011

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Recent Publication: The Lesser Evil: Executive Accountability with Partisan Supporters
Gerard Padro i Miguel

We develop a model of electoral accountability with primaries. Prior to the general election, the supporters of each of two parties decide which candidates to nominate. We show that supporters suffer from a fundamental tension: while they want politicians who will faithfully implement the party's agenda in office, they need politicians who can win elections. Accountability to supporters fails when supporters fear that by punishing or rewarding their incumbent for her loyalty or lack thereof, they unintendedly increase the electoral prospects of the opposing party. Therefore, accountability decreases with the importance that supporters assign to the elections, and it breaks down in two cases. First, a popular incumbent safely defects as she knows she will be re-nominated. Second, an unpopular incumbent defects because she knows she will be dismissed even if she follows the party line. These behaviors are labeled impunity and damnation respectively, and are illustrated with case studies.

"The Lesser Evil: Executive Accountability with Partisan Supporters" (with Erik Snowberg), forthcoming in Journal of Theoretical Politics.

News Posted: 21 November 2011      [Back to the Top]

Recent Publications: Policy Papers: The Land Acquisition Bill: A Critique and a Proposal
Maitreesh Ghatak

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.

News Posted: 14 October 2011      [Back to the Top]

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.

News Posted: 13 October 2011      [Back to the Top]

Recent Publications
Tim Besley, Konrad Buchardi, Maitreesh Ghatak

Incentives and the de Soto Effect

The paper is forthcoming in Quarterly Journal of Economics and 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.

News Posted: 10 October 2011      [Back to the Top]

Applications for STICERD desks
Call for applications (LSE PhD Students ONLY)

STICERD offers a limited number of desks to economics doctoral students, who work in applied microeconomics. We now welcome applications for the year 2011/12 from PhD students and MRes students, who:
  • have already successfully passed their three core courses (Ec441, Ec442, Ec443)

  • are interested in applied microeconomics (theory and/or empirics)
STICERD is a research centre located on the fifth floor of the Lionel Robbins Building. It offers a vibrant research environment and a unique opportunity to interact with other researchers. Each desk includes a PC and the use of STICERD facilities, but there is no associated grant or fee support. More information about STICERD can be found on:

Students who are assigned STICERD desks are asked to make a full use of their office space and to take part in the centre's activities, including a weekly work-in-progress seminar series. They may also be asked to help out with other small tasks (up to four hours per week).

If you wish to apply, please email a brief research statement explaining why you are interested in STICERD (no more than half a page) and a CV (including your marks at the LSE). In the CV, please include two primary areas of research interests (e.g., Development Economics and Public Economics). Please email this material to Henrik Kleven ( , Gerard Padro ( and Mark Schankerman (, with a copy to Sue Coles (

Please send the material to us before Wednesday, 31 August 2011.

When you do this, please let us know about your availability at LSE during the first week of Michaelmas term (Thursday, 29th September - Wednesday, October 5th) when we plan to schedule the interview. In particular, let us know if there is a day of that week when you cannot make it. Based on the feedback we get, we will choose a date for interviewing the prospective candidates.

If we receive a number of applications that is larger than the number of available desks, we will select applicants based on their academic record at the LSE and on how close their research interests are to those of other STICERD members.

Best wishes,

Henrik Kleven
Gerard Padro
Mark Schankerman

News Posted: 07 July 2011      [Back to the Top]

Development Economics - Useful Link
ThRed - Theoretical Research in Development Economics

ThRed is an organization dedicated to research in Development Economics, including empirical work motivated and guided by theory

ThRed supports research which combines theory and empirics, as well as research that is purely empirical but theoretically grounded: research which helps us choose between alternative theories, or stimulates further theoretical research. Our goal is to hold workshops, events, and host working papers and lecture notes, all geared to a methodological focus that is theory-oriented.

ThRed has held several conferences in Development Economics, and plans to organize more. The ThRed website website will post news of conferences, and provide a respository of working papers and lecture notes.

The ThRed website is at

For more useful development economics websites and links please see the Useful Links section on the EOPP website.

News Posted: 29 June 2011      [Back to the Top]

Vox - interview with Tim Besley
State Capacity and Development

Tim Besley of the London School of Economics talks to Romesh Vaitilingam about the importance of a country's fiscal capacity and legal capacity for its development prospects - and the link to policy debates about 'fragile states'. The interview was recorded in London in June 2011 after a 'blue-sky' conference on development policy-making organised by CAGE, the Centre for Competitive Advantage in the World Economy at the University of Warwick.

Listen to the interview on the Vox website

Download the Podcast (MP3)

News Posted: 24 June 2011      [Back to the Top]

Economics of Non-Profits, NGOs and Aid Effectiveness

A workshop in Namur

This workshop is organized by G. Aldashev (University of Namur), M. Ghatak (LSE) and T. Verdier (PSE)

For more information and registration please follow the link

News Posted: 15 June 2011      [Back to the Top]


The Conference is being organised by Robin Burgess and Maitreesh Ghatak. It is aimed to bring together a selected group of researchers working on development economics, public economics and political economy, the core areas of the research program EOPP (Economic Organization and Public Policy). We look forward to generating discussions about the emerging research themes and ideas in these fields in the coming years, and to what extent there are important overlaps in the respective research agendas. The occasion is also to celebrate ten years of Tim Besley's tenure as Director of STICERD and also, co-incidentally, his 50th birthday.

News Posted: 13 June 2011      [Back to the Top]

2011 Carlo Alberto Medal
Oriana Bandiera wins the 2011 Carlo Alberto Medal

The members of the selection committee (Orazio Attanasio, Maristella Botticini, Luigi Guiso, Christopher Pissarides, Thomas Sargent, Guido Tabellini and Fabrizio Zilibotti) have announced that Professor Oriana Bandiera has been awarded the 2011 Carlo Alberto Medal, given to an outstanding Italian economist under 40. Details are at

News Posted: 04 April 2011      [Back to the Top]

Recent Publications
Maitreesh Ghatak: Implementing Health Insurance for the Poor: The Rollout of RSBY in Karnataka

This paper joint with D. Rajasekhar, Erlend Berg, R. Manjula, and Sanchari Roy is forthcoming in the Economic and Political Weekly of India


The National Health Insurance Scheme (Rashtriya Swasthya Bima Yojana, RSBY) aims to improve poor people’s access to quality health care in India. This paper looks at the implementation of the scheme in Karnataka, drawing on a large survey of eligible households and interviews with empanelled hospitals in the state. Six months after initiation, an impressive 85% of eligible households in the sample were aware of the scheme, and 68% had been enrolled. However, the scheme was hardly operational and utilisation was virtually zero. A large proportion of beneficiaries were yet to receive their cards, and many did not know how and where to obtain treatment under the scheme. Moreover, hospitals were not ready to treat RSBY patients. Surveyed hospitals complained of a lack of training and delays in the reimbursement of their expenses. Many were refusing to treat patients under the scheme until the issues were resolved, and others were asking cardholders to pay cash. As is typical for the implementation of a government scheme, many of the problems discussed can be related to a misalignment of incentives.

Link to article.

News Posted: 10 March 2011      [Back to the Top]

Recent Publications
Johannes Spinnewijn: Capital Income Taxes with Heterogeneous Discount Rates (with Peter Diamond)

This paper is forthcoming in AEJ: Economic Policy


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.

Link to article.

News Posted: 18 February 2011      [Back to the Top]

IGC-STICERD-DESTIN Development Lecture
Creating Pathways for the Poorest: Linking safety nets, livelihoods and access to finance

Professor Syed M. Hashemi
Director, BRAC Development Institute Monday, January 24, 1-2pm
STICERD Conference Room (R505)
5th Floor, LSE RLab, Lionel Robbins Building, Portugal Street, London WC2A 2HD

Map to venue

Presentation (in Adobe PDF)

About the topic

Trickle Up Graduation Pilot
West Bengal, India People at the very bottom of the economic ladder are often excluded, or exclude themselves, from microfinance. Their income is usually too low and unreliable to permit repayment of loans or investment in anything but basic food consumption. In some countries the very poor are served by safety net programs, which usually take the form of cash transfers, food aid, or guaranteed employment schemes.
Starting in 2006, CGAP and the Ford Foundation have been exploring how a 'graduation model' can create pathways out of extreme poverty, adapting a methodology developed by BRAC in Bangladesh.

The graduation model targets the 'ultra poor'- people who have no assets and are chronically food insecure. Safety nets usually help these very poor people survive but donít allow them to build up assets. The graduation program combines support for immediate needs with longer term investments in training, financial services, and business development so that within two years ultra poor people are equipped to help themselves move out of extreme poverty. The term 'graduation' refers to participants moving out of safety net programs and 'graduating' into income-earning activities that let them sustain themselves without external subsidies. The graduation approach was originally developed by BRAC in Bangladesh. Over the past five years BRACís Specially Targeting the Ultra-Poor program has reached 800,000 households- over 70 percent of them are currently food secure and managing sustainable economic activities.

Since, 2006 CGAP-Ford Foundation Graduation Program is helping to implement ten Graduation Pilots in partnership with local organizations in Haiti, India, Pakistan, Honduras, Peru, Ethiopia, Yemen and Ghana. The ten pilots involve diverse institutional forms, economic contexts, and cultures. Several of the pilots are measuring the program's effects on people's lives through rigorous randomized impact evaluations and qualitative research. This presentation will provide an overview of the graduation model and the pilot implementation.

About the speaker

Syed M. Hashemi has recently moved to Bangladesh to set up the BRAC Development Institute. The Institute seeks to create south-south partnerships to develop practical solutions for the poor for economic transformations, gender equity and social accountability. Prior to joining the Institute Hashemi worked for CGAP (Consultative Group to Assist the Poor) in Washington DC. At CGAP he focused on identifying pro-poor innovations and disseminating best practice lessons related to poverty outreach and impact. Hashemi was amongst the pioneers who started the Social Performance Taskforce to promote a double bottom line in microfinance. He still continues to work for CGAP as Team Leader/manager of the CGAP-Ford Foundation Graduation Program, a multi-country program to develop new pathways for the poorest to graduate out of food insecurity.

Hashemi has also been Director of the Program for Research on Poverty Alleviation at Grameen Trust and Professor at the Department of Economics in Jahangirnagar University. He holds a Ph.D. in Economics from the University of California at Riverside.

About BRAC Development Institute (BDI)

BDI provides graduate training, promotes research and builds knowledge to address the challenges of poverty, inequity and social injustice. It brings together academics and practitioners to raise critical questions on development, develops new ideas and new strategies, pilot tests new initiatives, provides important lessons on good practices, and advocates for pro-poor policies.

News Posted: 24 January 2011      [Back to the Top]