Firm-level data for the manufacturing sector in Africa, presented in this paper, shows very low levels of investment. A positive effect from profits onto investment is identified in a flexible accelerator specification of the investment function controlling for firm fixed effects. There is...

Poor people often do not make investments, even when returns are high.  One possible explanation is that they have low aspirations and form mental models which ignore some options for investment.  This paper reports on findings of an innovative experiment to test this in rural Ethiopia. ...

With serious impacts of climate change looming in a few decades, but currrent poverty still high in the developing word, we ask how to spend development aid earmarked for the poor.  Poverty reduction tends to be strongly linked to economic growth, but growth impacts the environment and...

Agriculture is the largest sector in most sub-Saharan economies in terms of employment, and it plays an important role in supplying food and export earnings.  Rural poverty rates remain high, and labor productivity is strikingly low.  This paper asks how these factors shape the role of...

We report on a randomized field experiment using price incentives to address both economic and gender inequality in land tenure formalization.  During the 1990s and 2000s, nearly two dozen African countries proposed de jure land reforms extending access to formal, freehold land tenure to...

Empirical work in labour economics has focused on rent sharing as an explanation for the observed correlation in cross-sections between wages and profitability. The alternative explanation of risk sharing between workers and employers has not been tested. Using a unique panel data set for four...

Empirical studies of the relationship between school inputs and test scores typically do not account for the fact that households will respond to changes in school inputs. We present a dynamic household optimization model relating test scores to school and household inputs, and test its...

Empirical studies of the relationship between school inputs and test scores typically do not account for the fact that households will respond to changes in school inputs. This paper presents a dynamic household optimization model relating test scores to school and household inputs, and tests...

Poor people in developing countries are often affected by droughts, floods, illness, crop failure, job loss, and economic downturns. Much of their energy goes into coping with these shocks and into day-to-day survival. While insurance and credit markets, combined with widespread social security,...