Reactions from a Control Group in Ghana

Randomized control trials (RCTs for short) have been the fad in development economics research during the past five years or so. One usual concern for this research methodology is that it's ethically incorrect. Usually, the trials evaluate the effect of offering poor people in poor countries with something that is supposed to be good, such as medicine, money, savings accounts, etc. And this offer is given to people randomly selected. So there are people who won't get any offer like this. Such people may be offended.

In Ghana, at least, this concern appears to be minimal. See this post from the blog of IPA, a non-profit organization founded by Dean Karlan, a leading development economist who made a fame from his RCT research in development economics. (He's actually coming to my workplace next month.)

What is an interesting paper in economics?

According to Steve Levitt, it is a paper that
A) teaches some important facts,
B) has a clever idea,
C) is believable, and
D) makes the world a better place.

Impact of insecticide-treated bed nets on infant mortality

I've done a bit of surveys on the impact of insecticide-treated bed nets (ITNs) on infant mortality. For the uninitiated, ITNs are known to be effective for preventing child deaths due to malaria infection. ITNs do not just protect you from mosquito bites that can transmit malaria parasite into your body. They also kill mosquitos that touch the ITNs as the bed net fabric contains insecticide. As malaria is transmitted only through mosquitos, ITNs reduce the risk of malaria infection in these two ways.

But how much do they reduce infant mortality in a village in Africa?

To identify randomized control trials of high quality on this topic, I look at the Cochrane Review (Lengeler (2004)), which identifies the list of such trials with no bias in the estimates. There are five studies looking at the impact on child mortality, and Lengeler (2004) concludes that ITNs reduce child mortality by 5.5 deaths per 1,000 children.

However, I'm interested in infant mortality (the death rate among those aged under 12 months old), not in child mortality (the death rate for children under the age of 5 years). Also, it is not clear to me whether these estimates refer to the intention-to-treat effect (the impact of distributing ITNs) or the effect of the actual use of ITNs. So I look at the original studies.

It turns out that one study looks at insecticide-treated curtains. Another looks at the impact of treating bed nets with insecticide (because the study is conducted in The Gambia, where the use of bed nets is common). The third study does not report infant mortality. So only two studies actually evaluate the impact on infant mortality. And the intervention they evaluate is actually the distribution of ITNs to a community, not the actual use of ITNs by villagers (though both studies find that the usage rate of distributed ITNs is rather high).

Binka et al. (1996) report that, in Kassena-Nankana district in Ghana, before distributing ITNs, the mortality among children 6 to 11 months old is 49.7 per 1,000 for treated villages while it is 55.1 per 1,000 for control villages. After the intervention, 73.2 for the treated and 90.3 for the control. The difference-in-difference estimate yields a reduction by 11.7 per 1,000. In addition, the authors report that the mortality for children aged 1 to 5 months is comparable between the treated and the control before the intervention (they don't report exact numbers) and that it becomes 77.4 for the treated and 100.7 for the control, implying that the impact is a reduction of 23.3 deaths per 1,000. Combining these figures, the impact on infant mortality is 35 deaths per 1,000, much higher than the effect for all the children under the age of 5 years concluded by Lengeler (2004).

The other study, Phillips-Howard et al. (2003), reports a reduction of infant mortality by 31 per 1,000 due to the distribution of ITNs in Asembo and Gem areas in western Kenya, which is surprisingly similar to what Binka et al. (1996) find. This similarity may be explained by the fact that malaria is endemic (ie. there is risk of infection throughout the year) in both study sites.

By the way, Hawley et al. (2003), another piece of paper by the same research team as Phillips-Howard et al. (2003), reports the reduction of child mortality by similar magnitude in villages without ITNs but near those villages with ITNs distributed. This finding suggests that the main mechanism through which ITNs reduce child mortality is not the protection of children (and pregnant mothers, as malaria infection during pregnancy can cause the malfunctioning of placenta and thus reduce the birth weight of newborns, which increases the risk of infant death) by bed nets but the eradication of mosquitos by insecticide.

Moving within Stockholm

There are three ways of finding a place to live in Stockholm (and other cities in Sweden): buy a place to live, make a queue for renting an apartment directly from the owner, and find someone who wants to sublet his or her apartment.

From what I hear from Swedes, the government encourages people to follow the first option. The supply of apartments for rent is severely discouraged due to the rent regulation. Rent is set according to the average cost of building an apartment in the area, nothing to do with demand for apartments.

The second option, making a queue, is infeasible for foreigners like myself. Those with their Swedish social security number or personnummer (everyone living in Sweden, Swedish nationals or not, must have one) can put themselves in a queue by paying 275 Swedish krona per year (about 26 euro), which by the way includes 25 percent VAT tax. Among those who are interested in a particular apartment for rent, the first 30 in the queue are allowed to have a look, and among those who do want to rent this apartment, the first in the queue is chosen as the tenant. On average, it takes five years to rent an apartment this way. Unless your Swedish parents put you in the queue long before you actually need to rent an apartment, it is impossible to find a place to live this way.

The last option, and effectively the only one for foreigners, is usually offered by Swedish tenants who need to go abroad for a certain period of time. It's unusual that such Swedes will stay abroad for more than a year. Therefore, the subletting contract usually lasts at most one year. So you need to move around Stockholm once in every year.

It seems like there is a political philosophy in Sweden which says that renting an apartment creates income inequality, which is nothing but evil. It is so anachronistic in the age of people moving around globally.

Anyway, the last option is what I took last weekend. There is an online real estate agency specializing in subletting, Bostad Direkt. (There appear to be many others of this kind, but only this one, it seems, has an English version of the list). The list of apartments for sublet can be viewed for free. But to find out the contact detail, you need to pay nearly 700 krona (67 euro) for the subscription lasting 45 days. I wanted to move in to an area called Hammarby Sjöstad. I've been browsing the list of apartments for sublet in this area since January, and couldn't find any with a reasonable amount of rent and a reasonable amount of contract duration (ie. at least 1 year) until early April. The first apartment that I saw was an excellent one. But the tenant, a Peruvian who broke up with his Swedish girlfriend a year ago and that is why he is subletting this spacious apartment, suddenly became out of reach on the day we would sign the contract. The second apartment that I saw is perfect but the fact that it lacks a bathtub. During the long, cold winter in Stockholm, taking a bath makes a lot of difference to someone from a country of bath culture. But there's no other option. I need to leave from my current apartment this August (because it's also a sublet), and there is absolutely no guarantee that I will find another apartment in this area by August. I may end up in a suburb of Stockholm where there is only one supermarket and nothing else (which is more or less true for all the suburbs in Stockholm). So I took this apartment in which I can stay until July 1st next year.

Since the contract with my previous apartment requires a 60-day advance notice of termination, I end up paying 2 months of rent for the apartment which I do not live in. And moving my stuff by truck costs about 2400 krona. Packing (and unpacking) all of my belongings and cleaning the apartment to leave costs two weeks. And all this will be repeated every year.

That's life in Stockholm.

Quantile Regression

Caution: If you are not an economist (or a social scientist of quantitative type), please skip this post.

Read Deaton (1997) (pages 80-83) to review the merit of running quantile regression.

1. Uncover the heteroskedasticity in the error term.

2. Figure out the shape of the conditional distribution (such as income conditional on age).

3. Obtain a more efficient estimator than OLS when the error term does not follow the normal distribution.

There is a concise survey of quantile regression in economics: Roger Koenker and Kevin F. Hallock (2001).

For an instrumental variables estimation of quantile regression, see Chernozhukov and Hansen (2005). For a method to estimate the the impact of a regressor on the unconditional distribution of the dependent variable, see Firpo, Fortin, and Lemieux (2007).

Week of an assistant professor

Push a little bit forward the autocracy network project, joint with a PhD student of my Institute, by reading some published papers on social networks (hence this post) and by listing up the members of the Presidium of the Romanian Communist Party since 1965 until 1974 from Keesing's.

Spring has finally come

Spring finally came to Stockholm today, because the wind is not freezing anymore and the night temperature does not go below 5 degrees. A coat is no longer necessary even at night. And we have 15 hours of daytime right now.

Tabbouli

For dinner with today's seminar speaker, we went to Tabbouli, a great Lebanese restaurant in Stockholm. This is my fourth visit to the restaurant, and the food is always good.

They serve Lebanese wine only (with exception of a couple of South African for some reason). We tried Château Ksara's red wine, and I liked this wine a lot. As I don't have good vocabulary for describing the taste of wine, I just let you read the description of the wine by Ksara itself (a pdf file). I also tried a cup of Lebanese coffee after dinner, which was brilliant with cardamon flavor. (Here's how to brew Lebanese coffee.)

If you don't know what to order because you're not familiar with Lebanese cuisine, just order the set menu at the back of the front page of the menu. That fills your stomach completely.

Bloch, Genicot, and Ray (2008, JET)

The paper's abstract is available at http://dx.doi.org/10.1016/j.jet.2008.01.008.

Consider a village in a developing country where households engage in bilateral insurance schemes with directly connected households (relatives or friends, for example). If a household deviates from the insurance scheme (ie. fails to transfer money to directly connected households that have negative income shocks), the victim household will tell such behavior to connected households who in turn terminate the insurance scheme with the deviating household as a punishment.

The question is what aspects of the household network characterizes a stable household network, that is, a network in which no household has incentive to deviate from the bilateral insurance schemes.

Denote by q the number of links that the victim's information is passed through. For example, q equals two if the victim tells its directly connected households which in turn tell their own directly connected households, but the information does not spread beyond that.

Then the stable network is characterized by the maximum length of the smallest cycle connecting any three households in the network being q+2.

Why? Suppose household i fails to transfer money to household j. Household j tells its suffering to its connected households with the path length of less than or equal to q. These informed households cut the link to household i. Since the length of the smallest cycle of any three households in the network is at most q+2, the information from household j reaches all the households with (direct or indirect) links both to i and j. As a result, household j will be cut off from the network that includes household i, by deviating from the insurance scheme. A smaller network yields a lower payoff (intuitively, pooling income risk among more households provides better insurance against negative income shocks). Therefore, household i has no incentive to deviate, which means that the household network is stable.

Day of an Assistant Professor (79)

Finish revising the African democracy paper and submit it to a journal. It took more than 6 months after the first rejection.

Day of an Assistant Professor (78)

Revise the African democracy paper.

Join a birthday party held by a PhD student of my Institute at his apartment in the evening.

Day of an Assistant Professor (77)

Revise the African democracy paper.

Attend a seminar.

Book flight tickets for the business trip to UK next month.

Day of an Assistant Professor (76)

Meet a PhD student to talk about his research ideas.

Resume the long overdue revision of the Africa-democracy paper.

Day of an Assistant Professor (75)

Prepare the presentation later today.

Give a talk on the climate project at my own department's seminar series with my colleague. After that, discuss with my colleagues the comments we received during the talk.

Day of an Assistant Professor (74)

Prepare for tomorrow's presentation on the climate project.

It's Easter Monday, but this kind of thing does not matter to researchers, especially those without a family and/or coming from Asia like myself.

Hotel Review: Bristol Hotel

I stayed in room 504 of the Bristol Hotel in Frankfurt from 10 to 12 April, 2009. It was one of the most pleasant hotels I've ever stayed at.

The hotel is the least expensive one of those listed in Wallpaper* City Guide for Frankfurt (70 euro per night for a small single room, including breakfast). Online booking on its website is very easy and smooth. The email confirmation message says, "A cancellation free of charge is possible until day of arrival, 4 pm."

I arrived in the late morning, but it was no problem for me to check in (I thought I should wait until around 2 pm for check-in). My room was even upgraded to a larger single room.

The bedroom is furnished pleasantly with minimalist design, featuring raindrop-shaped door knobs and hooks for hanging clothes on the wall. The bathroom has a removable shower head and a designer wash basin, with a pitch-white bin by Koziol (there is no shower curtain or bath tub, though). It would be perfect if the bedroom has a kettle for brewing tea. But with good design, such tiny details of convenience do not matter much.

The entrance hall is also well-designed, complete with cow-skin couches and electro music of good quality in the background. The hotel bar serves good food.

The breakfast room, open after 6:30 am, faces the hotel's courtyard garden with lush green tree leaves through large windows, serving not only continental but also English/American breakfast, which is important for someone like me who needs to eat plenty of food in the morning. Food is decent, so are tea bags (Tchibo Coffee Service's Pure Tea Selection).

Wireless broadband connection is for free. Even if you don't have your own laptop, there are two computer terminals in the lobby, available for free. The front desk also lends you a mini laptop by Acer to be used in your bedroom if you deposit your credit card (but again for free of charge). I don't have a laptop and don't intend to email during my stay. But after the amazing experience at Cocoon, I feel like emailing a friend of mine to tell my excitement. The Bristol Hotel just makes my desire feasible for free of charge.

The location is excellent, too. Just a five minute walk away from an U-Bahn station (if you walk via platform 24 of Frankfurt Hbf station). Five minutes of a further walk takes you to airport coach stops on Mannheimer Strasse.

Finally, the hotel staff is all friendly. When I check out, it takes a bit of time for my credit card to be recognized. The receptionist apologizes, a rarity outside Japan.

I'll definitely stay at this hotel if I visit Frankfurt again.

Portikus

A mill house on a sandbank of the Main, which is actually a gallery space for contemporary art called Portikus.

This is a brilliant location for contemporary art exhibition. It doesn't belong to anything else in Frankfurt due to its position on the River Main. People driving or walking on the Alte Brucke bridge (including my friend) won't notice this is a gallery, rather than an abandoned mill house, unless they are curious. I love its solitude in this busy city.

Grosse Rittergasse

A street in Frankfurt

A view from the south bank of the Main

Euro!

What an ugly symbol of euro, standing in front of the Eurotower in which the European Central Bank has offices.