Understanding Development in Africa: An Interview with Dr. Nathan Fiala

Earlier this month, Dr. Nathan Fiala came to CERGE-EI to lecture about his research in Africa. The lecture was titled “Employment Generation in Rural Africa: Mid-term Results from an Experimental Evaluation of the Youth Opportunities Program in Northern Uganda.” Dr. Fiala sat down with CERGE-EI for a brief interview where he discussed his current research, the morals of sustainable development, and the expedience of experimental methods. Have a look!:

 

What research are you currently working on?

Right now I am doing randomized control trials. This is a big, new, exciting field.  In the last ten years it has become a special interest to a lot of developmental economists. I am conducting experiments in Africa, mostly in Uganda, but also India, and hopefully a few coming up in Kenya.

One that I’m working on right now is a ‘Cash Grant’ program, geared toward young men and women who are unemployed or underemployed in Uganda. The government has transferred money to them in order to help them set up businesses and gain some kind of employment and income generation.

There is a lot of unemployment and underemployment in Uganda, and very little formal sector employment. So for a lot of young people there, setting up their own business is basically the only option that they have. But there is doubt whether these types of ‘Cash Grant’ programs have any real impact, whether they provide any kind of meaningful help for individuals.

In order to explore this, we randomized who received the cash grant and who did not receive the cash grant. We did that because we wanted to try to compare those that received the cash grant with some kind of comparison group. It has to be a very well thought out comparison group, and randomization gives you the opportunity to basically ensure that with a large enough sample size. The people who receive the program versus those who do not receive it still have the same characteristics.  They’re about the same age on average, the same ratio of gender, the same education levels, etc. But most importantly they have the same level of excitement and interest in starting their own businesses.

Is there anything unique about doing research in Uganda?

Well one of the unique things about this is that it’s a program being conducted in a post-conflict area. It’s in Northern Uganda, which just finished a 20-year civil war. The government is interested in how to decrease the likelihood of civil unrest, violence, and proclivity to anti-social behavior. They hope these cash grant programs will cause citizens to become more productive citizens and less likely to engage in negative social behavior.

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‘Going Global’ with Professor Vega-Redondo

On October 18th, Professor Fernando Vega-Redondo visited CERGE-EI to present his paper ‘Social Networks and the Process of Globalization.’ Professor Vega-Redondo specializes in Game Theory, Evolutionary Theory, and Social Networks. A graduate from University of Minnesota, he is currently on faculty at the European University Institute in Florence.

In the beautiful interior of CERGE-EI, Dr. Vega-Redondo gave an interesting and thought-provoking lecture on his most recent research on globalization (which he did in collaboration with Georg Duernecker). In the paper, the authors propose a dynamic model to understand the role of social networks in the process of globalization. They define globalization as the process when distant agents interact, and they use this ‘spatial’ theoretical framework to understand the relationship between globalization and economic growth. Their model allows for the existence of social networks – the only channel through which geographically-distant agents can cooperate in economic activity. Without the phenomenon of ‘global social networks,’ economic activity will stagnate.

To shed light on the main objective of the paper, the lecturer started by answering two important questions related to the paper – ‘What is globalization?’, and ‘Why is globalization important?’  He then continued on to the main focus of the paper – the dynamic model itself.  The model incorporates the idea that ‘connections breed connections’ by providing linking opportunities and building trust between agents.

Presentation of the model was divided in two parts: the first part covered the setup of the model with social networks included; the second part described the evolution of the social network itself. He explained how ‘going global’ can in fact be an abrupt occurrence in a social network, and how the right level of a local economy’s ‘geographical cohesion’ is crucial in this process.

Dr. Vega-Redondo’s visit to CERGE-EI provided for stimulating discussion about the global changes happening in the world economy. His research provides a much-needed theoretical contribution to the predominantly empirically-based literature on globalization processes. CERGE-EI would like to sincerely thank him for his visit!

CERGE-EI Students Travel to Bergen for ‘Experimental Economics Course’ with Professor John List

Three CERGE-EI students (Jana Cahlikova, Vojtech Bartos and Tomas Miklanek) visited Bergen, Norway on October 15-19 to participate in an intensive PhD course with University of Chicago’s Prof. John List. Located on the banks of a beautiful fjord in Bergen, the Norwegian School of Economics (NHH) provided the backdrop for the course, titled “Lab and Field Experiments in Economics”. The course covered topics ranging from field experiments in education, firms, economics of discrimination and economics of crime. John List also devoted substantial amount of time to covering the most recent methodological issues in experimental economics. He also shared his thoughts about the possible future development of the field.

The lively discussions and networking opportunities provided avenues for potential new research collaboration in the still emerging and dynamic field of experimental economics. Vojtech Bartos and coauthors Jana Cahlikova and Lubomir Cingl also had the opportunity to present their research findings in front of the whole class. They received valuable comments not only from John List, Bertil Tungodden (NHH), and Alexander Cappelen (NHH) – organizers of the event – but also from students interested in experimental economics from top European universities.

CERGE-EI Blog Is Back!

ATTENTION: The CERGE-EI blog has been roused from its slumber! After a temporary hiatus, the blog is gearing back into action with lots of new content. Stay tuned in the coming weeks and months for interesting updates and stories. We are particularly excited about a new series of content highlighting the visits of prestigious guests and lecturers at CERGE-EI. Keep checking back in!