Does Africa Need a Rotten Kin Theorem? Experimental Evidence from Village Economies
This paper measures the economic impact of social pressure to share income with kin and neighbors in rural Kenyan villages. The authors conduct a lab experiment in which they randomly vary the observability of investment returns. The goal is to test whether subjects reduce their income in order to k...
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Format: | Policy Research Working Paper |
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World Bank, Washington, DC
2012
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Online Access: | http://documents.worldbank.org/curated/en/2012/06/16358327/africa-need-rotten-kin-theorem-experimental-evidence-village-economies http://hdl.handle.net/10986/9337 |
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okr-10986-93372021-04-23T14:02:45Z Does Africa Need a Rotten Kin Theorem? Experimental Evidence from Village Economies Jakiela, Pamela Ozier, Owen ACCOUNTING AFFILIATED ORGANIZATIONS ASSET HOLDINGS BANK OPERATIONS BARGAINING BORROWING CREDIT ASSOCIATIONS CREDIT COOPERATIVES DECISION MAKING DECLINE IN INVESTMENT DEMOGRAPHIC DEVELOPING ECONOMIES DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DRIVERS DURABLE DURABLE ASSET DURABLE ASSETS ECONOMIC DEVELOPMENT ECONOMIC GROWTH EMPLOYMENT EXCHANGE RATE EXPECTED UTILITY EXPERIMENTAL ECONOMICS HOUSEHOLD BARGAINING HOUSEHOLD WEALTH HUMAN DEVELOPMENT INCENTIVE EFFECTS INCOME INCOMES INSURANCE INSURANCE MARKETS INTERNATIONAL BANK INVESTING INVESTMENT AMOUNT INVESTMENT CHOICE INVESTMENT CHOICES INVESTMENT DECISION INVESTMENT DECISIONS INVESTMENT INCENTIVES INVESTMENT INCOME INVESTMENT OPPORTUNITIES INVESTMENT OPTION INVESTMENT OPTIONS INVESTMENT RETURN INVESTMENT RETURNS INVESTMENT STRATEGY LEVEL OF RISK LEVY LIQUIDITY LOAN LOTTERIES MARGINAL UTILITY MAXIMUM LIKELIHOOD ESTIMATION MICRO ENTERPRISE MICROENTERPRISES MUTUAL INSURANCE OCCUPATIONS OPTIMAL ALLOCATION OPTIMAL INVESTMENT OPTIMIZATION PARTICIPATION CONSTRAINTS PAYOUT PERMANENT INCOME PRODUCTIVE INVESTMENTS PROFITABILITY RESOURCE ALLOCATION RISK AVERSE RISK AVERSE INDIVIDUALS RISK AVERSION RISK POOLING RISK PREFERENCE RISK PREFERENCES RISKY INVESTMENT RISKY INVESTMENTS RISKY SECURITY SANCTION SANCTIONS SAVINGS SAVINGS ACCOUNT SAVINGS ACCOUNTS SELFHELP SOCIAL CAPITAL SOCIAL NETWORKS TAX TAX RATE TAX RATES TAXATION UNSKILLED LABOR UTILITY FUNCTION UTILITY FUNCTIONS UTILITY MAXIMIZATION UTILITY THEORY WAGES WEALTH This paper measures the economic impact of social pressure to share income with kin and neighbors in rural Kenyan villages. The authors conduct a lab experiment in which they randomly vary the observability of investment returns. The goal is to test whether subjects reduce their income in order to keep it hidden. The analysis finds that women adopt an investment strategy that conceals the size of their initial endowment in the experiment, although that strategy reduces their expected earnings. This effect is largest among women with relatives attending the experiment. Parameter estimates suggest that women behave as though they expect to be pressured to share four percent of their observable income with others, and substantially more when close kin can observe income directly. Although this paper provides experimental evidence from a single African country, observational studies suggest that similar pressure from kin may be prevalent in many rural areas throughout Sub-Saharan Africa. 2012-06-29T20:50:35Z 2012-06-29T20:50:35Z 2012-06 http://documents.worldbank.org/curated/en/2012/06/16358327/africa-need-rotten-kin-theorem-experimental-evidence-village-economies http://hdl.handle.net/10986/9337 English Policy Research Working Paper; No. 6085 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank World Bank, Washington, DC Publications & Research :: Policy Research Working Paper Publications & Research |
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Digital Repository |
institution_category |
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institution |
Digital Repositories |
building |
World Bank Open Knowledge Repository |
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World Bank |
language |
English |
topic |
ACCOUNTING AFFILIATED ORGANIZATIONS ASSET HOLDINGS BANK OPERATIONS BARGAINING BORROWING CREDIT ASSOCIATIONS CREDIT COOPERATIVES DECISION MAKING DECLINE IN INVESTMENT DEMOGRAPHIC DEVELOPING ECONOMIES DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DRIVERS DURABLE DURABLE ASSET DURABLE ASSETS ECONOMIC DEVELOPMENT ECONOMIC GROWTH EMPLOYMENT EXCHANGE RATE EXPECTED UTILITY EXPERIMENTAL ECONOMICS HOUSEHOLD BARGAINING HOUSEHOLD WEALTH HUMAN DEVELOPMENT INCENTIVE EFFECTS INCOME INCOMES INSURANCE INSURANCE MARKETS INTERNATIONAL BANK INVESTING INVESTMENT AMOUNT INVESTMENT CHOICE INVESTMENT CHOICES INVESTMENT DECISION INVESTMENT DECISIONS INVESTMENT INCENTIVES INVESTMENT INCOME INVESTMENT OPPORTUNITIES INVESTMENT OPTION INVESTMENT OPTIONS INVESTMENT RETURN INVESTMENT RETURNS INVESTMENT STRATEGY LEVEL OF RISK LEVY LIQUIDITY LOAN LOTTERIES MARGINAL UTILITY MAXIMUM LIKELIHOOD ESTIMATION MICRO ENTERPRISE MICROENTERPRISES MUTUAL INSURANCE OCCUPATIONS OPTIMAL ALLOCATION OPTIMAL INVESTMENT OPTIMIZATION PARTICIPATION CONSTRAINTS PAYOUT PERMANENT INCOME PRODUCTIVE INVESTMENTS PROFITABILITY RESOURCE ALLOCATION RISK AVERSE RISK AVERSE INDIVIDUALS RISK AVERSION RISK POOLING RISK PREFERENCE RISK PREFERENCES RISKY INVESTMENT RISKY INVESTMENTS RISKY SECURITY SANCTION SANCTIONS SAVINGS SAVINGS ACCOUNT SAVINGS ACCOUNTS SELFHELP SOCIAL CAPITAL SOCIAL NETWORKS TAX TAX RATE TAX RATES TAXATION UNSKILLED LABOR UTILITY FUNCTION UTILITY FUNCTIONS UTILITY MAXIMIZATION UTILITY THEORY WAGES WEALTH |
spellingShingle |
ACCOUNTING AFFILIATED ORGANIZATIONS ASSET HOLDINGS BANK OPERATIONS BARGAINING BORROWING CREDIT ASSOCIATIONS CREDIT COOPERATIVES DECISION MAKING DECLINE IN INVESTMENT DEMOGRAPHIC DEVELOPING ECONOMIES DEVELOPMENT ECONOMICS DEVELOPMENT POLICY DRIVERS DURABLE DURABLE ASSET DURABLE ASSETS ECONOMIC DEVELOPMENT ECONOMIC GROWTH EMPLOYMENT EXCHANGE RATE EXPECTED UTILITY EXPERIMENTAL ECONOMICS HOUSEHOLD BARGAINING HOUSEHOLD WEALTH HUMAN DEVELOPMENT INCENTIVE EFFECTS INCOME INCOMES INSURANCE INSURANCE MARKETS INTERNATIONAL BANK INVESTING INVESTMENT AMOUNT INVESTMENT CHOICE INVESTMENT CHOICES INVESTMENT DECISION INVESTMENT DECISIONS INVESTMENT INCENTIVES INVESTMENT INCOME INVESTMENT OPPORTUNITIES INVESTMENT OPTION INVESTMENT OPTIONS INVESTMENT RETURN INVESTMENT RETURNS INVESTMENT STRATEGY LEVEL OF RISK LEVY LIQUIDITY LOAN LOTTERIES MARGINAL UTILITY MAXIMUM LIKELIHOOD ESTIMATION MICRO ENTERPRISE MICROENTERPRISES MUTUAL INSURANCE OCCUPATIONS OPTIMAL ALLOCATION OPTIMAL INVESTMENT OPTIMIZATION PARTICIPATION CONSTRAINTS PAYOUT PERMANENT INCOME PRODUCTIVE INVESTMENTS PROFITABILITY RESOURCE ALLOCATION RISK AVERSE RISK AVERSE INDIVIDUALS RISK AVERSION RISK POOLING RISK PREFERENCE RISK PREFERENCES RISKY INVESTMENT RISKY INVESTMENTS RISKY SECURITY SANCTION SANCTIONS SAVINGS SAVINGS ACCOUNT SAVINGS ACCOUNTS SELFHELP SOCIAL CAPITAL SOCIAL NETWORKS TAX TAX RATE TAX RATES TAXATION UNSKILLED LABOR UTILITY FUNCTION UTILITY FUNCTIONS UTILITY MAXIMIZATION UTILITY THEORY WAGES WEALTH Jakiela, Pamela Ozier, Owen Does Africa Need a Rotten Kin Theorem? Experimental Evidence from Village Economies |
relation |
Policy Research Working Paper; No. 6085 |
description |
This paper measures the economic impact of social pressure to share income with kin and neighbors in rural Kenyan villages. The authors conduct a lab experiment in which they randomly vary the observability of investment returns. The goal is to test whether subjects reduce their income in order to keep it hidden. The analysis finds that women adopt an investment strategy that conceals the size of their initial endowment in the experiment, although that strategy reduces their expected earnings. This effect is largest among women with relatives attending the experiment. Parameter estimates suggest that women behave as though they expect to be pressured to share four percent of their observable income with others, and substantially more when close kin can observe income directly. Although this paper provides experimental evidence from a single African country, observational studies suggest that similar pressure from kin may be prevalent in many rural areas throughout Sub-Saharan Africa. |
format |
Publications & Research :: Policy Research Working Paper |
author |
Jakiela, Pamela Ozier, Owen |
author_facet |
Jakiela, Pamela Ozier, Owen |
author_sort |
Jakiela, Pamela |
title |
Does Africa Need a Rotten Kin Theorem? Experimental Evidence from Village Economies |
title_short |
Does Africa Need a Rotten Kin Theorem? Experimental Evidence from Village Economies |
title_full |
Does Africa Need a Rotten Kin Theorem? Experimental Evidence from Village Economies |
title_fullStr |
Does Africa Need a Rotten Kin Theorem? Experimental Evidence from Village Economies |
title_full_unstemmed |
Does Africa Need a Rotten Kin Theorem? Experimental Evidence from Village Economies |
title_sort |
does africa need a rotten kin theorem? experimental evidence from village economies |
publisher |
World Bank, Washington, DC |
publishDate |
2012 |
url |
http://documents.worldbank.org/curated/en/2012/06/16358327/africa-need-rotten-kin-theorem-experimental-evidence-village-economies http://hdl.handle.net/10986/9337 |
_version_ |
1764409185974353920 |