Essays in development economics

Abstract

(cont.) social activities. These results are unlikely to be driven by omitted environmental variables: social violence increases fastest where participation in Koran study also increases the fastest, and this is not true for state or industrial violence. Religious intensity is more strongly linked with social violence in regions that are more economically distressed. Credit availability mitigates this effect. These results support the ex-post social insurance model of religious intensity. High marginal utilities during economic distress increase incentives to enact sanctions. With volatility, religions with harsher punishment or violence are more stable and successful. As volatility declines, benign groups and religions become relatively successful. Chapter 3 During the early 20th century, France initiated an unusual tax policy to promote marriage and fertility, regressive in that fertility incentives were so large and greatest among the rich. Eugenic interest in family allowances was substantial during this time due to fear of depopulation and changing ratios of uneducated to educated. Family incomes were divided by family size to determine a final tax bracket. A number of countries have begun promoting similar tax incentives. Economic theory is ambiguous as to what such incentives do. This paper uses variation in tax policy with differential impact for different population groups to disentangle economic incentives from propaganda that often accompany such country-wide initiatives. Evidence using synthetic cohorts constructed from aggregate tax return data suggests ...

Chapter 1 exploits relative price shocks induced by the Indonesian financial crisis to demonstrate a causal relationship between economic distress and religious intensity and investigate why it exists. Rapid inflation favored growers of staple crops and disfavored sticky wage-earners. I use pre-crisis wetland hectares and government occupation as instruments and dryland hectares and service occupation as "placebo instruments" to estimate the impact of economic distress on religious intensity. Economic distress stimulates Koran study and Islamic school attendance but does not stimulate other social activities or secular school attendance. The results seem attributable to the role of religion as ex-post social insurance: credit availability reduces the effect of economic distress on religious intensity by roughly 80%, religious intensity alleviates needing alms or credit to meet basic needs at the peak of the crisis, and religious institutions facilitate consumption smoothing among villagers. I explain these findings in a model where religious intensity represents the degree of social insurance. in which people participate and social sanctions facilitate religion's function as ex-post insurance. Together, these results provide evidence that religious intensity responds to economic forces and suggest alleviating risk may mitigate fundamentalist tendencies. Chapter 2 exploits differences in religious intensity across Indonesia before and during the Indonesian financial crisis to identify the effect of religious intensity on social violence. In high religious intensity areas, violence is more likely to arise. Stronger measures of religious intensity are more strongly associated with social violence. Social violence is negatively associated with other