Journal of Development Economics
Volume 120, Pages 1-224 (May 2016)
http://www.sciencedirect.com/science/journal/03043878/120

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Regular Articles
The value of children: Inter-generational support, fertility, and human capital
Original Research Article
Pages 1-16
Jaqueline Oliveira
Abstract
This paper offers robust empirical evidence of a Darwinian pro-natalist mechanism: parents can improve their old-age support with an additional child. Using the incidence of first-born twins as an instrument for fertility outcomes, I find that Chinese senior parents with more children receive more financial transfers and are more likely to co-reside with an adult child. They are also less likely to work past retirement age. The estimated effects are large, despite the evidence that adult children from larger families are less educated and earn significantly less. Interestingly, the effect of an increase in the number of children on old-age support does not depend on the child’s gender.

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Impact of Village Savings and Loan Associations: Evidence from a cluster randomized trial
Original Research Article
Pages 70-85
Christopher Ksoll, Helene Bie Lilleør, Jonas Helth Lønborg, Ole Dahl Rasmussen
Abstract
The vast majority of the world’s poor live in rural areas of developing countries with little access to financial services. Setting up Village Savings and Loan Associations (VSLAs) has become an increasingly widespread intervention aimed at improving local financial intermediation. Using a cluster randomized trial we investigate the impact of VSLAs in Northern Malawi over a two year period. We find evidence of positive and significant intention-to-treat effects on several outcomes, including the number of meals consumed per day, household expenditure as measured by the USAID Poverty Assessment Tool, and the number of rooms in the dwelling. This effect is linked to an increase in savings and credit obtained through the VSLAs, which has increased agricultural investments and income from small businesses.

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Airtime transfers and mobile communications: Evidence in the aftermath of natural disasters
Original Research Article
Pages 157-181
Joshua E. Blumenstock, Nathan Eagle, Marcel Fafchamps
Abstract
We provide empirical evidence that Rwandans use the mobile phone network to transfer airtime to those affected by unexpected shocks. Using an extensive dataset on mobile phone activity in Rwanda and exploiting the quasi-random timing and location of natural disasters, we show that individuals make transfers and calls to people affected by disasters. The magnitude of these transfers is small in absolute terms, but statistically significant; in response to the Lake Kivu earthquake of 2008, we estimate that roughly US$84 in airtime was transferred to individuals in the affected region, that 70% of these transfers were immediately used to make outgoing calls, and that US$16,959 was spent calling those near the epicenter. Unlike other forms of interpersonal transfers, mobile airtime is sent over large geographic distances and in response to covariate shocks. Transfers are more likely to be sent to wealthy individuals, and are sent predominantly between pairs of individuals with a strong history of reciprocal favor exchange.

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Witchcraft beliefs and the erosion of social capital: Evidence from Sub-Saharan Africa and beyond
Original Research Article
Pages 182-208
Boris Gershman
Abstract
This paper examines the relationship between witchcraft beliefs, a deep-rooted cultural phenomenon, and various elements of social capital. Using novel survey data from nineteen countries in Sub-Saharan Africa we establish a robust negative association between the prevalence of witchcraft beliefs and multiple measures of trust which holds after accounting for country fixed effects and potential confounding factors at the individual, regional, and ethnic-group levels. This finding extends to other metrics of social capital, namely charitable giving and participation in religious group activities. Such coexistence of witchcraft beliefs and antisocial attitudes stands in stark contrast to a well-explored alternative cultural equilibrium characterized by religious prosociality. Evidence from societies beyond Africa shows that in preindustrial communities where witchcraft is believed to be an important cause of illness, mistrust and other antisocial traits are inculcated since childhood. Furthermore, second-generation immigrants in Europe originating from countries with widespread witchcraft beliefs are generally less trusting.