07.26.2012 - Joyce Chen

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Altruism, Cooperation, and Efficiency: Agricultural Production in Polygynous Households

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07.26.2012 - Joyce Chen

  1. 1. ALTRUISM, COOPERATION, ANDEFFICIENCY: AGRICULTURALPRODUCTION IN POLYGYNOUSHOUSEHOLDS Joyce Chen (Ohio State), Richard Akresh (Illinois-Urbana), Charity Moore (Ohio State)
  2. 2. Efficiency in the Household Households have many features that encourage cooperation and the efficient allocation of resources  Altruism/shared public goods  Repeated interaction  Better information And, yet, there is ample evidence of inefficiency, in both consumption and production  Udry (1996), Goldstein and Udry (2008)  Duflo and Udry (2004), Dubois and Ligon (2010)
  3. 3. Inefficiency in the Household Common culprits of inefficiency include  Imperfect monitoring  Limited commitment/enforcement  Social norms  Separate spheres Perhaps altruistic preferences themselves can inhibit cooperation and efficiency  Leadto higher utility in a non-cooperative equilibrium  Make threats of punishment less credible
  4. 4. Altruism and Exchange Bernheim and Stark (1988) first suggested, in a theory paper, that altruism can inhibit cooperation by reducing the credibility of punishments Empirical studies typically compare relationships between family and non-family members, making it difficult to distinguish altruism from information, etc. We look at relationships with differing degrees of altruism, within the same family
  5. 5. Outline Context and Data A Simple Game-Theoretic Model Main Results Robustness and Extensions
  6. 6. Context: Burkina Faso Data are drawn from the 1984-85 ICRISAT Survey Married Burkinabé women often have access to private plots under their own control But they also must provide labor on household communal plots, usually at discretion of the head Husbands typically provide staple foods and contribute to medical expenses and school fees
  7. 7. Table 1. Average Yield and Plot Area Monogamous Household Wife of Other Other Head Head Male FemaleYield (1000 FCFA) 126.29 49.15 142.93 124.82 (651.6) (267.0) (498.2) (434.7)Area (Hectare) 0.748 0.075 0.318 0.069 (1.24) (0.13) (0.54) (0.12)Observations 743 425 172 319 Polygynous Household Wife of Other Other Head Head Male FemaleYield (1000 FCFA) 85.47 59.50 145.51 71.57 (341.3) (208.4) (358.6) (250.6)Area (Hectare) 0.756 0.099 0.385 0.074 (1.14) (0.14) (0.48) (0.10)Observations 1156 1305 407 699
  8. 8. Context: Burkina Faso Polygyny is quite common in our data (51%)  Mostof these households (56%) have just two wives  One-third have three wives, 11% have more Although interaction between co-wives is often characterized by conflict, there is also a fair amount of cooperation for pragmatic goals  Labor-sharing  Exchange of goods and/or services
  9. 9. Altruism and Cooperation Consider a household with three individuals – one husband and two wives Each player engages in agricultural production on his/her own plot, using the same technology But different plot characteristics mean the optimal labor allocation differs across plots as well
  10. 10. Altruism and Cooperation Husbands and wives care about each other’s consumption of certain goods  “Separate spheres”– otherwise, production and consumption decisions are separable  Consistent with anthropology of Burkinabé households Co-wives have no altruistic linkage Each individual can choose to coordinate production (i.e., share labor) with other household members
  11. 11. The Basic Game With altruism, there will be some exchange between spouses, even without explicit cooperation, but not between co-wives The gains to cooperation can be higher for co- wives, even if aggregate production is not Lack of altruism allows co-wives greater scope for punishment, while altruism makes the husband’s punishment susceptible to renegotiation
  12. 12. Altruism and Efficiency Results are sensitive to separate spheres assumption  Consistent with Burkinabé households  Not an uncommon formulation of altruism to have preferences over a good that one does not directly control (e.g., children’s education, utility of spouse) Cooperation implies efficient allocation of inputs across plots controlled by cooperating parties  Controllingfor land quality, crop choice and time- varying shocks, plot yields should be equalized
  13. 13. Empirical Application Estimate yields as a function of plot characteristics (size, toposequence, soil type, location) and cultivator characteristics 𝑄𝑄ℎ𝑡𝑡 𝑡𝑡 𝑡𝑡 = 𝑿𝑿ℎ𝑡𝑡 𝑡𝑡 𝑡𝑡 𝛽𝛽 + 𝛾𝛾 𝐺𝐺 𝐺𝐺ℎ𝑡𝑡 𝑡𝑡 𝑡𝑡 + 𝛾𝛾 𝑂𝑂𝑂𝑂 𝑂𝑂𝑂𝑂ℎ𝑡𝑡 𝑡𝑡 𝑡𝑡 + 𝛾𝛾 𝑂𝑂𝑂𝑂 𝑂𝑂𝑂𝑂ℎ𝑡𝑡 𝑡𝑡 𝑡𝑡 + 𝜆𝜆ℎ𝑡𝑡 𝑡𝑡 + 𝜀𝜀ℎ𝑡𝑡 𝑡𝑡 𝑡𝑡 where 𝛾𝛾 𝑘𝑘 = 𝛾𝛾 0 + (𝑃𝑃𝑃𝑃𝑃𝑃 𝑃𝑃ℎ𝑡𝑡 ∗ 𝛾𝛾 𝑘𝑘𝑃𝑃 ) for k = G, OM, OF 𝑘𝑘 Include household-crop-year fixed effects (λ) Allow cultivator characteristics to vary with conjugal status (monogamous/polygynous)
  14. 14. Empirical Application If cooperation is greater among co-wives, should observe smaller negative effect of gender in polygynous households If polygyny also provides husbands with more opportunities for cooperation, then we should observe a smaller gap between heads and other male cultivators as well 𝛾𝛾 𝑂𝑂𝑂𝑂 ≥ 0 𝑃𝑃
  15. 15. Alternate Explanations Household head can enforce cooperative arrangements between players other than himself – also implies smaller yield differences between other 𝛾𝛾 𝑂𝑂𝑂𝑂 < 𝛾𝛾 𝑂𝑂𝑂𝑂 cultivators than between husbands and wives Strong preferences (lower costs) for cooperation among women – also implies smaller differences 𝛾𝛾 𝑂𝑂𝑂𝑂 > 0 between females in polygynous households 𝑃𝑃
  16. 16. Table 2. Fixed Effects Estimates of the Effect of Cultivator Characteristics on Plot Yield Other Men Only Cultivators Women Only (I) (II) (III) (IV)Gender (1=female) -202.21 *** -160.72 *** (34.14) (54.01)Other Male -97.18 ** -74.78 ** (39.38) (36.06)Other Female -31.96 18.16 (31.39) (20.77)Gender*Polygynous 168.94 *** 131.04 ** (40.09) (61.80)Other Male*Poly 86.50 * 69.99 * (45.82) (42.05)Other Female*Poly 28.71 -18.87 (35.81) (23.23)Observations 5230 2478 1597 2748
  17. 17. Main Results Estimates consistent with altruism– co-wives more likely to cooperate with each other than with husband  Husbands do not do as well under polygyny, relative to other male cultivators – evidence of transaction costs No clear evidence for alternate explanations  Gap between other males and other females is not significantly smaller  No significant gap between wives and other women
  18. 18. Table 3. Alternate Tests Gender (1=female) -63.60 Gender (1=female) -45.46 (66.14) (50.68) Gender*Other Female -132.29 * Gender*No. of Kids -23.28 ** (78.33) (10.27) Gender*Poly 33.67 Gender*Poly 41.94 (75.20) (64.85) Gender*Poly*OF 126.61 Gender*Poly*Kids 22.15 * (88.86) (11.62) Observations 3629 Observations 4701 If females have stronger preferences for cooperation, addition of other female cultivator should increase efficiency among women Cooperation should be decreasing in the degree of altruism (# of shared goods) between players
  19. 19. Robustness Checks Fixed effects control for factors that are fixed across individuals planting the same crop, in the same year, within the same household But they do not control for differences in crop choice or preferences for cooperation across monogamous and polygynous households  Main results include full set of interactions with polygyny to allow for different technologies
  20. 20. Table 4. Robustness Checks, Fixed Effects Estimates Polygynous Polygynous Household- =2 Wives >2 Wives Year FEb (I) (II) (V)Gender (1=female) -155.14 *** -155.14 *** -81.52 *** (40.11) (39.01) (23.50)Other Male -56.35 -56.35 -29.70 (47.21) (45.91) (29.82)Other Female -16.02 -16.02 0.97 (36.50) (35.49) (26.27)Gender*Polygynous 136.33 ** 154.32 *** 76.40 *** (53.59) (53.01) (28.36)Other Male*Poly 72.42 45.40 29.62 (62.19) (62.09) (35.80)Other Female*Poly 14.76 13.91 -8.50 (48.07) (44.86) (30.85)Observations 3112 3142 5230
  21. 21. Unobserved Land Quality Fallow decisions can provide some indication of land quality Omitting observed land quality measures can reveal the direction of bias, if correlation between observed and unobserved characteristics is known Data for 1981-83 only included co-wives’ plots for cotton, cereal and root crops
  22. 22. Table 5. Checks for Unobserved Land Quality Years Since No Plot 1981-83 Fallow Chars. Only (I) (II) (III)Gender (1=female) -6.73 *** -125.67 *** -35.13 *** (2.20) (31.15) (12.48)Other Male -9.48 ** -8.52 -30.30 ** (3.99) (36.98) (12.58)Other Female 2.73 -3.58 2.74 (2.14) (31.80) (15.60)Gender*Polygynous 1.31 128.65 *** 1.66 (2.32) (35.90) (14.88)Other Male*Poly 2.34 21.09 17.15 (4.03) (43.12) (15.25)Other Female*Poly -3.21 6.01 -23.77 (2.33) (36.33) (18.53)Observations 4356 5230 4198
  23. 23. Unobserved Heterogeneity While greater efficiency among wives seems clear, proximate cause is not yet clear  No evidence of greater cooperation among husbands and wives, contract enforcement by head or greater propensity for cooperation among women But polygyny may require the head to contribute more time to administrative tasks Or, polygynous men may have a different level of underlying productivity
  24. 24. Table 6. Fixed Effects Estimates of the Effect ofCultivator Characteristcs on Plot Yield, by Household Structure Vertical a Horizontal b (I) (II) Gender (1=female) -8.43 -516.33 *** (21.02) (111.29) Other Male -18.55 -237.79 ** (25.80) (109.52) Other Female -22.94 -5.00 (20.73) (74.17) Gender*Polygynous -9.68 518.79 *** (26.50) (117.88) Other Male*Poly 8.06 251.77 ** (34.52) (116.05) Other Female*Poly 20.62 2.30 (27.05) (78.45) Observations 2878 1823
  25. 25. Table 7. Household Fixed Effects SpecificationGender (1=female) -99.54 *** (26.25)Other Male -32.28 Implied Fixed Effect (31.46) Switch to Poly -30.98Other Female 7.914 (49.66) (27.03) Always Polygynous -67.78 ***Polygynous -82.87 (20.49) (83.71) Total Hh Plot Area 7.790 ***Gender*Poly 65.37 ** (2.752) (30.21) Capital Intensity 30.21Other Male*Poly 12.21 (37.21) (37.27) Observations 120Other Female*Poly -15.13 (31.65)Observations 5230
  26. 26. Unobserved Heterogeneity Cooperation is likely more difficult in horizontal households, given varying family allegiances  Polygyny, by providing more opportunities for mutual benefit, has a greater positive effect on efficiency  Not consistent with greater demands on time for polygynous household heads Differences between polygynous household heads and other male cultivators seem to arise over time, rather than being intrinsic
  27. 27. Dynamic Inefficiency Greater cooperation may make investments in large capital goods more cost-effective Wealthier households are more likely to make such investments, but wives have found to be a substitute for investment in durable assets  Look at expenditure on large capital goods as a percentage of total expenditure on farm inputs  Treat polygyny and household wealth (total area under cultivation) as endogenous
  28. 28. Dynamic Inefficiency Instruments include:  Ethnic group of the household – polygyny based in ethno-cultural traditions, while farming practices are similar across ethnic groups  Area of land inherited – land for permanent cultivation, reflects relative position in lineage, unobserved skill Also include village-year fixed effects to account for aggregate shocks and differences in agro- climatic zones
  29. 29. Table 8. Percentage of Input Purchases in Large Capital Goods, IV Estimates First Stage Polygyny Total AreaPolygynous 0.592 *** Dagari-Djula 0.708 *** 0.841 (0.209) (0.190) (1.172)Total Hh Plot Area 0.008 Bwa 0.201 4.140 *** (0.017) (0.147) (0.909)Observations 231 Other Ethnic Group 0.096 0.648 (0.195) (1.208)Sargan Test 0.27 Inherited Area 0.004 0.260 ***(p-value) (0.87) (0.008) (0.050)
  30. 30. Dynamic Inefficiency Polygynous households invest more, proportionally, in large capital equipment  Without cooperation, lumpy investments should lead to greater divergence in yields They seem to have more labor and more capital  Perhaps monogamous households use more chemicals and/or improved seed varieties  Need to estimate production function to fully understand the implications for income and growth
  31. 31. Conclusions In polygynous households, co-wives cooperate more with each other, at the expense of husbands  Difference between heads’ and wives’ yields is smaller, as is the difference between heads and other males Some evidence of head acting as an enforcement mechanism, but only in certain contexts Some evidence of greater cooperation among all women, but relationship matters
  32. 32. Conclusions Results do not seem to be explained by  Differing preferences for cooperation  Endogenous crop choice  Unobserved plot quality  Differing demands on the household head  Self-selection into polygyny Although polygynous households are a very specific case, there are many cases of 3+ player games in which there are differing degrees of altruism

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