NEUDC 2021 roundup - Indonesia papers

Gedeon presented our paper on Bagirata on Saturday at the NEUDC. This year's conference was also virtual so even though BU was the host it didn't feel like there's much difference from last year. From Dave Evan and Almedina Music's excellent roundups I learned there were a couple of other Indonesia papers that I missed (there are six papers in total, two fewer from last year). 

On a COVID-19 mutual aid platform in Indonesia, donors are more likely to give a donation when given a smaller choice set of potential beneficiaries, and they prefer to donate to self-reported breadwinners and females. (Hilmy, Lim, and Riyanto)

In Mexico and Indonesia, as average heat and precipitation rise, people's aversion to risk falls. But as variation in heat and precipitation rise, aversion to risk rises. (Higher risk aversion correlates with fewer risky behaviors like smoking or migrating.) (Howden and Levin) #FE 

Unconditional cash transfers in Indonesia led recipients to be “2 to 3 percent less likely to be employed and, among those employed, 3 to 6 percent less likely to be in formal work following receipt of the transfer.” (Pritadrajati) #DID 

Despite large post-disaster reconstruction programs after the 2004 tsunami in Aceh, Indonesia, the economic status of those living in heavily damaged areas did not keep up. This is partly driven by much higher inflation rates in those areas. (Lawton et al.) #FE 

In Indonesia, performance appraisals of teachers reduce generosity (as proxied by willingness to make a donation to their own school) at the workplace and increase dishonest behavior, especially when appraisals are linked to financial sanctions. (Ibanez Priebe Riener Susanti) #FE 

What information do community members have and use for social benefits targeting? In Purworejo, Central Java, community members use longer-term wealth information to predict dynamic welfare and to target social benefits. This may be useful in identifying long-term poverty but less so to identify short-term distress. (Trachtman, Permana, and Sahadewo) #LIF 

Bonus: microsummaries for papers from BU folks:

In Malawi, women who received targeted counseling were 15.6 percent less likely to use their stated ideal contraceptive method. With husbands present at the counselling session, women were 13.5 percent less likely to change their stated ideal method. (Karra and Zhang) #RCT 

Buildings constructed when the county officials had connections to their superiors at the prefecture level (in terms of having the same hometown) were 83 percent more likely to collapse during the 2008 Sichuan earthquake relative to the no-connection benchmark. (Cao) #DID 

Essays in Trespassing

Only a few [economists] were so troubled to probe whether it was the quest for economic development that had wrought political disasters. My own reaction was to withdraw into the history of ideas. The most surprising idea I came across was the speculation that the expansion of the market economy would serve to restrain the “passions” of the sovereign and would therefore result in less arbitrary and more humane government. Economic growth would bring constraints that would put an end to despotism.

For Montesquieu, a more complex economy is a delicate mechanism that must not be tampered with. In [his] mind, this tampering could emanate only from the government of its head, the capricious sovereign. But the argument cuts several ways. If it is true that the economy must be deferred to, then there is a case not only for constraining the imprudent actions of the prince but for repressing those of the people, for limiting participation, in short, for crushing anything that could be interpreted by some economist-king as a threat to the proper functioning of the ‘delicate watch’. 

The principal “economic” explanations of authoritarian rule in Latin America today run along those same lines.

-- Hirschman in Essays in Trespassing (1981), p99-103.

Who'd have thought that what Hirschman wrote forty years ago (!) would resonate with the goings-on of one country half the world away from the countries that he initially wrote about?

NEUDC 2020 roundup - Indonesia papers

This year's NEUDC was fully online--so not only I was able to watch Ben presented our paper succinctly in 15 minutes, it was super convenient to catch up on some of the other interesting panels, too. All from the comfort of my (really cold) apartment. David Evans and Almedina Music wrote a helpful summary of the papers from the conference, and the summary for all Indonesia-related papers are below:

When one child is born smaller than another, do parents compensate for those differences with health and nutrition investments, or do they reinforce them? Evidence from Indonesia suggests that in early childhood, parents reinforce differences. Data from 50 countries suggest parents are more likely to “reinforce initial inequalities in poorer countries.” (Banerjee and Majid) #FE

If you took the Indonesian secondary school entrance exam on a particularly hot day, it not only affects your math and science score, it also has “compounding negative effects on a wide range of long-term achievements such as adult educational attainment, labor market returns and entry to the marriage market.” (Das) #IV

Palm-oil price shocks in Indonesia benefit producing districts with higher per capita expenditure, while price shocks on rice do not. Districts exposed to palm-oil price shocks and those surrounding them receive more migration resulting in an overall welfare increase of 0.39 percent, with one third due to internal migration. (Siregar)

Indonesian firm-level data shows that democratization increases firm productivity, a critical determinant of economic growth. (Abeberese et al.) #DID

Massive public-school construction in Indonesia in the 70s decreased attendance in primary Islamic schools in favor of public schools but increased enrolment in religious schools at secondary level—absorbing the higher demand that resulted from mass public primary schooling. (Bazzi, Hilmy, and Marx)

Natural disasters in Indonesia increase risk aversion among exposed individuals, with variation by severity, type and time frame of the disasters. (Purcell)

Grassroots monitoring leads to a decrease in the share of missing expenditures of 8–10 percentage points in non-audit villages in Indonesia. However, “in government audit villages, individuals are less likely to attend, talk, and actively participate in accountability meetings.” (Gonzales, Harvey and Tzachrista)

OLS estimates of relative income mobility based on household data in Indonesia show higher mobility than the preferred IV estimates. Absolute mobility in income and consumption expenditure also suggests lower upward mobility. (Zafar) #IV

One of the papers tagged as a paper from Indonesia is actually about India's MNREGA, so I do not include it here.

Bonus: summary of three papers from other BU Econ PhD students, below.

Switching from appointed to randomly assigned municipal auditors in Italy increased municipality’s surplus by 9 percent and debt repayments by 8 percent, with improvements coming from those that ran deficits before the reform and where the mayor did not face re-election pressure. (Vannutelli) #DID

“Refugees who have access to a larger co-refugee network tend to have more interactions with the local population” among Syrian refugees in Turkey. This is likely because “immigrant networks share experiences and information on the local population, therefore making it easier for refugees to interact with locals.” (Gautier) #IV

What happens when your local school closes in China due to a school consolidation program? Delayed enrollment, but no change in lifetime education attainment. Later in life, it may have led to later marriage and more off-farm work. (Zhao) #DID

Islam dan Akar Kesenjangan

Di bulan Ramadan kali ini saya ingin mengulas tulisan ihwal persilangan Islam dan teori ekonomi. Bukan apa-apa, mumpung peringatan Nuzulul Quran dan saya baru saja membaca tulisan yang pas: Islam, Inequality, and Pre-Industrial Comparative Development yang terbit di Journal of Development Economics tahun 2016. Ini adalah tulisan Stelios Michalopoulos di Universitas Brown, Alireza Naghavi di Universitas Bologna, dan Giovanni Pralolo yang juga di Universitas Bologna.

Studi ini adalah sebuah kajian teori yang membahas akar-akar ekonomi yang menghasilkan struktur doktrin Islam. Dengan kata lain, mereka mengajukan teori ini untuk merasionalisasikan prinsip ekonomi dalam doktrin Islam. Namun perlu dicatat bahwa mereka tidak berteori tentang teologi Islam di makalah ini. (Saya pun juga tidak mau berteori tentang hal itu.)

Kajian mereka bersandar pada tiga komponen: perdagangan, kesenjangan, dan teori permainan (game theory).

Perdagangan: Islam muncul dengan goyahnya jalur-jalur perdagangan lama di abad ke-7. Perang berkepanjangan antara Kekaisaran Romawi dan Kekaisaran Sasani di Persia mengganggu perdagangan di Jalur Sutera. Pun runtuhnya Kerajaan Ghassaniyah di Syam dan Kerajaan Lakhmid di Irak membuat rute yang biasa dilalui para saudagar tidak lagi aman dari serangan. Di selatan Jazirah Arab, Kerajaan Himyar di Yaman takluk pada Kerajaan Aksum. Sementara itu, menyusutnya kekuatan maritim Kekaisaran Romawi Timur membuat jalur perdagangan Laut Merah rawan perompakan.

Ini mendorong terbukanya rute perdagangan baru di tengah jazirah, karena kaum saudagar mulai  melintasi Gurun Arab.

Kesenjangan: Gurun Arab adalah daerah penuh kesenjangan. Mayoritas tanah gurun tidak bisa dipakai bercocok tanam dan hanya kantung-kantung oasis terpencil yang mampu menyokong pertanian dan perdagangan. Para penulis mengkarakterisasikan masyarakat ini menjadi dua kelompok: kaum saudagar dari daerah subur yang kaya dan kaum badui dari daerah gersang yang miskin. Kaum saudagar berdagang, sementara kaum badui mencoleng.

Teori: Berdagang ada biayanya bagi kaum saudagar, pun mencoleng ada pula biayanya bagi kaum badui. Pencolengan belum tentu sukses, tapi jika dengan perhitungan probabilitas sukses itu ekspektasi imbalannya lebih besar maka kaum badui akan mencoleng. Begitu pula untuk kaum saudagar, jika dengan suatu probabilitas mereka bisa sukses mempertahankan dagangan mereka dari kaum badui untuk mendapat imbal yang besar, mereka akan berdagang.

Kaum saudagar ini bisa juga bersedekah atau berzakat kepada kaum badui agar mereka tidak mencoleng. Dengan kata lain, kaum saudagar punya dua opsi: berzakat atau tidak berzakat sementara kaum badui juga punya dua opsi: mencoleng atau tidak mencoleng. Pasangan {zakat, tidak mencoleng} adalah pilihan yang paling memakmurkan kedua belah pihak, namun piilhan ini rentan diingkari karena zakat adalah konsep redistribusi satuwaktu (statis). Kaum badui akan mendapat imbalan yang lebih besar dari {zakat, mencoleng} maka mereka akan ingkar. Pun kaum saudagar akan jadi berstrategi untuk tidak berzakat. Ekulibrium Nash permainan ini maka akan berakhir di pasangan {tidak berzakat, mencoleng}.

Beranjak dari sistem statis yang buyar, Islam bisa dilihat sebagai suatu kesepakatan untuk mengubah sistem redistribusi satuwaktu menjadi redistribusi antargenerasi (dinamis). Menurut para penulis, inti dari redistribusi dinamis ini bisa mengambil bentuk friksi apa pun yang mencegah pemusatan aset. Dalam teori mereka, ini berbentuk zakat plus wakaf dan hukum anti-riba.

Skema teori permainan ini kini berubah dari permainan statis ke dinamis. Dari skema pohon permainan ini pasangan aksi {adopsi islam, tidak mencoleng} bisa langgeng dengan satu syarat: distribusi tanah gurun di sekeliling tanah oasis yang subur ada di atas suatu ambang kritis (lamda c-tilda-s). Dengan kata lain, dominasi tanah gurun yang menghambat kaum badui untuk memetik manfaat langsung dari terbukanya jalur perdagangan baru inilah yang lalu berujung pada sistem kelembagaan ekonomi Islam yang diadopsi bangsa Arab.

Para penulis menutup studi dengan menyitir kajian mereka yang lain yang terbit di Economic Journal tahun 2018 yang melihat jarak ke jalur perdagangan dan kesenjangan geografis bisa memprediksi adopsi Islam di kawasan Afro-Eurasia. Saya sarankan untuk membacanya jika tertarik.

Rujukan
Michalopoulos, S., Naghavi, A., & Prarolo, G. (2016). Islam, inequality and pre-industrial comparative development. Journal of Development Economics, 120, 86-98.
Michalopoulos, S., Naghavi, A., & Prarolo, G. (2018). Trade and Geography in the Spread of Islam. The Economic Journal, 128(616), 3210-3241.

Adoption

When Ben Olken gave a lecture for the Indonesia Project this summer, Rivan asked if research evidence ever gets translated to action[1]. He pointed at the findings from the Targeting RCT outlined in the lecture, and he said that the Indonesian government seemed to have not been doing anything in response to the study.

I don't fully agree with his characterization of the policy response. (And from another context, there's a new working paper by Jonas Hjort et al. which provides a hopeful picture on this question: they show officials in Brazil were more likely to adopt a policy after being informed of research.)

But I got reminded of Rivan's question again when today I stumble upon this interview of Shengwu Li in Logic Magazine. Excerpts:

Li: So in 1961 Vickrey writes a paper where he proposes a new kind of auction that combines the benefits of both formats. … Here’s how it works: everybody bids, the highest bidder wins, and then the winner pays the second-highest bid. Thus the second-price auction was born. 

Logic: What happens to Vickrey’s idea? 

Li: Mostly it gets ignored. No real auctioneers adopt this way of selling things. Then, about a half-century later, in the early 2000s, Google picks it up and dusts it off as they’re figuring out how to sell ads.

Half a century! Now that's a really long time for research adoption.

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[1] --not his exact words but it was along this line. This phrasing is lifted shamelessly from an old J-PAL tagline.

Nobel, Cumi, dan Harapan

Bahwa Abhijit Banerjee, Esther Duflo, dan Michael Kremer menang Nobel Ekonomi 2019, ini kita semua tahu. Saya sendiri belum sepenuhnya menginternalisasikan apa arti penghargaan ini, tapi di hari itu menarik sekali membaca tanggapan orang-orang.

Yang paling pertama adalah kawan sekantor dulu di Salemba, yang subuh-subuh berkabar bahwa ia terharu. Ini membuat saya ikut terharu juga, karena ia mengabari kami. (Setelahnya saya kembali tidur karena masih subuh, mencontoh teladan Abhijit haha). Sepanjang hari beberapa mantan kolega yang lain menge-tweet respon bahagia mereka tentang kabar ini. Ini membuat jagad twitter sejenak menjadi sedikit lebih lega setelah ketegangan unjuk rasa minggu-minggu sebelumnya. Sentimen bahagia senada datang dari ekonom dan staf kantor IPA, dan membaca respons bahagia mereka membuat saya ikut bahagia.

Ilustrasi Citron / CC-BY-SA-3.0

Tentunya tidak semua respon senada. Sebagian sumir: ada satu artikel yang bahkan menyetarakan jaringan penelitian J-PAL seperti cumi-cumi vampir. Saya paham sih artikelnya ingin menakut-nakuti pembacanya karena cumi-cumi berkerabat dengan gurita, sesuatu yang menggurita konotasinya buruk, dan vampir yang mengisap darah konotasinya buruk juga. Tapi ketika saya tahu cumi-cumi vampir berbeda dengan gurita dan tidak mengisap darah, kiasannya ga jalan bro. Ini adalah contoh teknik menulis yang harus dihindari menurut Agustinus Wibowo.

Saya lihat juga ada respons dari Deirdre McCloskey—saya suka bukunya tentang teknik menulis yang jelas jadi saya tertarik melihat tanggapan ybs. Sayangnya tanggapannya menurut saya cetek, glib. Ia menyitir satu evaluasi acak, berargumentasi bahwa karena satu evaluasi ini tidak ada kontribusi ilmiahnya, maka semua evaluasi acak di dunia ini ngga mungkin ada kontribusi ilmiahnya. Saya membacanya langsung merasa sayang kenapa beliau nggebyah uyah.

Namun ini tidak berarti bahwa tidak ada kritik yang valid. Menurut saya observasinya Nathan Nunn dari seminar Innis penting untuk diperhatikan.

[C]onsider the Abdul Latif Jameel Poverty Action Lab (J-PAL). In terms of involving those from developing countries in academic research, the organization is as inclusive as it gets. Despite this, as of the time this article is being written, according to their website, of J-PAL’s network of 170 affiliated professors from 58 Universities, there is only one University that is not from a country that is either European or a European offshoot. This is the Indian Institute of Management. They have one affiliate from an African University, but this is the University of Cape Town, located in South Africa. 

Ini adalah persoalan besar yang masih harus diusahakan perbaikannya. (Tapi yang menarik, Nunn mengkategorikan Brazil dan Chile setara dengan Eropa?)

Terlepas dari dialektika evaluasi acak, pengumuman hadiah Nobel tahun ini membuat saya menilik ulang makalah-makalah ketiga pemenang ini (halah bahasa gue, dialektika). Tentu saja rangkuman dari David Evans (untuk Kremer, Duflo) sangat membantu untuk memilah mana yang paling menarik untuk dibaca penuh. Tulisan Oriana Bandeira ini juga mengarahkan saya ke beberapa makalah mereka yang belum pernah saya baca sebelumnya.

Dua makalah mereka yang lalu saya baca dan menarik perhatian saya adalah tentang Massive Open Online Courses/MOOC dan growth theory. Di makalah yang berjudul (Dis)Organization and Success in an Economics MOOC (Banerjee and Duflo, AER: P&P 2014), mereka mengulas kuliah online mereka MITx 14.73x: The Challenges of Global Poverty. Statistik yang menarik dari kuliah ini adalah banyak peserta yang rontok: 42,314 students registered for the course, 26,140 ever viewed any page (they are usually referred to as the “starters”), and 12,947 were ever “active,” in that they attempted any assignment or finger exercise (even if they got a zero on the that assignment). Of those, 4,597 earned a certificate. The retention rate is thus 11 percent of registrants, 18 percent of starters, and 36 percent of active participants. Saya dulu juga ambil kelas ini waktu bekerja di Salemba, dan jadi tahu bahwa "sekadar" dapat sertifikat ketika khatam kuliah ini sudah membuat saya ada di kelompok 10% teratas seluruh pendaftarnya!

Makalah kedua berjudul Growth Theory through the Lens of Development Economics (Banerjee and Duflo, Handbook of Economic Growth 2005). Makalah ini membuat saya penasaran apakah ada makalah serupa yang mengulas rekam jejak pertumbuhan ekonomi Indonesia dari lensa growth theory secara menyeluruh. Porsi kuliah ekonomi makro di sini tentunya lebih banyak membahas sejarah pertumbuhan ekonomi AS. Sayangnya, fokus ini membuat pemahaman saya yang semenjana tercerabut dari konteks Indonesia. Bisa jadi ini adalah efek samping sejarah akademik saya yang tidak pernah mengambil mata kuliah ekonomi di Indonesia.

Selain dua makalah di atas, daftar singkat makalah mereka yang lalu juga saya baca adalah sbb:

• From Proof of Concept to Scalable Policies: Challenges and Solutions, with an Application. (Banerjee, Banerji, Berry, Duflo, Kannan, Mukerji, Shotland, and Walton, JEP 2017)
• Decision Theoretic Approaches to Experiment Design and External Validity. (Banerjee, Chassang, and Snowberg, NBER WP 2016). 
• Field Experiments in Development Economics. (Duflo, Ninth World Congress in Economics and Econometrics 2009) 
• Schools, Teachers, and Education Outcomes in Developing Countries. (Glewwe and Kremer, Handbook of the Economics of Education 2006)
• Randomized Evaluations of Educational Programs in Developing Countries: Some Lessons. (Kremer, AER: P&P 2003)

Sebagian makalah mereka di atas mungkin terkesan bacaan berat (karena jenisnya makalah, tapi daftar singkat di atas sih sebetulnya ngga karena saya lagi ngga kuat baca yang berat-berat). Berita bagusnya, penghargaan Nobel tahun ini untuk Banerjee dan Duflo kebetulan (?) berdekatan dengan peluncuran buku baru mereka untuk pembaca awam: Good Economics for Hard Times.

Untuk menyokong peluncuran buku ini, mereka menulis dua kolom op-ed di koran The New York Times dan The Guardian. Di New York Times, mereka menulis bahwa Economic Incentives Don’t Always Do What We Want Them To, yang saya kutip sebagian di bawah:

If it is not financial incentives, what else might people care about? The answer is something we know in our guts: status, dignity, social connections. Chief executives and top athletes are driven by the desire to win and be the best. The poor will walk away from social benefits if they come with being treated like a criminal. And among the middle class, the fear of losing their sense of who they are and their status in the local community can be an extraordinarily paralyzing force.

Sementara itu di The Guardian, kolom mereka adalah sebuah seruan: If we’re serious about changing the world, we need a better kind of economics to do it. Sebagian kutipan:

Economists have a tendency to adopt a notion of wellbeing that is often too narrow – some version of income or material consumption. Yet we know in our guts that a fulfilling life needs much more than that: the respect of the community, the comforts of family and friends, dignity, lightness, pleasure. The focus on income alone is not just a convenient shortcut – it is a distorting lens that has often led the smartest economists down the wrong path, and policymakers to the wrong decisions. This is a big part of what persuades so many of us that the whole world is waiting at the door to steal our well-paying jobs. It is what has led to a single-minded focus on restoring the western nations to some glorious past of rapid economic growth. It is also what makes the trade-off between the growth of the economy and the survival of the planet seem so stark.

Di Indonesia, Tirto memberitakan penghargaan ini di satu artikel yang titik beratnya ada di studinya Duflo tentang SD Inpres, lalu langsung terjun ke ulasan sengketa evaluasi acak di kalangan akademisi. Saya lebih suka kolomnya Bu Vivi Alatas di Tempo, Nobel Ekonomi untuk Sebuah Gerakan.

Saya suka kolomnya Bu Vivi karena beliau menulis opini yang hanya bisa ditulis oleh beliau seorang di Indonesia: sebagai mahasiswa yang hadir langsung di seminarnya Duflo dan sebagai kolaborator Banerjee di berbagai studi. Kesan yang ditangkap Freida serupa, untuk alasan yang berbeda: ekonom wanita tidak banyak jumlahnya, dan Bu Vivi adalah satu di antaranya. Selain alasan-alasan di atas, kolom ini juga ditulis dengan apik: kalimat pamungkasnya kuat. Saya tidak bisa menandinginya:

Nobel adalah pengakuan akan kontribusi dan kerja tekun mereka dalam menanggulangi kemiskinan. Ketika jumpa wartawan setelah pengumuman Nobel itu, ketiganya berharap apa yang mereka lakukan sebagai peneliti ataupun aktivis terus berjalan.  

Kremer berharap momentum ini memberikan semangat kepada para peneliti masalah kemiskinan untuk terus berkarya. Duflo, sebagai perempuan kedua penerima Hadiah Nobel Ekonomi, ingin apa yang ia raih menjadi inspirasi bagi perempuan untuk sukses, diakui, dan terus berkarya. Adapun Banerjee berharap momentum ini bisa membuka pintu gerakan penanggulangan kemiskinan berbasis bukti melalui kebijakan lebih lebar. 

Harapan mereka adalah harapan kita juga.

NEUDC 2019 roundup - Indonesia papers

As always, David Evans (and Almedina Music)'s one-sentence summary of papers presented in the NUEDC conference is a useful read--even more so now as I start working on my own projects. Of particular interest to me are the 10 Indonesia-related papers. I plucked their summary of the eight papers included in the roundup below, and the titles of the other two papers are added at the end.

Summaries:

Clean energy access improves women’s lung capacity and increases women’s labor supply in Indonesia, as a result of higher domestic productivity allowing for more working hours. (Priya and Imelda)  

In Indonesia, a “1 percent increase in the proportion of [internal] migrants in the population leads to a 3.9 percent increase in the number of economically-motivated crimes reported by local media,” but—in an exciting twist—when you look at reports from household surveys, more migrants reduce the probability of being a crime victim. (Feld and Kleemans)  

How spatially misallocated is public infrastructure investment, and why? Misallocation in healthcare infrastructure is lower after Indonesia’s democratization in 1999, because (i) of a reduced bias toward previously Suharto-favored villages, and (ii) spillover effects are less internalized as districts become more focused on their own constituents. (Hsiao)  

Providing information about the level of inequality increased the likelihood that respondents would vote against the president in Indonesia. Providing information about a respondent‘s position in the distribution resulted in richer Indonesians becoming less supportive of redistribution. (Hoy, Toth, and Meredikawati)  

An index of the marginal utility expenditure (IMUE) may better capture changes in households’ welfare from receiving transfers: In over 25 percent of the Indonesian villages the IMUE measure rankings had a higher correlation with the community ranking than proxy means tests or total consumption rankings did. (Trachtman)  

As palm oil factories proliferated in Indonesia, areas around those factories had “more non-agricultural employment, higher incomes, and more people.” (Edwards)  

Rice import restrictions in Indonesia benefitted villages more suited for rice production in terms of aggregate income and nutrition. Local governments responded by directing more resources toward the more adversely affected villages: They were more likely to receive a health facility. (Sim) 

During Ramadan, Muslim salespeople in Indonesia are nearly one-third less productive in the two hours before sunset. After sunset, productivity shoots back up. (Hu and Wang) 

Titles only:

The Long Term Effects of Delayed School-going Age: Evidence from Indonesia (Arya Gaduh and Saurabh Singhal) 

Why Pay The Chief? Political Selection & Electoral Accountability in Indonesia (Gedeon Lim)

JKN and human capital

This morning I finished reading two papers on my commute. The first one is a paper about JKN which was recently published in the Lancet. Most of what's covered there are familiar grounds for me, but this one paragraph near the end struck me as very interesting:

Another lesson that Indonesia and other LMICs should learn from higher-income countries is that UHC correlates with increasing per-capita GDP in all countries where the system is implemented. The Netherlands achieved UHC in 1966, and thereafter showed higher GDP per capita than before UHC was implemented. France reached UHC in 1974 and Italy in 1978, and both countries showed increased GDP per capita with UHC. Lastly, South Korea quickly achieved UHC after 12 years of implementing social health insurance schemes, and also showed increased GDP per capita (appendix) once UHC was in place. Although UHC was not the sole determinant of this increase in GDP, no evidence suggests that UHC caused decreased economic growth. The lesson for developing countries is clear, do not assume that UHC will place an economic burden on the country. (Agustina, Rina, et al. "Universal health coverage in Indonesia: concept, progress, and challenges." The Lancet (2018).)

Note on abbreviation: UHS is Universal Health Coverage. I don't think I've seen this argumentation very often when JKN is discussed. (Oke skeptisisme pertama adalah korelasi tidak sama dengan hubungan sebab akibat, tapi karena gue ga hafal trajectory pertumbuhan GDP masing-masing negara yang disebut jadi gw belum punya argumen substantif juga.) But I'm not a fan of the graph they included in the appendix:

The second paper is an old paper by Mankiw, Romer, and Weir in QJE in 1992 (I just realized it's almost as old as me). First thought was: ah we covered this in first year macro. Second thought was, this is actually quite interesting and now I get a sense of how the Solow model contrasts with the endogenous growth theory. This must be why a lot of people are banging on human capital in general and population dividend for Indonesia in particular. (And saving? But I haven't really heard about saving-driven growth ...). This is part of the reading for my development class so I wonder if we're going to talk about human capital a lot.

2937 tasks

I feel like a big boy.

I just submitted an array job that consists of 2937 tasks to BU's shared computing cluster. Granted, they are embarrassingly parallel tasks, but this is still a job that consists of almost 3000 tasks so allow me to feel pretty pleased with myself.

New Keynesian economics: abridged

... beyond the point of usefulness, dalam sepuluh langkah mudah*.

1. Real Business Cycle economists say the RBC model works. Here's how it works.
2. Other economists argue that actually, the RBC model isn't so great. Here are some critiques.
3. RBC doesn't care about money, but money actually affects real economy. Here's some evidence from VAR.
4. Unless you are taking a shortcut, adding money to RBC does nothing. Here's how you get money neutrality.
5. If you add monopoly, price now has mark ups over marginal cost of production. Here's how the Dixit-Stiglitz setup works.
6. If your firm can’t always adjust your price, when you do adjust it, you’ll take into account of the future where you can’t adjust your price. Here’s how the Calvo fairy works.
7: Shocks will change things. Here’s some predictions, though they aren’t always good (here are some critiques). Nonetheless, it’s the best model that we have for now.
8. If your central bank doesn’t want to commit, they should lean against the wind to respond to cost-push shock. Lean on the interest rate aggressively to respond to inflation.
9. If you can commit, it will bring benefits. Here’s how tying yourself to the mast will save you from the sirens.
10. When you can’t lower your interest rate any further, committing to inflation (or government spending) will ease your slump. Here’s how.

(* Yang sebenarnya ngga mudah juga. Tapi paling ngga saya masih bisa berhitung jadi penyajiannya beneran dalam sepuluh langkah.)

Adenda:

- Judul dicuri dari sini.

- Masih merasa ringkasan ini terlalu panjang? Ya sudah, intinya kuartal ini saya belajar tentang: uang. Ini adalah kelanjutan dari semester lalu yang dibagi menjadi dua kuartal: pertumbuhan (growth) dan ketidakpastian (uncertainties). Kuartal sekarang adalah kuartal kapita selekta: kelas makro saya akan membahas bunga rampai teori model pengangguran, perpajakan, dan ??? (belum ada di silabus).

- Kuartal depan? @#@??#$$#@!T_T@#@OTL

Teh Talua

Nina seorang perempuan yang ingin makan di restoran Padang di simpang jalan. Makanannya enak, harganya terjangkau. Restoran itu selalu laris, dan ada banyak juga pelanggannya yang orang Jawa.

Bagaimana dengan Nina? Hanya dia yang tahu apakah dia orang Jawa atau Minang. Tapi kita bisa menebaknya dengan mengamati minuman yang Nina pesan. Kalau Nina orang Minang, Nina pasti akan memesan teh talua. Sementara itu, kalau Nina orang Jawa, Nina akan cenderung memesan teh manis. Semua orang tahu orang Jawa suka minuman yang manis.

Teh talua: penambah stamina kerja.
Foto Ramzy Muliawan

Tapi tunggu dulu, Nina bisa juga pesan teh talua meski sebenarnya dia orang Jawa. Ini bukan karena Nina suka rasanya ("Masa teh dicampur telur mentah?!" pikir Nina-Jawa). Seandainya ternyata Nina orang Jawa, Nina masih mungkin mengurungkan niatnya memesan teh manis.

Mengapa? Karena di restoran itu ada Joni.

Joni sudah memasuki usia ngebet kawin. Dua minggu sekali ibunya bertanya peruntungan asmaranya. Biasanya, ibunya Joni yang masih tinggal di Jawa sekaligus berpesan, “Goleko bojo wong Jowo wae, le.”

Inilah sebabnya Joni akan mengenalkan diri ke Nina jika dia melihat Nina memesan teh manis.

Tapi Nina malas. Ia datang hanya karena ingin rendang, yang ia inginkan adalah bisa makan dengan tenang tanpa gangguan. Nina tenteram jika ia bisa makan sendirian. Nina juga senang kalau bisa pesan minuman kesukaan. Di sisi lain, Joni suka kalau bisa berkenalan dengan Nina.

Jadi, apa strategi ekuilibriumnya Nina?

(Kalau Anda ingin mencari titik ekuilibriumnya, anggap perbandingan orang Minang dan Jawa adalah satu banding sembilan. Atur utilitas Nina dan Joni dengan angka-angka yang jamak digunakan.)

Ini adalah modifikasi permainan bir dan quiche. Bacaan lebih lanjut bisa ditemukan di sini. Diposting malam-malam sebelum esok terjerembab ke sedu-sedan lihat hasil ujian mikro tadi siang.

The Great Escape

It is possible to be unhappy or worried, or to feel stress, even at times when you think your life is generally going well. Indeed, sadness, pain, and stress might be inevitable during some of the experiences one must go through in order to build a good life. Army boot camp, graduate studies in economics, medical school, or dealing with the death of a parent are examples of unpleasant experiences that are nevertheless an essential part of life. 

The above is from Angus Deaton's The Great Escape, page 52. I agree with Nils' review of the book here.

Addendum: Shout out to my girlfriend who allowed me to steal her copy of this book. (In my defense, it's not really likely that she'll ever get around to finish it anyway.)