Essays in applied development economics

Abstract

This thesis is a collection of three independent papers using applied microeconomics and focusing on various development topics in India. The first paper studies the impact of women empowerment policy in politics on women in the household in India. Reserving political offices for women challenges social and cultural norms in India’s patriarchal society. The study estimates the indirect effect of the political inclusion of women in local councils on marriages across Indian states by using a staggered difference-in-differences design. I find that the policy induces women to marry husbands with higher education and that they enter into marriages with a lower age gap. I also document an improvement in various measures of female autonomy, most likely explained by selection of a mate. Despite the rise in women’s autonomy, however, my results highlight a no effect on intimate partner violence. A plausible mechanism at play is the change in bargaining power within the parents’ belief in spouse selection for their daughter. The second paper looks at the causal effect of gender difference in ownership and in leadership on firm performance, simultaneously. Despite a growing literature investigating the effect of gender diversity (among CEOs) and firm performance, the answer is still unclear. In this study, I exploit a unique data from more than 9,000 Indian firms by using propensity score matching techniques. Findings reveal a positive significant association between female CEO and firm performance but no definite association between the female owners and firm performance. The effect is more prominent in progressive and high-sex ratio states in India. Third, the evidence suggest potential payoffs to firms that adopt gender–inclusive policies intended to increase the share of female CEOs in India. Results confirm no bias from unobservable covariates. The last paper investigates the impact of district–level alcohol bans on crime in India. The analysis exploits the variation in alcohol prohibition imposed across districts from 1972 to 2016. The quasi–experimental structure of the policy facilitates a difference–in– differences design to estimate the causal impact of the policy on crime outcomes. I use the largest-to-date unique annually archived administrative data on district crime statistics. Results uncover that bans on liquor in districts lead to a significant reduction in criminal activities, particularly for violent crimes, crimes against women, and property crimes in India. The mechanism in play indicates that crimes are primarily perpetrated by individuals who suffer from alcoholism and the effect is substantially driven by high poverty states in India.