melissa dell

My Conversation with Melissa Dell

Interesting throughout, here is the transcript and video and audio, here is part of the summary:

From the impact of the Mexican Revolution to the different development paths of northern and southern Vietnam, her work exploits what are often accidents of history — whether a Peruvian village was just inside or outside a mine’s catchment area, for example — to explain persistent differences in outcomes. Her work has earned numerous plaudits, including the John Bates Clark Medal earlier this year.

On the 100th episode of Conversations with Tyler, Melissa joined Tyler to discuss what’s behind Vietnam’s economic performance, why persistence isn’t predictive, the benefits and drawbacks of state capacity, the differing economic legacies of forced labor in Indonesia and Peru, whether people like her should still be called a Rhodes scholar, if SATs are useful, the joys of long-distance running, why higher temps are bad for economic growth, how her grandmother cultivated her curiosity, her next project looking to unlock huge historical datasets, and more.

And here is one excerpt:

DELL: Yeah, I’ve done some work looking at the persistence of economic development in Vietnam. The work I did, actually, was limited to what was South Vietnam because there’s also been huge events, obviously, that have happened in the past hundred years in North Vietnam, with a war that destroyed much of the country and was fought over an extended period of time.

But when you look, in general, at places in Vietnam that have a similar recent history, but going back in time, one of them was part of a much stronger, more centralized state. The other one was part of what is today Cambodia, a much weaker state, generally ruled by local lords instead of by a strong centralized state.

You see the towns that were part of the stronger, centralized state going back before colonialism, so several hundred years ago. More recently, they have better-functioning local governments. They’re richer. They’re better off, which shows that places that have a long history of governance seem better able to do that more recently.

So places going back a long time ago — they were part of the central state. They had to collect taxes locally to send up to the central state. They had to organize military conscripts. The central state mandated that they had certain laws.

More recently, those places also have more functional local governments and are also better off economically, whereas the places that never had that structure that comes from a state — it was, essentially, if you were living in that area, there’d be a warlord that you sent tribute to. But there was never any regular taxation, never any organized local government under a central state. Those places much more recently — when there were constitutional reforms in Vietnam that gave them a degree of self-government — they weren’t able to do that very effectively.

They weren’t able to keep the positions on their local city council filled. They weren’t able to provide, as effectively, local public goods, like education or health services. So really, having this long history of governance makes places more able to do that today. That’s relevant because there’s been a big push to have local governments provide an important role in providing public goods, et cetera.

If places don’t have a history of doing that, perhaps not surprisingly, they tend to have a much harder time. When the World Bank says, “Well, we want to give local autonomy to let local governments decide how to provide schools in the way that works best for them,” that’s going to work in places that have a long history of providing education. In places that don’t, they’re more likely to have a hard time.

COWEN: But if you select your cases on the basis of having similar histories, aren’t you selecting for persistence because the locales that have reversals of fortune — a big war in North Vietnam, Communism coming to North Vietnam — that’s a kind of mean reversion. It deliberately gives them a not-similar history. Do you then not overrate the degree of persistence in the dataset by just taking the sliver that is indeed continuous with its own history?

DELL: I think that you could imagine writing papers about different things. Our motivation was, we wanted to think about if the historical state could have a role at all. In order to do that, you don’t really want to compare South Korea to the Philippines — which is what most of the historical literature on this does — because they’re different in so many ways. We know that South Korea looks really different from the Philippines, but there’s so many ways that they can be different.

By looking within South Vietnam, we wanted to say, “Okay, these are places that had a much more recent modern history. Can their past history still matter?” But we’re not saying that that begins to explain everything. There’s other forces that happened more recently that we think are also important.

Certainly, there can be mean reversions, and the argument is not that things are always persistent. I think part of the literature is about understanding why sometimes things persist and sometimes they don’t. Certainly, more recent events can matter, and we’re not claiming that there’s an R-squared of one that a place’s history is its destiny, but that there are these forces.

Next up will be Nathan Nunn, and I asked him a series of related questions about persistence…

What should I ask Melissa Dell?

She is a professor of economics at Harvard, and winner of the most recent John Bates Clark medal.  I would describe her as a both a rising star and an already-risen star.  From Wikipedia:

Melissa Dell’s research interests include development economics, economic history and political economy. Her work has mainly focused on explaining economic development through the persistence of historical institutions and climate. She has also investigated the effect of conflict on labor market and political outcomes and vice versa. Much of her research has focused on Latin America and Southeast Asia. She was one of the first economists to use a spatial regression discontinuity design, in her paper on the long-term effects of Peru’s Mining Mita.

Her broader biography is interesting as well (see Wikipedia).  Here is previous MR coverage of Melissa Dell, and here is the very good Clark medal summary of her research.

So what should I ask her?

Melissa Dell, economic historian, wins John Bates Clark award

Very well-deserved, here is the full account, including a summary of her research.  Excerpt:

Historians (e.g., Engerman and Sokolov) have long argued for the persistence of institutions and the “long shadow” of historical events on developing countries. For example, cross-national studies have noted that Latin America and North America organized labor differently during colonial periods and used cross-country historical data to support the idea that these differences have had long-run impacts. More generally, Acemoglu, Johnson, and Robinson compare the experience of countries with different institutions set in place during colonial time for largely accidental reasons, showing that these early differences continue to matter today.

In her work, Dell goes beyond the cross-country evidence, using historical accidents or peculiarities to shed light on persistent effects of institutional differences, including different in the organization of the state. She exploits historical settings in which she is able to very convincingly establish the persistent impacts of specific institutions as well as explore specific channels through which these impacts occur.

Do read the whole thing.  Here are some previous MR posts on Melissa Dell.

Melissa Dell on trafficking networks and the Mexican drug war

This is the abstract, from a very smart and brave woman:

Drug trade-related violence has escalated dramatically in Mexico during the past five years, claiming 40,000 lives and raising concerns about the capacity of the Mexican state to monopolize violence. This study examines how drug traffickers’ economic objectives influence the direct and spillover effects of Mexican policy towards the drug trade. By exploiting variation from close mayoral elections and a network model of drug trafficking, the study develops three sets of results. First, regression discontinuity estimates show that drug trade-related violence in a municipality increases substantially after the close election of a mayor from the conservative National Action Party (PAN), which has spearheaded the war on drug trafficking. This violence consists primarily of individuals involved in the drug trade killing each other. The empirical evidence suggests that the violence reflects rival traffickers’ attempts to wrest control of territories after crackdowns initiated by PAN mayors have challenged the incumbent criminals. Second, the study accurately predicts diversion of drug traffic following close PAN victories. It does this by estimating a model of optimal routes for trafficking drugs across the Mexican road network to the U.S. When drug traffic is diverted to other municipalities, drug trade-related violence in these municipalities increases. Moreover, female labor force participation and informal sector wages fall, corroborating qualitative evidence that traffickers extort informal sector producers. Finally, the study uses the trafficking model and estimated spillover effects to examine the allocation of law enforcement resources. Overall, the results demonstrate how traffickers’ economic objectives and constraints imposed by the routes network affect the policy outcomes of the Mexican Drug War.

The link to her papers — all of which look interesting — is here.  She is currently on the job market from MIT, and I will be serving up some further posts on a few of the more interesting job market papers this year.  The original pointer is from Chris Blattman.

Here is a good summary and discussion from Ray Fisman:

Dell conjectures—based on anecdotal evidence about the drug war—that police efforts tend to weaken a cartel’s grip on a town just enough that competing traffickers see an opening to come in and fight for control of the town. Indeed, when a rival cartel controls a neighboring town, the effect of a PAN win on the drug-related homicide rate is several times higher.

And:

Drug confiscations in the communities where Dell predicts traffickers will relocate to following a crackdown increase by about 20 percent in the months following close PAN victories. It’s a reminder that crime fighting is a bit like Whac-A-Mole—smothering traffickers’ activities in one locale merely causes them to shift their operations elsewhere. Dell finds that drug-related homicides also go up in places that her model predicts will lie on traffickers’ new paths from Mexican drug labs to the U.S. border.

The real China shock came to Mexico

Mexican manufacturing job loss induced by competition with China increases cocaine trafficking and violence, particularly in municipalities with transnational criminal organizations. When it becomes more lucrative to traffic drugs because changes in local labor markets lower the opportunity cost of criminal employment, criminal organizations plausibly fight to gain control. The evidence supports a Becker-style model in which the elasticity between legitimate and criminal employment is particularly high where criminal organizations lower illicit job search costs, where the drug trade implies higher pecuniary returns to violent crime, and where unemployment disproportionately affects low-skilled men.

That is from a recent paper by Melissa Dell, Benjamin Feigenberg, Kensuke Teshima, forthcoming in AER: Insights.