Essays in the Economics of Sanitation and Human Capital in Developing Countries

Abstract

This thesis is a collection of three essays in the empirical economics of sanitation, open defecation, and child well-being in developing countries.

Physical height is an important economic variable reflecting health and human capital. Puzzlingly, however, differences in average height across developing countries are not well explained by differences in wealth. In particular, children in India are shorter, on average, than children in Africa who are poorer, on average. This paradox has been called "the Asian enigma" and has received much attention from economists. Chapter one provides the first documentation of a quantitatively important international gradient between child height and sanitation. I apply three complementary empirical strategies to identify the association between sanitation and child height: country-level regressions across 140 country-years in 65 developing countries; within-country analysis of differences over time within Indian districts; and econometric decomposition of the India-Africa height difference in child-level data. Open defecation, which is exceptionally widespread in India, can account for much or all of the excess stunting in India.

Chapter two studies the Indian government's Total Sanitation Campaign, which offered local government agents a large ex post monetary incentive to eliminate open defecation. I use two strategies to estimate the program's effect on children's health: first, heterogeneity in the timing of program implementation across districts, and second, a discontinuity in the monetary incentive to village governments. On average, the program caused a decrease in infant mortality and an increase in children's height. Importantly, this paper studies a full-scale program implemented by a large bureaucracy with limited capacity. In the context of governance constraints, incentivizing local government agents can be effective.

Chapter three is coauthored with Jeffrey Hammer. We study a randomized controlled trial of a village-level sanitation program, implemented in one district by the government of Maharashtra. The program caused a large but plausible average increase in child height. Unusually, the original World Bank evaluation team also collected data in districts where the government planned but ultimately did not conduct an experiment, permitting us to analyze how the set of villages eligible for randomization into the treatment group might shape research findings.