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Estimation of empirical relationships is prone to bias. Economists have carefully studied sources of bias in structural and quasi-experimental approaches, but the randomized control trial (RCT) has only begun to receive such scrutiny. This paper argues that several lessons from medicine, derived from analysis of thousands of RCTs establishing a clear link between certain practices and biased estimates, can be used to reduce the risk of bias in economics RCTs. It identifies the subset of these lessons applicable to economics and uses them to assess risk of bias in estimates from economics RCTs published between 2001 and 2011. In comparison to medical studies, most economics studies examined do not report important details on study design necessary to assess risk of bias. Many report practices that suggest risk of bias, though this does not necessarily mean bias resulted. The paper concludes with suggestions on how to remedy these issues.

Macroeconomics and economic growth

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This paper presents estimates of the relationship between the share of income accruing to the middle class and gross domestic product per capita of economies from the Association of Southeast Asian Nations. The increase in gross domestic product per capita that these economies experienced during 1970-2010 significantly contributed to a higher share of income accruing to the middle class. The impact of the rise of the middle class on economic growth depends on the countries' initial level of gross domestic product per capita. In the majority of these countries, a rise of the middle class that is unrelated to gross domestic product per capita growth would have had a significant negative effect on economic growth, based on the values of the countries' gross domestic product per capita in 1970. In contrast, for recent values of gross domestic product per capita, a rise of the middle class would positively contribute to growth in gross domestic product per capita. The paper shows that human capital accumulation is an important channel through which a rise of the middle class affects economic growth.

Asean --- Economic Growth --- Income Inequality

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Returns to education remain an important parameter of interest in economic analysis. A large literature estimates returns to education in the labor market, often carefully addressing issues such as selection, into wage employment and in terms of completed schooling. There has been much less exploration of whether estimated returns are robust to survey design. Specifically, do returns to education differ depending on how information about wage work is collected? Using a survey experiment in Tanzania, this paper investigates whether survey methods matter for estimating mincerian returns to education. The results show that estimated returns vary by questionnaire design, but not by whether the information on employment and wages is self-reported or collected by a proxy respondent (another household member). The differences due to questionnaire type are substantial varying from 6 percentage points higher returns to education for the highest educated men, to 14 percentage points higher for the least educated women, after allowing for non-linearity and endogeneity in the estimation of these parameters. These differences are of similar magnitudes as the bias in OLS estimation, which receives considerable attention in the literature. The findings underline that survey design matters for the estimation of structural parameters, and that care is needed when comparing across contexts and over time, in particular when data is generated by different surveys.

Education --- Macroeconomics and economic growth

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The Sri Lanka Development Update has two main aims. First, it reports on the key developments over the past six months in Sri Lanka's economy, and places these in a longer term and global context. Based on these developments, and on policy changes over the period, it updates the outlook for Sri Lanka's economy and social welfare. Second, the Update provides a more in-depth examination of selected economic and policy issues, and analysis of medium-term development challenges. It is intended for a wide audience, including policymakers, business leaders, financial market participants, and the community of analysts and professionals engaged in Sri Lanka's evolving economy.

Analysis of Economic Growth --- Economic Growth --- Economic Management --- Export Competitiveness --- Fiscal & Monetary Policy --- Macroeconomics and Economic Growth --- Trade --- Trade Policy

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Recent National Sample Surveys point to significant poverty reduction in India since 2004/05, with a marked acceleration between 2009/10 and 2011/12. This paper enquires into important aspects of income mobility between 2004/05 and 2011/12, based on new statistical methods to convert the three pertinent National Sample Survey rounds into synthetic panels. The analysis draws on the synthetic panels to derive a vulnerability line for India that can be used to separate out a population subgroup comprising non-poor households facing a heightened risk of falling into poverty. The paper documents a strong pattern of upward mobility out of poverty and vulnerability into the middle class, with a noticeable acceleration between 2009/10 and 2011/12. The paper further undertakes a careful investigation into the comparability of the survey rounds, prompted by the observation that fairly significant modifications had been made to survey questionnaires. The findings suggest that changes in questionnaire design have not compromised the comparability of the data.

Macroeconomics and Economic Growth --- Poverty Reduction