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This paper develops a structural approach for modeling how respondents answer survey questions and uses it to estimate the proportion of respondents who are reticent in answering corruption questions, as well as the extent to which reticent behavior biases down conventional estimates of corruption. The context is a common two-step survey question, first inquiring whether a government official visited a business, and then asking about bribery if a visit was acknowledged. Reticence is a concern for both steps, since denying a visit sidesteps the bribe question. This paper considers two alternative models of how reticence affects responses to two-step questions, with differing assumptions on how reticence affects the first question about visits. Maximum-likelihood estimates are obtained for seven countries using data on interactions with tax officials. Different models work best in different countries, but cross-country comparisons are still valid because both models use the same structural parameters. On average, 40 percent of corruption questions are answered reticently, with much variation across countries. A statistic reflecting how much standard measures underestimate the proportion of all respondents who had a bribe interaction is developed. The downward bias in standard measures is highly statistically significant in all countries, varying from 12 percent in Nigeria to 90 percent in Turkey. The source of bias varies widely across countries, between denying a visit and denying a bribe after admitting a visit.

Education --- Public Sector Development --- Science and Technology Development --- Social Development

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This paper examines the sustainability of weight loss achieved through cash rewards and, for the first time, the potential of monetary incentives to prevent weight cycling. In a three period randomized controlled trial, about 700 obese persons were assigned to two treatment groups, which were promised different cash rewards contingent on the achievement of an individually assigned target weight, and to a control group. Successful participants were subsequently allocated to two treatment groups offered different monetary incentives for maintaining the previously achieved target weight and to a control group. This is the first experiment of this kind that finds sustainable effects of weight loss rewards on the body weight of the obese even 18 months after the rewards were removed. Additional incentives to maintain an achieved body weight improve the sustainability of weight loss only while are in place.

Education --- Health, Nutrition and Population --- Science and Technology Development

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Catastrophe risk models are quantitative models used to estimate probabilistic loss distributions for a specified range of assets subject to a baseline level of disaster risk. While cat risk models are used extensively by the insurance and reinsurance industry to estimate expected losses to insured assets, their ability to estimate damages outside of a narrow range of physical assets such as buildings or infrastructure is still limited. This paper first provides a brief outline of cat risk models as they currently exist, and then outlines the major econometric issues involved in incorporating research from the growing literature on the microeconomic impacts of disasters into a cat model framework. Attention is specifically drawn to issues arising from the generally low recurrence frequencies of disasters, the likely role of difficult-to-document indirect damages in influencing total disaster costs, and issues related to generalizing disaster response functions across different domains. The paper ends by noting the large discrepancy between the current state of the literature on disaster impacts on microeconomic indicators and the level needed for adequate cat risk model performance, and suggests means of closing that gap as well as potential areas for future research.

Education --- Environment --- Macroeconomics and Economic Growth --- Science and Technology Development --- Urban Development

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This paper uses a new data set of 12,000 firms in China to estimate the returns to research and development investment and its spillover effects, and investigates how the returns to research and development depend on firm incentives. For the firms in the sample, the results show that on average firm output increases around 0.4 yuan for each additional 1 yuan spent on research and development in the previous year, and there is high research and development return regardless of whether the analysis deals with the endogeneity of research and development intensity. Interestingly, the marginal return to research and development is significantly higher in firms whose chief executive officers were not appointed by the government and lower when the chief executive officer's pay is directly related to annual performance. The return to research and development is higher in relatively poor regions and for firms with worse access to finance. There are also non-trivial research and development spillover effects.

Agriculture --- Education --- Private Sector Development --- Rural Development --- Science and Technology Development

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This paper evaluates the performance of alternative estimators of the gravity equation when zero trade flows result from economically-based data-generating processes with heteroscedastic residuals and potentially-omitted variables. In a standard Monte Carlo analysis, the paper finds that this combination can create seriously biased estimates in gravity models with frequencies of zero frequently observed in real-world data, and that Poisson Pseudo-Maximum-Likelihood models can be important in solving this problem. Standard threshold-Tobit estimators perform well in a Tobit-based data-generating process only if the analysis deals with the heteroscedasticity problem. When the data are generated by a Heckman sample selection model, the Zero-Inflated Poisson model appears to have the lowest bias. When the data are generated by a Helpman, Melitz, and Rubinstein-type model with heterogeneous firms, a Zero-Inflated Poisson estimator including firm numbers appears to provide the best results. Testing on real-world data for total trade throws up additional puzzles with truncated Poisson Pseudo-Maximum-Likelihood and Poisson Pseudo-Maximum-Likelihood estimators being very similar, and Zero-Inflated Poisson and truncated Poisson Pseudo-Maximum-Likelihood identical. Repeating the Monte Carlo analysis taking into account the high frequency of very small predicted trade flows in real-world data reconciles these findings and leads to specific recommendations for estimators.

International Economics & Trade --- Macroeconomics and Economic Growth --- Science and Technology Development