The Value of Political Capital: Dictatorship Collaborators as Business Elites

Journal of Economic Behavior & Organization, 2018

Joint work with Mounu Prem

What is the value of political capital for individuals? Towards the end of the Pinochet dictatorship in Chile, military and civilian collaborators entered the business elite, controlling the largest and most important firms in the country. Using a novel panel dataset of board members in these firms, we document an appointment premium for those who had previously collaborated with Pinochet. After democratization, however, collaborators were removed from boards and their compensation premium disappeared. These results suggest that dictatorship collaborators earn a premium in the business world in dictatorship, but not in democracy.

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Can Television Bring Down a Dictator? Evidence from Chile's "No" Campaign

Journal of Comparative Economics, 2018

Joint work with Mounu Prem

Can televised political advertising change voting behavior in elections held in authoritarian regimes? We study the case of Chile, where the opposition used television campaigns weeks before the election that ended the seventeen-year dictatorship known as the Pinochet regime. Using national surveys conducted before the election and administrative electoral data, we provide evidence of a positive effect of television exposure on opposition votes. When compared to similar estimates in democracies, the effect of campaigns in Chile appear large. These results suggest that televised political campaigns can help to defeat dictators at the polls.

Link to paper

Media: Qué Pasa


Higher temperatures increase suicide rates in the United States and Mexico

Nature Climate Change, 2018

Joint work with M. Burke, P. Baylis, S. Heft-Neal, C. Baysan, S. Basu, and S. Hsiang

Linkages between climate and mental health are often theorized but remain poorly quantified. In particular, it is unknown whether the rate of suicide, a leading cause of death globally, is systematically affected by climatic conditions. Using comprehensive data from multiple decades for both the United States and Mexico, we find that suicide rates rise 0.7% in US counties and 2.1% in Mexican municipalities for a 1 °C increase in monthly average temperature. This effect is similar in hotter versus cooler regions and has not diminished over time, indicating limited historical adaptation. Analysis of depressive language in >600 million social media updates further suggests that mental well-being deteriorates during warmer periods. We project that unmitigated climate change (RCP8.5) could result in a combined 9–40 thousand additional suicides (95% confidence interval) across the United States and Mexico by 2050, representing a change in suicide rates comparable to the estimated impact of economic recessions, suicide prevention programmes or gun restriction laws.

Link to paper

Media: The Atlantic, CNN, San Francisco Chronicle, MIT Technological Review, Scientific American, The Guardian, Time
Media en español: DiCyT, La Tercera.


Start-Up Nation? Slave Wealth and Entrepreneurship in Civil War Maryland

Journal of Economic History, 2017

Joint work with Guillermo Marshall and Suresh Naidu

Slave property rights yielded a source of collateral as well as a coerced labor force. Using data from Dun and Bradstreet linked to the 1860 census and slave schedules in Maryland, we find that slaveowners were more likely to start businesses prior to the uncompensated 1864 emancipation, even conditional on total wealth and human capital, and this advantage disappears after emancipation. We assess a number of potential explanations, and find suggestive evidence that this is due to the superiority of slave wealth as a source of collateral for credit rather than any advantage in production. The collateral dimension of slave property magnifies its importance to historical American economic development.

Link to paper, NBER Working Paper

Media: Marginal Revolution


War and Collective Action in Sierra Leone: A Comment on Coefficient Stability

Journal of Public Economics, 2015

Joint work with Edward Miguel

In a study of the effect of civil war exposure on local collective action outcomes in Sierra Leone, Bellows and Miguel (2009) employ a coefficient stability approach to assess the importance of omitted variable bias building on Altonji et al. (2005a). Here we clarify the econometric assumptions underlying Bellows and Miguel (2009), and extend their analysis using data on dependent variable reliability ratios and the method developed in Oster (2015). 

Link to paper


Drug Trafficking Organizations and Local Economic Activity in Mexico

PLoS ONE, 2015

Little is known about the relationship between illegal firms and local economic activity. In this paper I study changes in satellite night lights across Mexican municipalities after the arrival of large drug trafficking organizations in the period 2000–2010. After accounting for state trends and differences in political regimes, results indicate no significant change in night lights after the arrival of these illegal firms. Estimated coefficients are precise, robust, and similar across different drug trafficking organizations.

Link to paper

Source: Memoria Chilena

Can Land Reform Avoid a Left Turn? Evidence from Chile After the Cuban Revolution

The B.E. Journal of Economic Analysis and Policy, 2013

Following the creation of the Alliance for Progress in 1961, several structural reforms were implemented in Latin America in response to the political effects of the Cuban Revolution. Among these, land reform was arguably the most important policy. Using a unique dataset of land expropriations, and a plausible exogenous variation in land concentration, this paper studies the causal effects this policy had on political support for the incumbent party in the central government. In a context where the incumbent was losing political support (and the power of the left wing was rising), municipalities affected by land reform voted by 3–5 percentage points higher for the incumbent than municipalities not affected by this process. Although it did not prevent the first democratically elected Marxist government, land reform decreased the political support for the left wing party. I discuss several theoretical mechanisms that can explain this empirical result.

Link to paper


Other Publications


Políticas de inclusión universitaria y comportamiento estratégico en educación secundaria

Estudios Públicos, 2018

Joint work with Esperanza Johnson

Con el objetivo de mejorar la inclusión del sistema educacional superior chileno, en junio del 2012 se incorporó el ranking de notas en educación secundaria al sistema de admisión universitario. Aunque esta política intenta bonificar a los mejores estudiantes de cada establecimiento, su efecto real depende del comportamiento de todos los integrantes del sistema de educación secundaria. Este artículo estudia el desempeño académico y las decisiones de migración de establecimiento de cientos de miles de estudiantes en Chile, y presenta dos resultados consistentes con cambios en el comportamiento de estudiantes y establecimientos, luego de la introducción de esta política conocida como puntaje ranking. Primero, comparando las notas de enseñanza media con las de octavo básico antes y después del puntaje ranking, documentamos un aumento en las notas de estudiantes de educación secundaria. Segundo, luego del anuncio del puntaje ranking, observamos migración de establecimientos entre los estudiantes que más se podrían beneficiar de esta decisión. En conjunto, estos resultados sugieren que el puntaje ranking incentivó a estudiantes y establecimientos a cambiar su comportamiento para maximizar los beneficios que obtienen de esta política.

Link to paper

La Reforma Agraria Chilena

Estudios Públicos, 2017

Joint work with José Ignacio Cuesta, José Díaz, Francisco Gallego, and Guillermo Marshall

Este artículo presenta un conjunto de hechos estilizados para la reforma agraria chilena a partir de datos provenientes de registros de cada predio involucrado. La información considera tamaño y ubicación de los predios, el momento de las expropiaciones, las razones legales invocadas para la expropiación y el resultado final del proceso. El artículo también presenta medidas de la intensidad de la reforma a nivel comunal y su correlación con la producción agrícola y la estructura de propiedad de la tierra antes de la reforma. Los antecedentes presentados confirman algunos rasgos conocidos del proceso de reforma y sugieren nuevas dimensiones: se identifica una alta heterogeneidad en el tamaño de los predios expropiados, así como en la intensidad de la reforma y de la contrarreforma a nivel comunal. Además, el examen de los datos sugiere que los problemas de desigualdad y de tenencia de la tierra fueron, en la práctica, motivaciones importantes de la reforma agraria.

Link to paper

Download the agrarian reform data

Media: La Segunda

Source: Central Bank of Chile

Local Impacts of Trade Liberalization: Evidence from the Chilean Agricultural Sector

In: Economic Policy in Emerging-Market Economies, 2015

Joint work with José Ignacio Cuesta and Francisco Gallego

Protectionist trade policies aim at shielding some sectors from international competition and may produce unintended consequences. In particular, they tend to create some taxed sectors that use protected inputs, usually in the agricultural sector, which end up facing a negative effective rate of protection (ERP). In this way, protectionism distorts the allocation of resources and creates disincentives for the production of some goods. This was the case of the tariff structure in Chile before the massive process of economic and trade liberalization that began in the mid-1970s. We find that ERPs have an economically and statistically signifficant effect on agriculture output. We also find that the elimination of negative ERPs also increases output specialization.

Link to paper