It has long been recognized that productivity growth and the business cycle are closely interrelated. Yet, until recently, the two phenomena have been investigated separately in the economics literature. This book provides the first consistent attempt to analyze the effects of macroeconomic volatility on productivity growth, and also the reverse causality from growth to business cycles. The authors show that by looking at the economy through the lens of private entrepreneurs, who invest under credit constraints, one can go some way towards explaining persistent macroeconomic volatility and the effects of volatility on growth. Beginning with an analysis of the effects of volatility on growth, the authors argue that the lower the level of financial development in a country the more detrimental the effect of volatility on growth. This prediction is confirmed by cross-country panel regressions. The data also suggests that a fixed exchange rate regime or more countercyclical budgetary policies are growth-enhancing in countries with a lower level of financial development. The former reduce aggregate volatility whereas the latter reduce the negative effects of volatility on long-term productivity-enhancing investment by firms. The book concludes with an investigation into how the interplay between credit constraints and pecuniary externalities is sufficient to generate persistent business cycles and to explain the occurrence of currency crises.

Handbook of Field Experiments provides tactics on how to conduct experimental research, also presenting a comprehensive catalog on new results from research and areas that remain to be explored. This updated addition to the series includes an entire chapters on field experiments, the politics and practice of social experiments, the methodology and practice of RCTs, and the econometrics of randomized experiments. These topics apply to a wide variety of fields, from politics, to education, and firm productivity, providing readers with a resource that sheds light on timely issues, such as robustness and external validity. Separating itself from circumscribed debates of specialists, this volume surpasses in usefulness the many journal articles and narrowly-defined books written by practitioners.

Why do the poor borrow to save? Why do they miss out on free life-saving immunizations, but pay for unnecessary drugs? In Poor Economics , Abhijit V. Banerjee and Esther Duflo, two practical visionaries working toward ending world poverty, answer these questions from the ground. In a book the Wall Street Journal called marvellous, rewarding," the authors tell how the stress of living on less than 99 cents per day encourages the poor to make questionable decisions that feed,not fight,poverty. The result is a radical rethinking of the economics of poverty that offers a ringside view of the lives of the world's poorest, and shows that creating a world without poverty begins with understanding the daily decisions facing the poor.

Handbook of Field Experiments, Volume Two explains how to conduct experimental research, presents a catalog of research to date, and describes which areas remain to be explored. The new volume includes sections on field experiments in education in developing countries, how to design social protection programs, a section on how to combat poverty, and updates on data relating to the impact and determinants of health levels in low-income countries. Separating itself from circumscribed debates of specialists, this volume surpasses the many journal articles and narrowly-defined books written by practitioners. This ongoing series will be of particular interest to scholars working with experimental methods. Users will find results from politics, education, and more.

It has long been recognized that productivity growth and the business cycle are closely interrelated. Yet, until recently, the two phenomena have been investigated separately in the economics literature. This book provides the first consistent attempt to analyze the effects of macroeconomic volatility on productivity growth, and also the reverse causality from growth to business cycles. The authors show that by looking at the economy through the lens of private entrepreneurs, who invest under credit constraints, one can go some way towards explaining persistent macroeconomic volatility and the effects of volatility on growth. Beginning with an analysis of the effects of volatility on growth, the authors argue that the lower the level of financial development in a country the more detrimental the effect of volatility on growth. This prediction is confirmed by cross-country panel regressions. The data also suggests that a fixed exchange rate regime or more countercyclical budgetary policies are growth-enhancing in countries with a lower level of financial development. The former reduce aggregate volatility whereas the latter reduce the negative effects of volatility on long-term productivity-enhancing investment by firms. The book concludes with an investigation into how the interplay between credit constraints and pecuniary externalities is sufficient to generate persistent business cycles and to explain the occurrence of currency crises.