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Abstract:
The decentralization of education services from the federal government to the provincial governments was an important component of the major fiscal and structural reforms undertaken in Argentina in the early 1990's. The theoretical literature is not conclusive about the absolute superiority of either centralization or decentralization in the provision of public services. In this paper, we evaluate empirically the effect of the decentralization of secondary schools on education quality. Our results suggest that, on average, decentralization improved the performance of public school students in test scores. We also assess whether the effect of decentralization depends on province characteristics. We find that the higher the provincial fiscal deficits, the smaller the positive impact of decentralization.

decentralization, evaluation, education quality

Abstract:
We study the prices paid for basic inputs during a crackdown on corruption in the public hospitals of the city of Buenos Aires, Argentina during 1996-97. We find a well-defined, negative effect on the measures used to capture corruption. Prices paid by hospitals for basic, homogeneous inputs fall by 15% during the first nine months of the crackdown. After this period prices rise, but they are still 10% lower than those prevailing before the crackdown. Relative to the pre-crackdown period, higher wages play no role in inducing lower input prices when audit intensity can be expected to be maximal (during the first phase of the crackdown), but have a negative and well-defined effect when audit intensity takes intermediate levels (the last phase of the crackdown). Controlling for fixed effects, we find that the wage elasticity of input prices exceeds 20%. These results are consistent with the standard model of bribes of Becker and Stigler (1974).

Anti-corruption crackdown, efficiency wages, audit, procurement

Abstract:
An important challenge in the crime literature is to isolate significant causal effects of police on crime. Following a terrorist attack on the main Jewish center in the city of Buenos Aires, Argentina, in July 1994, all Jewish and Muslim institutions (including schools, synagogues, mosques, cemeteries and clubs) were given 24-hour police surveillance. Thus, this hideous event induced a geographical allocation of police forces that can be presumed exogenous in a crime regression. Using data on the location of all car thefts in three large neighborhoods before and after the terrorist attack, we find a large negative effect of observable police on crime. The effect is local, so that the costs of police presence are almost seven times larger than the benefits in terms of lower car thefts.

Crime, deterrence, observable police, displacement, natural experiment

Abstract:
This paper analyzes whether publicly traded firms price differently from privately held firms in the product markets. Our empirical evidence shows that, in the US newspaper industry, firms increase (decrease) their prices when their ownership structure changes from private to public (from public to private). The effects are robust and significant. A plausible explanation is that private owners enjoy more freedom than public managers to expand circulation and distort content pursuing the consumption of non-pecuniary benefits of control. Additional evidence is consistent with this interpretation. To our knowledge there are no previous studies comparing pricing by private and public companies.

ownership structure, prices, private benefits of control

Abstract:
The initiation in criminal activities is, typically, a young phenomenon. The study of the determinants of entry into criminal activities should pay attention to major events affecting youth. In many countries, one of these important events is mandatory participation in military service. The objective of this study is to estimate the causal relationship between mandatory participation in military service and crime. The authors exploit the random assignment through a draft lottery of young men to conscription in Argentina to identify this causal effect. Their results suggest that participation in military service increased the likelihood of developing a criminal record in adulthood (in particular, for property and weapon-related crimes).

Peace & Peacekeeping, Children and Youth, Political Systems and Analysis, Politics and Government, Crime and Society

Abstract:
The study of how crime affects different income groups faces several difficulties. The first is that crime-avoiding activities vary across income groups. Thus, a lower victimization rate in one group may not reflect a lower burden of crime, but rather a higher investment in avoiding crime. A second difficulty is that, typically, only a small fraction of the population is victimized so that empirical tests often lack the statistical power to detect differences across groups. We take advantage of a dramatic increase in crime rates in Argentina during the late 1990s to document several interesting patterns. First, the increase in victimization experienced by the poor is larger than the increase endured by the rich. The difference appears large: low-income people have experienced increases in victimization rates that are almost 50 percent higher than those suffered by high-income people. Second, for home robberies, where the rich can protect themselves (by hiring private security, for example), we find significantly larger increases in victimization rates amongst the poor. In contrast, for robberies on the street, where the rich can only mimic the poor, we find similar increases in victimization for both income groups. Third, we document direct evidence on pecuniary and non-pecuniary protection activities by both the rich and poor, ranging from the avoidance of dark places to the hiring of private security. Fourth, we show the correlations between changes in protection and mimicking and changes in crime victimization. Fifth, we offer one possible way of using these estimates to explain the incidence of crime across income groups.

Victimization, income distribution, private security, victim adaptation

Abstract:
Argentina privatized most public utilities during the 1990's but re-nationalized the main water company in 2006. We study beliefs about the benefits of the privatization of water services amongst low and middle income groups immediately after the 2006 nationalization. Negative opinions about the privatization prevail. These are particularly strong amongst households that did not benefit from the privatization and amongst households that were reminded of the government's negative views about the privatization. A person's beliefs of the benefits of the water privatization were almost 30% more negative (relative to other privatizations) if his/her household did not gain access to water after the privatization. Similarly, a person's view of the water privatization (relative to other privatizations) was 16% more negative if he/she was read a vignette with some of the negative statements about the water privatization that Argentina's President expressed during the nationalization process. Interestingly, the effect of the vignette on households that gained water is insignificant, while it is largest (and significant) amongst households that did not gain water during the privatization. This suggests that propaganda was persuasive when it had a basis on reality.

Abstract:
This paper examines the effects of the expansion of the water network in urban shantytowns in Argentina. We find large reductions in the presence, frequency and severity of diarrhoea episodes among children reached by network expansions relative to a control group. Moreover, expanded connections induce savings in water expenditures, as these families are able to substitute piped water for more expensive and distant sources of water provision. These health and savings effects are also important for households that previously had clandestine self-connections to the water network, which were free but of low quality.

Abstract:
While most countries are committed to increasing access to safe water and thereby reducing child mortality, there is little consensus on how to actually improve water services. One important proposal under discussion is whether to privatize water provision. In the 1990s Argentina embarked on one of the largest privatization campaigns in the world, including the privatization of local water companies covering approximately 30 percent of the country's municipalities. Using the variation in ownership of water provision across time and space generated by the privatization process, we find that child mortality fell 8 percent in the areas that privatized their water services and that the effect was largest (26 percent) in the poorest areas. We check the robustness of these estimates using cause-specific mortality. While privatization is associated with significant reductions in deaths from infectious and parasitic diseases, it is uncorrelated with deaths from causes unrelated to water conditions.