Essays in Applied Microeconomics

Abstract

This dissertation consists of three essays in applied microeconomics. The first essay describes a field experiment studying paternalism in anti-poverty programs. Anti-poverty programs often take the form of cash or in-kind transfers. While in-kind transfers, such as food, may be more expensive to administer, they can potentially reduce temptation spending on items such as alcohol and cigarettes. In the experiment, I simultaneously study beliefs about temptation spending and preferences for restrictions among the extreme poor themselves. I find that most participants imposed costly restrictions on transfers received by strangers in their community but were only half as likely to restrict transfers received by themselves. However, these restrictions were generally unnecessary, as temptation spending was much lower than participants predicted. Participants’ beliefs shifted little in response to information about temptation spending. The second essay describes a natural field experiment with over 13 million social media users that measures the demand for, and effectiveness of, soft commitment devices. We find low take-up of the commitment device and present evidence for three reasons for this: low perceived self-control problems, limited effectiveness of the commitment device, and sensitivity to the timing and nature of the invitation to take up commitment. The third essay uses Monte Carlo simulations to understand under what conditions spatial correlation generates high false positive rates (FPRs). I find that FPRs are well-controlled by the Conley correction for many types of explanatory variables, while others can generate FPRs up to 70%. This suggests that earlier researchers' divergent conclusions about the FPRs generated by spatial data are due in part to differences in the nature of the spatial correlation they examined.