Group (ERG) organized a day long conference on "Economic Research”,
in collaboration with the Association of Economic and Development
Studies for Bangladesh (AEDSB). It was the 4th Winter Annual
Conference of ERG, and the event was held at ERG conference room on
28th December, 2014.
The annual event served dual purposes - it was a reunion for Bangladeshi economists, researchers, academicians from home and abroad; and it provided the platform to young researchers for sharing their work done (or, to be undertaken) with analytical rigor. The day long conference had 3 technical sessions:
- a.Theorizing possibly anything,
- b. Nominal ties of macro lives and
- c. Empirics of human decisions.
Six research papers and a research idea (by Urmee Rahman) were presented in three sessions. Each presentation was followed by open floor (question-answer) discussion, where presenters replied to the various queries raised by the participants. The charm of this small gathering of about fifty persons was the lively critical engagements among all.
The first research paper “Beyond Consequences of Lying: Can Social Influence Substitute (Compensate) for Monetary Stakes?” was presented by Quazi Shahriar, faculty member, San Diego State University. It was a joint research work with Arnab Mitra, a faculty member of Portland State University. The paper raised two key questions: does social norm of dishonesty influence an individual’s(dis)honesty?; and, does such influence outweigh the influence of personal gains associated with being dishonest/liar? In particular, they study whether high level of dishonest behavior by a group makes an individual more likely to be dishonest even when the own monetary benefit is less. To asses empirically, they did a game experiment on a sample of students and saw how their lying pattern changes with benefit and information about benefit. One of the findings is, penalty of dishonesty does not work because people are dishonest by nature. Hence, Policy makers probably need to think of other interventions to promote a culture of honesty.
The second paper, “The psychology of political selection: Identity, intrinsic motivation, and candidacy” was presented by Shehzad Arefin, a young faculty at ESS, Brac University. The central theme addressed is an old question in political thought - who wants to rule versus who should. Within an analytical model with a restricted set of assumptions, he shows that those who seek political office are those who are least deserving of it.
His exercise also ventured into exhibiting that growth of profit organizations that simultaneously seek to achieve social targets has negative impact on good governess in the public sector. He argued, if the private sector is not particularly repressed and public offices also allow private businessmen to stimulate the political process such as campaigning, lobbying and so on then there is a strong negative impact over good governess. Finally he exhibited that, the quality of candidate pool is bad because of strong private sector effect, as a result in many countries of the world has constant bad government. Private sectors always try to reduce quality of good politicians because they try to influence the political office to maximize their profit.
Biru Paksha Paul, Chief Economist of the Bangladesh Bank, presented a paper titled “When and why does Bangladesh’s inflation differ from India’s?”, co-authored with Hasan Zaman, a Senior Adviser of the World Bank. They compare the trend of inflation in both Bangladesh and India, and probe into the causes of inflation in the two countries. Findings from their econometric exercise suggest that money growth is one of the main determinants of inflation in these countries.
Asad Karim Khan Priyo, Assistant Professor, North South University, addressed a contemporary issue in this paper, “Uncertainties in Deposit Financing, Risky Trading Securities and Differences in Loan and Reserve Behavior of U.S. Commercial Banks”. He argues that, during the financial crisis of 2007-08, excess reserve holdings of commercial banks in the U.S. increased by large amounts. Such excesses could potentially lead to inflation, make monetary policies ineffective, reduce banks' productivity and hinder economic progress by reducing loan extension to investors.
The data set revealed that the large increase in excess reserves was concentrated among a small number of large commercial banks, whereas reserve behavior of thousands of small banks remained virtually unchanged. He found two main reasons that can explain the data. Greater un-certainty in securing external funding led these banks to maintain larger excess reserves. In addition, their portfolio turned more risky because of investing heavily in risky trading securities. The latter reduced their prospect to borrow from interbank loan market, which further fueled maintaining higher excess reserve.
In final session, Abu Shonchoy, a faculty member at JETRO, discussed their findings on fertility rate decline with increasing electricity consumption. This study was undertaken in collaboration with Tomoki Fuji. The exercise accounted for potential endogeneity of the adoption of electricity by exploiting infrastructure development and the quality of service delivery as instrumental variables. The negative impact of electricity on fertility is more pronounced when the household already has two or more children. The authors argue that the adoption of electricity only affects the optimal number of children, and not necessarily the current fertility behavior, when the current number of children is below optimal.
The last paper of the conference was presented by Shyamal Chowdhury, faculty member of University of Sydney. The paper “Evolution of Mehr and Dowry among Muslims in Bangladesh: Natural Shocks as an Explanation” is co-authored with Debdulal Mallick, a faculty member of Dunkin University.
The natural exogenous shocks that affect income can powerfully affect the evolution of major social institutions. They showed that the trend of meher and dowry was affected by three different phenomena. These were new water-fertilizer-seed technology in the 1960s popularly known as Green Revolution (GR), The War of Independence in 1971, and the famine in 1974. They also found that, the legal changes during 1960-2000 to prohibit polygamy and to curb the practice of dowry had no effect on the value of dowry and mehr.
Program and Papers presented in the Conference
|10:15a||Opening Remarks and Logistics|
|10:30a-12:00p||Session A: Theorizing possibly anything|
|10:30a||Shehzad M Arifeen (BRAC University)
The psychology of political selection: identity, intrinsic motivation, and candidacy
|11:00a||Kangoh Lee and Quazi Shahriar (San Diego State University)
Fairness, one’s source of income, and others’ decisions
|11:30a||Jorge M. Agüero (University of Connecticut) and Urmee Khan
(University of California, Riverside)
Contracting economic development: impact evaluation, project choice and contract theory
|12:30p-01:30p||Session B: Nominal ties of macro lives|
|12:30p||Biru Paksha Paul (SUNY-Cortland) and Hassan Zaman (World Bank)
When and why does Bangladesh’s inflation differ from India’s?
|01:00p||Asad Karim Khan Priyo (North South University)
Uncertainties in deposit financing, risky trading securities and differences in loan and reserve behavior of U.S. commercial banks
|02:30p-03:30p||Session C: Empirics of human decisions|
|02:30p||Tomoki Fujii (Singapore Management University) and Abu Shonchoy
(Institute for Developing Economies, JETRO)
Fertility and rural electrification in Bangladesh
|03:00p||Shyamal Chowdhury (University of Sydney) and Debdulal Mallick (Deakin
Evolution of Mehr and dowry among Muslims in Bangladesh: natural shocks as an explanation
|03:35p||Closing Remarks and Feedbacks|