- Editor’s Summary
This volume of Economía consists of four papers. The first one is very special: Jere R. Behrman’s Carlos Díaz-Alejandro Prize Lecture, entitled “What You Don’t Know CAN Hurt You—Or at Least Mislead You.” The Board of Editors has been discussing whether to include the lectures in Economía for some time, and we are pleased to report that Economía, as the official journal of LACEA, will publish all future Carlos Díaz-Alejandro Prize Lectures, as well as the LACEA Presidential Addresses.
Jere R. Behrman has devoted his life to the empirical study and evaluation of human resources, household behavior, and social policies in Latin America, and we are honored to welcome his lecture as the first in our journal. It is only fitting, then, that the other three papers in this volume study related topics: first, Cárdenas, Chong, and Ñopo explore how households in Latin America cooperate and trust each other; second, Krivonos and Olarreaga analyze the impact of agricultural export prices on poverty in Brazil; and third, Ronconi looks at how public works influence workers’ welfare in Argentina.
In “What You Don’t Know CAN Hurt You—Or at Least Mislead You,” Berhman summarizes his extensive forty years of experience in research and policy analysis in the region. He discusses the empirical challenges he has faced in the evaluation of social and other programs in the last forty years, and he shares his journey toward improving the field’s understanding, data collection, and policy discussion. He has had a tremendous impact on the way policies have been designed in the region, and I am sure his research will continue to make a mark in the future. As pointed out by Mauricio Cardenas in his introductory remarks, Jere Berhman tackles some of the most important questions in development: “his research is rooted in a profound moral concern about the opportunities facing individuals and societies” and has covered questions that deal with some of the “most basic inputs to opportunity: the sufficiency of your nutrition, the effort of your parents, the quality of your schools, and the kind of labor market they confront.” Latin America is perhaps one of the most [End Page vii] unequal regions in the world, and Jere Berhman has been leading the charge in the analysis of programs aimed at addressing that issue.
The lecture summarizes Berhman’s views on the estimates found in the literature on a diverse set of questions. He highlights, quite convincingly, that some of those estimates are questionable, at best. He points to the two most important problems in evaluation—endogeneity and selection—and he discusses different possible approaches for dealing with these issues. His conclusion captures his feelings on the matter: “Estimates can be interpreted more confidently if they are based on explicit models of behavior that recognize the possible importance of unobserved factors and that are linked to special data. The estimation methods should also control for factors such as selection on unobserved variables and endogeneity.” This paper is a tour through Behrman’s amazingly interesting research and, at the same time, a lecture on how to do good empirical work.
The second paper in this volume is “To What Extent Do Latin Americans Trust, Reciprocate, and Cooperate? Evidence from Experiments in Six Latin American Countries,” by Juan Camilo Cárdenas, Alberto Chong, and Hugo Ñopo. The authors are interested in understanding one of the most puzzling and important phenomena in our society: how does cooperation arise? This is puzzling because humans are generally modeled as having individualistic objectives. Moreover, as Cárdenas, Chong, and Ñopo point out, “Cooperating or forming groups to produce an outcome that is beneficial to the group is usually costly. Sometimes it involves a coordination game in which each individual would benefit more if everyone else behaves accordingly, and the payoffs drive individuals toward the best outcome without conflicts between individual and group interests. Other times it is a collective action game in which the individual strategy would be not to cooperate, although everyone in the group would benefit if everyone cooperated.”
To tackle the question of how cooperation arises, C...