Quantifying Incentives for Policy Change in an Expost Rewards System Prepared for the Millennium Challenge Corporation by Ingrid Aune Yanyan Chen Christina Miller Joshua Williams ID: 690561
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Slide1
The MCC Incentive EffectQuantifying Incentives for Policy Change in an Ex-post Rewards System
Prepared for the Millennium Challenge Corporation by :Ingrid AuneYanyan ChenChristina MillerJoshua Williams-- Spring 2013 --Slide2
The Team and the OutlineIngrid Aune
Yanyan Chen
Christina Miller
Joshua WilliamsSlide3
Previous Quantitative StudiesSlide4
DataSlide5
Indicator Mobility
Source: Authors’ CalculationsTop 10 Rank ChangeSlide6
Correlation between IndicatorsSize is proportional to Correlation
Critical Value = 0.3Slide7
Correlation between Indicators (continued)Size is proportional to Correlation
Critical Value = 0.3Slide8
Plausible Conjectures of Treatment Groups Slide9
Preliminary Analysis: Locally weighted scatter plot smooth (LOWESS)Positive MCC Incentive Effect
Treatment: Close to Passing or FailingSlide10
Neutral/Mixed MCC Incentive EffectPreliminary Analysis: LOWESS
(continued)
Treatment: Qualitative MCC Incentive EffectSlide11
Negative
MCC Incentive EffectPreliminary Analysis: LOWESS
(continued)
Treatment: Middle Range Government ExpendituresSlide12
Difference-in-Differences Slide13
Overview of General Model ResultsAll Results: 38 (+) and 31 (-) Slide14
Select Statistically Significant Results:Treatment
ModelIndicator
Time Period
2004-2006
2006-2008
2008-2010
Qualitative MCC Incentive Effect
Rate of Reform
Cost to Start a Business
53.3
**(26.94)
Cost to Register Property
1.205**(0.601)
Trade Freedom-5.690*
(3.188)
Likelihood of ImprovementRegulatory Quality
0.429***
(0.146)0.456***(0.144)Threshold Partnership
Rate of ReformTime to Register Property
-24.41*(14.45)
Depth of Credit Information-0.657**
(0.330)Economic FreedomSlide15
Treatment
ModelIndicatorTime Period
2004-2006
2006-2008
2008-2010
Qualitative MCC Incentive Effect
Rate of Reform
Girls' Primary Education Completion
7.215
***(2.762)
Immunization Rate-4.504**
(2.224)Likelihood of ImprovementGirls' Primary Education Completion
0.353**(0.166)0.487***(0.164)
0.366**(0.178)Threshold PartnershipRate of Reform
Primary Education Expenditures
0.911**(0.373)
Health Expenditures
-4.678**(2.127)-5.614***(2.134)
Immunization Rate
-5.453**(2.540)Likelihood of Improvement
Health Expenditures-0.459***(0.165)
-0.435**(0.166)Investing in PeopleSlide16
Treatment
ModelIndicatorTime Period
2004-2006
2006-2008
2008-2010
Qualitative MCC Incentive Effect
Rate of Reform
Civil Liberties
1.566
*(0.878)
Political Rights2.398**(1.146)
Voice and Accountability-0.117**(0.0575)
-0.213***(0.0579)-0.181***(0.0579)
Likelihood of Improvement Political Rights0.366
**(0.139)
Control of Corruption
0.278*(0.148)
Voice and Accountability-0.295**(0.145)
-0.442***(0.142)-0.324**(0.145)Threshold Partnership
Rate of ReformCivil Liberties
2.307**(1.006)Political Rights
2.443*(1.335)Rule of Law-0.124**(0.0611)
Likelihood of ImprovementControl of Corruption
0.427**(0.170)
Political Rights0.284*(0.168)
Rule of Law-0.357**(0.177)
Ruling JustlySlide17
Number of Results in Economic Freedom (Breakdown)Slide18
Number of Results in Investing in PeopleSlide19
Number of Results in Ruling JustlySlide20
Number of Positive and Negative ResultsDifferent Time PeriodsEconomic Freedom
Investing in People
Ruling JustlySlide21
Conclusions and Recommendations Slide22
Recommendation to the MCC Slide23
QuestionsSlide24
Acknowledgements