Nine examples of successful government policies

Evidence from economic research featured on VoxDev has shed light on effective government interventions around the world. This blog highlights nine examples of public policies that have improved welfare in Colombia, India and Mexico.

We hear a lot about failed efforts to promote economic development, and there has been a host of research on the 'unintended consequences' of interventions in development economics. But often we do not focus enough on the many policy successes in low- and middle income countries. In this blog, I highlight evidence on some of these success stories that you might not have heard of, where governments in Colombia, India, and Mexico have improved welfare through policy. I explain why I chose these countries, and reflect on why economists might not do enough of this type of research, at the end of this blog.

I have briefly summarised these policies and their impacts (which you can read about in more detail in the full articles I have linked to below) in no particular order, so this is not a ranked 'best-buys' list of investments.

Successful government policies in Colombia

Digital reforms at ports

Policy - Between 2000 and 2005, Colombia implemented a sweeping digitisation of customs processes at its 26 major ports.

Impacts:

Boosted trade volumes and compliance.
Curbed corruption.
Improved firm performance.

Read more about this win-win for growth and tax revenues in Rachid Laajaj, Marcela Eslava and Tidiane Kinda’s research here.

Financial aid for college students

Policy - In 2014, Colombia’s national government introduced the “Ser Pilo Paga” Programme, a generous student loan initiative for low-SES high-achievers

Impacts:

Significant improvements in college enrolment, quality, and completion.
Recipients also experience a substantial boost in the labour market.
Aid recipients did not displace ineligible students, with colleges expanding cohorts to meet increased demand.

Constructing better prisons

Policy - In 2004, Colombia commissioned the construction of new prisons in response to the systematic violation of constitutional rights to the prison population. As a result, ten new prisons opened between 2010 and 2013.

Impacts:

Reduced reoffending rates.
New prisons did a better job at interrupting criminal careers.
Welfare analysis reveals this construction programme likely created higher social returns than the economic cost of building these new prisons.

Learn more about Santiago Tobón's research here.

A school feeding programme

Policy - The “Programa de Alimentación Escolar”, started in in 2006 and ramped up between 2012 and 2019, provides a food supplement during the school day and throughout the school year to all students attending public schools in Colombia.

Impacts:

Improved retention of children within the school system.
Broader positive impacts on student learning, high school graduation rates and access to tertiary education.

Successful government policies in India

Food transfers in India

Policy - The National Food Security Act significantly expanded India’s food transfer programme.

Impacts:

Reduced stunting.
Improved dietary diversity.
Increased labour incomes.
Resilience against climate shocks.

Reforming payments for the public works scheme

Policy - Prior to 2010, NREGS (National Rural Employment Guarantee Scheme) payments in Andhra Pradesh were authenticated using pen and paper, with beneficiaries collecting wages at local post offices. To address the issues of this system, the government introduced a new system of biometrically authenticated payments.

Impacts

Increased incomes, and reduced poverty, amongst beneficiaries.
Impacts driven by increased earnings and employment in the private sector, outside of NREGs.

Successful government policies in Mexico

Preschool mandate

Policy - In 2002, Mexico passed a law mandating three years of preschool education as part of the compulsory-education system

Impacts:

Improved cognitive skills persist beyond early years
Enhanced school engagement and reduced failure rates
Improved non-cognitive skills
Increased likelihood of completing high school and enrolling in college

Public infrastructure investment

Policy - Mexico’s Programa Hábitat, a three-year infrastructure investment programme in which US$68 million was allocated across 370 neighbourhoods in 68 Mexican municipalities to infrastructure improvements and residential amenities.

Impacts:

Substantial positive impact on the commercial economy.
Elevated wages remain six years after investments.
Increases in firms' capital stocks and revenues accelerated.
Increased tax revenues from private sector firms alone mean programme could pay for itself in 14 years.

Read Daniel Rogger, Leonardo Iacovone, Luis F. Sánchez-Bayardo and Craig McIntosh’s research here.

Remote learning

Policy - Telesecundarias, which enrol students in grades seven through nine, were introduced in 1968 in response to difficulties in attracting qualified teachers to rural areas. At telesecundarias, each subject begins with a 15-minute lecture that has been recorded in Mexico City by high-quality instructors.

Impacts:

Increased average test scores in maths and Spanish.
Increased probability of staying in school.
Reduce urban rural test-score gap.

Are economists evaluating the right policies?

Reflecting on the research I reread when putting this together, it struck me that this type of project, which carefully examines a previous government policy in a developing country after the fact, is not the norm in the 'top' economics journals.

This is inevitable to some extent, given that a lack of data on economic outcomes before and after reforms prevents economists from deploying econometric methods to understand causality in the past. But this leads to a bias in the research that gets published in development economics. Many papers have revisited previous government policies in Asia and Central and South America, but few have done so in Africa.

Rigorously evaluating flagship government policies to provide evidence on their effectiveness seems to be a particularly impactful way that research can shape current policy debates, yet this type of work is very much missing in certain parts of the world. We would certainly like to read more of it, so please do send through any papers that we might have been missing over the past few years to [email protected]

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