Seminar: Nancy Qian (12/1/09)
Tuesday, Dec 1, 3:30-5:00 PM, Bunche Hall 9383
Co-sponsored with Albert Family Fund Seminar in Applied Microeconomics
“The Institutional Causes of Famine in China, 1959-61″
Nancy Qian (Yale University)
Abstract:
We investigate the institutional theory of famine in the
context of the largest famine in history: China’s Great Famine
1959-61. First, we provide evidence inconsistent with the traditional
aggregate-food shortage theory of famine by showing that even though food production declined in 1959, national food production remained well above per-capita subsistence needs. Second, we use historic data to provide evidence that are difficult to reconcile with conventional market-failure theory of famine (Sen, 1981): regions that are were more productive in grain suffered famine more in 1959 even though in normal years, they were better off. Finally, we reconcile these two facts with a model of constrained optimal policy which explains a new institutional mechanism for the generation of famine. Our model implies that government policy, which is constrained by imperfect information and limited bureaucratic capacity, can amplify the rise in mortality resulting from a downturn in aggregate food production and can cause this rise in mortality to be increasing in local food production. A counterfactual exercise suggests that the presence of free markets for food would generate lower mortality relative to the constrained optimal policy because free markets incorporate the aggregate decline in food production into the price of food, resulting in a more equal cross-regional decline in food consumption.
If you’re interested in meeting with or joining the lunch/dinner group, please send email to Prof. Pascaline Dupas (PDupas@econ.ucla.edu) with cc to Kristina de Vera (Kdevera@ccpr.ucla.edu).
