Do debit cards increase household spending? Evidence from a semiparametric causal analysis of a survey

© Institute of Mathematical Statistics, 2014.Motivated by recent findings in the field of consumer science, this paper evaluates the causal effect of debit cards on household consumption using population-based data from the Italy Survey on Household Income and Wealth (SHIW). Within the Rubin Causal Model, we focus on the estimand of population average treatment effect for the treated (PATT). We consider three existing estimators, based on regression, mixed matching and regression, propensity score weighting, and propose a new doubly-robust estimator. Semiparametric specification based on power series for the potential outcomes and the propensity score is adopted. Cross-validation is used to select the order of the power series. We conduct a simulation study to compare the performance of the estimators. The key assumptions, overlap and unconfoundedness, are systematically assessed and validated in the application. Our empirical results suggest statistically significant positive effects of debit cards on the monthly household spending in Italy.

A Hard Bargain? A cost-benefit analysis of an improved cookstove program in India

In developing countries, access to modern energy for cooking and heating still remains a challenge to raising households out of poverty. About 2.5 billion people depend on solid fuels such as biomass, wood, charcoal and animal dung. The use of solid fuels has negative outcomes for health, the environment and economic development (Universal Energy Access, UNDP). In low income countries, 1.3 million deaths occur due to indoor smoke or air pollution from burning solid fuels in small, confined and unventilated kitchens or homes. In addition, pollutants such as black carbon, methane and ozone, emitted when burning inefficient fuels, are responsible for a fraction of the climate change and air pollution. There are international efforts to promote the use of clean cookstoves in developing countries but limited evidence on the economic benefits of such distribution programs. This study undertook a systematic economic evaluation of a program that distributed subsidized improved cookstoves to rural households in India. The evaluation examined the effect of different levels of subsidies on the net benefits to the household and to society. This paper answers the question, “Ex post, what are the economic benefits to various stakeholders of a program that distributed subsidized improved cookstoves?” In addressing this question, the evaluation used empirical data from India applied to a cost-benefit model to examine how subsidies affect the costs and the benefits of the biomass improved cookstove and the electric improved cookstove to different stakeholders.