Monday, September 20, 2010

Going Meta, What a Meta-analysis tells you

I have not been updating the blog much lately. I have been hard at work on a project funded by the British Government's Department For International Development.

The project is a meta-analysis of how giving poor families money influences their children's height. A meta-analysis means I'm examining a bunch of different studies (a couple of dozen is what we found after weeks of searching databases). Why children's height, because it's a good indicator of health?

I'm not ready to be cited yet, but I have learned there really aren't that many studies of how cash influences children's health (a couple dozen). Cash programs (and particularly those with conditional health check ups and schooling) seem to be extremely popular with governments and aid agencies.

I hope our study sheds a little light on what might influence a program's effect on children's height (and health). Since most of the support for these cash payments is based off of results on a handful of programs continuing to analyze differences between countries is important.

A study in Brazil (Morris et al. 2004) where a cash payment actually decreased child height, gives us a little pause. The authors suggest that families feared they might lose the transfer if children were too healthy (even thought this wasn't the case). This shows even if a type of program would work well in all places, you might not get a well functioning program everywhere.
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Friday, September 10, 2010

Loyalty in the Information Age

"Loyalty is what we call it when someone refuses a momentarily better option." from Seth Godin

I like this quote as it applies to brand loyalty. There are very few brands I'm loyal too. In fact I can't think of any right now. One thing is with low cost items I can try a new one out if it's cheap. For high cost items the internet makes searching for reviews easy. In the information age, I wonder if loyalty is falling since people can research other options.

One type business I try to be loyal to is a local coffee shop. Loyalty should seem to increase for service oriented transactions that occur regularly. A renovated store front around the corner looks like it might be a coffee shop, will I stay loyal to the other one? I'm not sure.
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Wednesday, September 8, 2010

The High Price of Coffee

The price of coffee has soared to a 13 year high. This Wall Street Journal article highlights the causes more demand and bad harvests.

So could this increase in coffee prices be good for coffee farmers? Yes in the short term they are likely to earn more money (assuming they aren't having the bad harvest). In fact the harvest might be so good they may pull their kids out of school to work on coffee farmers (Krueger (2007) in Journal of Development Economics)

13 years ago the last time coffee prices peaked was 1997. Just 3 years later coffee prices had fallen 50-70% and many families who earned income through coffee saw their income fall substantially. Why did this happen? With all the profits to be made in coffee, countries like Vietnam increased production to the point where there was a glut in the market.

So I'm guessing this price surge will be temporary. But the linked article suggests

"If coffee prices stay high, it may make sense at some point for die-hard drinkers to start stocking up. If you buy the beans green and roast them yourself, they will stay fresh longer. You're earning no interest on the money you have in the bank anyway, so the "opportunity cost" of the money is minimal. You might as well withdraw some of it and buy your coffee "forward.""

Having had fresh roasted beans this sounds like a great idea!

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