Reducing poverty and promoting socioeconomic welfare and subjective well-being

Where I do research and analytical work:

Eric Mvukiyehe - Economist, World Bank Research Department - Research Map

Research Overview

Employment generation is a top priority for growth, development, and social stability in developing countries, particularly in fragile states. When employment prospects are dim, creating jobs can not only reduce vulnerability and extreme poverty, but can also lower the risk of social unrest and violence by helping redress grievances and raising the opportunity cost of joining rebellions or criminal organizations. Jobs, especially decent and well-paying jobs, have been hypothesized to have the potential to rebuild social fabric in fractured communities through enabling inclusion and providing common economic objectives. As the result, the development community and governments spend tens of billions of dollars every year on employment creation programs, with the goal to mitigate negative shocks and vulnerabilities from unemployment, especially in periods of crisis or economic downturns.

My research under this thematic area seeks to understand the sources of poverty and vulnerability for the poor and youth in developing and fragile contexts and to investigate the effectiveness of strategies to unlocking their labor market potential and breaking poverty traps in a sustainable manner. It uses theories from economics and political science and Randomized Control Trial (RCT) methods to assess the effectiveness development interventions targeting labor market outcomes, social stability and subjective wellbeing, particularly in FCV countries. I have two specific lines of research in this area I discuss further below.

Multi-country research on the effects of public works programs (PWPs) on economic welfare and subjective wellbeing of the poor

Eric Mvukiyehe - Economist, World Bank Research Department - Reducing Poverty

Public works programs (PWPs) provide temporary opportunities for the poor and unemployed individuals to work on labor-intensive projects, such as the development and maintenance of local infrastructure in exchange for low pay. Beyond the immediate goals of poverty relief and protection against income fluctuations, PWPs have also been hypothesized to have non- material effects such as reducing conflict/anti-social behaviors and promoting social cohesion and increasing subjective well-being, among other outcomes.

My work uses RCT methods across multiple countries to investigate these claims. Specifically, I’ve led 6 RCTs of PWPs in 4 countries (Comoros, DRC, Egypt, and Tunisia). Two key results stand out. First, overall PWPs have positive, short-term effects on economic welfare and labor market outcomes, but the evidence on whether such effects persist in the long run is scant. Second, the evidence on many non-material outcomes such as subjective wellbeing, migration and social cohesion pro-social behaviors or social cohesion is mixed at best.

Ongoing and further research focuses on 3 sets of issues. First, I’m investigating long-run impacts of PWPs, in addition to testing whether add-on interventions such as unconditional cash grant programs or incentivized savings can promote entrepreneurship and sustained livelihoods of beneficiaries. Second, I’m leveraging the rich and fine-grained data to measure more precisely the effects of PWPs on select non-material outcomes, migration, especially subjective well-being and child labor. I’m leveraging new and geo-coded data on crime, conflict and violence from third-party sources such as ACLED and/or SPEED to further ascertain the links (if any) between unemployment/employment and violence.

Research on the effects active labor market programs (ALMPs) on social and labor force integration of at-risk youth

Eric Mvukiyehe - Economist, World Bank Research Department - Reducing Poverty

The second strand of my research in this space targets present bias as well as labor market and behavioral constraints that affect the crime/violence anti-social behaviors versus employment choices of at-risk youth in wide-ranging settings, including Azerbaijan, DRC, Kazakhstan and Nigeria. In addition to investigating the effectiveness of traditional skills training programs, I also look at novel approaches such as apprenticeship schemes and soft skills targeting youth who lack basic foundational skills to be competitive in the labor market.

Emerging evidence from a set of randomized trials is mixed. In Nigeria, for example, my co- authors and I investigated experimentally two programs—an apprenticeship scheme and community-based skills training programs both of which targeted marginalized youth. We find that both programs had strong and positive effects on participants’ employment and productivity, job search behavior, and economic welfare, with some outcomes displaying striking heterogeneity in the results. The evidence on non-material outcomes is mixed: no evidence of effect on psychological well-being, anti-social behaviors, or support for religious enforcement norms, but positive effects on the expansion of professional social networks.

By contrast, in Kazakhstan, my co-authors and I conducted a randomized trial of an innovative program that sought to promote youth’s social integration and labor force engagement through grants for community service-learning projects and non-cognitive skills training involving mentorship. We find largely null or negative program impacts on enhancing non-cognitive skills and social capital, labor market outcomes and income, though there is evidence of weakly positive effects on human capital and economic welfare. We also find some heterogeneity, with rural participants displaying somewhat better results on some of these outcomes.