Can foreign aid foster economic development, even if it is given to satisfy objectives of the donor country? I study this highly debated question in the context of Chinese infrastructure aid, which has received much attention from policymakers. I link project-level aid data with administrative firm-level data from China to identify political determinants of Chinese aid and its economic consequences for recipient countries. I document that when there is local labor unrest in a Chinese prefecture, contracts for Chinese aid projects are allocated to large state-owned firms in the prefecture, and employment by these firms increases. Connections between these firms and other countries mean that China's response to domestic unrest affects the allocation of Chinese aid projects to recipient countries. I exploit the variation in countries' receipt of aid caused by the timing and spatial variation in local labor unrest in China, together with these connections, to develop a novel instrument for identifying the causal effects of Chinese aid on recipients. I find large positive effects on GDP, trade, consumption and employment.
We exploit the staggered introduction of 3G mobile internet in Africa to examine the effect of new communication technologies on the spread of political unrest in and across countries. We design a novel empirical strategy that allows us to separate the direct effect of mobile internet on unrest from spillovers. We find that digital communication networks lead to the spread of unrest independent of physical distance. Preliminary evidence suggests that social media constitute an important channel.
We use detailed administrative firm data and natural language processing techniques to understand the scope of and motivations underlying the Chinese Communist Party's (CCP) growing involvement in the operations of private firms in China.
This paper examines the state-building process in multi-ethnic societies. Specifically, we study the Ujamaa policy in Tanzania from 1970--1981, one of the largest policy experiments in post-colonial Africa aimed at building a national identity among the population and establishing the new post-independence state as a legitimate authority. The policy brought much, but not all of the country's population to live in planned villages, where children were exposed to public education whose content reflected the new government's political goals. We combine differences in the intensity of villagization across districts with differences in the exposure to the timing of the policy across age cohorts to identify the effect of the Ujamaa policy on citizens' attitudes. We show persistent, positive effects on national identity, as measured by survey responses and inter-ethnic marriage decisions. Treated cohorts are less likely to demand democratic accountability: they express positive views for a strong central state and question less state authority.