Programs
The research activities of CERP are currently grouped under four research programs, each of which broadly corresponds to different research areas in economics. As CERP expands we anticipate these programs will grow both in scope and depth. Each program is led by a director, and all CERP Research Fellows are associated with one or more of these programs. The programs seek to promote research in specific areas bit by bringing together a network of scholars and by organizing seminars, conferences and facilitating policy exchanges. The links below provide further details on each program.
Firms,
and Organizations
Social Policy and Public Goods
Governance
and Institutions
Macro Policy and Finance
While somewhat narrowly titled, this program covers a wide range of research areas ranging from understanding firm and organizational behavior to examining individual decision making and beliefs. The tools utilized range from microeconomic theory and behavioral economics to econometric analysis of detailed micro-level datasets. In doing so it draws upon the field of Microeconomic and Contract theory, Industrial Organization, Corporate Finance, Organization Behavior, Behavioral and Experimental Economics, and Mechanism/Market Design. While motivated by fundamental research questions, the motivation and ultimate applications have a strong policy component to them.
A current area of interest of the program has been understanding how firms operate in the context of an emerging economy like Pakistan. This has included both examining how firms are organized in relational networks, how firm borrowing and financial health is affected by liquidity shocks, how private entrepreneurship is affected by market conditions that affect supply side factors and informational asymmetries, and the internal organizational design of firms and worker incentives.
In addition, program members have been also interest in examining issues related to how individuals face self-control and temptations in decision making, and how cognitive biases affect market behavior.
Program Director: Asim Ijaz Khwaja
Social Policy and Public Goods
This
research program encompasses research on education, health, social protection
and other public goods provision. The program aims to take a comprehensive
approach towards social policy looking at both the demand side--households,
parents, children—and the supply side--schools, teachers, health providers
as well as governance institutions and policy. The program aims to combine
insights from economic theory, detailed field work, large scale surveys
and policy experiments to bring out rigorous research papers as well as
frame the public debate and inform policy. Extensive education work has
been done under the LEAPS (Learning and educational Achievement in Punjab--www.leapsproject.org)
umbrella. Other empirical work includes a broad based empirical evaluation
of recovery from the 2005 earthquake.
In addition, program members have interests in gender issues, fertility
and family planning and design of income support programs.
Program Director: Tahir Andrabi
Political Economy, Institutions and Governance
Politics and the behavior of government play a crucial role in determining the growth and poverty reduction performance of economies. Political institutions and governance systems impact growth and poverty reduction because they: influence policy choice; determine the type and magnitude of public goods supplied; and impact the nature of economic institutions adopted by society. The considerable experimentation with political institutions and governance systems in developing economies offers a unique opportunity to deepen our understanding of the impact of different institutions on economic performance.
Our interest is in political institutions and governance systems ranging from: empowered versus weak local governments; politically versus bureaucratically-managed regulatory systems; decentralized versus centralized tax-raising powers; non-party based versus party-based electoral systems; autocracies versus democracies etc. We are also interested in analyzing the impact socio-economic inequality and ethno-linguistic fragmentation within political constituencies has on the behavior of politicians and government. We are particularly interested in analyzing how these factors impact political competition, political selection, and political and government accountability and, in turn, how changes in these channels impact economic outcomes. The program is also interested in empirically analyzing the role of history and path-dependence in shaping institutional trajectories and political outcomes.
The goal of the program is to further the theoretical and empirical understanding of the political sphere. It uses tools from game theory, contract theory and mechanism design theory for purposes of theoretical analysis. An important goal is to further empirical work in political economy based on detailed field-work, large-scale survey data and impact assessments of reform experiments. This work will be used to enrich the public and political debate on the reform of political institutions and governance systems, and to identify complementary socio-economic reforms that make politics and governance work better.
Program
Director: Ali Cheema
Our core area of focus is financial intermediation, i.e. the mechanisms through which capital is channeled to borrowing firms and households. Given the importance of capital as a factor of production, financial intermediation is intimately connected with both the level and volatility of economic growth. The recent economic crisis is yet another reminder of how excesses and disruptions in the intermediary process can seriously affect the economy.
Our goal is to focus on the theoretical and empirical understanding of how frictions in the intermediation process affect the real economy. Theoretically financial intermediation has two important roles to play: to promote global growth by channeling funds to countries where marginal product is highest and to reduce economic volatility by sharing risk across market participants.
However the success of financial intermediation in achieving its objectives is mixed. Capital often flows in the wrong direction with high-growth emerging markets exporting capital to mature economies. And financial intermediation is often-times blamed for creating and amplifying economic volatility, let alone mollify it. There is thus a great need to understand why capital is hard to push towards countries with high-growth potential, and how asset prices and financial intermediaries influence real activity. This group is dedicated to the pursuit of such questions.
Program
Director: Atif Mian