Economic Affairs
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Background:
Empirical evidence suggests that the uptake of maternal and child health (MCH) services is still low in poor rural areas of China. There is concern that this low uptake may detrimentally affect child health outcomes. Previous studies have not yet identified the exact nature of the impact that a conditional cash transfer (CCT) has on the uptake of MCH services and, ultimately, on child health outcomes. The objective of this study is to examine the relationship between CCT, uptake of MCH services, and health outcomes among children in poor rural areas of western China.

Methods:
We designated two different sets of villages and households that were used as comparisons against which outcomes of the treated households could be assessed. In 2014, we conducted a large-scale survey of 1522 households in 75 villages (including 25 treatment and 50 comparison) from nine nationally designated poverty counties in two provinces of China. In each village, 21 households were selected based on their eligibility status for the CCT program. Difference-in-difference analyses were used to assess the impact of CCT on outcomes in terms of both intention-to-treat (ITT) and average-treatment-effects-on-the-treated (ATT).

Results:
Overall, the uptake of MCH services in the sample households were low, especially in terms of postpartum care visits, early breastfeeding, exclusive breastfeeding, and physical examination of the baby. The uptake of the seven types of MCH services in the CCT treatment villages were significantly higher than that in the comparison villages. The results from both the ITT and ATT analyses showed that the CCT program had a positive, although small, impact on the uptake of MCH services and the knowledge of mothers of MCH health issues. Nonetheless, the CCT program had no noticeable effect on child health outcomes.

Conclusions:
The CCT program generated modest improvements in the uptake of MCH services and mothers’ knowledge of MCH services in poor rural areas of Western China. These improvements, however, did not translate into substantial improvements in child health outcomes for two potential reasons: poor CCT implementation and the low quality of rural health facilities.

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BMC Public Health
Authors
Alexis Medina
Scott Rozelle
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Product reliability is a key concern for manufacturers. We examine a significant but under-recognized determinant of product reliability: the rate of workers quitting from the product's assembly line, or its worker turnover. While modern manufacturers make extensive efforts to control defects and assure quality worksmanship, some quality variation in the manufactured units may be revealed only after they have been used repeatedly. If this is the case, then the disruptiveness of high turnover may directly lead to product reliability issues. To evaluate this possibility, our study collects four post-production years of field failure data covering nearly fifty million sold units of a premium mobile consumer electronics product. Each device is traced back to the assembly line and week in which it was produced, which allows us to link product reliability to production conditions including assembly lines' worker turnover, workloads, firm learning, and the quality of components. Significant effects manifest in two main ways: (1) In the high-turnover weeks immediately following paydays, eventual field failures are surprisingly 10.2% more common than for devices produced in the lowest-turnover weeks immediately before paydays. Using post-payday as an instrumental variable, we estimate that field failure incidence grows by 0.74-0.79% per 1 percentage increase in weekly turnover. (2) Even in other weeks, assembly lines experiencing higher turnover produce an estimated 2-3% more field failures. We demonstrate that staffing and retaining a stable factory workforce critically underlies product reliability and show the value of connected field data in informing manufacturing operations.

Keywords: Data-driven workforce planning, Empirical operations management, Employee turnover, People 

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Working Papers
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Authors
Prashant Loyalka
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The past four decades have witnessed unprecedented economic growth and rapidly rising food demand in China. This paper provides an introduction to readers with useful information summarising the development of China’s agricultural sector and the transformation of its rural economy over the 40 years of economic reform. It is, however, impossible to cover all aspects of this recent and rich history in a single journal special issue. Nevertheless, we are of the view that these papers address the most fundamentally important and insightful topics including: land reform and rural development; technology progress and productivity growth; changing food consumption patterns; rural education and human capital accumulation; and poverty alleviation.

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The Australian Journal of Agricultural and Resource Economics
Authors
Scott Rozelle
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We find that rapid worker turnover significantly disrupts the productivity of responsive manufacturers. Our study uses a uniquely rich dataset drawn from China-based FATP (final assembly, testing, and packaging) facilities that produce millions of units of consumer electronic goods weekly yet exhibit high worker turnover exceeding 300% annually. The data cover the firm's weekly production plans, 52,214 workers' compensations and assignments, and assembly station productivity. To study managerial prescriptions, we extend the classical production planning problem to include endogenous worker turnover as an Experience-Based Equilibrium and use advances in reinforcement learning and approximate dynamic programming to estimate and simulate our model. Our empirical analyses exploit instrumental variables, including the firm's demand forecasts as demand shifters". We find that turnover's impact on yield waste is conservatively $146-178M, and that a well-calibrated wage increase reduces the manufacturer's variable production costs (including wages) by up to 21%, or $594M for the product we study. The wage increase reduces the firm's reliance on a larger workforce and overtime to hedge against yield disruptions from turnover; it stabilizes a leaner workforce and improves both production reliability and exibility. In settings where performance depends on workers repeating known tasks in coordinated groups, our results suggest that firms responsively matching supply to demand can pay a steep price for a disruptively turnover-prone workforce.

 

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Prashant Loyalka
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This paper describes the current level of human capital in China and seeks to identify a number of education-related challenges that may slow down the nation’s economy from transitioning to high-income status. Relying on recent census-based data from OECD for the rest of the world and using data from the 2015 Micro-Census for China, the authors show that the low levels of education of China’s labour force is really a problem that has its roots in the past (in the 1970s, 1980s, and 1990s). In recent years (since 2000), China has been investing heavily in education as shown by the increasing the share of youth, including rural youth, attending high school. Despite this recent effort to raise the nation’s human capital, the education system still faces several challenges in trying to provide high-quality education for all youth. First, the government must figure out a way to overcome the relatively low rates of participation in high school by rural students. Second, there is concern that many vocational schools, especially those in rural areas, cannot deliver quality education. Finally, the paper will show that many rural students may be unprepared due to poor early childhood development outcomes.

 

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Journal Articles
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Journal of Contemporary China
Authors
Scott Rozelle
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Abstract and Keywords
Although global exporters, foreign producers, and domestic producers have been battling each other in China’s chocolate market for decades, it is not clear how Chinese consumers respond to the various brands. This chapter discusses the implementation of two tasting experiments to test the preferences of Chinese consumers. A ‘blind condition’, where participants were not told about the chocolate brands, was compared with a ‘non-blind condition’, where participants were informed about the brands before tasting. The results suggest that brand information does influence tasting experience. Chinese consumers have higher preferences for imported brands as compared with domestic brands or foreign brands which are produced in China.
 
Keywords: blind condition, Chinese consumers, preference of Chinese consumers, chocolate brands, tasting experiments, experiments, imported brands
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Oxford Scholarship Online
Authors
Scott Rozelle
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Unlike performance incentives for private sector managers, little is known about performance incentives for managers in public sector bureaucracies. Through a randomized trial in rural China, we study performance incentives rewarding school administrators for reducing student anemia -- as well as complementarity between incentives and orthogonally assigned discretionary resources. Large (but not small) incentives and unrestricted grants both reduced anemia, but incentives were more cost-effective. Although unrestricted grants and small incentives do not interact, grants fully crowd-out the effect of larger incentives. Our findings suggest that performance incentives can be effective in bureaucratic environments, but they are not complementary to discretionary resources. 

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Journal of the European Economic Association
Authors
Grant Miller
Scott Rozelle
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A recently developed small area estimation technique is used to geographically derive detailed estimates of consumption-based poverty and inequality in rural Shaanxi, China. These estimates may be helpful for targeting since there is wide variability in poverty rates within Shaanxi but low levels of inequality within most counties and townships. We also investigate whether including environmental variables in the equation used to predict consumption and poverty improves upon typical approaches that only use household survey and census data. Ignoring environmental variables appears likely to produce targeting errors.

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Environment and Developmental Economics
Authors
Scott Rozelle
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Using rural household panel data from three Chinese provinces, this paper identifies determinants of long-term poverty and tests the duration dependence on the probability to leave poverty. Special emphasis is given to the selection of the poverty line and inter-regional differences across provinces. Results suggest that the majority of population seems to be only temporary poor. However, the probability to leave poverty for those who were poor is differently affected by poverty duration across provinces ranging from no duration dependence in Zhejiang to highly significant duration dependence in Yunnan. The number of nonworking family members, education, and several village characteristics seem to be the most important covariates.

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World Development
Authors
Scott Rozelle
Number
4
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In contrast to its decentralized political economy model of the 1980s, China took a surprising turn towards recentralization in the mid-1990s. Its fiscal centralization, starting with the 1994 tax reforms, is well known, but political recentralization also has been under way to control cadres directly at township and village levels. Little-noticed measures designed to tighten administrative and fiscal regulation began to be implemented during approximately the same period in the mid-1990s. Over time these measures have succeeded in hollowing out the power of village and township cadres. The increasing reach of the central state is the direct result of explicit state policies that have taken power over economic resources that were once under the control of village and township cadres. This article examines the broad shift towards recentralization by examining the fiscal and political consequences of these policies at the village and township levels. Evidence for this shift comes from new survey data on village-level investments, administrative regulation and fiscal oversight, as well as township-level fiscal revenues, expenditures, transfers (between counties and townships) and public-goods investments.

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Journal Articles
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The China Quarterly
Authors
Scott Rozelle
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