econ361 Cookstove Data
Cookstove DataAn NGO called HPLC operating in India which distributes high-efficiency cook stoves to low-income households gives you a data set. They would like to generate evidence that their cook stoves reduce indoor air pollution and subsequently improve health outcomes for their beneficiaries. The dataset contains variables as follows:the cookstove at a one-month follow-up visit by HPLCpoverty score).household had over the past six monthsendline_hh_size: data collected on income, hospital visits, pollution, and household size collected six months after the cooking stove distribution at an endline survey.
Problem Set 3
NEW DUE DATE: Nov 17th
Please turn in electronically on Blackboard 1. Cookstove Data
An NGO called HPLC operating in India which distributes high-efficiency cook
stoves to low-income households gives you a data set. They would like to generate
evidence that their cook stoves reduce indoor air pollution and subsequently improve
health outcomes for their beneficiaries. The dataset contains variables as follows:
• baseline_poverty_score: A baseline score HPLC created based on an initial
visit to all households in their service area
• hpcl_trt: An indicator for households that were given a free HPLC cookstove
• hpcl_use: An indicator for households that were found to be actually using
the cookstove at a one-month follow-up visit by HPLC
• baseline_income: household income measure at baseline (closely linked to
• baseline_hospital_visits: a count of the number of hospitals visits the
household had over the past six months
• baseline_pollution: a measure of indoor air pollution collected at baseline
• baseline_hh_size: number of people living in the household at baseline
• endline_income / endline_pollution / endline_hospital_visits / endline_hh_size: data collected on income, hospital visits, pollution, and
household size collected six months after the cooking stove distribution at an
a) The NGO asks you if they can just compare the indoor air pollution and hospital
visits of those who they gave the cookstoves to those who they did not. Explain why
or why not this is a good idea.
b) The NGO informs you that they allocated the cookstoves to households based on their
initial measure of baseline poverty. Only if a household had a poverty score of 15 or
less were given the cookstove. Based on this new information suggest an alternative
research design to the NGO that would be able to answer their questions. c) You are concerned that the NGO also provides other interventions (such as livelihood
support, microcredit, and other health interventions) along the same targeted
threshold. i) Explain why the two graphs below help you check this concern and ii)
whether these graphs make you feel better or worse about the research design.
d) You produce two graphs that answers the NGO’s question about the effect of their
cookstoves on i) indoor air pollution (at endline) and ii) the number of hospital visits
a household makes. Based on these graphs, what would you (approximately) estimate
the treatment effect of cookstoves is on these two outcomes?
6 5 4 3 2 1
0 20 40 60 80
0 20 40 60 80
4 3 2 1
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0 20 40 60 80
e) An NGO employee informs you that many households knew the allocation rule of the
NGO before the baseline survey. What concern does this raise about your research
design you used above? You produce a graph to check this concern. Does the graph
make you feel better or worse about this potential problem?
f) The same NGO employee also informs you that many households do not like the taste
of food cooked using the cook stoves and so they stopped using them after a few
days. i) Where could you check for this effect in your data? ii)If true, how does this
change your interpretation of the treatment effects?
0 20 40 60 80
baseline_poverty_score 2. Education
a) Explain why low-income households might perceive the returns to education as being
lower than they actually are. You may find it helpful to draw a graph to illustrate your
b) How would the process you explained in part a) affect a high-income household? (i.e.
would a high-income household perceive the returns to education to be too high, too
low, or accurately?)
c) Describe the empirical evidence that individuals (or households) do in fact have
incorrect beliefs about the return to education.
d) Using the simple model of optimal choice of education we discussed in class,
describe how incorrect beliefs about the returns to education would change optimal
e) Using the same model, describe how the construction of a factory that has high
demand for unskilled labor would change optimal schooling choice. 3. Agriculture
a. i) Explain in words why the risk of land appropriation affects the amount of inputs
a farmer may use on their field? ii) Express this relationship using math based on
the model explored in the lecture slides.
b. Which type of investment do you expect would be more affect by land insecurity:
fertilizer usage or irrigation investments? Why?
c. Explain why farmers might choose to pay for fertilizer now to be delivered later
rather than opting to pay only once it arrived. What type of preferences must a
farmer have for this choice to be rational (i.e. welfare maximizing from the
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