NBER Publications by Shuang Zhang

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June 2016Willingness to Pay for Clean Air: Evidence from Air Purifier Markets in China
with Koichiro Ito: w22367
We develop a framework to estimate willingness to pay (WTP) for clean air from defensive investment. Applying this framework to product-by-store level scanner data on air purifier sales in China, we provide among the first revealed preference estimates of WTP for clean air in developing countries. A spatial discontinuity in air pollution created by the Huai River heating policy enables us to analyze household responses to long-run exposure to pollution. Our model allows heterogeneity in preference parameters to investigate potential heterogeneity in WTP among households. We show that our estimates provide important policy implications for optimal environmental regulation.
February 2016The Limits of Meritocracy: Screening Bureaucrats Under Imperfect Verifiability
with Juan Carlos Suárez Serrato, Xiao Yu Wang: w21963
Meritocracies are less effective at identifying high-ability bureaucrats when performance is imperfectly observed. We develop this point in two ways. First, we show that governments face a trade-off between setting incentives that screen for high-ability people, and incentives that maximize output. We formalize this trade-off and show that observed compensation patterns may reveal whether governments prioritize screening. Empirically, we show that provincial Chinese governments used the implementation of the One Child Policy to screen for mayoral ability, implying a meritocratic objective. Second, our theory shows that misreporting prevents meritocracies from selecting high-ability bureaucrats. We use a non-manipulated measure of performance to show that Chinese mayors misreported performa...
June 2013Land Reform and Sex Selection in China
with Douglas Almond, Hongbin Li: w19153
Following the death of Mao in 1976, abandonment of collective farming lifted millions from poverty and heralded sweeping pro-market policies. How did China's excess in male births respond to rural land reform? In newly-available data from over 1,000 counties, a second child following a daughter was 5.5 percent more likely to be a boy after land reform, doubling the prevailing rate of sex selection. Mothers with higher levels of education were substantially more likely to select sons than were less educated mothers. The One Child Policy was implemented over the same time period and is frequently blamed for increased sex ratios during the early 1980s. Our results point to China's watershed economic liberalization as a more likely culprit.

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