When useful information is distressing, it may deliberately be ignored. In this paper, we examine both theoretically and experimentally whether increasing perceived efficacy — the belief that one’s actions can influence an outcome — reduces such strategic ignorance. Participants in India are given the choice to receive or avoid information about the average loss in life expectancy due to air pollution in their district and are later asked to recall it. We find that increasing perceived efficacy significantly improved recall, particularly among participants with optimistic prior beliefs. The pattern is confirmed when conducting the same experiment in the United States. Our theoretical framework highlights how perceived efficacy shapes the interplay between anticipatory and realized utility, thereby influencing strategic ignorance.

This study examines the socio-economic, behavioral, and psychological consequences of a terminated business loan program in South Sudan on intended beneficiaries. While all participants received business training, only some were able to obtain the promised loan before the program was canceled due to renewed conflict. The study combines data from face-to-face interviews and data from lab experiments to examine outcomes one year after the program’s cancellation. Results from local average treatment effect (LATE) estimations show that those participants who failed to receive the loan display significant declines in consumption. Moreover, this group exhibits a significant reduction in trust, particularly trust in institutions. These results highlight that more attention should be given to the detrimental effects of implementation failures.

Almost half of the world’s states provide bilateral development assistance. While previous research takes the set of donor countries as exogenous, this article introduces a new dataset on aid giving covering all countries in the world, both rich and poor, and explores the determinants of aid donorship. It argues and shows empirically that democratic institutions support the setup of an aid program in richer countries but undermine its establishment in poorer countries. The findings hold in instrumental-variable regressions and the pattern is similar for the amount of aid.

This paper examines how perceived income status shapes individual behavioral responses to air pollution, holding actual income constant. In a randomized online experiment with 1,253 adults in India, participants are informed about their position in the state-level income distribution. Given the widespread underestimation of income rank, the information treatment shifts perceived status upward on average. This increase in perceived rank lowers reported health concerns about air pollution, reduces intended adoption of private protective measures, and decreases support for public mitigation, as measured by real-stakes contributions to environmental NGOs. These findings show that perceptions of income status alter the relative value individuals place on health versus consumption, shaping both private adaptation and support for collective environmental action.

Urban flooding is projected to intensify under climate change, yet causal evidence on the economic impacts of physical adaptation infrastructure remains scarce. We study drainage infrastructure upgrades in Barishal, Bangladesh, exploiting spatial spillovers in flood hazard reduction at non-targeted locations as a source of quasi-experimental variation. Using high-resolution elevation data and a two-dimensional hydrodynamic flood model, we show that these spillovers are large and geographically diffuse. Combining these predictions with a spatially representative household survey of 2,649 households conducted after the 2025 rainy season, we show that reduced flood exposure lowers income losses and school absences and improves the reliability of local transport. By contrast, we find no evidence of effects on adult labor supply or overall mobility. Our findings have direct implications for climate adaptation policy in rapidly urbanizing, flood-prone cities.

Rising regional inequality has renewed interest in place-based infrastructure investments as a tool for promoting local economic development. This study uses the large-scale roll-out of electric transmission infrastructure in Nigeria from 2009 to 2015 to quantify the effect of electrification on internal migration. We address endogenous placement in two ways: First, we compare peripheral households along transmission corridors, i.e. areas not targeted by the program. Second, we instrument actual lines with least-cost paths. Results show an increase in the individual likelihood of migrating by 6 percent and a reduction in household size by 0.8 individuals, mainly driven by young adults and older teenagers. These effects are consistent with electrification easing credit constraints; local job creation for younger individuals remains limited. Results from a gravity model of migration show a reduction in the elasticity of migration with respect to movement costs and a rise in migration to rural, electrified destinations following the electricity supply shock. Taken together, these findings suggest that productivity-enhancing place-based infrastructure investments may facilitate out-migration from disadvantaged areas and have unintended implications for regional inequality and urbanization.