A Pro-Poor Development Project in Rural Pakistan: An Academic Analysis and a Non-Intervention

The Asian Development Bank is an important source of external development assistance. In the course of a Bank project in rural Sindh (Pakistan), it was revealed at the project identification stage that sharecropping continued to be the basis of the agrarian system and that many of the sharecroppers were kept in a bonded relationship. The material conditions of the majority of the people in the area, despite past development projects, may have deteriorated in the last two decades and, it was suggested, would continue to do so unless the conditions of the sharecroppers were given primary attention. The research commissioned by the Bank revealed that deprivation, indebtedness and bondedness are widespread and co-exist with a tendency among the big landlords to turn part of their land to mechanized farming, thereby further marginalizing and disempowering tenant families. The team commissioned to study the conditions and propose the modalities of a rural development project proposed a bottom-up approach that confronted the sharecropping system head-on. The Asian Development Bank has been silent thereafter.     

Third-party punishment and counter-punishment in one-shot interactions

This paper presents experimental evidence from a simple three-person game showing that many individuals are willing to avenge third-party punishment in one-shot interactions. The threat of counter-punishment has a large negative effect on the willingness of third parties to punish selfish behavior. In spite of this, the extent of selfish behavior is identical to that in a treatment without counter-punishment opportunities. We discuss explanations for this puzzling finding.