Brenda Samaniego de la Parra is assistant professor of development economics in the Keough School of Global Affairs and affiliate faculty at the BIG Lab and the Pulte Institute for Global Development.
How did you get interested in development economics and research?
Brenda Samaniego de la Parra: A combination of things drew me towards research in general and towards studying development specifically. An important experience that strengthened my interest in a PhD and in research was my time working at Mexico’s National Banking and Securities Commission. One of the big questions the Commission was working on at the time was “How can we improve access to basic financial services?”. I was working with a lot of people who had PhDs and trying to answer these questions, and it got to a point where I could read the academic papers about it, but I couldn't necessarily replicate them, let alone generate novel analysis. But I felt like some of the models that the existing papers used weren’t directly applicable to countries like Mexico. I needed this research toolkit to answer those questions.
Then when I started my PhD program at the University of Chicago, I was exposed to research on labor market frictions, and to people thinking about how firms and workers meet and how that impacts unemployment and growth. This then became a big source of interest for me because of the large and persistent presence of informality in labor markets in Latin America.
In your paper Wage setting protocols and labor makret conditions: Theory and evidence, you look at entrepreneurial ability. Could you tell us how you identified that Zambia was the place you wanted to examine that in?
So there's a couple of reasons why Zambia became the focus of a series of papers. The paper on entrepreneurial ability is one of them, but now I have been working in Zambia for the past 5 years, creating a detailed account of how the retail sector operates in a developing country, the challenges shops face, and how various policies can help stem growth. Going back to your question on “why Zambia:” I would argue that in this quest to study “How can we improve the lives of people?” it's important to focus really on places that have the biggest challenges, and Sub-Saharan Africa is one of those places.
And the second reason, which, might initially seem to contradict this point, is that actually some of the challenges, or features, that got me interested in Zambia actually exist in most of the middle-income and developed world.
In fact, my initial interest in the idea of “Why do we observe huge and persistent differences in the performance of shop,” even within narrowly defined industries and after controlling for various relevant factors initially came to me from looking at Mexico. The project got implemented in Zambia, but the findings are quite generalizable, I would argue.
You mentioned the lack of retail data in developing countries, how was it working on this project and some of the challenges of collecting data within the project/research?
This was one of the first projects where I collected my own data. Before then, I would rely on very large data sets, but often from administrative services or other pre-existing surveys. That's a big difference between working in a middle income, or even middle-low income, country, versus working in very low-income areas, or countries that are classified as low development. There's just no data. The government doesn't consistently collect it. It's expensive, it's hard to collect, so then governments aren't doing as much as other places to keep track of all this data.
One of the biggest challenges was that we didn't have a census of the shops. Oftentimes, when you're collecting your own data, you say, “Well, the country has some list, a census, of all the shops that exist, and then we're going to sample from this set, and go and survey them and ask them questions”. Even when such a census exists, it is still a big challenge, because as researchers we need to go and build trust with the shops. We had to first go and figure out where are the shops? How many are there? What is their lifespan?
For this project, we were very ambitious in terms of the data collection, so we did the census, we had a baseline survey that was very detailed, and then after that, we did a high-frequency phone survey where we called shops every day of a week, once a month, for 8 months. It was definitely a learning process but I think we ended up with a very high-quality survey with very low attrition, with people participating at very high rates, and for a long period of time, which is also rare.
On your projects, your work with multiple partners. What in your experience has helped in forming effective working partnerships across stakeholders like governments, local implementing partners, or other organizations?
I think establishing strong feedback channels is important. Presenting the idea in a non-extractive arrangement, where you're like “this is what I'm after, this is what I need. But here's how I see the project benefiting the respondents, benefiting your institution, this is why I think this is important.”
As researchers, we might have a pre-established idea of what the benefits of the project are. But we need to be flexible and open to feedback. The various stakeholders (respondents, government and community organizations, universities, etc.) are a source of valuable information and you can learn a lot about your own project by sharing your goals with them.
For example, after talking to some of the firms in Zambia, they suggested we get the support of “market leaders.” These are individuals who are part of the community who are respected, that are able to walk around and tell other shops, “Listen, you can trust these guys, they're not scammers, they're not here to steal your data, etc.”i.e. someone from the community that can “vouch for you.”
Showing the institutions, the government, the respondents, that you're actually interested in what they have to say and not just have a very fixed idea, potentially built from an outsider perspective, from the outset. Repeated interactions help a lot as well.
What is one of the most memorable episodes from your research in the field that has shaped your perspective on your work?
In general, a newfound respect for people that do their own data work. There's always unexpected events no matter how prepared we feel, no matter how many pilots we do beforehand, and how familiar we are with this sample now. There's always something that we just didn't expect.
More broadly, how do you see your work affecting people’s lives and policy?
This is how I came into academia. In search of better policies, better outcomes, so I try to have a policy connection in all of my work, to think “What is the policy intervention?” Not just what policies can we implement to improve things, but maybe what policies can we remove? I think one of the main ways in which my research can influence policy is by identifying the things that policy is getting wrong, and measuring the impact of those policies and potentially removing them, correcting, or giving some insights on how firms and workers operate that is different from how they work in a developed context.
What research, be it new areas or new projects are you looking forward to? Any new projects in the plans?
Academia feels like this battle between the existing projects that are close to wrapping up, and the new ones that are, just by virtue of being new, more exciting.
In a new project that I am currently working on the goal is to understand how information frictions impact formal employment. Many of the benefits that you get from having a formal job, you get in the future, whereas the cost you pay today. For example, you're paying taxes today, and then, 20 years from now, conditional on meeting a bunch of other requirements, you'll get a pension. Even if, you know, accounting-wise, the value is there, like it is worth it to be paying those costs so that at the end of your work life you have a pension, it's sometimes hard to make that calculation. It can either be that people have a hard time calculating it, or that they just don't know what the requirements are. I'm trying to understand whether these sort of information frictions or behavioral frictions of overly discounting the future are behind the high rates of informality that we observe across the developing world. And I'm excited about it!
This interview has been edited for length and clarity. It was conducted as part of a series of faculty profiles on BIG Lab Affiliated Faculty coming out this spring. Stay up to date with the BIG Lab by following us on Twitter, LinkedIn, or Bluesky.