Alicia Adsera és Investigadora i Professora d’Economia i Afers Internacionals a la Princeton University (EUA).

Seminari sobre la recerca duta a terme per: Alicia Adsera (Princeton University); Francesca Dalla Pozza (EBRD); Sergei Guriev (EBRD); Lukas Kleine-Rueschkamp (OECD) i Elena Nikolova (UCL).

Abstract.- Using newly available data, we re-evaluate the impact of economic and political transition in Eastern Europe on anthropometric measures (height and BMI) and subjective well-being. In particular we use the Life in Transition Survey LiTS III that was administered by EBRD and the World Bank in 2015/16 and covers over fifty thousand households in 29 formerly communist countries (excluding Turkmenistan) and 5 comparator countries (Germany, Italy, Turkey, Greece and Cyprus). Our identification strategy is based in a differences in differences estimator that uses the fact that transition (measured as the year of price liberalization) started at different times in different countries in our sample. We find clear evidence of the high social cost of early transition reforms: cohorts born around the start of transition are on average close to 1cm shorter as adults than their older or younger peers. This height gap indicates major deprivation in the first years of reform. This impact is similar in size to that of a war and is partially but not fully explained by GDP. The impact is larger among urban residents and it is negatively related with maternal education.

To test the robustness of results we employ the Russian Longitudinal Monitoring Survey of the Higher School of Economics (RLMS) 1994-2014 that includes both children and adult in the same household so we can control for parental height, and measure differences in height during childhood. Given the longitudinal nature of the data we can also control for age. We address concerns of endogenous fertility and differences in unobservable characteristics at the household level by conducting both propensity matching score and within-family models to compare siblings.

Despite this shock in height, those cohorts are no less satisfied with their lives today than their peers. While this optimistic message holds for an average resident of transition countries, we do identify certain vulnerable social groups for whom the negative impact of the early transition shock still persists.