Essays in applied microeconomics

This thesis studies service provision and organizations with a spatial perspective. Chapter 2 proposes that digitalisation makes the physical distance between service provider and user less relevant. I quantify the potential gains this flexibility offers in digital primary care in Sweden, harnessing nationwide conditional random assignment. I evaluate causal effects of matching patients of varying risks to doctors with different skills. Matching patients at high risk of avoidable hospitalizations to doctors skilled at triaging reduces avoidable hospitalizations by 20% on aggregate – without affecting other outcomes. Conversely, matching the best triaging doctors to the richest patients leads to more avoidable hospitalizations, since the most vulnerable patients are often the poorest. Hence, remote matching can sever the link between local area income and service quality. Chapter 3 is a spatial study of infrastructure provision. Africa’s demand for urban housing is soaring, even as it faces a proliferation of slums. In this setting, can modest infrastructure investments in greenfield areas where people subsequently build their own houses facilitate long-run neighborhood development? We study projects implemented in seven Tanzanian cities during the 1970s and 1980s, using a spatial regression discontinuity design to compare greenfield areas that were treated (de-novo) with nearby greenfield areas that were not. We find that by the 2010s, de-novo areas developed into neighborhoods with larger, more regularly laid-out buildings and better-quality housing. Chapter 4 evaluates the effectiveness of performance incentives across locations. Performance rewards are a cornerstone of management practices in Western countries but rarely used elsewhere. We test the hypothesis that the effect of rewards depends on whether a society values individual achievements. To do so, we set up identical data-entry firms in three countries and randomize the incentives offered to workers. We find that the effect of incentives on productivity aligns with the country’s rank on the individualism-collectivism scale, ranging from 0 in the least individualistic country to 20% in the most individualistic. We conclude that cultural norms must be embedded in the design of personnel policies