Timothée Demont: timothee.demont[at]univ-amu.fr
Roberta Ziparo: rziparo[at]gmail.com
This paper sheds light on the question of how the process of economic development affects interactions in economic and social networks. To this end, we study networks of exchanges in 56 rural villages of The Gambia, West Africa. For each household in these villages we collect detailed data on six different dimensions of economic exchanges and exploit a randomly placed Community-Driven Development (CDD) project, which provides an exogenous source of variation to village-level stocks of productive capital, to identify the effect of economic development. We study network-related outcomes of this intervention at the village-, household- and at the dyadic-level. The CDD program is also designed to affect the structure of interactions within the villages, with a particular focus on inclusiveness and avoiding elite capture, and we study heterogeneous effects along those dimensions. Our data also allow us to investigate possible mechanisms for the observed changes in interactions within networks. In particular, we test whether the treatment affects reciprocity, formality of exchanges, and changes in the interactions with village outsiders. Further, we study a possible implication of the program-induced changes in networks, namely changes in risk-sharing.