nep-afr New Economics Papers
on Africa
Issue of 2007‒09‒09
fourteen papers chosen by
Suzanne McCoskey
George Washington University

  1. The Long-Term Effects of Africa's Slave Trades By Nathan Nunn
  2. The Impact of Unconditional Cash Transfers on Nutrition: The South African Child Support Grant By Jorge M. Agüero; Michael R. Carter; Ingrid Woolard
  3. How responsive is body weight to transitory income changes? Evidence from rural Tanzania By Bengtsson, Niklas
  4. The Case for Financial Sector Liberalization in Ethiopia By Kozo Kiyota; Barbara Peitsch; Robert M. Stern
  5. Long-Term Farming Trends. An Inquiry Using Agricultural Censuses By Gustavo Anríquez; Genny Bonomi
  6. The economic impact of climate change on Kenyan crop agriculture : a ricardian approach By Karanja, Fredrick K; Kabubo-Mariara, Jane
  7. Setas – A Vehicle for the Skills Revolution? By Renee Grawitzky
  8. Rural Income Generating Activities; A Cross Country Comparison By Benjamin Davis; Paul Winters; Gero Carletto; Katia Covarrubias; Esteban Quinones; Alberto Zezza; Kostas Stamoulis; Genny Bonomi; Stefania DiGiuseppe
  9. Rural Household Access to Assets and Agrarian Institutions; A Cross Country Comparison By Alberto Zezza; Paul Winters; Benjamin Davis; Gero Carletto; Katia Covarrubias; Esteban Quinones; Kostas Stamoulis; Takis Karfakis; Luca Tasciotti; Stefania DiGiuseppe; Genny Bonomi
  10. An Assessment of the Impact of Wheat Market Liberalization in Egypt; A Multi-Market Model Approach By Gamal M. Siam; André Croppenstedt
  11. The International Literature on Skills Training and the Scope for South African Application By Sean Archer
  12. Addressing Food Insecurity in Fragile States; Case Studies from the Democratic Republic of the Congo, Somalia and Sudan By Luca Alinovi; Günter Hemrich; Luca Russo
  13. Action, Function, & Structure; Interpreting Network Effects on Behavior in Rural Malawi By Guy Stecklov; Alejandro Alexander Weinreb
  14. Muslim population shares and global development patterns 1990 - 2003 in 134 countries By Tausch, Arno

  1. By: Nathan Nunn
    Abstract: Can part of Africa's current underdevelopment be explained by its slave trades? To explore this question, I use data from shipping records and historical documents reporting slave ethnicities to construct estimates of the number of slaves exported from each country during Africa's slave trades. I find a robust negative relationship between the number of slaves exported from a country and current economic performance. To better understand if the relationship is causal, I examine the historical evidence on selection into the slave trades, and use instrumental variables. Together the evidence suggests that the slave trades have had an adverse effect on economic development.
    JEL: F1 F15 N0 O1
    Date: 2007–09
  2. By: Jorge M. Agüero (University of California, Riverside); Michael R. Carter (University of Wisconsin, Madison.); Ingrid Woolard (University of Cape Town)
    Abstract: In light of research that has argued that the income elasticity of nutrition is low, the goal of a new generation of cash transfer programmes to boost the nutrition of poor families' children may seem surprising. This observation applies especially to South Africa's unconditional Child Support Grant (CSG), in which cash grants are made to families with no strings attached. However, in contrast to the market-generated income increases that identified low nutritional elasticities in the earlier studies, the income increases generated by the South African cash transfers are almost exclusively assigned to women. Taking advantage of a slow programme rollout that created exogenous variation in the extent of CSG treatment received by beneficiaries in the province of KwaZulu-Natal, this Working Paper utilizes the continuous treatment method of Hirano and Imbens (2004) to estimate the impact of these transfers on child nutrition as measured by child height-for-age. Large dosages of CSG treatment early in life are shown to significantly boost child height. Drawing on the best estimates in the literature, these estimated height gains in turn suggest large adult earnings increases for treated children and a discounted rate of return on CSG payments of between 160 per cent and 230 per cent.
    Keywords: Nutrition, cash transfers, continuous treatment estimator, South Africa, poverty
    JEL: I12 H53 C21 D13
    Date: 2007–09
  3. By: Bengtsson, Niklas (Department of Economics)
    Abstract: We use time-series of rainfall along with individual fixed effects to estimate the response of body weight to transitory changes in house-hold income and expenditure. Our data consist of a longitudinal sample of subsistence farmers in rural Tazania, representing one of the poorest populations in the world. We find that the response of body weight to transitory changes in household income is positive on average, but that the impact decreases with age and being male. For female children, a ten percent increase in household income implies an increase in body weight with about 0.4 kilo. The body weight of male adults is practically invariant to income changes.
    Keywords: Income variability; Consumption; Nutrition; sub-Saharan Africa
    JEL: D13 I12 O12
    Date: 2007–08–30
  4. By: Kozo Kiyota (Yokohama National University and University of Michigan, Ann Arbor); Barbara Peitsch (University of Michigan, Dearborn); Robert M. Stern (University of Michigan, Ann Arbor)
    Abstract: This paper focuses on issues of financial sector liberalization in Ethiopia, with reference in particular to the Ethiopian banking sector. We identify two factors that may constrain Ethiopia’s financial development. One is the closed nature of the Ethiopian financial sector in which there are no foreign banks, a non-competitive market structure, and strong capital controls in place. The other is the dominant role of state-owned banks. Our observations suggest that the Ethiopian economy would benefit from financial sector liberalization, especially from the entry of foreign banks and the associated privatization of state-owned banks.
    Keywords: foreign banks, state-owned banks, financial sector liberalization, Africa, Ethiopia
    JEL: G21 G32 L33 O55
    Date: 2007
  5. By: Gustavo Anríquez (Agricultural and Development Economics Division, Food and Agriculture Organization); Genny Bonomi (Agricultural and Development Economics Division, Food and Agriculture Organization)
    Abstract: This paper provides a long-term and global view at current farming trends by analyzing a specially created database of farming characteristics of 17 countries across 43 different agricultural censuses representing the different developing regions of the world. The study shows that while agricultural land appears to be a constraint in central and East Asia, it has been under expansion in Latin America, Northern Africa, and most of Sub Saharan Africa. We also estimate that 9 out of 10 farms are small (i.e. smaller than 2 ha). These farms are more specialized in staple crops than their larger counterparts, and exhibit slower productivity growth.
    Keywords: Small Farms, land distribution, agricultural census, productivity.
    JEL: Q10 Q15
    Date: 2007
  6. By: Karanja, Fredrick K; Kabubo-Mariara, Jane
    Abstract: This paper measures the economic impact of climate on crops in Kenya. The analysis is based on cross-sectional climate, hydrological, soil, and household level data for a sample of 816 households, and uses a seasonal Ricardian model. Estimated marginal impacts of climate variables suggest that global warming is harmful for agricultural productivity and that changes in temperature are much more important than changes in precipitation. This result is confirmed by the predicted impact of various climate change scenarios on agriculture. The results further confirm that the te mperature component of global warming is much more important than precipitation. The authors analyze farmers ' perceptions of climate variations and their adaptation to these, and also constraints on adaptation mechanisms. The results suggest that farmers in Kenya are aware of short-term climate change, that most of them have noticed an increase in temperatures, and that some have taken adaptive measures.
    Keywords: Climate Change,Environmental Economics & Policies,Common Property Resource Development,Global Environment Facility,Crops & Crop Management Systems
    Date: 2007–08–01
  7. By: Renee Grawitzky
    Abstract: Abstract: Sector Education and Training Authorities (Setas), established in terms of the Skills Development Act, 97 of 1998, were launched amid much fanfare and expectation of delivery towards achieving a skills revolution in the country. Upon their immediate establishment in March 2000, these perceived bureaucracies – which controlled the flow of billions – came under attack and became the subject of constant criticism. Over the years, this criticism has not abated and perceptions of Seta non-delivery has been exacerbated by recent reports that a resolution to the ‘skills crisis’ is critical for the success of government’s Accelerated and Shared Growth Strategy for South Africa (Asgisa). The perception of a skills crisis has raised concerns as to whether Setas are responsive enough to the needs of employers (private and public) and the country as a whole. In view of these underlying sentiments, the University of Cape Town’s Development Policy Research Unit (DPRU) commissioned a study to evaluate the role of Setas in contributing towards addressing the country’s skills needs. This study will seek to evaluate Seta performance since their inception by exploring: • Seta functioning and distill, from a range of perceptions (and legislation), their core deliverables and responsibilities; • Whether there are underlying factors – systemic or otherwise – which are impacting on the way in which Setas are supposed to operate; and • Based on the findings of three case studies, recommend interventions to improve Seta performance.
    Keywords: Setas (Sector Education and Training Authorities), Skills development
    JEL: A1
    Date: 2007–07
  8. By: Benjamin Davis (Agricultural and Development Economics Division, Food and Agriculture Organization); Paul Winters (Agricultural and Development Economics Division, Food and Agriculture Organization); Gero Carletto (Agricultural and Development Economics Division, Food and Agriculture Organization); Katia Covarrubias (Agricultural and Development Economics Division, Food and Agriculture Organization); Esteban Quinones (Agricultural and Development Economics Division, Food and Agriculture Organization); Alberto Zezza (Agricultural and Development Economics Division, Food and Agriculture Organization); Kostas Stamoulis (Agricultural and Development Economics Division, Food and Agriculture Organization); Genny Bonomi (Agricultural and Development Economics Division, Food and Agriculture Organization); Stefania DiGiuseppe (Agricultural and Development Economics Division, Food and Agriculture Organization)
    Abstract: This paper uses a newly constructed cross country database composed of comparable variables and aggregates from household surveys to examine the full range of income generating activities carried out by rural households in order to determine: 1) the relative importance of the gamut of income generating activities in general and across wealth categories; 2), the relative importance of diversification versus specialization at the household level; 3) the relationship between key household assets and the participation in and income earned from these activities; and 4) the influence of rural income generating activities on poverty and inequality. Analysis of the RIGA cross country dataset paints a clear picture of multiple activities across rural space and diversification across rural households. This is true across countries in all four continents, though less so in the African countries included in the dataset. For most countries the largest share of income stems from off farm activities, and the largest share of households have diversified sources of income. Diversification, not specialization, is the norm, although most countries show significant levels of household specialization in non-agricultural activities as well. Nevertheless, agricultural based sources of income remain critically important for rural livelihoods in all countries, both in terms of the overall share of agriculture in rural incomes as well as the large share of households that still specialize in agricultural sources of income.
    Keywords: rural non farm, income diversification, household surveys.
    JEL: I32 O15 O57
    Date: 2007
  9. By: Alberto Zezza (Agricultural and Development Economics Division, Food and Agriculture Organization); Paul Winters (Agricultural and Development Economics Division, Food and Agriculture Organization); Benjamin Davis (Agricultural and Development Economics Division, Food and Agriculture Organization); Gero Carletto (Agricultural and Development Economics Division, Food and Agriculture Organization); Katia Covarrubias (Agricultural and Development Economics Division, Food and Agriculture Organization); Esteban Quinones (Agricultural and Development Economics Division, Food and Agriculture Organization); Kostas Stamoulis (Agricultural and Development Economics Division, Food and Agriculture Organization); Takis Karfakis (Agricultural and Development Economics Division, Food and Agriculture Organization); Luca Tasciotti (Agricultural and Development Economics Division, Food and Agriculture Organization); Stefania DiGiuseppe (Agricultural and Development Economics Division, Food and Agriculture Organization); Genny Bonomi (Agricultural and Development Economics Division, Food and Agriculture Organization)
    Abstract: Access to assets and agrarian institutions is of critical importance to the economic viability of rural households. Understanding the extent of this access and how it links to the ability of rural households to employ different pathways out of poverty is thus vital for designing rural development policies. This paper characterizes household access to assets and agrarian institutions through the comparative analysis of datasets from 15 nationally representative household surveys from four regions of the developing world. We find that the access of rural households to a range of assets (including education, land and livestock) and institutions is in general low, though highly heterogeneous across countries, and by categories of households within countries. A large share of rural agricultural households do not use or have access to basic productive inputs, agricultural support services or output markets, and in general it is the landless and the smallest landowners who suffer significantly more from this lack of access.
    Keywords: rural non farm, assets, agrarian institutions, household surveys.
    JEL: O13 O57 Q12
    Date: 2007
  10. By: Gamal M. Siam (Agricultural and Development Economics Division, Food and Agriculture Organization); André Croppenstedt (Agricultural and Development Economics Division, Food and Agriculture Organization)
    Abstract: Wheat is central to the government of Egypt’s food security policy which is influenced by a concern for overdependence on imports and the need to provide subsidized bread for the poor. This paper uses a multi-market approach to assess the impact of complete wheat market liberalization, an international wheat price increase, the value of strategic stocks and the impact of investment to generate higher yields and lower transaction costs for wheat producers. Results show that wheat market liberalization implies very substantial costs for consumers and producers. The estimated income losses that these groups suffer would appear to be below the current total subsidy costs and hence a cash transfer program would, in principle, be feasible. The results show that wheat price movements impact strongly on the supply and/or demand side in particular of berseem, rice, maize, cotton and livestock which has significant implications for their net imports as well as input use. Results indicate that strategic stocks can be useful to neutralize the impact of a wheat price spike. Increasing wheat yields and reducing transportation boosts wheat self-sufficiency but does not dampen the impact of removing the wheat subsidy system on household’s welfare.
    Keywords: Egypt, agriculture sector, wheat, multi-market model, bread subsidy, policy scenario impact analysis.
    JEL: Q11 Q18
    Date: 2007
  11. By: Sean Archer (University of Cape Town)
    Abstract: Abstract: This paper aims to introduce selected issues from the international literature on skills training into the South African policy forum. Reform of national strategies in skills production has characterised a number of industrial as well as certain developing economies in recent decades. Their experience is potentially valuable locally. The main lessons are that skills training resembles education in being partly a public good. The acquisition of skills parallels the acquisition of knowledge. Training opportunities do have to be rationed by some mechanism, either through the market or by rules internal to an organisation engaged in training, but the content of the competency learned is a form of knowledge. More competency with economic value that is acquired by one person does not mean less of it is available for acquisition by another. Nor, secondly, can non-payers be wholly excluded from the benefits of training financed by others. For example, there are separate gains for fellow workers, for employers poaching trained workers, and for investors in new technology. So certain economic decision-takers can free-ride on such investments in human capital. As classic examples of market failure they make clear that simple allocation through a market is not at all adequate for a national system of skills training. The second lesson is that problems of information, incentives and market power preclude the emergence of a training equilibrium in which individual workers and employers pursue their interests successfully and therefore efficiently. In practice most training takes place on the job, where it is difficult for an outside agency like the state to influence investment decisions directly. Sensible roles for the state are to supply needed information, to put in place positive and negative incentives where needed, to provide accreditation that is credible in the market, to set up a framework of regulation that fosters informational transparency and constrains skills poaching, and to invest in high quality prior education for trainees flowing into occupational markets. An additional state function is to provide workable policy devices like ‘temporary migration programmes’ that enable active skilled labour recruitment from source countries. International precedents exist that show the way in a number of these expedients.
    Keywords: skills training, on the job training, South African policy
    JEL: A1
    Date: 2007–07
  12. By: Luca Alinovi (Agricultural and Development Economics Division, Food and Agriculture Organization); Günter Hemrich (Agricultural and Development Economics Division, Food and Agriculture Organization); Luca Russo (Agricultural and Development Economics Division, Food and Agriculture Organization)
    Abstract: Drawing on case studies from the Democratic Republic of the Congo (DRC), Somalia and Sudan, this paper focuses on policy, programming and institutional issues related to addressing food insecurity in protracted crises and fragile states, with a focus on areas afflicted by conflicts. The case studies illustrate how dysfunctional institutions are at the root of structural food insecurity and show how local people and institutions have been able, to a certain extent, to adapt and cope with the crises. However, the protracted nature of the crises has substantially eroded people’s assets and weakened the capacities of traditional safety net systems to provide protection. Against this background, mainstream humanitarian assistance – which has been the international community’s dominant response – has not been able to address the basic determinants of food security and in particular has not sufficiently supported the positive efforts of local institutions. The case studies illustrate some innovative approaches for addressing food insecurity during protracted crises. They show that while it remains indispensable to ensure neutrality for immediate responses that protect the most vulnerable, it is also crucial to take into account institutional and policy dynamics that support processes to rebuild resilience; create opportunities for strengthening the livelihoods of affected population at the very early stages of the crisis; and develop an adequate basket of interventions to address a variety of needs.
    Keywords: Food security, Institutions, Protracted crisis, Fragile states, Resilience, Livelihoods, Humanitarian assistance.
    JEL: Q15 Q18 R20 R52
    Date: 2007
  13. By: Guy Stecklov (Agricultural and Development Economics Division, Food and Agriculture Organization); Alejandro Alexander Weinreb (Agricultural and Development Economics Division, Food and Agriculture Organization)
    Abstract: A long series of ethnographic and sociological studies on kinship systems and information flows in developing societies has portrayed networks as varying structurally, serving multiple functions, and expressing themselves in different types of interaction. Little of this earlier work has informed empirical research in demography or development-related research. In stead, the latter operationalize social networks in relatively narrow ways, allowing for little overlap between multiple networks, and focusing on a subset of potential causal mechanisms. In an effort to pull the empirical literature closer to its qualitative forbearer, we use data from the Malawi Diffusion and Ideation Change Project to test how conversation networks and transfer networks overlap. We offer some predictions regarding how these overlapping networks might individually or jointly influence distinct outcome including ownership of livestock, planning innovative crops and HIV testing. Our sample of women from Malawi, interviewed in 3 rounds across a 6-year period, also enables us to question the inter-temporal stability of network effects. Our findings highlight: (a) how networks based on different actions appear nonetheless consistent with diverse behavioral outcomes; (b) how there is relatively little overlap between conversational and transfer networks; and (c) how there is considerable instability in temporal effects of conversational networks.
    Keywords: Agricultural innovation, social networks, risk diversification, HIV testing.
    JEL: J1 O1 O3 D8 D85
    Date: 2007
  14. By: Tausch, Arno
    Abstract: 9 key conclusions are drawn: 1) First of all, Islam is hardly to blame for global development problems, let alone, Muslim migration is to blame for the failure of the European Lisbon process 2) it emerges that the European Union, the way it is constructed, is not the answer, but part of the very problem of stagnation and deficient development 3) in particular, the Lisbon target “low comparative price levels” contradicts the other Lisbon targets 4) Europe is characterized by an aging society and the pension crisis. But World Bank pension models will not propel economic growth and sustainable development 5) Opening up to global markets and unfettered globalization will not provide sustainable development to the European political economy 6) Many of the ills of the Muslim world are in reality caused by the crisis of modernization (“things get worse, before the get better”) 7) The “Limits to Growth” in the richest countries create serious social and ecological tensions 8) Urbanization negatively affects development in many ways 9) The positive effects of globalization are very limited While the analysis on world development 1990 – 2003, which contradicts in many ways Huntingtons famous book (1996), shows the detrimental effects of dependency, low comparative price levels and membership in the EU-15 on the social and ecological balances of countries of the world, we also tested the effects of our new data on Muslims per cent of total population on a comprehensive number of dependent variables of socio-economic development in 134 countries of the world, namely 1. economic growth, 1990-2003 (UNDP HDR, 2005) 2. freedom from political rights violations, 1998, and 2006 (Easterly, 2000-2002, and Freedom House, 2007) 3. Happy Planet Index (Happy Planet Organization) 4. Human development Index, 2005 (UNDP HDR 2005) 5. Gender development index 2004 (UNDP HDR, 2006) 6. Gender empowerment index, 2004 (UNDP HDR, 2006) 7. life expectancy, 1995-2000 (UNDP HDR 2000) 8. Life Satisfaction (Happy Planet Organization) 9. freedom from unemployment (UN statistical system website, social indicators) 10. eco-social market economy (GDP output per kg energy use) (UNDP HDR 2000) 11. the Yale/Columbia environmental sustainability index (ESI-Index), 2005 12. female economic activity rate as % of male economic activity rate (UNDP HDR 2000) 13. freedom from % people not expected to survive age 60 (UNDP HDR 2000) 14. freedom from a high ecological Footprint (Happy Planet Organization) 15. freedom from a high quintile ratio (share of income/consumption richest 20% to poorest 20%) (UNDP HDR 2005) 16. freedom from civil liberty violations, 1998, and 2006 (Easterly, 2002, and Freedom House, 2007) 17. freedom from high CO2 emissions per capita (UNDP HDR 2000) Ceteris paribus, Muslim culture even significantly and positively affects the human rights record, human development, gender development, and the ecological balances, and in general terms alleviates the problem of “structural violence”, measured in terms proposed by Galtung (1971). But there is a significant negative relationship between the percentages of Muslims per total population and the indicator: life satisfaction. Also it emerges that Muslim nations and countries with large Muslim population shares suffer dispropotrionately from heavy unemployment; which is closely connected to the problem of unequal exchange (low comparative international price levels). As to the causal directions of these relationships, the article argues in favor of cautious interpretations, and no final verdict is reached. In many ways, Muslim communities are to be regarded as socially stabilizing and growth enhancing factors. But the negative relationship between life satisfaction and Muslim population shares invites for a more thorough debate on happiness, based on classic Muslim philosophy or hanafist Euro-Islam, and against tendencies of a salafist reading of the scriptures. Our work also argues in favor of taking the problem of unequal exchange (low comparative price levels) more seriously as in the past. It is an underlying causal mechanism, creating unemployment in the Muslim world. At any rate, a liberal, tolerant and spiritual reading of the Holy Scriptures is recommended – much in the spirit of major religious Muslim figures as Professor Smail Balic from Bosnia and Professor Ali Bardakoglu from Turkey.
    Keywords: C21 - Cross-Sectional Models; Spatial Models; Treatment Effect Models; C43 - Index Numbers and Aggregation; Z12 – Religion; F59 - International Relations and International Political Economy: Other
    JEL: F5 Z12 F22 F15 F50
    Date: 2007

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