nep-afr New Economics Papers
on Africa
Issue of 2012‒04‒23
28 papers chosen by
Quentin Wodon
World Bank

  1. How important are external shocks in explaining growth in Sub-Saharan Africa? Evidence from a Bayesian VAR By Senbeta Sisay R.
  2. Working Paper 148 - Role of Fiscal Policy in Tackling the HIV/AIDS Epidemic in Southern Africa By AfDB
  3. Remittances provide resilience against disasters in Africa By Naudé, Wim; Bezuidenhout, Henri
  4. Public Support to Food Security in India, Brazil and South Africa: Elements for a Policy Dialogue By Darana Souza; Danuta Chmielewska
  5. Democracy and Stock Market Performance in African Countries By Simplice A , Asongu
  6. Real Wage, Labor Productivity, and Employment Trends in South Africa: A Closer Look By Nir Klein
  7. Integrating Public Works and Cash Transfers in Ethiopia: Implications for Social Protection, Employment and Decent Work By Maikel Lieuw-Kie-Song
  8. The impact of health worker migration on development dynamics: evidence of wealth-effects from Africa By Simplice A, Asongu
  9. Development thresholds of foreign aid effectiveness in Africa By Simplice A , Asongu
  10. Institutional benchmarking of foreign aid effectiveness in Africa By Simplice A, Asongu
  11. Education, HIV Status, and Risky Sexual Behavior: How Much Does the Stage of the HIV Epidemic Matter? By Danielia Iorio; Raul Santaeulalia-Llopis
  12. Do Export Costs Matter in Determining Whether, When, and How Much African Firms Export? By Naude, Wim; Matthee, Marianne
  13. Inflation Expectations of the Inattentive General Public By Monique Reid
  14. An exploration of agricultural grassroots innovation in South Africa and implications for innovation indicator development By Letty, Brigid; Shezi, Zanele; Mudhara, Maxwell
  15. Evidence from Spatial Correlation of Poverty and Income By Hamaguchi, Nobuaki
  16. Government spending, corruption and economic growth By d'Agostino, Giorgio; Dunne, Paul J.; Pieroni, Luca
  17. Ethnic Networks and Technical Knowledge Learning in Industrial Clusters By Chung, Yessica C.Y.
  18. Assessing Effectiveness and Sustainability of Community-managed Informal Irrigation in Africa By Hanatani, Atsushi; Sato, Mine
  19. Fiscal Policies and Rules in the Face of Revenue Volatility Within Southern Africa Customs Union Countries (SACU) By Olivier Basdevant
  20. The High-Frequency Response of the Rand-Dollar rate to Inflation Surprises By Greg Farrell; Shakill Hassan; Nicola Viegi
  21. Monetary Policies and Nigerian Economy:Simulations from Dynamic Stochastic General Equilibrium(DSGE)Model By Nwaobi, Godwin
  22. Recursos naturales y desarrollo en el Chad: ¿maldición de los recursos o inserción periférica? By Artur Colom Jaén
  23. Impact of Farmer Field Schools on Agricultural Income and Skills By Todo, Yasuyuki; Takahashi, Ryo
  24. A subgroup decomposition of inequality of poverty in Cameroon By BILOA ESSIMI Jean Aristide, BEJA; CHAMENI NEMBUA Célestin, CNC; MIAMO WENDJI Clovis, MWC
  25. Exchange Rate Volatility Under Peg: Do Trade Patterns Matter? By Constant Lonkeng Ngouana
  26. Identifying aid effectiveness challenges in fragile and conflict-affected states By Ishihara, Yoichiro
  27. Gacaca and DDR By Takeuchi, Shinichi
  28. Do Community-Managed Schools Facilitate Social Capital Accumulation? Evidence from the COGES Project in Burkina-Faso By Sawada, Yasuyuki; Ishii, Takaharu

  1. By: Senbeta Sisay R.
    Abstract: This paper assesses the relative importance of external shocks in explaining the GDP growth in Sub-Saharan African countries. We estimate a Bayesian VAR model with the Stochastic Search Variable Selection (SSVS) approach for ?ve countries in the region - Botswana, Ethiopia, Kenya, Mauritius, and Nigeria - two of which are among the fastest growing countries over the last decade, while the other three are countries for which relatively complete data are found on variables of interest. The results suggest the following two points. First, the contribution of external shocks to the variation in the growth rate of GDP of the home country varies signi?cantly across the countries considered. Second, the terms of trade shock is the most important of the external factors we included in our analysis. One lesson that can be drawn from this study is that generalizations about the impact of external shocks to the whole Sub-Saharan African region are misleading.
    Date: 2012–04
  2. By: AfDB
    Date: 2012–04–16
  3. By: Naudé, Wim (UNU-MERIT/MGSoG, Maastricht University); Bezuidenhout, Henri (North-West University, Potchefstroom, South Africa)
    Abstract: How responsive are remittances to various disasters, both natural and human-made? And would remittances be affected by systemic financial crises (such as the 2008/09 financial crisis)? Using panel data on 23 Sub-Saharan African (SSA) countries over the period 1980 to 2007, we find that remittances are slow to respond to natural disasters, unresponsive to outbreaks of conflict, and will decline, albeit slowly, after a global financial crisis only to the extent that the crisis affects incomes, migration stocks, exchange rates, and the banking system. The relative persistence of remittances suggests that it is a good bulwark against natural disasters and global financial crises in SSA.
    Keywords: remittances, migration, disasters, global financial crisis, Africa
    JEL: F24 F22 O55
    Date: 2012
  4. By: Darana Souza (International Policy Centre for Inclusive Growth); Danuta Chmielewska (International Policy Centre for Inclusive Growth)
    Abstract: Together, India, Brazil and South Africa have nearly 1,365 billion inhabitants (World Bank, 2009), or about 20 per cent of the world?s population. Although the three countries have demonstrated the potential for transformative development in the South, their experience has been marked by key challenges such as relatively high levels of poverty, inequality and food insecurity, problems that persist for significant numbers of people. This minilateral group of countries known as IBSA is a crucial pole for increasing South-South learning and has much potential for debate on innovative development policy initiatives. (...)
    Keywords: Public Support to Food Security in India, Brazil and South Africa: Elements for a Policy Dialogue
    Date: 2011–04
  5. By: Simplice A , Asongu
    Abstract: Purpose – This paper assesses the incidence of political institutions on stock market performance dynamics in Africa. Design/methodology/approach – The estimation technique used is a Two-Stage-Least Squares Instrumental Variable methodology. Channels of democracy, polity and autocracy are instrumented with legal-origins, religious-legacies, income-levels and press-freedom qualities to account for stock market performance dynamics of capitalization, value traded, turnover and number of listed companies. To ensure robustness of the analysis, the following checks are carried out: (1) usage of alternative indicators of political institutions; (2) employment of two distinct interchangeable sets of moment conditions that engender every category of the instruments; (3) usage of alternative indicators of stock market performance; (4) account for the concern of endogeneity; (5) usage of Principal Component Analysis(PCA) to reduce the dimensions of stock market dynamics and political indicators and then check for further robustness of findings in the regressions from resulting indexes. Findings – Findings broadly demonstrate that democracy improves investigated stock market performance dynamics. Practical implications – As a policy recommendation, the role of sound political institutions is crucial for financial development in Africa. Democracies have important effects on both the degree of competition for public office and the quality of public offices that favor stock market development in the African continent. Originality/value – To the best of our knowledge this is the first paper to assess the incidence of democracy on stock market performance in an exclusive African context. Political strife has plagued many African countries and continue to pose a significant threat to financial market development.
    Keywords: Financial Markets; Government Policy; Political Economy; Development
    JEL: P43 G18 G28 G10 P16
    Date: 2012–04–17
  6. By: Nir Klein
    Abstract: The paper looks at the dynamics of employment in South Africa and examines the factors that contributed to the job-shedding observed during the recent financial crisis. The paper finds that the rapid growth of the real wage, which outpaced the labor productivity growth in most sectors, played an important role in suppressing employment creation. The paper also finds that while there is a co-integrating link between the real wage and labor productivity, the deviations from equilibrium are persistent and thus contribute to a weak link between real wage growth and labor productivity growth in the short term. This finding is also supported by a cross-country analysis, which shows that in South Africa the link between the real wage and labor productivity is substantially weaker than in other emerging markets, even after controlling for labor market tightness indicators.
    Keywords: Employment , Labor markets , Labor productivity , Unemployment , Wages ,
    Date: 2012–04–03
  7. By: Maikel Lieuw-Kie-Song (Independent researcher and consultant)
    Abstract: What is the relevance of Africa?s second largest social protection programme, Ethiopia?s Productive Safety Net Programme (PSNP), for other countries and especially for India, Brazil and South Africa (IBSA)? Are there policy lessons to be noted and operational innovations to be learned from? At least in part, this paper sets out to answer these question by reviewing and analysing the employment and social-protection aspects of PSNP. Four aspects of PSNP were considered of potential interest and identified for further analysis, all of them interrelated to some degree. (?)
    Keywords: Integrating Public Works and Cash Transfers in Ethiopia: Implications for Social Protection, Employment and Decent Work
    Date: 2011–08
  8. By: Simplice A, Asongu
    Abstract: This paper examines three relevant hypotheses on the incidence of health worker migration on human development and economic prosperity (at macro and micro levels) in Africa. Owing to lack of relevant data on Health Human Resource(HHR) migration for the continent, the subject matter has remained empirically void over the last decades despite the acute concern of health professional emigration. Using quantile regression, the following findings have been established. (1) The effect of HHR emigration is positive (negative) at low (high) levels of economic growth. (2) HHR emigration improves (mitigates) human development (GDP per capita growth) in low (high) quantiles of the distribution. (3)Specific differences in effects are found in top quantiles of human development and low quantiles of GDP per capita growth where the physician (nurse) emigration elasticities of development are positive (negative) and negative (positive) respectively. As a policy implication blanked health-worker emigration control policies are unlikely to succeed across countries with different levels of human development and economic prosperity. Hence the policies should be contingent on the prevailing levels of development and tailored differently across the most and least developed African countries.
    Keywords: Welfare; Health; Human Capital; Migration
    JEL: F22 O15 J24 D60 I10
    Date: 2012–04–18
  9. By: Simplice A , Asongu
    Abstract: Purpose – This paper examines whether initial levels in GDP growth, GDP per capita growth and inequality adjusted human development matter in the impact of aid on development. In substance its object is to assess if threshold development conditions are necessary for the effectiveness of foreign-aid in Africa. Design/methodology/approach – The panel quantile regression technique enables us to investigate if the relationship between development dynamics and development assistance differs throughout the distributions of development dynamics. Findings – Two main findings are established. (1) The effectiveness of aid in economic prosperity (at micro and macro levels) increases in positive magnitude across the distribution. This implies high-growth countries are more likely to benefit from development assistance (in terms of economic prosperity) than their low-growth counterparts. (2) Existing levels of human development do not affect the manner in which foreign-aid negatively affects human emancipation. Thus the negative incidence of aid on human emancipation is almost similar across the human development distribution. Practical implications – Two policy implications result. (1) Blanket policies on the aid-economic prosperity nexus are unlikely to succeed in Africa; thus policy measures should be contingent on prevailing levels of economic growth and tailored differently across high and low growth countries. (2) Common policies could be applied within the framework of the aid-human development nexus regardless of country-specific (existing) human emancipation levels. Originality/value – This paper contributes to existing literature on the effectiveness of foreign-aid by focusing on the distribution of the dependent variables (development dynamics). It is likely that high and low growth countries respond differently to development assistance.
    Keywords: Foreign Aid; Political Economy; Development; Africa
    JEL: F35 F50 O55 O10 B20
    Date: 2012–04–13
  10. By: Simplice A, Asongu
    Abstract: This paper integrates two main strands of the aid-development nexus in providing additional information as to why institutional benchmarks (thresholds) matter for the effectiveness of aid in institutional development. Using seven government-quality dynamics (rule of law, regulation quality, government-effectiveness, political-stability, voice & accountability, corruption-control and democracy), we provide a thorough assessment of the aid-development nexus when existing institutional development levels matter. Results which are consistent across specifications and conditional distributions of institutional variables have three broad implications (with respect to three tested hypotheses). (1) Institutional benefits of foreign-aid are contingent on existing institutional levels in Africa. (2) But for a thin exception, foreign-aid is instrumental in institutional development for countries with low levels of institutional quality. (3) Institutional quality benefits of development assistance are questionable in countries with high levels of institutional development. As a policy implication, blanket policies based on the aid-development nexus are unlikely to be appropriate; therefore policy measures should be contingent on prevailing levels of institutional development and tailored differently across best and worst countries in terms of institutional development.
    Keywords: Foreign Aid; Political Economy; Development; Africa
    JEL: F35 F50 O55 O10 B20
    Date: 2012–04–13
  11. By: Danielia Iorio; Raul Santaeulalia-Llopis
    Abstract: We study the relationship between education and individual HIV status using nationally representative data (Demographic and Health Surveys, DHS) for 18 countries in Sub- Saharan Africa (SSA). Because the diffusion of knowledge on HIV prevention.hence, actual change in sexual behavior.may differ across education groups, we explicitly explore the possibility of a dynamic relationship between education and the probability of being infected with HIV over aggregate stages of the HIV epidemic. Our contribution is twofold. First, we construct an innovative algorithm that positions, for any set of countries, the country-specific evolution of the HIV epidemic in a unified framework.a normalized epidemiological define stages of the HIV epidemic in a comparable manner across SSA countries. Second, using this framework, we exploit epidemiological stage variation across DHS country observations and find that the relationship between education and individual HIV status is dynamic and significantly evolves with the course of the epidemic. Specifically, we show that the education gradient of HIV displays a large U-shaped (positive-zero-positive) pattern over the aggregate stages of the HIV epidemic.
    Keywords: HIV, demographics
    JEL: I15
    Date: 2011–11
  12. By: Naude, Wim; Matthee, Marianne
    Abstract: What is the impact of export costs on the speed and extent to which African firms exports? We answer this question using a sample of 49,584 (mostly formal) firms across 71 countries, including 5,839 firms in 16 African countries surveyed by the World Bank during 2002 and 2003. We find that firms in African countries face higher export costs on average than firms in other parts of the world. However we find that African firms are more likely to enter export markets, but that when they do the extent of their exports (exports as a share of their total sales) is on average less than that of firms elsewhere. Also, younger firms are more likely to start exporting than older firms. As for the impact on export costs, we establish that the costs of exporting (as measured in US dollars) lower the likelihood and the extent of African firms’ exports but not when African firms start exporting.
    Keywords: international entrepreneurship , exports , transport costs , firm heterogeneity , Africa
    Date: 2012–02–21
  13. By: Monique Reid
    Abstract: The majority of academic research on central bank communication has analysed a central bank’s audience as a single group. Analyses, especially empirical research have focused almost exclusively on a central bank’s interaction with the financial markets, facilitated by the availability of high-quality, high-frequency asset price data. In practice, a central bank’s audience is heterogeneous, and recognising this is advantageous for both modelling purposes and effective central bank communication. Many central banks use a range of communication tools to reach their various audiences, but little formal analysis has been conducted to guide policy design and communication strategies. Gathering and processing information are costly for the general public, so they make rational decisions that limit the time and resources they allocate to these tasks. As a result, aggregate inflation expectations of the public as a whole can be described as ‘stick' in that the spread of information about inflation expectations through the economy is not instantaneous. A body of literature has emerged over the past decade, led by Mankiw and Reis (2001), who developed the Sticky Information Phillips Curve (SIPC), and Carroll (2002, 2003), who proposed microfoundations for the SIPC. This paper follows Carroll (2002, 2003) in adopting epidemiological models to provide insight into how the general public in South Africa forms its inflation expectations. This enables an estimation of the speed at which the South African general public updates its inflation expectations (information stickiness). Agent-based models, which explain the complex aggregate inflation expectations of the general public from the agent level upwards, are then used to verify these estimates of information stickiness and explore the microfoundations of aggregate inflation expectations
    Keywords: South Africa, sticky information, inflation expectations, inattentive general public
    JEL: D82 D83 E31 E52 E58
    Date: 2012
  14. By: Letty, Brigid (Institute of Natural Resources, South Africa); Shezi, Zanele (Farmer Support Group, University of KwaZulu-Natal); Mudhara, Maxwell (Farmer Support Group, University of KwaZulu-Natal)
    Abstract: The core of this paper consists of two case studies of 'grassroots' innovation led by innovative smallholder farmers in a village in South Africa - one about developing an alternative production practice for growing potatoes, and the other about introducing a new cash crop (cherry peppers) and the establishment of a new marketing relationship. One of the purposes of the study was to explore questions about the development of innovation indicators that might support policy and management concerned with this kind of innovation. The case studies are therefore located in the context of a review of existing science, technology and innovation indicators and their limitations with respect to this area of agricultural innovation. Another purpose was to identify and clarify the position of 'grassroots' innovation within other perspectives on different kinds of innovation system (or mode of innovation) in agriculture in developing countries. The case studies are also therefore set in the context of a review of literature about these other system perspectives, focusing in particular in 'formal' and 'informal' systems, and on 'grassroots' and 'participatory' modes of innovation involving interactions between formal and informal systems. The combination of case studies and broader reviews leads to two main conclusions: (1) grassroots and other participatory modes of agricultural innovation merit much greater policy attention than they have received; but (2) the base of available analysis and indicators about these approaches to innovation and their effectiveness is still inadequate to inform and support policy and management in this area. The paper therefore concludes with a discussion of steps that might be taken to improve the available information, understanding and indicators about these modes of innovation.
    Keywords: Agriculture, innovation, grassroots innovation, informal economy
    JEL: O13 O17 O33
    Date: 2012
  15. By: Hamaguchi, Nobuaki
    Abstract: Using the district-level data, we found that even in a relatively poor country like Kenya, ethnic diversity is associated with better economic outcomes at local level. However, we found that income spillovers depend on ethnic similarity. This suggests the influence of ethnic bias through which ethnic diversity may undermine economic efficiency at the national-level, as many crosscountry regressions have pointed out. This result implies, for policy making, that the question of interregional transaction costs cannot be narrowly focused on problems of transportation infrastructure but it is also related with ethnic divisions in African context.
    Keywords: ethnic bias , spatial correlation , regional economy
    Date: 2011–11–14
  16. By: d'Agostino, Giorgio; Dunne, Paul J.; Pieroni, Luca
    Abstract: This paper considers the effects of corruption and government spending on economic growth. It starts from an endogenous growth model and extends it to account for the detrimental effects of corruption on the potentially productive components of government spending, namely military and investment spending. The resulting model is estimated on a sample of African countries and the results show, first, that the growth rate is strongly influenced by the interaction between corruption and military burden, with the interaction between corruption and government investment expenditure having a weaker effect. Second, allowing for the cyclical economic fluctuations in specific countries leaves the estimated elasticities close to those of the full sample. Third, there are significant conditioning variables that need to be taken into account, namely the form of government, political instability and natural resource endowment. These illustrate the cross country heterogeneity when accounting for quantitative direct and indirect effects of key variables on economic growth. Overall, these findings suggest important policy implications.
    Keywords: corruption; military spending; development economics; panel data; Africa
    JEL: D73 H5 O57
    Date: 2012–04–15
  17. By: Chung, Yessica C.Y.
    Abstract: Using an enterprise-level dataset collected from 234 workshops located in the furniture cluster of the city of Arusha, Tanzania, this paper investigates the mechanisms of technical knowledge exchange that take place in clusters. A knowledge exchange link is defined as any two clustering entrepreneurs who perform similar manufacturing techniques in the production process. The results show that the strength of the ethnic networks of producers has positive effects on acquisition of manufacturing techniques, particularly in skills such as wood-joining, which are mainly influenced by a producer’s own skills rather than production facilities. Using dyadic data analysis, this paper further finds that two producers from the same ethnic minority are more likely to exhibit the same manufacturing techniques compared with two producers from the same ethnic majority. These findings suggest that ethnic networks facilitate knowledge exchange in an industrial cluster, but that this positive externality of the ethnic network effect only takes place in small-sized ethnic groups, and only to the extent that sophisticated facilities are not essential in the knowledge learning processes.
    Keywords: ethnic networks , knowledge learning , industrial cluster , Africa
    Date: 2012–01–24
  18. By: Hanatani, Atsushi; Sato, Mine
    Abstract: Since early 2000, a type of group-based informal irrigation for irrigating a very small area ? less than two hectares on average, has seen widespread adoption among Malawian farmers. The technology, called “temporary” irrigation, uses farmers’ own labor and locally available materials for constructing river diversion structures and canals, and these are managed by informal “clubs.” This paper attempts to assess the effectiveness and sustainability of this technology from the beneficiaries’ point of view, by employing an analytical framework that focuses on property rights and collective action as critical factors affecting technology choice and adoption. A comparative examination of selected informal irrigation cases in the Dowa district reveals that, in spite of the absence of secure tenure over land and water and of strong collective-action incentives among farmers, temporary irrigation has satisfied most of the effectiveness criteria and thus has contributed to technological expansion. This is attributable to the relative resource affluence and temporary nature of irrigation facilities which have existed at least up to the present. But the very “success” of the informal irrigation technology is changing the nature of the resources: where water in the streams has become scarce, river-bank lands have been commoditized and temporary diversion structures have been upgraded to permanent structures. Specific policy measures necessary to ensure sustainability of temporary irrigation should include: 1) provision of agronomic extension services to improve the profitability of irrigation, 2) promotion of basin-wide watershed management including provision of opportunities for stakeholder dialogues for conflict resolution while improving water use efficiency to enable secure and equitable access to productive resources, and 3) a cautious approach in strengthening water users’ associations based on deeper understandings of the farmers’ incentives (cost and benefit) for taking collective action.
    Keywords: Malawi , informal irrigation , property rights , collective action , effectiveness , sustainability
    Date: 2011–08–25
  19. By: Olivier Basdevant
    Abstract: Following the onset of the global economic crisis in 2008, SACU member countries have witnessed a significant growth slowdown, and a deterioration of their fiscal balances. This paper (i) assesses options for the design of the needed fiscal consolidation, and (ii) discussed medium-term fiscal policy rules that would help maintain a sound fiscal stance once consolidation has taken place. The main messages are: (i) government consumption cuts appears to minimize the negative impact on growth, and would be appropriate given the relatively large size of the public sector in each country, (ii) fiscal rules could be of particular interest for SACU members notably, a new customs revenue-sharing formula, procedural rules to strengthen budget process, and numerical rules at the national level.
    Keywords: Fiscal consolidation , Fiscal policy , Government expenditures , Revenue measures , Revenues , Southern Africa ,
    Date: 2012–04–04
  20. By: Greg Farrell; Shakill Hassan; Nicola Viegi
    Abstract: We examine the high-frequency response of the rand-dollar nominal rate within ten-minute intervals around (…five minutes before, …five minutes after) official infl‡ation announcements, and show that the rand appreciates (respectively, depreciates) on impact when in‡flation is higher (respectively, lower) than expected. The effect only applies after the adoption of infl‡ation targeting, and is stronger for “good” news. Our …ndings are rationalizable by the belief, among market participants, in a credible (though perhaps not particularly aggressive) in‡flation targeting policy in South Africa; and can be used to monitor changes in currency market perceptions about the monetary policy regime.
    Keywords: high-frequency exchange rates; in‡flation surprises; Taylor rules; in‡flation targeting; credibility.
    JEL: E31 E52 F30 F31
    Date: 2012
  21. By: Nwaobi, Godwin
    Abstract: Traditionally, the task of monetary management is usually performed by the monetary authority on behalf of government. However, a key challenge in monetary management is how to deal with uncertainty. Thus, the relevant policy questions must include how best the available instruments of monetary policy be deployed in shock prone mature stabilizers. Therefore, the basic thrust of this paper is to evaluate monetary policy - tradeoffs using a dynamic stochastic general equilibrium(DSGE)model estimated on data for Nigeria.
    Keywords: dynamic; stochastic; general; equilibrium; dsge; nigeria; monetary management; shocks; var; monetary policy; fiscal policy; exchange rate; central bank
    JEL: D50 C68 C63 C50 E58
    Date: 2012–04–17
  22. By: Artur Colom Jaén (Departament d'Economia Aplicada, Universitat Autonoma de Barcelona)
    Abstract: The significant increase in foreign investment in the African extractive sector in the last decade has refuelled the debate on the effects on development of the rents generated in this sector. From the resource curse theory, it is argued that the negative effects on development of these rents have to do basically with internal disfunctions, getting around the elements and external actors that shape and influence these internal features. The case of Chad, an oil-producing country since 2003 with the support of the World Bank, is presented and analysed in this article, and we reach the conclusion that the analysis of the peripherical insertion of the country is crucial to understand the disfunctions generated by oil rent.
    Keywords: Recursos naturales, maldición de los recursos, Chad
    JEL: O55 Q34
    Date: 2012–01
  23. By: Todo, Yasuyuki; Takahashi, Ryo
    Abstract: This study estimates the effect of farmer field schools in rural Ethiopia on income from agriculture. The farmer field schools were established in association with participatory forest management associations for forest protection funded by Japanese aid. We employ a difference-in-differences propensity score matching approach to correct for possible biases due to selection of participants. We find that by participating in the farmer field schools, agricultural households increased their real income per worker by about 60-160 US dollars on average, which is equivalent to, or even more than, the average income per worker before the project. We also find evidence that the large increase in income is due to the use of new agricultural practices, such as new varieties, taught and promoted in the farmer field schools.
    Keywords: impact evaluation , poverty alleviation , farmer field school , Ethiopia
    Date: 2011–05–19
    Abstract: This paper studies multi-dimensional aspects of deprivation associated to the living conditions and inequality status in Cameroon. The study employs the fuzzy-set framework to analyze deprivation and inequalities through Dagum sub group decomposition. Results in deprivation analysis and inequalities related reveal some new insights about the poverty situation in the country, which contrasts with the results available from traditional poverty analysis. We observe respectively, high deprivation degrees for household ‘essential’ items such as health, education and housing and a small Gini index for inequalities of deprivation. Decomposition by group reveals that within groups inequalities are as important as the between groups.
    Keywords: Fuzzy-sets; Poverty; Inequality; Sub-group-Decomposition; Cameroon
    JEL: D63 D01 I32
    Date: 2012
  25. By: Constant Lonkeng Ngouana
    Abstract: This paper assesses the role of trade patterns in shaping the volatility of the effective exchange rate under two alternative peg regimes: a hard peg to a single currency and a peg to a basket of currencies. I link the changes in the nominal effective exchange rate of a pegged currency to the fluctuations of its anchor vis-a-vis other major currencies, with an emphasis on the dynamics of trade patterns. In an application to the WAEMU (West African Economic and Monetary Union), I find that the nominal effective exchange rate of the union was twice as volatile under the hard peg to the euro as it would have been under a hypothetical basket peg over the past decade. This result was driven by the substantial shifts that occurred in WAEMU trade patterns, away from euro area countries and toward the Â"BICs" (Brazil, India, and China). These findings suggest that policymakers should pay as much attention to the type of peg as to pegging in itself, with a particular focus on the dynamics of trade patterns.
    Keywords: Currency pegs , Exchange rates , Trade , West African Economic and Monetary Union ,
    Date: 2012–03–09
  26. By: Ishihara, Yoichiro
    Abstract: Fragile and conflict-affected states face daunting challenges for development. Aid has a greater importance on development in these states than in others, and therefore aid effectiveness –management and delivery of aid – bears serious consideration. Despite its significance, aid effectiveness is appreciably lower in fragile and conflict-affected states than in others. What are the key aid effectiveness challenges in these states and how can these issues be better addressed? As important initial steps, this paper aims to identify (i) aid effectiveness challenges facing fragile and conflict-affected states and (ii) good aid effectiveness examples using the results of the Survey on Monitoring the Paris Declaration on aid effectiveness, which was designed as a mechanism to support global and country level accountability. Both fragile and conflict-affected states (recipients) and development partners (providers) are mutually accountable for aid effectiveness; therefore, this paper focuses on both sides. While the analysis confirms the significantly lower aid effectiveness performance in fragile and conflict-affected states -- especially on aid on budget, aid predictability, and use of country systems -- good performance examples in several of these states are identified. The aid effectiveness performance of development partners in fragile and conflict-affected states differs significantly across different groups. Multilateral development banks and other multilateral organizations perform better on average than bilateral organizations and vertical funds. Disaggregation of development partner performance at the institutional level and the partner country level enables the analysis successfully to identify good performance examples. In using the results of this paper to improve aid effectiveness, key additional steps should include (i) considering whether the identified challenges are essential; (ii) analyzing the factors/reasons behind good performance examples; and (iii) discussing whether good performance examples can provide lessons that can be adapted and applied.
    Keywords: Development Economics&Aid Effectiveness,E-Business,Country Strategy&Performance,Banks&Banking Reform,Disability
    Date: 2012–04–01
  27. By: Takeuchi, Shinichi
    Abstract: State-building is currently considered to be an indispensable process in overcoming state fragility: a condition characterized by frequent armed conflicts as well as chronic poverty. In this process, both the capacity and the legitimacy of the state are supposed to be enhanced; such balanced development of capacity and legitimacy has also been demanded in security sector reform (SSR), which is regarded as being a crucial part of post-conflict state-building. To enhance legitimacy, the importance of democratic governance is stressed in both state-building and SSR in post-conflict countries. In reality, however, the balanced enhancement of capacity and legitimacy has rarely been realized. In particular, legitimacy enhancement tends to stagnate in countries in which one of multiple warring parties takes a strong grip on state power. This paper tries to understand why such unbalanced development of state-building and SSR has been observed in post-conflict countries, through a case study of Rwanda. Analyses of two policy initiatives in the security sector ? Gacaca transitional justice and disarmament, demobilization, and reintegration (DDR) ? indicate that although these programs achieved goals set by the government, their contribution to the normative objectives promoted by the international community was quite debatable. It can be understood that this is because the country has subordinated SSR to its state-building process. After the military victory of the former rebels, the Rwandan Patriotic Front (RPF), the ruling elite prioritized the establishment of political stability over the introduction of international norms such as democratic governance and the rule of law. SSR was implemented only to the extent that it contributed to, and did not threaten, Rwanda’s RPF-led state-building
    Keywords: state-building , Rwanda , SSR , conflict , Gacaca , legitimacy
    Date: 2011–07–25
  28. By: Sawada, Yasuyuki; Ishii, Takaharu
    Abstract: In this paper, we investigate the role of a School Management Committee (COGES) in facili- tating social capital among community members and teachers. We employ unique data from Burkina Faso, where the COGES project was recently introduced. To determine the individual level of social capital of each community member and teacher, we conduct public goods games, one of the standard artefactual field experiments, with monetary rewards. Using in- strumental variable and propensity score matching methods, we obtain several findings. First, we find that the COGES project increases the level of social capital significantly. This finding is robust across different econometric specifications and methodologies. According to our point estimates, the amount of voluntary contribution to public goods increases by 16% to 27%. Second, the social capital facilitation effect of COGES varies based on the characteristics of the participant: while those who are more educated tended to have a lower level of social capital, Muslims have a higher level of social capital with COGES. Third, our qualitative re- sults are maintained if we use the subjective assessment data of social capital based on the General Social Survey (GSS) questions.
    Keywords: School Management Committee (COGES) , community participation , social capital , Burkina Faso , field experiments public goods game
    Date: 2012–03–28

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