nep-agr New Economics Papers
on Agricultural Economics
Issue of 2015‒06‒20
25 papers chosen by
Angelo Zago
Università degli Studi di Verona

  1. Who Really Benefits from Agricultural Subsidies? Evidence from Field-level Data By Barrett Kirwan; Michael Roberts
  2. Sustainable Agriculture Development Problems in the Context of Providing food security in Georgia By Marine Natsvaladze
  3. Crop choice and infrastructure accessibility in Tanzania : subsistence crops or export crops ? By Iimi,Atsushi; Humphreys,Richard Martin; Melibaeva,Sevara
  4. Food Bowl or Folly? The economics of irrigating Northern Australia By Jared Dent; Michael B. Ward
  5. A counterfactual experiment on the effectiveness of plastic ponds for smallholder farmers: A case of Nepalese vegetable farming By Buddhi Raj Ghimire; Koji Kotani
  6. Nudges, social norms and permanence in agri-environmental schemes By Laure Kuhfuss; Raphaële Préget; Sophie Thoye; Nick Hanley; Philippe Le Coent; Mathieu Désolé
  7. Adapting to Climate Change: Farmers’ Responses to Heat and Drought in South Australia By Guy Robinson
  8. Preferences for REDD+ contract attributes in low-income countries : a choice experiment in Ethiopia By Dissanayake,Sahan T. M.; Beyene,Abebe Damte; Bluffstone,Randall; Gebreegziabher, Zenebe; Martinsson,Peter; Mekonnen,Alemu; Toman,Michael A.; Vieider,Ferdinand M.
  9. The Productivity of agricultural credit in India By Sudha Narayanan
  10. Universal food security program and nutritional intake: Evidence from the hunger prone KBK districts in Odisha By Andaleeb Rahman
  11. Microcredit Program Participation and Household Food Security in Rural Bangladesh By Asadul Islam; Chandana Maitra; Debayan Pakrashi; Russell Smyth
  12. Price Transmission in the Milk Portuguese Market By Maria de Fátima Oliveira; Maria Leonor da Silva Carvalho; Maria Raquel Lucas; Pedro Damião Henriques
  13. Working Paper - 220 - Developing a Food (in) Security Map for South Africa By AfDB AfDB
  14. Structural Transformation in the North-Eastern Region of India: Charting out an agriculture-based development policy By Alwin D’souza; Amit Shovon Ray
  15. Deconstructing Supermarket Interventions as a Mechanism for Improving Diet: Lessons from the Seacroft Intervention Study By Rudkin, Simon
  16. The improved biomass stove saves wood, but how often do people use it ? evidence from a randomized treatment trial in Ethiopia By Beyene,Abebe D.; Bluffstone,Randall; Gebreegziabher,Zenebe; Martinsson,Peter; Mekonnen,Alemu; Vieider,Ferdinand
  17. Behavioral Economic Insights on Index Insurance Design By Michael Carter; Ghada Elabed; Elena Serfilippi
  18. Market imperfections exacerbate the gender gap: the case of Malawi By Palacios-Lopez,Amparo; López,Ramón
  19. Multinational corporations and climate adaptation – Are we asking the right questions? A review of current knowledge and a new research perspective By Alina Averchenkova; Florence Crick; Adriana Kocornik-Mina; Hayley Leck; Swenja Surminski
  20. Using Engel Curves to Estimate CPI Bias for the Elderly By Scrimgeour, Dean; Gorry, James
  22. Do the Poor Benefit from Corporate Social Responsibility? A Theory-Based Impact Evaluation of Six Community-Based Water Projects in Sri Lanka. By Löwenstein, Wilhelm; Shakya, Martina; Hansen, Marc; Gorkhali, Sanjay
  23. Reducing the Generosity and Increasing the Conditionality of Disability Benefits: Turning the Supertanker or Squeezing the Balloon? By Barbara Broadway; Duncan McVicar
  24. Novel and improved insurance instruments for risk reduction By Swenja Surminski; Paul Hudson; Jeroen Aerts; Wouter Botzen; M.Conceição Colaço; Florence Crick; Jill Eldridge; Anna Lorant; António Macedo; Reinhard Mechler; Carlos Neto; Robin Nicolai; Dionisio Pérez-Blanco; Francisco Rego
  25. Benefits of Invasion Prevention are Constrained by Lags and Timing of Invasion Impacts By Epanchin-Niell, Rebecca S.; Liebhold, Andrew M.

  1. By: Barrett Kirwan (University of Illinois at Urbana-Champaign); Michael Roberts (University of Hawaii at Manoa)
    Abstract: If agricultural subsidies are largely capitalized into farmland values then expanding support for agriculture may not benefit farmers who rent the land they farm. Suddenly reducing subsidies may be problematic to the extent that land values already embody expectations about future subsidies. Existing evidence on the incidence of subsidies on land values is mixed. Identification is obscured by unobserved or imprecisely measured factors that tend to be correlated with subsidies, especially land quality and time-varying factors like commodity prices and adverse weather events. A problem that has received less attention is the fact that subsides and land quality on rented land may differ from owned land. Since most farms possess both rented and owned acreage, farm-level measures of subsidies, land values and rental rates may bias estimated incidence. Using a new, field-level data set that, for the first time, precisely links subsidies to land parcels, we show that this bias is considerable: Where farm-level estimates suggest an incidence of 20 to 79 cents of the marginal subsidy dollar, field-level estimates from the same farms indicate that landlords capture just 10–25 cents. The size of the farm and the duration of the rental arrangement have substantial effects. Incidence falls by 5–15 cents per acre when doubling total operated acres, and the incidence falls by 0.1–1.2 cents with each additional year of the rental arrangement. Low incidence of subsides on rents combined with the farm-size and duration effects suggest that farmers renting land have monopsony power.
    Date: 2015–06
  2. By: Marine Natsvaladze (Ivane Javakhishvili Tbilisi State University)
    Abstract: Due to the peculiarities of the natural resources of Georgia the main priority of the agriculture is the development of bio production. Production of bio products is alternative, modern system of agricultural products production, which has steadily increasing economic potential. Current research shows that the rapid increase in production of bio products could be a good alternative for agricultural development of Georgia, but the growth rate of bio production is quite low than expected. The present paper examines the situation of bio production in agricultural sector of Georgia. The main aim of the research was to evaluate the role of bio-production in sustainable development of agriculture of Georgia and to work out some recommendations for further development. According to our goal, these problems were:1.Evaluation of consumers interest and approach to bio-products;2.Evaluation of Georgian producer’s interest in bio-market;3.To identify the reasons of underdevelopment of bio-products market in Georgia.4.Improve implementation of sustainable agriculture policy.Our research showed that despite consumers readiness to purchase bio-products, the segment of the Georgian market is developing more slowly than in other countries. The research show that for producers the most influential are the economic factors and the least influential are the social factors.The agricultural politics of Government played a significant role in development of the market. The most important directions include: Promotion of Georgian bio-products, supporting the bio sector of agriculture and developing the local and export bio markets.The systematic approach to the problems will help to develop the bio-farms:Qualification: The farmers need to have enough knowledge about the bio-farming, bio-products and the perspectives of the bio-production, also how to transfer from the traditional to the bio farming.Support: The farmers could transfer from traditional to the bio farming easily with financial and informational support.Certification: Bio producer should have the guarantees that after all required procedures they would not have any problems with certification.Sales: The farmer needs a serious support in organizing the problems of export and entering the international markets, they could not do it alone.Bio-production - quality oriented, sustainable, and rapidly growing and perspective production could become the main priority for Georgian agriculture. In this regard, bio-products may be considered as a direction of developing sustainable agriculture.
    Keywords: bio production, sustainable development, agriculture, agriculture policy, bio products market
    JEL: O13
  3. By: Iimi,Atsushi; Humphreys,Richard Martin; Melibaeva,Sevara
    Abstract: Africa has great potential for agriculture. Although international commodity prices have been buoyant, Africa?s supply response seems to be weak. A variety of constraints may exist. Using the case of Tanzania, the paper examines the impact of market connectivity, domestic and international, on farmers? crop choices. It is shown that the international market connectivity, measured by transport costs to the maritime port, is important for farmers to choose export crops, such as cotton and tobacco. Internal connectivity to the domestic market is also found to be important for growing food crops, such as maize and rice. Among other inputs, access to irrigation and improved seed availability are also important factors in the crop choices of farmers. The size of land area is one constraint to promote the crop shift. The paper also reports the finding that farmers are not using market prices effectively in their choice of crop, even after the endogeneity of local prices is taken into account.
    Date: 2015–06–15
  4. By: Jared Dent; Michael B. Ward
    Abstract: Australia’s northern area has vast but largely undeveloped land that would be arable if irrigated. The prospect of a northern ‘food bowl’ has drawn political support for irrigation schemes from both major parties in the 2013 federal election. In this study we consider the net economic benefits of allocating northern Australia’s divertible surface water to irrigation, a scheme that would require significant infrastructure costs in dam and canal construction. We estimate the benefits to northern Australia, using a Ricardian hedonic approach to forecast the economic value of constructing major new irrigation schemes that would be capitalised into agricultural land values. We use publicly available information from existing and potential Australian irrigation schemes to define the cost of constructing large water storages and distribution infrastructure, as well as on-farm irrigation infrastructure. We find that the costs of turning northern Australia into an irrigated food bowl are likely to exceed any benefits that would be capitalised into land prices by a multiple of between 1.1 and 3.2.
    Keywords: irrigation, dams, agruculture, land value, benefit cost analysis
    JEL: Q15 R11
    Date: 2015–01
  5. By: Buddhi Raj Ghimire (International University of Japan); Koji Kotani (School of Economics and Management, Kochi University of Technology)
    Abstract: Plastic pond has attracted huge attention as water harvesting technology, since it is reported to be cost-effective and adoptable in various geographical settings such as sloping land. Therefore, it is expected to contribute to poverty reduction for smallholder farmers. Despite its importance, there has been no research on the issue, and thus this paper identifies the impact of plastic-pond technology on agriculture. We focus on vegetable farming for which adoption of plastic ponds gains some popularity and implemented questionnaire surveys of 1,001 farmers in Nepal. With the data, endogenous switching regression is applied by taking vegetable income and adoption of plastic ponds as dependent variables in regime and selection equations, respectively, because it enables to take into account endogeneity in technology adoption and to measure the impact via counterfactual experiments. The selection equation shows that adoption of plastic ponds is enhanced by credit access, investment, improved seeds, education and agricultural training. The regime equations find that vegetable incomes for nonadopters are affected by several factors such as age, education, livestock, land value, credit access, investment and improved seeds, while the only two determinants of livestock value and credit access are important for vegetable incomes of adopters. This implies that plastic ponds fundamentally change the structure of vegetable farming. The counterfactual experiment demonstrates that vegetable income of nonadopters would increase by 33% if nonadopters adopt plastic ponds, which is significant to improve food security and welfare of farmers. Overall, the plastic pond shall be a promising technology in not only Nepal and but also many other developing nations.
    Keywords: Counterfactual experiment, plastic-pond technology, endogenous switching regression, vegetable farming in Nepal
    Date: 2015–05
  6. By: Laure Kuhfuss (Department of Geography and Sustainable Development, University of St. Andrews); Raphaële Préget (INRA, UMR 1135 LAMETA, F-34000 Montpellier, France); Sophie Thoye (Montpellier SupAgro, UMR 1135 LAMETA, F-34000 Montpellier, France); Nick Hanley (Department of Geography and Sustainable Development, University of St. Andrews); Philippe Le Coent (Université Montpellier 1, UMR 5474 LAMETA, F-34000 Montpellier, France); Mathieu Désolé (Montpellier SupAgro, UMR 1135 LAMETA, F-34000 Montpellier, France)
    Abstract: The permanence of land management practices adopted under Agri-environmental schemes (AES) is often questioned. This paper investigates the drivers of farmers’ decision to maintain or not the adopted practices beyond the duration of the contract, and especially the effect of social norms and framing on this decision. Our results, based on the stated intentions of 395 farmers, show that pecuniary but also non-pecuniary motivations drive farmers’ decision, which is significantly influenced by information about the social norm. These results lead to recommendations for “nudging” farmers, by conveying information to them on other farmers’ decisions concerning pro-environmental land management practices.
    Keywords: Agri-environmental schemes, Permanence, Framing, Social norms
    JEL: Q18 Q28
    Date: 2015–05
  7. By: Guy Robinson (University of South Australia)
    Abstract: This paper focuses on one of the key challenges facing farming communities around the world, namely how to adapt to changes in climate that can threaten farming livelihoods. The paper draws upon two detailed studies in South Australia where farmers have long been accustomed to dealing with issues of water shortage and very high temperatures. However, recent modelling predicts increased severity of drought and more incidences of extreme heat in some of the prime farming districts in the state. Farmers are already commenting on seasonal changes to water availability and to variations in the timing and duration of very hot weather. The two studies have examined ways in which farmers are reacting to these changes in weather and climate, firstly using in-depth interviews with a small sample to look specifically at their attitudes towards spells of excessive heat, and second, focusing on adaptations being made in their farming systems. The latter study involved semi-structured interviews with formal institutions, e.g. government agencies, and communities of practice, e.g. farm systems groups, within two major regions in South Australia. Members from both groups interviewed in the second study noted that farmers autonomously adapt to a variety of risks, including those induced by climate variability; however, the types and levels of adaptation varied among individuals as a result of different barriers to adaptation. The lack of communication and engagement processes established between formal institutions and communities of practice was one such barrier. The paper presents and discusses a model for transferring knowledge and information on climate change among formal institutions, communities of practice, trusted individual advisers and rural landholders, and for supporting the co-management of climate change across multiple groups in agricultural areas in South Australia and elsewhere. The prevalence of particular views held by farmers about heat and drought need to be addressed by policy makers if specific types of adaptation are being promoted.
    Keywords: climate change, farmers, formal institutions, communities of practice
    JEL: Q54 Q56 Q15
  8. By: Dissanayake,Sahan T. M.; Beyene,Abebe Damte; Bluffstone,Randall; Gebreegziabher, Zenebe; Martinsson,Peter; Mekonnen,Alemu; Toman,Michael A.; Vieider,Ferdinand M.
    Abstract: This paper informs the national and international policy discussions related to the adoption of the United Nations Reducing Emissions from Deforestation and Forest Degradation Programme. Effective program instruments must carefully consider incentives, opportunity costs, and community interactions. A choice experiment survey was applied to rural Ethiopian communities to understand respondents? preferences toward the institutional structure of the program contracts. The results show that respondents have particular preferences about how Reducing Emissions from Deforestation and Forest Degradation programs are structured with regard to the manner in which the payments are divided between the households and the communities, the restrictions on using grazing land, and the level of payments received for the program. Surprisingly, restrictions on firewood collection do not significantly impact contract choice. The paper further analyzes the structure of the preferences by using attribute interaction terms and socio-demographic interaction terms. The analysis finds significant regional variation in preferences, indicating that Reducing Emissions from Deforestation and Forest Degradation should be tailored to specific regions. Finally, the marginal willingness to pay for attributes is calculated using the traditional preference space approach, as well as the more recent willingness-to-pay approach.
    Keywords: Economic Theory&Research,Forestry Management,Climate Change Mitigation and Green House Gases,Biodiversity,Environmental Economics&Policies
    Date: 2015–06–09
  9. By: Sudha Narayanan (Indira Gandhi Institute of Development Research)
    Abstract: This study examines the nature of the relationship between formal agricultural credit and agricultural GDP in India, specifically the role of the former in supporting agricultural growth, using state level panel data covering the period 1995-96 to 2011-12. The study uses a mediation analysis framework to map the pathways through which institutional credit relates to agricultural GDP relying on a control function approach to tackle the problem of endogeneity. The findings from the analysis suggest that over this period, all the inputs are highly responsive to an increase in institutional credit to agriculture. A 10 increase in credit flow in nominal terms leads to an increase by 1.7 in fertilizers (N, P, K) consumption in physical quantities, 5.1 increase in the tonnes of pesticides, 10.8 increase in tractor purchases. Overall, it is quite clear that input use is sensitive to credit flow, whereas GDP of agriculture is not. Credit seems therefore to be an enabling input, but one whose effectiveness is undermined by low technical efficiency and productivity. Notwithstanding these aggregate findings detailed microstudies would be necessary to provide insights into this issue.
    Keywords: agricultural credit, growth, control function, elasticity, India
    JEL: Q10 Q14
    Date: 2015–01
  10. By: Andaleeb Rahman (Indira Gandhi Institute of Development Research)
    Abstract: This article provides evidence on the role of consumer food subsidies in improving nutritional intake and diet quality by evaluating the expansion of the government food assistance program coverage in the hunger prone state of Odisha in India. In 8 districts of Odisha, popularly known as the Kalahandi-Balangir-Koraput (KBK) region which is notable for extreme poverty and starvation deaths, the government did away with the targeted food assistance program in 2008 and made the scheme universal. Using a Difference-in-Difference methodology over two repeated cross sectional household surveys, this article finds that the shift from targeted to a universal food security program in the KBK region of Odisha has led to an improvement in the household nutritional intake and diet quality. Further examination suggests that proportion of households consuming below the recommended dietary allowance of calorie, fats and protein has declined significantly in this region post the intervention.
    Keywords: Consumer Subsidy; Nutrition; Program Evaluation; Hunger; India
    JEL: I38 H31 H43 H53 Q18
    Date: 2015–06
  11. By: Asadul Islam; Chandana Maitra; Debayan Pakrashi; Russell Smyth
    Abstract: We use a large household level panel dataset collected from rural households in Bangladesh to examine the effects of microcredit program participation on household food security. We examine how microcredit affects different measures of food security; namely, household calorie consumption, dietary diversity indicators and anthropometric status of women of reproductive age (15-49 years) and children under the age of five. We find that microcredit program participation increases calorie consumption both at the intensive and extensive margins, but does not improve dietary diversity and only has mixed effects on the anthropometric measures. We also find that the effect of participation on food security may be non-linear in which participation initially has either no effect on food security or may actually worsen it, before improving it in the long run. Our results may explain why short-term evaluation of microcredit might not show any positive effects.
    Keywords: microcredit, food security, calorie availability, malnutrition, dietary diversity
    JEL: G21 I3 I14 Q18
    Date: 2015–02
  12. By: Maria de Fátima Oliveira (Escola Superior Agrária de Coimbra, Centro de Estudos de Recursos Naturais, Ambiente e Sociedade – CERNAS); Maria Leonor da Silva Carvalho (Departamento de Economia, Escola de Ciências Sociais, Instituto de Ciências Agrárias e Ambientais Mediterrânicas, Universidade de Évora); Maria Raquel Lucas (Departamento de Gestão, Escola de Ciências Sociais, Centro de Estudos e Formação Avançada em Gestão e Economia, Universidade de Évora); Pedro Damião Henriques (Departamento de Economia, Escola de Ciências Sociais, Centro de Estudos e Formação Avançada em Gestão e Economia, Universidade de Évora)
    Abstract: This paper aims to analyze milk price transmission along the food chain in Portugal, temporally and spatially. The results show that the volatility of retail prices is small but happens after 2008. The farm gate price does not change when the price of packaged milk changes. On the mainland, price transmission does not occur but it does in the Azores. In intensive systems, the risk of collapse is greater than in extensive systems, where the volatility of prices reflects the process of market adjustment.
    Keywords: Dairy, Farm-Gate Milk, Prices, Cointegration, Feed Prices; Portugal.
    JEL: Q11 Q18
    Date: 2014
  13. By: AfDB AfDB
    Date: 2015–03–09
  14. By: Alwin D’souza (Centre for International Trade and Development,Jawaharlal Nehru University); Amit Shovon Ray (Centre for International Trade and Development,Jawaharlal Nehru University; Director, Centre for Development Studies, Trivandrum)
    Abstract: Economic development is associated with a process of structural transformation that entails a falling share of agriculture both in terms of output and employment. However, at least in the initial phases, the share of agricultural GDP in total GDP tends to decline much faster than the share of agricultural employment in total employment. Consequently, the difference between these two shares, termed as the GAP in development literature, increases during the initial phase of economic development, whereby the agricultural sector continues to employ the majority of labour force but contributes less and less output to total GDP. This creates a structural imbalance in the economy, resulting in low agricultural productivity, high income inequality and consequent political instability. In this paper, we intend to study this process of structural transformation in the North Eastern States of India. Within the paradigm of agriculture led development, pioneered by John Mellor, our paper attempts to chart out a development path for the North Eastern region centred on agriculture and agricultural productivity. We derive specific policy parameters that would go a long way in correcting the structural imbalances and the resulting economic inequality and political instability by reducing the ‘GAP’ and by augmenting agricultural productivity.Length:20 pages
  15. By: Rudkin, Simon
    Abstract: Supermarkets, with vast product ranges and relatively low prices, are an established solution to problems of availability of healthy foodstuffs in areas of limited retail access. However, where they may indeed raise consumption of desirable goods they also open up new opportunities to buy less healthful items for less, a situation which potentially undermines their ability to improve diet. Using under-reported diary data from the Seacroft Intervention Study in the United Kingdom takes this paper beyond the extant fruit and vegetable focus, giving it scope to explore the full effect of supermarkets. Quantile regressions show existing behaviours are reinforced, and intervention stores may do little to improve diet. Switching to Tesco Seacroft is shown to increase the portions of unhealthy food consumed by almost 1 portion per day for the least healthy. Managing demand through promoting balanced diets and restricting offers on unhealthy items will be more effective than intervention, and is an essential accompaniment to new large format retailers if they are not to entrench dietary inequality further. Policymakers and practitioners alike should avoided being distracted by aggregate conclusions if food deserts are to be truly tackled.
    Keywords: retail intervention, food deserts, diet, healthy eating
    JEL: D12 I14 I18
    Date: 2015
  16. By: Beyene,Abebe D.; Bluffstone,Randall; Gebreegziabher,Zenebe; Martinsson,Peter; Mekonnen,Alemu; Vieider,Ferdinand
    Abstract: This paper uses a randomized experimental design and real-time electronic stove use monitors to evaluate the frequency with which villagers use improved biomass-burning Mirt injera cookstoves in rural Ethiopia. Understanding whether, how much, and why improved cookstoves are used is important, because use of the improved stove is a critical determinant of indoor air pollution reductions, and reduced greenhouse gas emissions due to lower fuelwood consumption. Confirming use is, for example, a critical aspect of crediting improved cookstoves? climate change benefits under the United Nations Reducing Emissions from Deforestation and Forest Degradation Programme. The paper finds that Ethiopian households in the study area do use the Mirt stove on a regular basis, taking into account regional differences in cooking patterns. In general, stove users also use their Mirt stoves more frequently over time. Giving the Mirt stove away for free and supporting community-level user networks are estimated to lead to more use. The study found no evidence, however, that stove recipients use the stoves more if they have to pay for them, a hypothesis that frequently arises in policy arenas and has also been examined in the literature.
    Keywords: E-Business,Disease Control&Prevention,Energy Conservation&Efficiency,Climate Change Mitigation and Green House Gases,Energy and Environment
    Date: 2015–06–09
  17. By: Michael Carter; Ghada Elabed; Elena Serfilippi
    Abstract: While behavioral economic experiments have uncovered a wealth of insights concerning how people decide in the face of risk and uncertainty, the implications of these insights for the demand for agricultural insurance are under-explored.
    Keywords: Ambiguity aversion, Discontinuous preferences, Index insurance, Risk and uncertainty
    JEL: F Z
    Date: 2015–05–30
  18. By: Palacios-Lopez,Amparo; López,Ramón
    Abstract: This paper hypothesizes that labor and credit market imperfections?by discouraging off-farm income-generating activities and restricting access to inputs, respectively?affect female farm productivity more deeply than male productivity. The paper develops a theoretical model that decomposes the contribution of various market imperfections to the gender productivity gap. The paper shows empirically that agricultural labor productivity is on average 44 percent lower on plots managed by female heads of household than on those managed by male heads. Thirty-four percent of this gap is explained by differences in labor market access and 29 percent by differences in credit access.
    Keywords: Labor Markets,Housing&Human Habitats,Labor Policies,Gender and Development,Political Economy
    Date: 2015–06–10
  19. By: Alina Averchenkova; Florence Crick; Adriana Kocornik-Mina; Hayley Leck; Swenja Surminski
    Abstract: Adapting to climate change requires the engagement of all actors in society. Until recently, predominant research focus has been on governments, communities and the third sector as key actors in the adaptation process. Yet, there is a growing emphasis internationally on understanding the role of and the need to engage businesses in adaptation given their potential to finance projects, develop and deploy technologies and innovative solutions, and enhance the scale and cost-effectiveness of certain adaptation measures. Already, many multinational corporations (MNCs) are purportedly beginning to take steps to adapt their operations to climate change. Some stated reasons for their engagement include minimising potential impacts on their supply chains, improving resource efficiency, enhancing the production and use of sustainable raw materials, and supporting customers’, suppliers’ and communities’ efforts to adapt to climate change. However, there is a paucity of work analysing adaptation actions by MNCs, their motivations and contribution to broader adaptation and climate resilient development efforts, as well as possible instances of maladaptation. We apply a three-tier framework on drivers, responses and outcomes to examine the state of knowledge according to recent literature on private sector and MNC adaptation to climate change. Our review highlights that the literature on the impact and outcomes of MNC adaptation actions is considerably sparse and we consider the implications for future research. Our analysis concludes with a reflection on the relevance of MNC-led adaptation – for the companies themselves, for policy-makers at all scales, as well as for society at large.
    Date: 2015–03
  20. By: Scrimgeour, Dean (Department of Economics, Colgate University); Gorry, James (Department of Economics, Colgate University)
    Abstract: We use shifts in food Engel curves among the U.S. elderly to estimate the extent of Consumer Price Index (CPI) bias specific to this population. Over the last thirty years the share of total expenditure devoted to food has declined more rapidly for elderly-headed households than for other households. This decline is not explained by a more rapid increase in measured total expenditure for the elderly, or by relative change in other covariates such as household composition. We present this as evidence that the true cost of living increased more slowly for the elderly than for the nonelderly over this period, in contrast to conventional wisdom that the elderly face a higher inflation rate.
    Keywords: Engel curve, CPI bias, cost of living, retirement, elderly
    JEL: E31 J14
    Date: 2015–06–01
  21. By: Evica Delova Jolevska, Ilija Andovski (MIT University Skopje, Faculty of Management, University of Nis, Faculty of Science and Mathematics)
    Abstract: Macedonian agriculture has received substantial donor support in the past two decades. Now, when most of those donor projects are completed, this paper looks at what have been the most important factors for achieving sustainability, and how the level of sustainability of the foreign assistance in the agriculture can be improved. The analysis is based on 8 different foreign donor projects in Macedonia. The data collection is done through a primary research – interviews with stakeholders of those projects, and secondary research – already existing publications on the topic. In the analyzed cases the achieved sustainability of the results is not on a required level. The factors that contributed to this can be seen in the lack of political support, socio-cultural aspects, institutional aspects, economic and financial aspects as well as the external factors. This gives basis for recommendations for the main stakeholders and potential users of this paper: the national government to ensure that the donors’ country strategies are in line with the national strategies; to the donors to use the participatory approach in the project design; and to the beneficiaries (farmers) to take greater responsibility and commitment for ownership of the achieved project results.
    Keywords: Sustainability, agriculture, donor projects, foreign assistance, development.
    JEL: F35 O13 O19
    Date: 2015–03
  22. By: Löwenstein, Wilhelm; Shakya, Martina; Hansen, Marc; Gorkhali, Sanjay
    Abstract: Corporate Social Responsibility (CSR) can work as an effective means towards minimising business risk and maintaining amicable relationships with diverse groups of stakeholders. While many studies have examined the impacts of CSR on firm value and customer perceptions, little is known about the effects of a philanthropic engagement of the private sector on external stakeholder groups, such as local communities in developing countries. This paper examines welfare effects of six community-based water supply projects that were supported by a thermal power plant in Sri Lanka as part of the company's CSR strategy. The implications of these CSR activities are analysed from the perspective of the project beneficiaries, the majority of them poor smallholder farmers. Household production and labour income functions are estimated from survey data to analyse two pathways through which the water projects affect the beneficiaries' lives. First, the households get individual access to water that allows for the irrigation of home gardens, increases land productivity and changes households' farm output and income (irrigation channel). Second, the projects have an indirect effect on households' income via a time channel, i.e. the effect that due to the individual water access the households save time as there is no need any more to fetch water from far away water bodies or wells. This allows for a reallocation of labour time for other productive income-generating activities. Despite the considerable costs that households have to bear for an individual water connection, the study finds a systematic, positive net income effect of the projects on the beneficiaries via both the irrigation and the time channel. Qualitative evidence supports these findings and also reveals additional positive, non-monetarised project impacts. As the water projects would not have been realised without the subsidiary financial support of the power plant, it is concluded that the company's CSR engagement is increasing the welfare of the beneficiary communities.
    Keywords: Corporate Social Responsibility; Productivity Method; Theory-based Impact Evaluation; Club Goods; Stakeholder; Smallholder Farmers; Community-Based Water Supply; Sri Lanka; Welfare Changes
    Date: 2015
  23. By: Barbara Broadway (Melbourne Institute of Applied Economic and Social Research, University of Melbourne); Duncan McVicar (Queen's University Belfast)
    Abstract: This paper examines the impact of a major Australian disability reform – the 2006 Welfare to Work reform – on welfare receipt. It uses a combination of difference-in-differences and propensity score matching to identify the treatment effect. The reform reduced the generosity and increased the conditionality of welfare payments by shifting partially disabled disability benefit claimants from disability benefits to unemployment benefits. This led to increases among partially disabled welfare recipients in the hazards for exiting welfare and for switching (back) from unemployment to disability benefits. It also led to an increase in the hazard for returning to welfare for those having previously exited welfare. Overall the reform had no impact on the probability of being on welfare 12 months or 24 months later. Disability reforms need to do more than simply reduce the generosity and tighten the conditionality of payments if they are to impact on welfare dependence among people with disability.
    Keywords: Welfare reform, disability, hazard rate, propensity score matching, difference-indifferences
    JEL: I38 J14
    Date: 2015–06
  24. By: Swenja Surminski; Paul Hudson; Jeroen Aerts; Wouter Botzen; M.Conceição Colaço; Florence Crick; Jill Eldridge; Anna Lorant; António Macedo; Reinhard Mechler; Carlos Neto; Robin Nicolai; Dionisio Pérez-Blanco; Francisco Rego
    Abstract: Managing risk and adapting to climate change is essential to minimise the losses and damages during and after disasters and extreme weather events. Several risk management approaches exist, one of which is the use of economic instruments (EI). Examples of EIs include taxes, subsidies and insurance to deliver financial protection in the event of a disaster, yet their design and the way in which they operate is essential to their success in mitigating and minimising hazard loss. Insurance is one example of an EI and functions as a tool to share and transfer risks and losses and is useful in aiding adaptation to climate change. Within this context insurance may be delivered using a range of approaches, which together contribute to its feasibility for delivery and operation as well as the potential for incentivising behavioural change. Yet undesirable aspects also exist and can include a lack of comprehensive information and cognitive biases, as well as financial constraints and moral hazard.
    Date: 2015–04
  25. By: Epanchin-Niell, Rebecca S. (Resources for the Future); Liebhold, Andrew M.
    Abstract: Quantifying economic damages caused by invasive species is crucial for cost-benefit analyses of control measures. Most studies focus on short-term damage estimates, but evaluating exclusion or prevention measures requires estimates of total anticipated damages from the time of establishment onward. The magnitude of such damages critically depends on the timing of damages relative to a species’ arrival because costs are discounted back to the time of establishment. Using theoretical simulations, we illustrate how (ceteris paribus) total long-term damages, and hence the benefits of prevention efforts, are greater for species that a) have short lags between introduction and spread or between arrival at a location and initiation of damages, b) cause larger, short-lived damages (as opposed to smaller, persistent damages), and c) spread faster or earlier. We empirically estimate total long-term discounted impacts for three forest pests currently invading North America - gypsy moth (Lymantria dispar), hemlock woolly adelgid (Adelges tsugae), and emerald ash borer (Agrilus planipennis) - and discuss how damage persistence, lags between introduction and spread, and spread rates affect damages. Many temporal characteristics can be predicted for new invaders and should be considered in species risk analyses and economic evaluations of quarantine and eradication programs.
    Keywords: biological invasion; economic impact, damages, gypsy moth (Lymantria dispar), hemlock woolly adelgid (Adelges tsugae), emerald ash borer (Agrilus planipennis)
    Date: 2015–05–19

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