nep-dev New Economics Papers
on Development
Issue of 2008‒09‒05
ten papers chosen by
Jeong-Joon Lee
Towson University

  1. Africa in 2008: Breaking Down the Growth By Kenneth G. Ruffing
  2. Investing in Africa’s Youth By Lucia Wegner
  3. Combating Under-five Mortality in Africa By Audrey Verdier-Chouchane
  4. To Be or Not to Be at the BOP: A One-North-Many-Souths Model with Subsistence and Luxury Goods By Zon, Adriaan van; Schmidt, Tobias
  5. The developing world is poorer than we thought, but no less successful in the fight against poverty By Chen, Shaohua; Ravallion, Martin
  6. Community-based Targeting and Initial Local Conditions: Evidence from Indonesia’s IDT Program By Chikako Yamauchi
  7. Moving Across Borders: Who is Willing to Migrate or to Commute? By Peter Huber; Klaus Nowotny
  8. Girl Farm Labour And Double-Shift Schooling In The Gambia: The Paradox Of Development Intervention By Pamela Kea
  9. Poverty in Kagera, Tanzania: Characteristics, Causes and Constraints By Julie Litchfield; Thomas McGregor
  10. The effects of rising food prices on poverty in Mexico By Valero-Gil, Jorge; Valero, Magali

  1. By: Kenneth G. Ruffing
    Abstract: Growth will accelerate for net oil exporters and weaken slightly for oil importers. Inflation is rising due to increases in the price of food imports and rising oil prices. The current-account deficits of oil-importing countries are increasing.
    Date: 2008–04
  2. By: Lucia Wegner
    Abstract: African countries face high youth unemployment and a skills shortage. Technical and vocational systems in Africa are poorly funded and managed. Skill-development strategies need to be integrated into poverty-reduction strategies and focused on sectors with promising employment prospects.
    Date: 2008–04
  3. By: Audrey Verdier-Chouchane
    Abstract: Reducing under-five mortality rates in Africa by two-thirds is urgent. HIV-AIDS, malaria, lack of basic health services and conflict are hampering progress. Preventable diseases take a heavy toll on the under-fives. Preventing the deaths of children is a matter of political will.
    Date: 2008–04
  4. By: Zon, Adriaan van (UNU-MERIT); Schmidt, Tobias (Centre for European Economic Research (ZEW))
    Abstract: In this paper we seek to explain the causes and consequences of Northern penetration in Southern subsistence markets in order to reach the countless masses at the Bottom of the (Income) Pyramid. To this end we formulate a One-North-Many-Souths model, inspired by the Krugman (1979) North-South model. In our model, Southern countries are differentiated with respect to population size, but also the degree of internal connectedness as a proxy for the cost involved in reaching the local subsistence market. Northern subsistence goods production in Southern countries takes place under increasing returns to scale, why local production of subsistence goods takes place under constant returns to scale. Using this set-up, we show what kind of Southern countries would be penetrated first, and under which conditions this would happen. From the point of view of Northern producers, Southern countries can be divided into three classes: the broad class of partner- and non partner countries, and within the class of partner countries, the sub-classes of small and large partners. In this context, small partners are so small, that all of local subsistence production is taken over by the North, while in large countries part of subsistence consumption must still be met out of local subsistence production. The main insights coming from numerical simulations with the model are that Northern penetration on Southern markets releases (labor) resources that can then be used for producing tradable luxury goods. This has a negative terms of trade effect for the South, but a positive income effect, while, moreover, the latter effect tends to outweigh the former. In addition, small partner countries generally stand to gain more from Northern penetration than large countries, as in small partner countries relatively more resources would be released when shifting production of subsistence goods from local to Northern technologies. Using numerical simulations in which we increase the rate of imitation, we show that this leads to higher terms of trade for the South, and consequently, a higher penetration of the North in Southern countries with respect to subsistence production. The reason is that the opportunity cost of using Northern labor in Northern luxury goods production falls, and consequently more Northern labor is allocated to its alternative use of managing subsistence goods production in Southern countries. Thus we are able to "explain" the recent penetration of Northern firms in subsistence goods production in countries like India and China (which have become increasingly important as manufacturing trading partners), as the latter countries are both large in population terms as well as relatively well connected.
    Keywords: Bottom of the Pyramid, North-South model, luxury goods, subsistence goods
    JEL: D58 F12 F16 F23 O33
    Date: 2008
  5. By: Chen, Shaohua; Ravallion, Martin
    Abstract: The paper presents a major overhaul to the World Bank's past estimates of global poverty, incorporating new and better data. Extreme poverty-as judged by what "poverty" means in the world's poorest countries-is found to be more pervasive than we thought. Yet the data also provide robust evidence of continually declining poverty incidence and depth since the early 1980s. For 2005 we estimate that 1.4 billion people, or one quarter of the population of the developing world, lived below our international line of $1.25 a day in 2005 prices; 25 years earlier there were 1.9 billion poor, or one half of the population. Progress was uneven across regions. The poverty rate in East Asia fell from 80% to under 20 percent over this period. By contrast it stayed at around 50 percent in Sub-Saharan Africa, though with signs of progress since the mid 1990s. Because of lags in survey data availability, these estimates do not yet reflect the sharp rise in food prices since 2005.
    Keywords: Achieving Shared Growth; Rural Poverty Reduction; Population Policies; Services & Transfers to Poor
    Date: 2008–08–01
  6. By: Chikako Yamauchi
    Abstract: Community-based selection of social program recipients has the potential to benefit from local knowledge about individuals in need. This informational advantage however might be offset by local elite capture and administrative incompetency. Using Indonesia's anti-poverty program, this paper investigates which pre-program conditions are associated with community-based targeting outcomes. Results show that wealthier and more unequal villages constantly target better. This suggests that, though there is much concern about local capture in communities with large inequality, the ease of identifying the poor could overwhelm the possibly larger political influence of local elites. Also, villages headed by young, educated persons initially exhibit better targeting, but lose this advantage over time, as the monitoring of loan disbursement becomes more difficult for village heads. I explore Indonesia's political context, which provides insight into these findings.
    Keywords: targeting, community, inequality, IDT, Indonesia
    JEL: D73 H11 H75 O17
    Date: 2008–08
  7. By: Peter Huber (WIFO); Klaus Nowotny (WIFO)
    Abstract: This paper analyses the willingness to commute and migrate across borders. We focus on differences in the effects of individual characteristics on the willingness to migrate and the willingness to commute. Based on a random utility model we estimate a multinomial probit regression using individual level data on migration and commuting plans in regions of the Czech Republic, Hungary, and Slovakia bordering on Austria. We find that indirect costs of mobility have a smaller impact on the probability of being willing to commute. Variables associated with potential earnings have mostly low marginal effects and no evidence of selection by education.
    Keywords: willingness to migrate, willingness to commute, cross-border commuting, multinomial probit regression
    Date: 2008–06–11
  8. By: Pamela Kea (Poverty Research Unit at Sussex, Department of Economics, University of Sussex)
    Abstract: This article examines the intensification of Gambian girls’ domestic and farm labour contributions as a result of the introduction of double-shift schooling. Drawing on fieldwork among female farmers and their daughters in Brikama the article puts forth the following arguments: double shift schooling facilitates the intensification and increased appropriation of surplus value from girls’ household and farm labour because girls are more readily able to meet gendered labour obligations that are central to the moral economy of the household and to the demands of agrarian production; secondly, double shift schooling highlights the paradoxical nature of development intervention where, on the one hand, legislation and policy call for a reduction in child labour by increasing access to school and, on the other, neo-liberal educational policy serves to facilitate the intensification of girls’ domestic and farm labour. It maintains that the intensification of girls’ work must be placed within a wider context where children’s, particularly girls’ cheap, flexible and/or unremunerated labour is central to the functioning of local and global processes of accumulation.
    Keywords: Inequality, Poverty, Labour, Schooling
    Date: 2007–10
  9. By: Julie Litchfield; Thomas McGregor (Poverty Research Unit at Sussex, Department of Economics, University of Sussex)
    Abstract: This paper analyses the determinants of household welfare in the Northwest region of Tanzania using microlevel cross section data. Despite having gone through a series of structural adjustment programs in the late-1980s, Tanzania is still considered one of the poorest countries in Sub-Saharan Africa. The paper argues that the determinants of household welfare are numerous and complex, ranging from individual and household to community and social characteristics, but that the relative importance of these factors varies across the welfare distribution. Using quantile regressions, we find that human, social and physical capital all play a significant role in improving households’ living standards, but that the relatively poor are harmed more by weather shocks because they face more constraints in diversifying out of agriculture. Our results also reveal subtle insights into the relationships between gender and poverty.
    Keywords: Poverty, inequality, quantile regression, gender, rainfall, shocks, agriculture, vulnerability, Kagera, Tanzania.
    JEL: D31 D63 I32 O12 O15
    Date: 2008–08
  10. By: Valero-Gil, Jorge; Valero, Magali
    Abstract: We evaluate the impact of the rise in food prices during 2006-2008 on the poverty and extreme poverty rates in Mexico. We concentrate on the poor’s consumption of staple foods, and analyze the change in their consumption brought about by changed prices. We also allow households receiving income from the farming and livestock sector to benefit from increases in prices of food products. We find a modest increase in poverty using 2006-2007 prices, however, there is a daunting effect on the poor once the 2008 prices are taken into account. After considering the positive effects of public policies announced in 2008, such as reduced taxes and tariffs on food products and greater subsidies to the extremely poor, the poverty rate measured through consumption increases from 25% to 33.5%, and the extreme poverty rate from 10.58% to 16%, given the increase in food prices. Further analysis using the theory of optimal taxes suggests policies oriented towards relieving the food price pressure on the Mexican poor should aim at lowering the prices of eggs, vegetable oil, milk, and chicken.
    Keywords: Food price changes; Poverty; Mexico
    JEL: H21 Q11 I38 I32 Q18
    Date: 2008–08–22

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