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on Development |
| By: | Paolo Falco |
| Abstract: | This paper investigates the role of risk-aversion in the allocation of workers between formal and informal jobs in Ghana. In the model I propose risk-averse workers can opt between the free-entry informal sector and queuing for formal occupations. Conditional on identifying the riskier option, the model yields testable implications on the relationship between risk-preferences and workers’ allocation. My testing strategy proceeds in two steps. First, I estimate expected income uncertainty through panel data and find it significantly higher in the informal sector. Second, using novel experimental data to elicit individual attitudes to risk, I estimate the direct effect of risk-aversion on occupational choices and find that, in line with the first result, more risk-averse workers are more likely to queue for formal jobs and less likely to be in the informal sector. The results bear important implications for the optimal design of employment policies and social security. |
| Keywords: | sector allocation; occupational choices; risk-aversion; informality |
| JEL: | C93 J21 J24 J64 O17 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:2013-15&r=dev |
| By: | Matthew Collin |
| Abstract: | This paper examines the relationship between ethnic heterogeneity and the demand for formal land tenure in urban Tanzania. Using a unique census of two highly-fractionalized unplanned settlements in Dar es Salaam, I show that households located near coethnics are significantly less likely to purchase a limited form of land tenure recently offered by the government. I attempt to address one of the chief concerns - endogenous sorting of households - by conditioning on a household’s choice of coethnics neighbors upon arrival in the neighborhood. I also find that coethnic residence predicts lower levels of perceived expropriation risk, but not perceived access to credit nor contribution to local public goods. These results suggest that close-knit ethnic groups may be less likely to accept state-provided goods due to their ability to generate reasonable substitutes, in this case protection from expropriation. The results are robust to different definitions of coethnicity and spatial cut-offs, controls for family ties and religious similarity as well as spatial fixed effects. Finally, the main result is confirmed using a large-scale administrative data-set covering over 20,000 land parcels in the city, exploiting ethnically-unique last names to predict tribal affiliation. |
| Keywords: | Ethnicity, Land tenure, Tanzania, Unplanned settlements |
| JEL: | J15 Q15 R23 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:csa:wpaper:2013-12&r=dev |
| By: | Syed Abul Hasan |
| Abstract: | This paper studies the eect of a sharp rice price increase on welfare and poverty in Bangladesh. We employ household expenditure information to estimate the welfare loss in- duced by the price increase. Our ndings suggest that we underestimate the proportionate welfare loss for the rice producing households and overestimate that of the households who do not produce rice, if we ignore indirect eects arising from a change in household consump- tion and production behaviour. Our estimates further support the hypothesis of a quadratic relationship between welfare loss and permanent household income. We also demonstrate that higher rice prices either increase or decrease the poverty head-count ratio, depending on the choice of the poverty line. However, if we consider the per capita income gap as a measure of poverty, we always observe that higher rice prices unambiguously increase poverty. |
| Keywords: | Welfare; Poverty; Rice Price Increase; Semiparametric Regression; Bangladesh |
| JEL: | O13 O53 Q12 D12 I32 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:pas:asarcc:2013-11&r=dev |
| By: | Spears, Dean; Lamba, Sneha |
| Abstract: | Early life health and net nutrition shape childhood and adult cognitive skills and human capital. In poor countries -- and especially in South Asia -- widespread open defecation without making use of a toilet or latrine is an important source of childhood disease. This paper studies the effects on childhood cognitive achievement of early life exposure to India's Total Sanitation Campaign, a large government program that encouraged local governments to build and promote use of inexpensive pit latrines. In the early years of the program studied here, the TSC caused six-year-olds exposed to it in their first year of life to be more likely to recognize letters and simple numbers. The results suggest both that open defecation is an important threat to the human capital of the Indian labor force, and that a program feasible to low capacity governments in developing countries could improve average cognitive skills. |
| Keywords: | Health Monitoring&Evaluation,Disease Control&Prevention,Primary Education,Educational Sciences,Population Policies |
| Date: | 2013–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6659&r=dev |
| By: | Kym Anderson; Maros Ivanic; Will Martin |
| Abstract: | This paper first considers the impact on world food prices of the changes in restrictions on trade in staple foods during the 2008 world food price crisis. Those changes—reductions in import protection or increases in export restraints—were meant to partially insulate domestic markets from the spike in international prices. The authors find that this insulation added substantially to the spike in international prices for rice, wheat, maize, and oilseeds. As a result, although domestic prices rose less than they would have without insulation in some developing countries, in many other countries they rose more than they would have in the absence of such insulation. The paper’s second purpose it to estimate the combined impact of such insulating behavior on poverty in various developing countries and globally. The analysis finds that the actual poverty-reducing impact of insulation is much less than its apparent impact, and that its net effect was to increase global poverty in 2008 by 8 million people, although this increase was not significantly different from zero. The paper examines the relative efficiency and equity of trade restrictions and domestic policies, such as conditional cash transfers, than are designed to provide social protection for the poor when international food prices spike. It also examines the potential consequences of multilateral agreements to limit changes in restrictions on trade during such times. |
| JEL: | F13 Q02 Q17 Q18 |
| Date: | 2013–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19530&r=dev |
| By: | Gajate-Garrido, Gissele |
| Abstract: | Why is the urban-rural gap in child malnutrition increasing in Peru despite government efforts to improve the provision of public services? To answer this question, the impact of regional public expenditure in Peru on young children's nutritional outcomes is examined. To account for policy endogeneity, public expenditures are instrumented using unanticipated regional mining revenues. Even after accounting for changes in expenditure composition due to increases in mining revenues, public spending has a significant and positive impact on children's outcomes only in urban areas. However, even in urban areas, barriers exist that diminish the effectiveness of public expenditure, so indigenous and frailer children in these areas do not benefit from public spending. These children face constraints that limit their ability to use public services. This result reveals the paramount importance of initial conditions. In rural areas, possibly because of the lower quantity and quality of public services, there is no positive effect for any children. |
| Keywords: | Health Monitoring&Evaluation,Public Sector Economics,Public Sector Expenditure Policy,Regional Economic Development,Public Sector Management and Reform |
| Date: | 2013–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6666&r=dev |
| By: | Sambit Bhattacharyya; Budy R. Resosudarmo |
| Abstract: | We study the impact of growth and growth accelerations on poverty and inequality in Indonesia using a new panel dataset covering 26 provinces over the period 1977-2010. This dataset allows us to distinguish between mining and non-mining sectors of the economy. We find that growth in non-mining significantly reduces poverty and inequality. In contrast, overall growth and growth in mining appears to have no effect on poverty and inequality. We also identify growth acceleration episodes defined by at least four consecutive years of positive growth in GDP per capita. Growth acceleration in non-mining reduces poverty and inequality whereas growth acceleration in mining increases poverty. We expect that the degree of forward and backward linkages of mining and non-mining sectors explain the asymmetric result. Our results are robust to state and year fixed effects, state specific trends, and instrumental variable estimation with rainfall and humidity as instruments. |
| Keywords: | Indonesia, growth; growth accelerations; mining, poverty; inequality |
| JEL: | I32 N15 O11 O13 O49 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:pas:papers:2013-15&r=dev |
| By: | Raghbendra Jha; Woojin Kang; Hari K. Nagarajan; Kailash C. Pradhan |
| Abstract: | Using ARIS/REDS data set for 2006 for rural India this paper models household vulnerability as expected utility and its components. We conclude, first, that between the years 1999 and 2006 household vulnerability is most explained by poverty and idiosyncratic components. Second, for risk coping strategy, households rely heavily on informal instrument such as their own saving, transfers or capital depletion. However, they also try to cope with covariate risks by participating in government programmes. Third, household consumption is highly covariate with income. This implies that existing informal insurance instruments are not sufficient to protect household consumption against income shocks. Fourth, a coping strategy using government programmes has vulnerability (idiosyncratic risk component) reducing effects. Finally, there is a strong case for the establishment of strong safety nets in Indian villages. The existing informal strategy is inadequate as a consumption insurance mechanism whereas government programmes are found to reduce vulnerability induced by idiosyncratic shocks. However, access to such programmes is highly constrained. The expansion of suitably designed government programs has the potential of protecting households efficiently from negative shocks. |
| Keywords: | Vulnerability as Expected Utility, Coping Strategy, Economic Growth, Social Safety nets |
| JEL: | D12 D18 I32 I38 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:pas:asarcc:2013-12&r=dev |
| By: | Kym Anderson; Maros Ivanic; Will Martin |
| Abstract: | This paper has two purposes. It first considers the impact on world food prices of the changes in restrictions on trade in staple foods during the 2008 world food price crisis. Those changes—reductions in import protection or increases in export restraints—were meant to partially insulate domestic markets from the spike in international prices. We find that this insulation added substantially to the spike in international prices for rice, wheat, maize and oilseeds. As a result, while domestic prices rose less than they would have without insulation in some developing countries, in many other countries they rose more than in the absence of such insulation. The paper’s second purpose it to estimate the combined impact of such insulating behavior on poverty in various developing countries and globally. We find that the actual poverty-reducing impact of insulation is much less than its apparent impact, and that its net effect was to increase global poverty in 2008 by 8 million, although this increase was not significantly different from zero. Since there are domestic policy instruments such as conditional cash transfers that could now provide social protection for the poor far more efficiently and equitably than variations in border restrictions, we suggest it is time to seek a multilateral agreement to desist from changing restrictions on trade when international food prices spike. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:pas:papers:2013-11&r=dev |
| By: | Nguyen, Cuong; Phung, Tung; Westbrook, Daniel |
| Abstract: | To increase the opportunities for poor ethnic minorities to benefit from economic growth the government of Vietnam implemented one of the biggest poverty reduction programs entitled ‘Socio-economic Development for the Communes Facing Greatest Hardships in the Ethnic Minority and Mountainous Areas’ during 2006 - 2010. This paper estimates the program’s impacts on households in the project areas. We find that the program had positive impacts on several important outcomes of the ethnic minority households, including productive asset ownership, household durables ownership, and rice productivity. Positive impacts were also recorded for agricultural income, household total income, and household per-capita income. A particularly important result is that poverty among minority households in treatment communes declined significantly more than it declined in comparison communes. Finally, ethnic minority households enjoyed a reduction in travel time to health facilities, relative to households in control communes. |
| Keywords: | Poverty reduction, ethnic minority, household survey, Vietnam. |
| JEL: | H43 I3 O1 O10 |
| Date: | 2013–06–22 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:50689&r=dev |
| By: | Peter Warr; Arief Anshory Yusuf |
| Abstract: | Spikes in international food prices in 2007-2008 worsened poverty incidence in Indonesia, both rural and urban, but only by small amounts. The paper reaches this conclusion using a multi-sectoral and multi-household general equilibrium model of the Indonesian economy. The negative effect on poor consumers, operating through their living costs, outweighed the positive effect on poor farmers, operating through their incomes. Indonesia’s post-2004 rice import restrictions shielded its internal rice market from the temporary world price increases, muting the increase in poverty. But it did this only by imposing large and permanent increases in both domestic rice prices and poverty incidence. Poverty incidence increased more among rural than urban people, even though higher agricultural prices mean higher incomes for many of the rural poor. Gains to poor farmers were outweighed by the losses incurred by the large number of rural poor who are net buyers of food and the fact that food represents a large share of their total budgets, even larger on average than for the urban poor. The main beneficiaries of higher food prices are not the rural poor, but the owners of agricultural land and capital, many of whom are urban based. |
| Keywords: | Indonesia; food prices; poverty incidence; general equilibrium modeling. |
| JEL: | D58 I32 F14 |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:pas:papers:2013-07&r=dev |