nep-dev New Economics Papers
on Development
Issue of 2014‒04‒05
eight papers chosen by
Jacob A. Jordaan
Utrecht University

  1. Fragile African States: What Should Donors Do? By Paul COLLIER
  2. The impact of Bolsa Família on schooling: Girls’ advantage increases and older children gain: By de Brauw, Alan; Gilligan, Daniel O.; Hoddinott, John F.; Roy, Shalini
  3. Aid effectiveness: How is the L’Aquila food security initiative doing?: By Benin, Samuel
  4. Cognitive Development and Infectious Disease: Gender Difference in Investments and Outcomes By Sonia R Bhalotra; Atheendar S Venkataramani
  5. Health information, treatment, and worker productivity: Experimental evidence from malaria testing and treatment among Nigerian sugarcane cutters By Andrew Dillon; Jed Friedman; Pieter Serneels
  6. Aid effectiveness for poverty reduction: lessons from cross-country analyses, with a special focus on vulnerable countries By Patrick GUILLAUMONT; Laurent WAGNER
  7. Improved dairy cows in Uganda: Pathways to poverty alleviation and improved child nutrition: By Kabunga, Nassul S.
  8. Can cash transfers promote the local economy? A case study for Cambodia: By Robinson, Sherman; Levy, Stephanie

  1. By: Paul COLLIER (Blavatnik School of Government)
    Abstract: 1. Introduction Necessarily, all donors will focus increasingly on fragile states. The more successful countries in Africa have achieved growing tax bases and are consequently now gaining access to global capital markets.  For such countries, aid is becoming marginal. In contrast, fragile states, by the nature of their condition, have small tax bases and face risks which deter private capital: for them aid remains potentially important. Not only do donors provide a substantial proportion of government revenues; they bring expertise which is sorely lacking in fragile states; and they change incentives for government both intentionally through the conditions they set, and unintentionally through the revenues and expertise they provide. Donor practices have evolved considerably over recent decades. Donors have gradually learned how to operate effectively in those states which have governments that are reasonably representative of the interests of their citizens, and reasonably competent in managing public spending. In such states budget support free of policy conditions is likely to be the most effective modality for providing aid. Government ownership of an aid program maximizes the benefit from the superior local knowledge that it has, and minimizes interference in the accountability of government to citizens. Unfortunately, fragile states are not usually characterized by the combination of governments that are reasonably representative of the interests of their citizens, and reasonably competent in managing public spending: if they had both of these characteristics they would probably not be fragile. Yet without these characteristics, unconditional budget support is liable to be ineffective and can easily be counterproductive. Donor money is unlikely to be well-spent and can undermine the capacities that the state needs to develop. Donors therefore appear to face a dilemma. If the neediest countries are those in which aid is least effective, in allocating aid between countries the donor is faced with an uncomfortable trade-off between need and effectiveness.
    Date: 2014–03
  2. By: de Brauw, Alan; Gilligan, Daniel O.; Hoddinott, John F.; Roy, Shalini
    Abstract: We estimate the impact of Bolsa Família on a range of education outcomes, including school participation, grade progression, grade repetition, and dropout rates. Using a large-sample household panel survey from 2005–2009 collected for this evaluation, we develop a statistically balanced comparison group of eligible nonparticipant households and estimate impacts using propensity-score-weighted regression. We estimate that Bolsa Família increased average school participation among all children age 6 to 17 years by (a weakly significant) 4.5 percent. It had no effect on grade promotion, on average. However, within the subsample of girls, Bolsa Família caused substantial improvements in schooling outcomes, including significant increases in school participation (8.2 percent) and rates of grade progression (10.4 percent). We show that the gains in girls’ schooling do not derive from catch-up effects, but rather increase girls’ existing advantage in schooling attainment. In general, impacts are larger among older children, in rural areas, and in the Northeast.
    Keywords: Education, Gender, Poverty, conditional cash transfers (CCT) programs, Bolsa Família,
    Date: 2014
  3. By: Benin, Samuel
    Abstract: This paper uses case studies of Bangladesh, Ghana, Rwanda, and Senegal to assess the degree to which the L’Aquila Food Security Initiative (AFSI) has been implemented within the framework of managing for development results (MfDR) and to evaluate progress in various outcomes, including economic governance, agricultural growth, poverty, and food and nutrition security (FNS).
    Keywords: Agricultural development, Rural development, Development aid, food security, Agriculture, L’Aquila Food Security Initiative, aid effectiveness,
    Date: 2014
  4. By: Sonia R Bhalotra; Atheendar S Venkataramani
    Abstract: We exploit exogenous variation in the risk of waterborne disease created by implementation of a major water reform in Mexico in 1991 to investigate impacts of infant exposure on indicators of cognitive development and academic achievement in late childhood. We estimate that a one standard deviation reduction in childhood diarrhea mortality rates results in about a 0.1 standard deviation increase in test scores, but only for girls. We show that a reason for the gender differentiated impacts is that the water reform induces parents to make complementary investments in education that favor girls, consistent with their comparative advantage in skilled occupations. The results provide novel evidence of the potential for clean water provision to narrow test score gaps across countries and, within countries, across gender.
    Date: 2013–12–11
  5. By: Andrew Dillon; Jed Friedman; Pieter Serneels
    Abstract: Agricultural and other physically demanding sectors are important sources of growth in developing countries but prevalent diseases such as malaria adversely impact the productivity, labor supply, and occupational choice of workers in these sectors by reducing physical capacity. This study identifies the impact of malaria on worker earnings, labor supply, and daily productivity by randomizing the temporal order at which piece-rate workers at a large sugarcane plantation in Nigeria are offered malaria testing and treatment. The results indicate a significant and substantial intent to treat effect of the intervention – the offer of a workplace based malaria testing and treatment program increases worker earnings by approximately 10% over the weeks following the mobile clinic visit. The study further investigates the effect of health information by contrasting program effects by workers revealed health status. For workers who test positive for malaria, the treatment of illness increases labor supply, leading to higher earnings. For workers who test negative, and especially for those workers most likely to be surprised by the healthy diagnosis, the health information also leads to increased earnings via increased productivity. Possible mechanisms for this response include selection into higher return occupations as a result of changes in the perceived cost of effort. A model of the worker labor decision that includes health perceptions in the decision to supply effort suggests that, in endemic settings with poor quality health services, inaccurate health perceptions may lead workers to misallocate labor thus resulting in sub-optimal production and occupational choice. The results underline the importance of medical treatment but also of access to improved information about one’s health status, as the absence of either may lead workers to deliver lower than optimal effort levels in lower return occupations.
    Keywords: malaria, labor supply, labor productivity, randomized experiment
    JEL: I12 J22 J24 O12
    Date: 2014
  6. By: Patrick GUILLAUMONT (Ferdi); Laurent WAGNER (Ferdi)
    Abstract: Introduction: focus of the paper Following the adoption of the MDG, particularly the first one that is to reduce poverty by half between 1995 and 2015, numerous studies have examined how external aid can contribute to their achievement. The formula "doubling aid to reduce the poverty by half" relied on the implicit assumption that aid was an effective instrument for poverty reduction. The formula and corresponding assumption have been debated. Two opposite views clearly appeared, one, represented by Jeffrey Sachs in his End of Poverty, underlining the need for a big push to get low income countries out of poverty traps, the other one, illustrated by the attacks of William Easterly against aid as a support of a big push and the idea of a poverty trap, and also including arguments about a limited absorptive capacity. Elsewhere we have argued that the absorptive capacity of aid depends on aid modalities and can be enhanced by a reform of aid, a way by which big push and absorptive capacity views can be reconciled and to which we come back later (Guillaumont and Guillaumont Jeanneney, 2010). Actually the academic debate on aid effectiveness of the first millennium decade has been dominated by another controversy, relying on cross country regressions and initiated by the highly influential paper of Burnside and Dollar (2000). After so many cross country studies following their paper, supporting or, more often, criticizing it, there seems to be a temptation to consider this research orientation as a deadlock and to switch to micro impact analysis. Whatever the importance and need of impact micro-analyses, we argue that it would be a dangerous dismissal to give up the cross-section approach, for several reasons. First the methodological weaknesses of many studies does not entail that other ones relying on better methodology and data cannot lead to more robust results. Second, since cross section studies on aid effectiveness will never be totally given up, there is a risk to see only the most provocative (and possibly least robust) retaining the attention of media and policy makers, a policy challenge to be kept in mind in the orientation of research. Finally micro studies and impact analyses, while they supply policy makers with useful information in a given context, are not an appropriate tool for assessing the impact of macro-economic features of countries on aid effectiveness. The aim of this paper, relying on results of the cross country literature on aid effectiveness, and drawing only on those we consider as particularly relevant and robust is to examine how aid can contribute to poverty reduction, with a special focus on the way it can address the vulnerability of  many developing countries.
    JEL: F35 O11 O40 C21 I3
    Date: 2014–03
  7. By: Kabunga, Nassul S.
    Abstract: The introduction and dissemination of improved dairy cow breeds in Uganda is arguably the most significant step taken to develop a modern and commercial dairy industry in the country over the last two decades. This study uses a nationally representative sample of Ugandan households to rigorously examine the impact of adoption of improved dairy cow breeds on enterprise-, household-, and individual child-level nutrition outcomes. We find that adopting improved dairy cows significantly increases milk productivity, milk commercialization, and food expenditure.
    Keywords: Technology adoption, productivity, child nutrition, Poverty, Impact assessment, poverty alleviation, propensity score matching,
    Date: 2014
  8. By: Robinson, Sherman; Levy, Stephanie
    Abstract: While previous research on cash transfer programs has primarily concentrated on micro-economic effects, this paper analyzes general equilibrium effects of social transfer policies using a computable general equilibrium model applied to Cambodia. It identifies the potential impact of these transfers on the local economy, looking particularly at prices and market responses to an increase in demand through production and trade. Our findings show that, for goods and services for which domestic supply is not elastic enough to respond to a significant rise in demand, prices will increase, affecting the value of transfers on poverty reduction.
    Keywords: Agricultural policies, Agricultural development, Impact assessment, agricultural development strategies, social protection, Computable General Equilibrium (CGE) model, impact evaluation,
    Date: 2014

This nep-dev issue is ©2014 by Jacob A. Jordaan. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
General information on the NEP project can be found at For comments please write to the director of NEP, Marco Novarese at <>. Put “NEP” in the subject, otherwise your mail may be rejected.
NEP’s infrastructure is sponsored by the School of Economics and Finance of Massey University in New Zealand.