nep-dev New Economics Papers
on Development
Issue of 2014‒12‒08
fourteen papers chosen by
Jacob A. Jordaan
Universitiet Utrecht

  1. Households’ investments in durable and productive assets in Niger: quasi-experimental evidences from a cash transfer project By Stoeffler, Quentin; Mills, Bradford
  2. Saving for a (not so) Rainy Day: A Randomized Evaluation of Savings Groups in Mali By Lori Beaman; Dean Karlan; Bram Thuysbaert
  3. Multidimensional Household Food Security Measurement in Rural Zambia By Wineman, Ayala
  4. Credit Constraints and Impact on Farm Household Welfare: Evidence from Vietnam’s North Central Coast region By Tran, Minh Chau; Gan, Prof Christopher; Hu, Baiding
  5. Estimating the Resiliency of Zambian Smallholder Farmers: Evidence from a Three-Wave Panel By Murray, Anthony G; Mills, Bradford F
  6. Impact of WIC program participation on food expenditures By Oh, Miyoung; Jensen, Helen H.; Rahkovsky, Ilya
  7. A First Step up the Energy Ladder? Low Cost Solar Kits and Household's Welfare in Rural Rwanda By Grimm, Michael; Munyehirwe, Anicet; Peters, Jörg; Sievert, Maximiliane
  8. The impact of microfinance on factors empowering women: Differences in regional and delivery mechanisms in India’s SHG programme By Bali Swain, Ranjula; Wallentin, Fan Yang
  9. Financial Services and Divisible Technology Dis-adoption among Farm Households: Theory and Empirical Application Using Data from Ethiopia By Guizar-Mateos, Isai; Dadzie, Nicholas
  10. Do Cows Have Negative Returns? The Evidence Revisited By Gehrke, Esther; Grimm, Michael
  11. Climate and Conflict By Marshall Burke; Solomon M. Hsiang; Edward Miguel
  12. Gender and Ethnicity in Bolivia, Ecuador and Guatemala By Carla Canelas; Silvia Salazar
  13. Africa Rising: Harnessing the Demographic Dividend By Paulo Drummond; Vimal Thakoor; Shu Yu
  14. Durable goods and poverty measurement By Amendola, Nicola; Vecchi, Giovanni

  1. By: Stoeffler, Quentin; Mills, Bradford
    Abstract: Cash transfers programs are an increasingly popular tool to alleviate poverty by raising households’ consumption and well-being. However, the sustainability of the short-term improvement induced by the transfers is still an open question in Sub-Saharan Africa. By studying a cash transfer project in rural Niger 18 months after its termination, this article investigates whether transfers induce investments in assets and productive activities that result in improvements in wellbeing that survive the termination of program payments. Results indicate that livestock asset and local credit (tontines) participation significantly increase among project participants. There is also evidence of improvement in private assets, living standards, micro-enterprises and agriculture. The findings imply that cash transfer programs can have long-term sustainable impacts even in extremely, poor rural areas.
    Keywords: Household investments, Productive Assets, Micro-enterprises, Unconditional Cash Transfers, Long-term Impact, Niger, Quasi-experiments, Consumer/Household Economics,
    Date: 2014
  2. By: Lori Beaman; Dean Karlan; Bram Thuysbaert
    Abstract: High transaction and contracting costs are often thought to create credit and savings market failures in developing countries. The microfinance movement grew largely out of business process innovations and subsidies that reduced these costs. We examine an alternative approach, one that infuses no external capital and introduces no change to formal contracts: an improved "technology" for managing informal, collaborative village-based savings groups. Such groups allow, in theory, for more efficient and lower- cost loans and informal savings, and in practice have been scaled up by international non-profit organizations to millions of members. Individuals save together and then lend the accumulated funds back out to themselves. In a randomized evaluation in Mali, we find improvements in food security, consumption smoothing, and buffer stock savings. Although we do find suggestive evidence of higher agricultural output, we do not find overall higher income or expenditure. We also do not find downstream impacts on health, education, social capital, and female decision-making power. Could this have happened before, without any external intervention? Yes. That is what makes the result striking, that indeed there were no resources provided nor legal institutional changes, yet the NGO-guided, improved informal processes led to important changes for households.
    JEL: D12 D91 O12
    Date: 2014–10
  3. By: Wineman, Ayala
    Abstract: Food security is recognized as a multifaceted condition of complex causality that is related to, yet distinct from, poverty and hunger. Given its broad definition, it is no surprise that food security eludes precise measurement. This study considers there to be three components of household food security (quantity, quality, and stability), and attempts to address the "concept-to-measurement" gap in food security by building an index that spans these three dimensions. A panel data set is used for descriptive analysis of food security indicators in rural Zambia in 2000/01, 2003/04, and 2007/08 for different types of households, including female-headed households. A multidimensional index of food security for rural Zambia is then developed using principal component analysis. This composite index is used to explore the spatial patterns of food security in Zambia over time, to assess correlates of food insecurity, and to measure the impacts of climate shocks on food security. Results indicate that both seasonal rainfall and temperature have a significant impact on a household's food security score, although not for all individual components of the food security index. The paper concludes with a consideration of the merits and shortcomings of developing a composite food security index.
    Keywords: climate, food security measurement, principal component analysis, Zambia, Food Security and Poverty, International Development, C38, Q12, Q54, I32,
    Date: 2014
  4. By: Tran, Minh Chau; Gan, Prof Christopher; Hu, Baiding
    Abstract: This study aims at identifying factors affecting formal credit constraint status of rural farm households in Vietnam’s North Central Coast region (NCC). Using the Direct Elicitation method (DEM), we consider both internal and external credit rationing. Empirical evidences confirm the importance of household head’s age, gender and education to household’s likelihood of being credit constrained. In addition, households who have advantages in farm land size, labour resources and non-farm income are less likely to be credit constrained. Poor households are observed to remain restricted by formal credit institutions. Results from the Endogenous Switching Regression model suggest that credit constraints have negative impact on household’s consumption per capita and informal credit can act as a substitute to mitigate the negative influence of formal credit constraints.
    Keywords: Credit constraint, determinants, impact, welfare, rural households, Agribusiness, Community/Rural/Urban Development, Consumer/Household Economics, International Development,
    Date: 2014
  5. By: Murray, Anthony G; Mills, Bradford F
    Abstract: Aggregate African agricultural production is expected to fall due to changes in temperature and rainfall under current economic models, but 65 percent of the African labor force is employed in agriculture activity. Therefore, climatic changes have the potential to significantly impact all African citizens, especially farmers. Agricultural producers must adapt to these climatic changes and the risk filled environment that rural households operate, especially small-holder farmers, which makes them particularly vulnerable to poverty and food insecurity without successful adaptation. The limited success of improving agricultural technology in Zambia makes it important to understand the determinants of changes in farm yield for major staple crops, including maize, groundnuts, sweet potatoes, and cassava. This paper generates an empirical model of the determinants of changes in farm yields using a three wave panel dataset for three agricultural seasons. Results indicate that over households have made minimal changes in crop choice and little impact has been observed due to changes in climate for Zambian farmers. Increases in yearly average rainfall and temperature positively affect maize yields. As temperatures continue to rise in the future, this relationship may not hold as the climate becomes unsuitable for large scale maize production. Changes in rainfall negatively affect household groundnut and sweet potato production which might result from switching between crops as weather changes. Finally, increased temperatures negatively affect cassava production.
    Keywords: Resiliency, Zambia, Agricultural and Food Policy, International Development, O13,
    Date: 2014
  6. By: Oh, Miyoung; Jensen, Helen H.; Rahkovsky, Ilya
    Abstract: This paper investigates the relationship between WIC program participation and purchases of WIC related food. Nielsen Homescan data 2008 to 2010 provide unique information with food expenditures including details on household’s demographics and reported WIC participation status. Using scanner data, we assess how participation in the WIC program relates to food expenditures by WIC eligible (but not participating) and by WIC participating households. The research includes a comparison of select food purchases between eligible WIC reporting and eligible WIC not-reporting households during the period of introduction of changes in the WIC food package. Specific foods and food groups of interest for the analysis include whole grain products.
    Keywords: Agricultural and Food Policy, Consumer/Household Economics, Food Consumption/Nutrition/Food Safety,
    Date: 2014
  7. By: Grimm, Michael (University of Passau); Munyehirwe, Anicet (IB&C Rwanda); Peters, Jörg (RWI); Sievert, Maximiliane (RWI)
    Abstract: More than 1.3 billion people lack access to electricity. The UN have proclaimed the goal of providing electricity to all by 2030. In recent years, Pico-Photovoltaic kits have become a lower cost alternative to investment intensive grid electrification. Using a randomized controlled trial we examine uptake and impacts of a simple Pico-Photovoltaic kit that barely exceeds the benchmark of what the UN considers as modern energy. We find significant effects on households' budget, productivity and convenience. Despite these effects, the data shows that adoption will be impeded by affordability, suggesting that policy has to consider subsidized dissemination strategies.
    Keywords: energy access, household technology adoption, Sub-Saharan Africa, randomized controlled trial
    JEL: O13 O18 Q41
    Date: 2014–10
  8. By: Bali Swain, Ranjula (Department of Economics); Wallentin, Fan Yang (Department of Statistics)
    Abstract: We examine how the impact on women empowerment varies with respect to the location and type of group linkage of the respondent. Using household survey data from five states in India, we correct for selection bias to estimate a structural equation model. Our results reveal that in the southern states of India empowerment of women takes place through economic factors. For the other states, we find a significant correlation between women empowerment and autonomy in women’s decision-making and network, communication and political participation respectively. We do not however find any differential causal impact of different delivery methods (linkage models).
    Keywords: microfinance; women empowerment; structural equation model; self-help groups
    JEL: C31 G21 J16
    Date: 2014–10–31
  9. By: Guizar-Mateos, Isai; Dadzie, Nicholas
    Abstract: The adoption of improved varieties and technologies by rural agricultural households remains a major goal in development efforts. This is because researchers and development practitioners recognize it as a potential source of income growth for the poor. However, while studies on adoption of improved technologies abound, little evidence exist on the continued use of improved technologies. This study addresses this gap by focusing on divisible technologies which do not require significantly high investments or capital. A dynamic stochastic model is formulated which analyzes the mechanics of adoption and abandonment of improved technology among poor households. The model is solved using numerical approximation methods for different regimes of financial intermediation. The results show that increasing credit limits helps in sustained adoption and prevents abandonment of high-income crop. Using discrete choice panel data models, we test the implications of our theoretical results with data from rural Ethiopia. The estimation results confirm that for households already engaged in high income crops like maize, access to credit prevents abandonment of the maize crop.
    Keywords: financial services, credit, abandonment, rural Ethiopia, Agricultural and Food Policy, Food Security and Poverty, International Development, Risk and Uncertainty,
    Date: 2014
  10. By: Gehrke, Esther (German Development Institute); Grimm, Michael (University of Passau)
    Abstract: This paper addresses the apparent paradox between widespread support of cattle farming by agricultural policy interventions and negative returns to cattle as stressed in recent works. Using a representative panel dataset for Andhra Pradesh, a state in the south of India, we examine average and marginal returns to cattle. One variant of our identification strategy builds on instrumental variable estimation, where the exposure to the National Rural Employment Guarantee Act (NREGA) is used as an instrument for investment in cattle. We find average returns in the order of -2% at the mean, but they vary across the cattle value distribution between negative 35% (in the lowest quintile) and positive 5% (in the highest). In contrast, marginal returns are positive over the entire distribution and, on average, as high as 13% annually. Both, average and marginal returns vary considerably not only across scale, but also across cattle breed and individual animal value. Our results suggest that cattle farming is associated with sizable non-convexities in the production technology and that substantial economies of scale as well a high upfront expenses of acquiring high productivity animals might trap poorer households in low-productivity asset levels.
    Keywords: livestock, profits, investment, India
    JEL: D24 O12 Q12
    Date: 2014–10
  11. By: Marshall Burke; Solomon M. Hsiang; Edward Miguel
    Abstract: Until recently, neither climate nor conflict have been core areas of inquiry within economics, but there has been an explosion of research on both topics in the past decade, with a particularly large body of research emerging at their intersection. In this review, we survey this literature on the interlinkages between climate and conflict, by necessity drawing from both economics and other disciplines given the inherent interdisciplinarity of research in this field. We consider many types of human conflict in the review, including both interpersonal conflict -- such as domestic violence, road rage, assault, murder, and rape -- and intergroup conflict -- including riots, ethnic violence, land invasions, gang violence, civil war and other forms of political instability, such as coups. We discuss the key methodological issues in estimating causal relationships in this area, and largely focus on "natural experiments" that exploit variation in climate variables over time, helping to address omitted variable bias concerns. After harmonizing statistical specifications and standardizing estimated effect sizes within each conflict category, we carry out a hierarchical meta-analysis that allows us to estimate the mean effect of climate variation on conflict outcomes as well as to quantify the degree of variability in this effect size across studies. Looking across 55 studies, we find that deviations from moderate temperatures and precipitation patterns systematically increase the risk of conflict, often substantially, with average effects that are highly statistically significant. We find that contemporaneous temperature has the largest average effect by far, with each 1σ increase toward warmer temperatures increasing the frequency of contemporaneous interpersonal conflict by 2.4% and of intergroup conflict by 11.3%, but that the 2-period cumulative effect of rainfall on intergroup conflict is also substantial (3.5%/σ). We also quantify heterogeneity in these effect estimates across settings that is likely important. We conclude by highlighting remaining challenges in this field and the approaches we expect will be most effective at solving them, including identifying mechanisms that link climate to conflict, measuring the ability of societies to adapt to climate changes, and understanding the likely impacts of future global warming.
    JEL: I3 O1 P48 Q51 Q54
    Date: 2014–10
  12. By: Carla Canelas (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon-Sorbonne); Silvia Salazar (CES - Centre d'économie de la Sorbonne - CNRS : UMR8174 - Université Paris I - Panthéon-Sorbonne)
    Abstract: In this article, we examine the structure of gender and ethnic wage gaps, and the distribution of both, paid and unpaid work in Bolivia, Ecuador and Guatemala. The wage gap is assessed by quantile decomposition methods and the classical Blinder-Oaxaca decomposition. The determinants of hours allocated to paid and unpaid work activities between gender groups, are estimated by seemingly unrelated regressions. The results indicate that women are highly discriminated in the job market and undertake most of the domestic activities of the households. The indigenous population also suffers from discrimination, but the wage gap is mostly explained by the difference in endowments. The wider gap at the lower tail of the distribution suggest the presence of stickly floors effects for both, women and indigenous population.
    Keywords: Discrimination; ethnicity; gender; time-use
    Date: 2014–03
  13. By: Paulo Drummond; Vimal Thakoor; Shu Yu
    Abstract: Africa will account for 80 percent of the projected 4 billion increase in the global population by 2100. The accompanying increase in its working age population creates a window of opportunity, which if properly harnessed, can translate into higher growth and yield a demographic dividend. We quantify the potential demographic dividend based on the experience of other regions. The dividend will vary across countries, depending on such factors as the initial working age population as well as the speed and magnitude of demographic transition. It will be critical to ensure that the right supportive policies, including those fostering human capital accumulation and job creation, are in place to translate this opportunity into concrete economic growth.
    Keywords: Demographic transition;Africa;Sub-Saharan Africa;Population growth;Human capital;Labor force participation;Econometric models;Demographic Dividend, Economic Growth, Sub-Saharan Africa, Panel Estimates
    Date: 2014–08–05
  14. By: Amendola, Nicola; Vecchi, Giovanni
    Abstract: The paper focuses on durable goods and their role in the measurement of living standards. The paper reviews the theoretical underpinnings of the methods available to estimate the value of the services flowing from consumer durable goods. It also provides a unified framework that encompasses the acquisition approach, the rental equivalent approach, and the user cost approach. The pros and cons of each method are discussed in the context of poverty and inequality analysis and it is argued that the user cost should receive the highest consideration.
    Keywords: Debt Markets,Economic Theory&Research,Markets and Market Access,Investment and Investment Climate,Access to Markets
    Date: 2014–11–01

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