nep-dev New Economics Papers
on Development
Issue of 2015‒03‒27
seven papers chosen by
Jacob A. Jordaan
Universiteit Utrecht

  1. Assesing The Impact of Microcredit in Bolivia Evidence from Crédito Productivo Individual – Banco de Desarrollo Productivo By Werner L. Hernani-Limarino; Paul Villarroel
  2. Beer, Wood, and Welfare By Michael Grimm; Jörg Peters
  3. Does Remittances Finance Welfare Development?: Evidence from the South Pacific Island Nation of Fiji By Rukmani Gounder
  4. Gender Differences in Time Poverty in Rural Mozambique By Diksha Arora
  5. Job Training and Employability Evidence from Mi Primer Empleo Digno By Werner L. Hernani-Limarino; Paul Villarroel
  6. Does commercialization of smallholder horticulture reduce rural poverty? Evidence based on household panel data from Kenya By Muriithi, Beatrice W.
  7. The Migrant Network Effect: An empirical analysis of rural-to-urban migration in South Africa By Caroline Stapleton

  1. By: Werner L. Hernani-Limarino (Fundación ARU); Paul Villarroel (Fundación ARU)
    Abstract: This paper presents the impact evaluation of Crédito Productivo Individual from Banco de Desarrollo Productivo S.A.M – government second-tier bank which channels resources toward productive activities in Bolivia. This financial product is specifically directed to micro and small enterprises in the productive sector, concentrating mostly in the agriculture and manufacturing. Taking into account differences in treatment received by beneficiaries, we use multiple control groups – assuming unconfoundedness, to estimate impact on family and production outcomes. The results show us that the main effects of credit are observed in manufacturing sector. In this sector we find an impact between 23% and 28% on machinery investment levels, which could be the explanation for an observed impact higher than 20% on production value. On the other hand, we only find effects in reducing input costs, suggesting that the greatest impact in the agricultural sector could be the opening of financial products to this group of producers.
    Keywords: impact evaluation, microcredits, microfinance
    JEL: C21 G2 I3
    Date: 2015–03
  2. By: Michael Grimm; Jörg Peters
    Abstract: Local beer breweries in Burkina Faso absorb a considerable amount of urban woodfuel demand. We assess the woodfuel savings caused by the adoption of improved brewing stoves by these micro-breweries and estimate the implied welfare effects through the woodfuel market on private households as well as the environmental effect. We find substantial wood savings among the breweries and, subsequently, huge welfare gains for households and reductions in CO2-emissions. Since woodfuel is predominantly used for cooking by the poorer strata, the intervention under study is an example for a green growth intervention with pro-poor welfare gains – something green growth strategies should look for.
    Keywords: Burkina Faso; demand for woodfuel; green growth; impact evaluation; improved stoves; technology adoption
    JEL: D2 D6 I3 O3
    Date: 2015–02
  3. By: Rukmani Gounder (Massey University)
    Abstract: Remittances to developing nations have become an important source of income to finance the recipient households’ livelihoods, where changes in expenditure patterns, consumption and savings-investment nexus for long term development lead to improve in wellbeing. The Pacific Islands have also seen to a significant rise in remittances and it has become a steady source of foreign exchange earnings. The island nations have a sizeable migration flow to Australia, New Zealand, the United States and United Kingdom as well as to other Pacific islands. A large number of emigrants from Fiji also migrate to Canada. More recently, remittances form a substantial flow through temporary labour schemes. Fiji’s rising migrant stock has seen remittances as the second largest foreign exchange earner after tourism surpassing other foreign capital flows of foreign aid, foreign direct investment as well as earnings from major commodity exports. It has large off-shore labour markets through specific employment abroad for teachers, nurses, care takers, sports personnel, military personnel and security officers in Australia, New Zealand, Dubai, United Kingdom, Middle East and the United Nations peace keeping force in the conflict-laden countries. The link between remittances and expenditure patterns has become an important nexus in the global welfare development framework. By increasing income of the recipient households’, remittances have gained impetus in the development agenda for its contribution to individual welfare through a range of consumption goods, entrepreneurial small and medium scale business and poverty reduction. Remittances impact on households’ welfare shows that this financial inflow has been used for consumer durable and non-durable goods, food, housing, savings, investment and developing human capital, i.e., schooling and health outcomes. Its eventual developmental impact depends on the sustainability and what categories of consumption and innovative investment expenditures the households spend remittances on. This study examines the impact of remittances on welfare development in Fiji using the household income and expenditure survey 2002-03 dataset for 5,245 households. Expenditure patterns of the households are estimated for various categories and further disaggregated by ethnicity, i.e. Fijian and Indo-Fijian households. The results provide some implications for social financing for wellbeing and note the empowering and visionary opportunities of remittances to be part of development.
    Keywords: International Migration, Remittances, Social financing, Welfare, Development, Fiji
    JEL: F37 I31 O12
    Date: 2014–07
  4. By: Diksha Arora
    Abstract: This study examines the nature and extent of time poverty experienced by men and women in subsistence households in Mozambique. Gender roles, shaped by patriarchal norms, place heavy work obligations on women. Time-use data from a primary household survey in Mozambique is used for this analysis. The main findings suggest that women’s labor allocation to economic activities is comparable to that of men. Household chores and care work are women’s responsibility, which they perform with minimal assistance from men. The heavy burden of responsibilities leave women time poorer, compared to 50% of women, only 8% of men face time constraints. Women’s time poverty worsens when the burden of simultaneous care work is taken into account. Not only women work longer hours, due to multi-tasking, the work tends to be more taxing. The examination of determinants of time poverty show that measures of bargaining power like assets and education do not necessarily affect time poverty faced by women.
    Keywords: intra-household allocation, time allocation, poverty, gender, Africa JEL Classification: D13, J22, I3, J16, O55
    Date: 2014
  5. By: Werner L. Hernani-Limarino (Fundación ARU); Paul Villarroel (Fundación ARU)
    Abstract: This document presents an impact evaluation of the pilot program Mi Primer Empleo Digno (MPED) – an active labor market program that provides classroom training and paid internships to low income youth from January 2009 to June 210 in main cities in Bolivia. Taking advantage of the discontinuities generated by the program’s targeting scheme, we use fuzzy regression discontinuity design (FRDD) to estimate the local average treatment effect of the treatment (LATE) for compliers of MPED’s selection rules on post-program employability measured as both, post-program participation, employment and “formal” employment prospects and post-program labor earnings. We find that compliers with the program selection rules had increase their participation, employment and “formal” employment probabilities but only temporarily –i.e. our LATE estimates are significant one quarter after the program was terminated; but we find no evidence of permanent long term effects –i.e. our LATE estimates turn out not significant two quarters after the program was terminated.
    Keywords: impact evaluation, labor market, youth employment, job training public programs
    JEL: C21 I3 J6 H5
    Date: 2015–03
  6. By: Muriithi, Beatrice W.
    Abstract: This study utilize two-wave household level panel data spanning 5 years on smallholder vegetable producers in Central and Eastern Kenya to assess the effects of commercialization of horticulture on two major poverty outcomes: household income and asset holdings. Methods that exploit panel nature of data to account for observed and unobserved heterogeneity in the sample are used, thus improving upon methods that make no such considerations or rely on cross-sectional data methods. Standards fixed effect, two-step fixed effects approach borrowed from Heckman (1976)’s framework and fixed effect instrumental variable approach find positive effects of commercialization of vegetables through export market pathway on per adult equivalent income. Controlling for heterogeneity and selection bias provides smaller effects of this market pathway compared to the naïve pooled OLS. Similarly, the naïve model overestimates the effect of commercialization through the domestic market pathway on per adult equivalent income. Fixed effect models reveal limited potential of income generated from export market pathway to raise household assets but find positive effect of income from domestic market pathway to improvement of household asset capacity. Results suggest the argument of commercialization of smallholder horticultural farming as “pro-poor” development strategy should look beyond household income to other household welfare aspects such as assets. Further, measuring effects of commercialization of agriculture can be improved by using panel data and addressing both heterogeneity and selection bias, to avoid overestimation of effects of agriculture on poverty. Further research should focus on intra-household distribution and utilization of income generated from the vegetable enterprises.
    Keywords: Horticulture, commercialization, smallholders, poverty, assets, Agribusiness, Consumer/Household Economics, Research Methods/ Statistical Methods,
    Date: 2013–09
  7. By: Caroline Stapleton
    Abstract: Recent empirical migration literature in South Africa suggests that access to physical and human capital, in the way of finance and education respectively, are key factors in increasing one’s probability of migrating. This paper attempts to extend this literature by directly measuring the extent to which social capital, broadly defined as one’s access to a migrant network, affects the probability of rural-to-urban migration. Using the first nationally representative panel dataset in South Africa, the National Income Dynamics Study, I estimate a standard model of migration choice with the inclusion of one’s connection to a migrant network. This connection is measured by being part of a household in the baseline wave that contains somebody with current or recent experience as a labour migrant. In line with international migration literature, the empirical results suggest that access to a migrant network increases the likelihood of becoming a migrant (by between 2-3 percentage points). These findings are robust to the inclusion of various controls and therefore suggest that social capital does indeed play a role along with physical and human capital in determining who migrates in South Africa.
    Keywords: Empirical migration, South Africa
    JEL: D1 I3 J1 J6
    Date: 2015

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