nep-dev New Economics Papers
on Development
Issue of 2016‒09‒25
fifteen papers chosen by
Jacob A. Jordaan
Universiteit Utrecht

  1. Aid on Demand: African Leaders and the Geography of China's Foreign Assistance By Axel Dreher; Andreas Fuchs; Roland Hodler; Bradley C. Parks; Paul A. Raschky; Michael J. Tierney
  2. The Effect of Cash Transfers and Household Vulnerability on Food Insecurity in Zimbabwe By Sudhanshu Handa; David Seidenfeld; Garima Bhalla; Gustavo Angeles; UNICEF Office of Research - Innocenti
  3. The elusive quest for the subsistence line How much does the cost of survival vary between populations? By Lindgren, Mattias
  4. Does Social Health Insurance Reduce Financial Burden? Panel Data Evidence from India By Mehtabul Azam
  5. The Role of Information and Cash Transfers on Early Childhood Development: Evidence from Nepal By Michael Levere; Gayatri Acharya; Prashant Bharadwaj
  6. The contribution of female health to economic development By Bloom, David E.; Kuhn, Michael; Prettner, Klaus
  7. Information transmission and ownership consolidation in aid programs By Axel Dreher; Sarah Langlotz; Silvia Marchesi
  8. The Impact of Legislation on the Hazard of Female Genital Mutilation/Cutting: Regression Discontinuity Evidence from Burkina Faso - Working Paper 432 By Ben Crisman, Sarah Dykstra, Charles Kenny and Megan O'Donnell
  9. The Challenge of Measuring Hunger through Survey By Joachim De Weerdt; Kathleen Beegle; Jed Friedman; John Gibson
  10. Economic Volatility and Inequality: Do Aid and Remittances Matter? By Lisa CHAUVET; Marin FERRY; Patrick GUILLAUMONT; Sylviane GUILLAUMONT JEANNENEY; Jules Sampawende TAPSOBA; Laurent WAGNER
  11. Cities and Agricultural Transformation in Africa: Evidence from Ethiopia By Joachim Vandercasteelen; Seneshaw Tamru; Bart Minten; Johan Swinnen
  12. Determinants of the Flow of Bilateral Adaptation-Related Climate Change Financing to Sub-Saharan Africa By Jamie Robertsen; Nathalie Francken; Nadia Molenaers
  13. The Impact of Conditional Cash Transfers on the Matriculation of Junior High School Students into Rural China’s High Schools By Fan Li; Yingquan Song; Hongmei Yi; Jianguo Wei; Linxiu Zhang; Yaojiang Shi; James Chu; Natalie Johnson; Prashant Loyalka; Scott Rozelle
  14. Evolution and Impact of EU Aid for Food and Nutrition Security: A Review By Lara Cockx; Nathalie Francken
  15. The Growth-Employment-Poverty Nexus in Latin America in the 2000s: Cross-Country Analysis By Guillermo Cruces; Gary S. Fields; David Jaume; Mariana Viollaz

  1. By: Axel Dreher (Heidelberg University); Andreas Fuchs (Heidelberg University); Roland Hodler (University of St. Gallen); Bradley C. Parks (College of William and Mary); Paul A. Raschky (Monash University); Michael J. Tierney (College of William and Mary)
    Abstract: This article investigates whether China's foreign aid is particularly prone to capture by political leaders of aid-receiving countries. We examine whether more Chinese aid is allocated to the birth regions of political leaders and regions populated by the ethnic groups to which leaders belong, controlling for indicators of need and various fixed effects. We have collected data on 117 African leaders' birthplaces and ethnic groups and have geocoded 1,650 Chinese development finance projects across 3,097 physical locations that were committed to Africa over the 2000{2012 period. Our econometric results show that when leaders hold power their birth regions receive substantially more funding from China than other subnational regions. We also find -less robust- evidence that African leaders direct more Chinese aid to areas populated by individuals who share their ethnicity. However, when we replicate the analysis for the World Bank, our regressions show no evidence of favoritism. We also evaluate the impact of Chinese aid on regional development, exploiting time variation in the amount of Chinese aid that results from China's production of steel and geographical variation in the probability that a subnational region will receive such aid. We find that Chinese aid improves local development outcomes, as measured by per-capita nighttime light emissions at the first and second subnational administrative level. We therefore conclude that China's foreign aid program has both distributional and developmental consequences for Africa.
    Keywords: Foreign aid, Favoritism, Aid allocation, Aid effectiveness, Africa, China, Official Development Assistance, Georeferenced data, Spatial analysis
    JEL: D73 F35 P33 R11
    Date: 2016–09–13
  2. By: Sudhanshu Handa; David Seidenfeld; Garima Bhalla; Gustavo Angeles; UNICEF Office of Research - Innocenti
    Abstract: We study the impact of the Zimbabwe Harmonized Social Cash Transfer (HSCT) on household food security after 12 months of implementation. The programme has had a strong impact on a well-known food security scale – the Household Food Insecurity Access Scale (HFIAS) – but muted impacts on food consumption expenditure. However aggregate food consumption hides dynamic activity taking place within the household where the cash is used to obtain more food from the market and rely less on food received as gifts. The cash in turn gives them greater choice in their food basket which improves diet diversity. Further investigation of the determinants of food consumption and the HFIAS shows that several dimensions of household vulnerability correlate more strongly with the HFIAS than food consumption. Labour constraints, which is a key vulnerability criterion used by the HSCT to target households, is an important predictor of the HFIAS but not food expenditure, and its effect on food security is even larger during the lean season.
    Keywords: cash transfers; food resources; food security; vulnerable groups; zimbabwe;
    JEL: D12 I31 I32 I38
    Date: 2016
  3. By: Lindgren, Mattias
    Abstract: The subsistence line, defined as the lowest possible income that can sustain a population, depends on several factors that vary between populations. For simplicity, however, the line is typically assigned a fixed dollar value, so that it represents subsistence under average conditions. We explore how much the line may differ across populations if we take relative prices, age composition, heights and climate into account. We estimate the cost of the physical minimum requirements, since this is the quantifiable part of the subsistence line. The variation of the physical minimum can shed light on the variation of the subsistence line, even though the latter is likely to be significantly higher than the physical minimum. Our physical minimum line, under baseline assumptions, is 0.67$ per day in 2005 international prices. Differences in prices between our cases imply physical minimum lines that vary between 50% and 150% of the baseline. The range of potential heights implies lines between 84% and 115% of the baseline and the range of age compositions implies lines between 97% and 110% of the baseline. The effect of climate is by assumption small, less than 5%. We cautiously suggest that relative prices is the first thing to take into account if we want to improve the subsistence line, whereas differences in the age composition is less of a concern.
    Keywords: subsistence line, poverty, living standard, income estimate
    JEL: D31 E01 I32 O10 O15
    Date: 2015
  4. By: Mehtabul Azam (Oklahoma State University)
    Abstract: Indian government launched a National Health Insurance Scheme known as Rashtriya Swasthya Bima Yojana (RSBY) in 2008 that provides cashless health services to poor households in India. We evaluate the impact of RSBY on RSBY beneficiary households' (Average Treatment Impact on the Treated) utilization of health services, per capita out-of-pocket (OOP) expenditure, and per patient OOP expenditures on major morbidities. To address the issue of non-randomness in enrollment into the scheme, we exploit the longitudinal aspect of a large nationally representative household survey data to implement difference-in-differences with matching. We find some evidence of positive impact of RSBY on utilization of health services by RSBY beneficiary households in rural India but not in urban India. However, there is no evidence that the RSBY reduced per person OOP expenditure for RSBY households in both rural and urban areas. Conditional on having received medical treatment for major morbidity, we find lower expenditure on medicine for a RSBY cardholder patient in rural areas.
    Keywords: SHI, RSBY, IHDS, out-of-pocket expenditure, health services utilization
    JEL: I1 I18 I38
    Date: 2016–09
  5. By: Michael Levere; Gayatri Acharya; Prashant Bharadwaj
    Abstract: While substantial progress has been made in combating malnutrition at a global level, chronic maternal and child malnutrition remains a serious problem in many parts of the developing world. In this paper, using a randomized control trial design in Nepal, we evaluate a program that provided information on best practices regarding child care and cash to families in extremely poor areas with pregnant mothers and/or children below the age of 2. We find significant and sizable impacts of the information plus cash intervention on maternal knowledge, behavior, child development, and nutrition. The size of these impacts along some measures of knowledge and development are significantly different from the information only intervention group suggesting a potential role for providing a short term cash safety net along with information to tackle the problem of malnutrition.
    JEL: I15
    Date: 2016–09
  6. By: Bloom, David E.; Kuhn, Michael; Prettner, Klaus
    Abstract: We analyze the economic consequences for less developed countries of investing in female health. We do this through developing and calibrating a novel micro-founded dynamic general equilibrium model in which parents trade off the number of children against investments in their education and in which we allow for health-related gender differences in productivity. We show that better female health speeds up the demographic transition and thereby the take-off toward sustained economic growth. By contrast, male health improvements delay the transition and take-off because ceteris paribus they raise fertility. Investing in female health is therefore a potent lever for promoting development.
    Keywords: economic development,educational transition,female health,fertility transition,quality-quantity trade-off
    JEL: O11 I15 I25 J13 J16
    Date: 2016
  7. By: Axel Dreher (Heidelberg University); Sarah Langlotz (Heidelberg University); Silvia Marchesi (University of Milano Bicocca and Centro Studi Luca d’Agliano)
    Abstract: We investigate the degree of leeway donors of foreign aid should grant to recipient governments when their preferences over how to implement the aid are different, and both the donor and recipient possess some private information about the most effective policies. Intuitively, our model shows that donors should stay in control of how their aid is spent when their own private information is more important than the private information of the recipient. Less obviously, an increase in the difference of preferences between donors and recipients can increase rather than decrease the leeway that donors should grant the recipients, as the recipients’ information gains in importance relative to those of the donors, and recipients become less likely to communicate truthfully. We test the model using dyadic data for 28 bilateral aid donors and 112 recipients, over the 1995-2010 period. Our proxy for “centralized†aid is project aid, while budget aid leaves more leeway to the recipient and thus proxies for “decentralized†aid. In line with the model, misaligned interests and informational asymmetries indeed influence the shares of aid given as budget and project aid.
    Keywords: Delegation, communication, ownership, foreign aid
    JEL: C23 D82 F33 O1
    Date: 2016–08–26
  8. By: Ben Crisman, Sarah Dykstra, Charles Kenny and Megan O'Donnell
    Abstract: In 1996, Burkina Faso enacted legislation banning the practice of female genital mutilation/cutting (FGM/C). Much of the qualitative literature surrounding FGM/C discounts the impact of legal change on what is considered a social/cultural issue. We use data from the Demographic and Health Surveys DHS(VI) in Burkina Faso to test for a discontinuous change in the likelihood of being cut in the year the law was passed. We find robust evidence for a substantial drop in hazard rates in 1996 and investigate the heterogeneous impact of the law by region, religion, and ethnicity. Overall, we roughly estimate that over a ten year period the law averted the genital mutilation/cutting of approximately 237,591 women and girls. We qualify our findings recognizing that Burkina Faso is a special case with a long history of bottom-up and top-down approaches to eliminating the practice.
    Keywords: FGM/C, social norms, legal change, regression discontinuity
    JEL: A13 I18 J16 J18 K14
    Date: 2016–07
  9. By: Joachim De Weerdt; Kathleen Beegle; Jed Friedman; John Gibson
    Abstract: There is widespread interest in estimating the number of hungry people in the world and trends in hunger. Current global counts rely on combining each country's total food balance with information on distribution patterns from household consumption expenditure surveys. Recent research has advocated for calculating hunger numbers directly from these same surveys. For either approach, embedded in this effort are a number of important details about how household surveys are designed and how these data are then used. Using a survey experiment in Tanzania, this study finds great fragility in hunger counts stemming from alternative survey designs. As a consequence, comparable hunger numbers will be lacking until more effort is made to either harmonize survey designs or better understand the consequences of survey design variation.
    Keywords: hunger prevalence, measurement error, consumption, survey design
    JEL: C88 O12 Q18
    Date: 2015
  10. By: Lisa CHAUVET (IRD DIAL); Marin FERRY (FERDI); Patrick GUILLAUMONT (Ferdi); Sylviane GUILLAUMONT JEANNENEY (Ferdi); Jules Sampawende TAPSOBA (FERDI); Laurent WAGNER (Ferdi)
    Abstract: We examine the adverse impact of macroeconomic volatility on inequality and the role that aid and remittances could play in mitigating this effect. Using a panel of 142 countries over 1973-2012, we find that macroeconomic volatility has an adverse impact on economic inequality and that the poorest are the most exposed to these fluctuations. However, while aid and remittances do not seem to have a clear direct impact on inequality, we find robust evidence that aid helps to dampen the negative effects of volatility on the distribution of income, while remittances do not.Keywords: Aid, Income volatility, Inequality
    Keywords: Aid, Income volatility, Inequality
    JEL: F35
    Date: 2016–07
  11. By: Joachim Vandercasteelen; Seneshaw Tamru; Bart Minten; Johan Swinnen
    Abstract: Due to the rapid growth of cities in Africa, a larger number of farmers is living in the rural hinterland providing food to urban residents. However, empirical evidence on how urbanization affects these farmers is scarce. To fill this gap, this paper explores the relationship between proximity to a city and the production behavior of rural staple crop producers. More in particular, we analyze unique data from teff producing farmers in major producing areas around Addis Ababa, the Ethiopian capital. We find that farmers more closely located to Addis Ababa face higher wages and land rental prices, but because they receive higher teff prices they have better incentives to intensify production. Moreover, we observe that modern input use, land and labor productivity, and profitability in teff production improve with urban proximity. There is a strong and significant direct effect of urban proximity, which is suggested to be related with more use of formal factor markets, less transaction costs, and better access to information. In contrast, we do not find strong and positive relationships of rural population density increases - as an alternative source of agricultural transformation - as they seem to lead to immiserizing effects in these settings. Our results show that urban proximity should be considered as an important determinant of the process of agricultural intensification and transformation in developing countries.
    Keywords: Agricultural Transformation, Crop Intensification, Urbanization, Cities, Ethiopia, Sub Saharan Africa
    Date: 2016
  12. By: Jamie Robertsen; Nathalie Francken; Nadia Molenaers
    Abstract: The apparent mismatch between countries receiving Adaptation-related Climate Change Financing (ACCF) and those most vulnerable to climate change is a concern which is the motivation for this research. This paper examines the determining factors of receiving ACCF for sub-Saharan African countries and finds that the recipient policy and an existing aid relationship are significant determinants of funding. ACCF therefore appears to be contingent on democratic characteristics of the recipient and prevailing a donor-recipient relationship, with vulnerability not being a factor. Our research draws a parallel between ACCF and traditional, bilateral aid allocation, and stresses the importance of accurate climate finance allocation practices.
    Date: 2015
  13. By: Fan Li; Yingquan Song; Hongmei Yi; Jianguo Wei; Linxiu Zhang; Yaojiang Shi; James Chu; Natalie Johnson; Prashant Loyalka; Scott Rozelle
    Abstract: The goal of this study is to examine whether promising a Conditional Cash Transfer (conditional on matriculation) at the start of junior high increases the rate at which disadvantaged students matriculate in to high school. Based on a randomized controlled trial involving 1,418 disadvantaged (economically poor) students in rural China, we find that the promise of a CCT has no effect on increasing high school matriculation for the average disadvantaged student. We do find, however, that providing the CCT increases high school matriculation among the subset of disadvantaged students who overestimate the direct costs of attending high school.
    Keywords: Conditional Cash Transfer, Voucher, Rural Education, Dropout, High School, Randomized Controlled Trial, China
    Date: 2015
  14. By: Lara Cockx; Nathalie Francken
    Abstract: In the aftermath of the world food price crisis, the issue of food and nutrition security has received a high level of political attention and the international donor community has repeatedly underlined its commitment to combat hunger in the world. In order to enhance the effectiveness of the international community’s efforts in addressing the widespread problem of malnutrition, we need to improve our knowledge on what activities donors are currently engaging in and which interventions have been shown to be successful. This paper offers both an overview of the aid for food and nutrition security landscape and how it has changed and an extensive review of the available evidence on the impact of a wide array of interventions aimed at addressing all four dimensions of food and nutrition security; availability, access, utilization and stability. We find that despite the renewed interest and elevated levels of funding for food and nutrition security assistance in developing countries, the empirical evidence base for the effectiveness of these interventions in improving beneficiaries’ food and nutrition security – although in several cases promising – is weak. In particular, the question whether different interventions improve the quality of food consumption and consequently nutrient intake and status, remains largely unanswered. Moreover, few studies assess longer-term effects and there exists relatively little rigorous evidence that compares different interventions. It is therefore strongly recommended to undertake additional research to improve the evidence base as this would allow researchers and policy makers to establish the type of approaches that improve food and nutrition security in the most efficient and cost-effective manner. Finally, in order to facilitate this process, there is a need for a clear and uniform definition of food and nutrition security assistance on the one hand as well as agreed upon, comprehensive indicators on the other hand.
    JEL: F35 F53 I38 O12 O13 O15
    Date: 2016
  15. By: Guillermo Cruces (CEDLAS - UNLP , CONICET y IZA); Gary S. Fields (Cornell University y IZA); David Jaume (Cornell University); Mariana Viollaz (CEDLAS - UNLP)
    Abstract: In the great majority of Latin American countries in the 2000s, economic growth took place and brought about improvements in almost all labour market indicators and consequent reductions in poverty rates. Across countries, economic growth was not all that mattered; external factors were particularly important for changes in labour market conditions, while reductions in poverty were strongly related to improvements in earnings and employment indicators. Although the 2008 crisis affected some countries differently from others, nearly all labour market indicators were at least as high or higher by 2012 than immediately before the crisis in all countries but one.
    JEL: J21 J30 O10 O54
    Date: 2016–07

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