nep-dev New Economics Papers
on Development
Issue of 2019‒07‒08
ten papers chosen by
Jacob A. Jordaan
Universiteit Utrecht

  1. The Historical Roots of Ethnic Differences: The Role of Geography and Trade By Andrew Dickens
  2. Managing the Impact of Climate on Migration: Evidence from Mexico By Isabelle CHORT; Maëlys DE LA RUPELLE
  3. Dust and Death: Evidence from the West African Harmattan By Achyuta Adhvaryu; Prashant Bharadwaj; James Fenske; Anant Nyshadham; Richard Stanley
  4. Modernization of African food retailing and (un)healthy food consumption: Insights from Zambia By Khonje, Makaiko G.; Qaim, Matin
  5. Crop and Conflict: exploring the impact of Inequalityin Agricultural Production on Conflict Risk By Paola Vesco; Matija Kovacic; Malcolm Mistry
  6. Leaving No One Behind: Can Tax-Funded Transfer Programs Provide Income Floors in Sub-Saharan Africa? By Nora Lustig; Jon Jellema; Valentina Martinez Pabon
  7. Floods and spillovers: households after the 2011 great flood in Thailand By Ilan Noy; Cuong Nguyen; Pooja Patel
  8. Efficiency and Equity of Rural Land Markets and the Impact on Income: Evidence in Kenya and Uganda from 2003 to 2015 By Tabetando Rayner; Yoko Kijima
  9. Can Insurance Payouts Prevent a Poverty Trap? Evidence from Randomized Experiments in Northern Kenya By Yuma Noritomo; Kazushi Takahashi
  10. Quantifying the Yield Sensitivity of Modern Rice Varieties to Warming Temperatures: Evidence from the Philippines By Wang, Ruixue; Rejesus, Roderick M.; Tack, Jesse B.; Balagtas, Joseph V.; Nelson, Andy

  1. By: Andrew Dickens (Department of Economics, Brock University)
    Abstract: The impact of ethnic divisions on economic growth and development are well understood, yet there is little known about the source of these divisions. This study takes the importance of ethnic group differences as given, and goes a step deeper to explore the geographic and economic foundation of group differences. I construct a novel georeferenced dataset to examine the border region of spatially adjacent ethnic groups, together with variation in the set of potentially cultivatable crops at the onset of the Columbian Exchange, to identify how variation in land productivity impacts linguistic differences between adjacent ethnic groups. I find that ethnic groups separated across geographic regions with high variation in land productivity are more similar in language than groups separated across more homogeneous regions. This finding is consistent with the proposed mechanism: historical trade was more frequent in these high variation regions and the frequency of trade served as a social tie between culturally distinct ethnic groups. To highlight this mechanism, I show that the productivity of a tract of land predicts a group’s historical mode of subsistence, where high productivity regions relied on agriculture and low productivity regions relied on pastoralism. Taken together, these findings suggest that geographic regions with high variation in land productivity relied on various modes of subsistence, thus creating an opportunity for trade. I then document the persistence of this fact with suggestive evidence that neighbouring ethnic groups in close proximity to Old World trade routes are more similar in language today.
    Date: 2019–06
  2. By: Isabelle CHORT; Maëlys DE LA RUPELLE
    Abstract: This paper uses state-level data on migration flows between Mexico and the U.S. from 1999 to 2011 to investigate the migration response to climate shocks and the mitigating impact of an agricultural cash-transfer program (PROCAMPO) and a disaster fund (Fonden). While lower than average precipitations increase undocumented migration, especially from the most agricultural states, Fonden amounts decrease the undocumented migration response to abnormally low precipitations during the dry season. Changes equalizing the distribution of PROCAMPO and favoring vulnerable producers in the non irrigated ejido sector mitigate the impact of droughts on migration, especially for a high initial level of inequality.
    Keywords: International migration ; Climate ; Public policies ; Weather variability ; Natural disasters ; Mexico-U.S. migration ; Inequality
    JEL: F22 J61 O15 Q18 Q54
    Date: 2019–06
  3. By: Achyuta Adhvaryu; Prashant Bharadwaj; James Fenske; Anant Nyshadham; Richard Stanley
    Abstract: Using two decades of data from twelve low-income countries in West Africa, we show that dust carried by harmattan trade winds increases infant and child mortality. Health investments respond to dust exposure, consistent with compensating behaviors. Despite these efforts, surviving children still exhibit negative health impacts. Our data allow us to investigate differential impacts over time and across countries. We find declining impacts over time, suggesting adaptation. Using national-level measures of macroeconomic conditions and health resources, we find suggestive evidence that both economic development and public health improvements have contributed to this adaptation, with health improvements playing a larger role.
    JEL: I18 J13 O13 Q53
    Date: 2019–06
  4. By: Khonje, Makaiko G.; Qaim, Matin
    Abstract: Food environments in Africa are changing rapidly, with modern retailers – such as supermarkets, hypermarkets, and fast-food restaurants – gaining in importance. Changing food environments can influence consumer food choices and dietary patterns. Recent research suggested that the growth of supermarkets leads to more consumption of processed foods, less healthy diets, and rising obesity. However, the use of modern retailers may differ by socioeconomic status, which was hardly considered in previous work. Furthermore, existing studies on nutrition effects focused mainly on the role of supermarkets, although most consumers obtain their food from various sources. We add to this research direction by examining more explicitly the relationships between socioeconomic status, use of different modern and traditional retailers, and dietary patterns. The analysis uses household survey data from urban Zambia. Results show that twothirds of the households use modern and traditional retailers simultaneously, whereby richer households are more likely than poorer households to use supermarkets and hypermarkets. Use of modern retailers is positively associated with higher consumption of ultra-processed foods, also after controlling for income and other socioeconomic factors. However, the use of traditional grocery stores and kiosks is also positively associated with the consumption of ultra-processed foods, suggesting that modern retailers are not the only drivers of dietary transitions.
    Keywords: Consumer/Household Economics, Demand and Price Analysis, Food Consumption/Nutrition/Food Safety, Food Security and Poverty, Health Economics and Policy
  5. By: Paola Vesco (Department of Economics, University Of Venice Cà Foscari; CMCC, Euro-Mediterranean Center on Climate Change; PRIO, Peace Research Institute Oslo); Matija Kovacic (Department of Economics, University Of Venice Cà Foscari); Malcolm Mistry (Department of Economics, University Of Venice Cà Foscari)
    Abstract: Recent attempts to find a robust empirical correlation between climate variability, crop production and civil conflict risk have been quite inconclusive. In this paper, we argue that the ambiguity in empirical findings may be partly due to a general tendency to treat agricultural production in absolute terms, while neglecting the importance of the relative deprivation triggered by unequal distribution in crop yields across locations and between groups. To test this hypothesis, we rely on high-resolution global gridded data on the local yield of four main crops for the period 1981-2017, and calculate the level of inequality in crop production by means of a Gini index using the grid-cell information on yearly crop yields both at the country level and between identity based groups (regional and ethnic). In addition, for each level of spatial disaggregation, we compute the Gini coefficient using information on crop production from rural grid-cells only. Our results reveal a strong and robust association between crop inequality and the probability of conflict outbreak. This effect is particularly pronounced in the case of inequality among rural areas. Climatic variability, on the other hand, is shown not to increase significantly the destabilizing effect of crop inequality. We also find that akin ethnic competition and discrimination along ethnic lines represent good predictors of conflict outbreak, especially in the case of ethnic conflicts, and when the between-group inequality in crop production is calculated along ethnic boundaries.
    Keywords: Agriculture, Inequality, Climate Change, Conflict
    JEL: D74 Q54 Q18 F51
    Date: 2019
  6. By: Nora Lustig (Stone Center for Latin American Studies, Department of Economics, Tulane University, Commitment to Equity Institute (CEQI)); Jon Jellema; Valentina Martinez Pabon
    Abstract: We use results from nine different country-based Commitment to Equity (CEQ) Assessments in sub-Saharan Africa to demonstrate the welfare impact in low- and middle-income countries of policy scenarios which (a) redirect current subsidy expenditures to direct cash transfer programs; (b) establish income floors to be funded from both current subsidy expenditure as well as from additional revenues generated through current direct and indirect tax instruments; and (c) target direct cash transfer spending to poor populations or to general populations (a "universal" transfer). Results indicate that at baseline the existing combination of taxes and transfers increases post-fiscal poverty in all countries but upper middle-income Namibia and South Africa. This result - which we call fiscal impoverishment - is most often due to the fact that the poor pay consumption taxes but receive very little in cash transfers and an exceedingly small share of total subsidies. Reallocating expenditures on general price subsidies to targeted transfers would yield better poverty outcomes in most countries, but a portion of the not-so-poor poor would then receive no transfers at all. Results also show that setting income floors equivalent to international poverty lines and funding the necessary transfers with direct taxes from individuals is often not feasible for two reasons: there is extreme reranking of individuals (from preto post-fiscal income) and negative post-fiscal incomes for tax-paying individuals and the tax burden on the nonpoor would be significantly higher. Scenarios establishing income floors are more likely to be feasible when the required additional funding is financed by a proportional increase in indirect taxes
    Keywords: fiscal impoverishment, fiscal policy, fiscal incidence, social spending, inequality, poverty, taxes
    JEL: H22 I38 D31
    Date: 2019–06
  7. By: Ilan Noy; Cuong Nguyen; Pooja Patel
    Abstract: In 2011, Thailand experienced its worst flood ever. Using repeated waves of the Thai Household Survey, we analyse the flood’s economic impacts. In 2012, households answered a set of questions on the extent of flooding they experienced. We use this self-identified flood exposure, and external exposure indicators from satellite images, to identify both directly affected households and those that were not directly flooded but their communities were (the spillovers). We measure the impact of the disaster on income, expenditure, assets, debt and savings levels, directly, and indirectly on spillover households. We also analyse the flood’s impacts across different socio-economic groups.
    Keywords: disaster, flood, Thailand, economic impact
    JEL: O12 Q54
    Date: 2019
  8. By: Tabetando Rayner (International Growth Centre, Tanzania); Yoko Kijima (National Graduate Institute for Policy Studies, Tokyo, Japan)
    Abstract: This study examines the evolution and impact of land sales and rental markets on agricultural efficiency in rural Kenya and Uganda using panel data spanning over 10 years. We first analyse the efficiency gains induced by land sales and rental markets by estimating the impact of participation in markets on unobserved farmer ability and land endowment. We do find evidence in both countries, that land markets induce efficiency by transferring land to households with higher farming ability. In both countries, the land market enhances equity by transferring land from land-abundant to land-constrained households. Although renting-in land increases crop income in Kenya, we find no evidence that renting in land enables households to escape from poverty. In contrast, increase in land owned helped decrease poverty incidence in Uganda. These findings points to potential weaknesses in the functioning of land markets in Kenya and Uganda which impedes their ability to contribute to poverty alleviation.
    Date: 2019–06
  9. By: Yuma Noritomo (Graduate School of Economics, The University of Tokyo); Kazushi Takahashi (National Graduate Institute for Policy Studies, Tokyo, Japan)
    Abstract: Index-based insurance can have welfare-enhancing effects through two pathways: by mitigating weather-related shocks through payouts and by inducing policyholders to take greater yet more profitable risks. Most studies fail to distinguish between these two. Thus, we know little about which effects dominate and their long-term welfare implications. Using a random distribution of discount coupons and drought events that trigger payouts as exogenous variations, this study aims to identify both the ex ante risk-management and ex post payout effects of index insurance in a pastoral-dominant society of northern Kenya, where the presence of asset-based poverty traps, represented by bifurcated herd-size dynamics, has been established in the literature. We find the following: (1) Both risk-management and payout effects contribute to reducing the probability of distress sales of livestock; (2) payout effects also lead to a reduced slaughter of livestock; (3) while payout effects remain robust in a subsample of poorer households below the poverty trap threshold, riskmanagement effects do not. Overall, our results suggest that insurance payouts assist people in escaping from poverty traps more effectively than do behavioural changes accompanied by insurance purchases.
    Date: 2019–06
  10. By: Wang, Ruixue; Rejesus, Roderick M.; Tack, Jesse B.; Balagtas, Joseph V.; Nelson, Andy
    Abstract: This study examines the relationship between yields of modern rice varieties and three major weather variables | maximum temperature, minimum temperature, and precipitation. Data from a long-running farm-level survey in the Philippines, with rich information on planted rice varieties, allows us to estimate fixed effect econometric models of rice yields. We find that increases in temperature, especially minimum temperatures, have substantial negative impacts on rice yields. Yield response to temperatures vary across different varietal groups. Early modern varieties, bred primarily for higher yields, pest resistance, and/or grain quality traits, demonstrate improved heat-stress resistance relative to traditional varieties. Moreover, the most recent varietal group bred for better tolerance to abiotic stresses are even more resilient to warming temperatures. These results provide some evidence that public investments in breeding rice varieties more tolerant to warming temperatures have been successful, and continued investments in these breeding efforts are warranted.
    Keywords: Agricultural and Food Policy
    Date: 2019–05–29

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