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SAGA PUBLICATIONS Included here are Working Papers and Conference Papers. Publications on this page are organized by author: RETURN TO MAIN AUTHORS PAGE Harding, Alan Survival and Success Among African Manufacturing Firms February 2004 Alan Harding, Måns Söderbom and Francis Teal Recent reforms in most African economies of their trading and exchange rate regimes have eliminated much of the protection which previously limited competition. Despite these reforms, African manufacturing firms remain unsuccessful, particularly in international export markets. In this paper we consider the roles of learning, competition and market imperfections in determining three aspects of firm performance, namely firm exit, firm growth and productivity growth. We use a pooled panel data set of firms in Ghana, Kenya and Tanzania that spans a period of five years. We find that the main determinant of exit is firm size, with small firms having much higher exit rates than large ones. Productivity impacts on firm survival among large firms, but not among small firms. Reasons for this result are discussed. We find evidence that, among surviving firms, old firms grow slower than young firms, which is interpreted as evidence consistent with market constraints limiting growth of firms in Africa. We find no evidence that larger firms have faster rates of productivity or input growth, or are more efficient in the sense of benefiting from scale economies. We also find that competitive pressure enhances productivity growth. Given that one of the objectives of the reform programmes implemented in all three countries was to stimulate higher efficiency levels, this finding shows that one aspect of the reform programme has been successful. Presented at the ISSER-University of Ghana-Cornell University International Conference on "Ghana at the Half Century," July 18-20, 2004, Accra, Ghana Hartzenberg, Trudi Trade liberalisation and regional integration in SADC: policy synergies assessed in an industrial organisation framework October 2004 Martine Visser and Trudi Hartzenberg Trade liberalisation has a significant impact on firm-market dynamics in a regional context. The purpose of this paper is to use an industrial organisation framework, focusing on the analytical units, the firm and the market, to assess the impact of trade liberalisation within the Southern African region, SADC. It is specifically the firm-level responses to various policies that will provide insight into changes in national industrial configurations, regional patterns of industrialisation and the potential for sustainable supplychain development in Southern Africa. The purpose of intra-regional trade liberalisation is to facilitate trade within a regional economic space, and through enhanced trade opportunities to elicit firm-level decisions to expand productive capacity. Such expansion of productive capacity, through various modalities of investment, can have important implications for the development of markets and market processes, resulting in robust, sustainable regional development. Presented at the DPRU-TIPS-Cornell University Forum on "African Development and Poverty Reduction: The Macro-Micro Linkage," October 13-15, 2004, Cape Town, South Africa Hassan, R. M. Stochastic Technology and Crop Production Risk: The Case of Small-Scale Farmers in East Hararghe Zone of Oromiya Regional State in Ethiopia July 2005 Bekabil Fufa and R. M. Hassan This study used the Just and Pope stochastic production technology specification to analyse the crop production and supply response behaviour of farmers in East Hararghe zone of Ethiopia under production risk. The results showed that improved seed, human labour, oxen labour and planting date were the most important determinants of yield levels of the crops grown in the area. On the other hand, the use of improved seed and fertilizer were yield risk increasing inputs in the production of maize and sorghum crops. However, early planting for all the annual crops grown, use of human labour for the package crops and oxen labour for all food crops grown in Faddis district were found to have yield risk reducing effects. The results have important implications for agricultural technology development and transfer in the study area. To reduce the yield risk increasing effect of fertilizer, the development and promotion of new crop varieties should consider fertilizer application trails for different levels across different agro-ecologies and farmers’ conditions. Also, farmers need to be provided with adequate advice and information on the use and application of fertilizer. Moreover, to overcome the yield risk increasing effect of improved seed, varieties should be tested for their suitability to varying agro-ecologies and management conditions of the farmers in the area. Extension advice and information on the management of the improved crop varieties need to be provided to the farmers to improve the yield stability of the crops. In addition, extension advice on early planting, provision of meteorological information to farmers to aid them in planting date decisions and development of short period maturing varieties could help to reduce variability in the yield levels of crops grown in the area. Finally, improving the small-scale farmers’ access to oxen would also enable the farmers to achieve stable yields from crop production. Presented at the International Conference on "Shared Growth in Africa," July 21-22, 2005, Accra, Ghana Herrero, M. Livelihood Choices and Returns among Agro-Pastoralists in Southern Kenya June 2006 Radeny, M., D. Nkedianye, P. Kristjanson, and M. Herrero This article addresses livelihood choices and income diversification strategies among agro-pastoralists and pastoralists in southern Kenya, and the factors influencing the returns to the diverse livelihood strategies being pursued. We explore how variability in income and wealth levels across households can be explained by household-level versus geographic factors. We find that household livestock asset levels, education level, landholdings, and diversification of household income sources can largely explain how well households are doing. Geographic factors such as distance to the nearest town, permanent water source, and Nairobi National Park, as well as pasture potential also matter in some cases, but relatively little compared to household-level factors. Investments in livestock remain key to how well households are doing and in some cases appear to be driving livelihood diversification strategies that keep them from falling into poverty. While relatively few households are yet receiving wildlife conservation-related income, for those that are, it is a more lucrative option than cropping, from which very few are earning positive returns. This information can contribute to more evidence-based decision making occurring across pastoral areas and inform policy decisions regarding conservation of wildlife and poverty reduction strategies. Presented at the Policy Research Conference on “Pastoralism and Poverty Reduction in East Africa,” held in Nairobi, Kenya, June 27-28, 2006. Hertz, Tom Have Minimum Wages Benefited South Africa’s Domestic Service Workers? October 2004 Tom Hertz In September of 2002 South Africa’s roughly one million domestic workers – about 840,000 predominantly African and Coloured women who work as housekeepers, cooks and nannies, and another 180,000 men who work primarily as gardeners1 – were granted formal labor market protection, including the right to a written contract with their employers, the right to paid leave, to severance pay, and to notice prior to dismissal (Department of Labour, 2002). Employers were also required to register their domestic workers with the Unemployment Insurance Fund (UIF) and to withhold UIF contributions from their paychecks; (since April of 2003 domestic workers have been entitled to unemployment benefits). In November of 2002, a schedule of minimum wages, including time-and-a-half provisions for overtime work, went into effect. The minima were set above the median hourly wages that prevailed at the time, making this a significant intervention in the domestic worker labor market. This paper attempts to determine if these regulations have had any effect on wages, employment levels, hours of work, and the conditions of employment. I find that the regulations do appear to have raised wages: Average nominal hourly wages for domestic workers in September of 2003 were 23% higher than they had been in September 2002, while for demographically similar workers in other occupations the nominal wage increase was less than 5%. Econometric evidence supports the conclusion that the wage increases were caused by the regulations, since the largest increases are seen in places where the greatest number of workers were initially below the minimum wage. Presented at the DPRU-TIPS-Cornell University Forum on "African Development and Poverty Reduction: The Macro-Micro Linkage," October 13-15, 2004, Cape Town, South Africa Hesse, Ced Strengthening Pastoralists’ Voice in Shaping Policies for Sustainable Poverty Reduction in ASAL Regions of East Africa June 2006 Hesse, Ced and Michael Ochieng Odhiambo The absence of a representative and effective pastoral civil society movement capable of articulating its members’ vision of their development is one of the key factors explaining why policies for pastoral development continue to fail, and poverty and conflict still characterise many pastoral communities in East Africa. Development experience in pastoral regions, particularly since independence, has clearly shown that pastoral people tend to lack the knowledge, political clout and resources with which to fight their own cause, and thus remain vulnerable to other people’s interpretation of what is best for them. In particular, policy makers continue to impose on pastoralists what they perceive to be good for them with little or no reference to the communities themselves. That these perceptions are for the most part founded on stereotypes of what pastoralism and pastoral land use is, only serves to compound the problem. Presented at the Policy Research Conference on “Pastoralism and Poverty Reduction in East Africa,” held in Nairobi, Kenya, June 27-28, 2006. Hoddinott, John Shocks and Their Consequences Across and Within Households in Rural Zimbabwe February 2006 Hoddinott, John Increasing attention is now being paid to poverty dynamics in developing countries. This work links the extent to which households smooth consumption or smooth assets given income shocks, the empirical evidence on the churning of households in and out of poverty, and the possibility that temporary shocks can have permanent consequences. Using longitudinal data from rural Zimbabwe, this paper extends the discussion of these issues by disaggregating the impact of shocks by levels of asset holdings, by disaggregating the impact of shocks on individual level welfare and by assessing the extent to which such shocks have permanent consequences. By doing so, it assesses the validity of distinguishing between asset and consumption smoothing and provides insights into whether poverty dynamics assessed at the household level provide an adequate picture of dynamics at the individual level. In Journal of Development Studies 42(2): 301-321, 2006 In Understanding and Reducing Persistent Poverty in Africa, Christopher Barrett, Peter Little, Michael Carter (eds.), Routledge, 2007. Hoffmann, Vivian Do Free Goods Stick to Poor Households? Experimental Evidence on Insecticide Treated Bednets March 2009 Hoffmann, Vivian, Christopher B. Barrett, and David R. Just If the market allocates goods to those willing and able to pay the most for them, efforts to target durable health goods such as insecticide-treated bednets (ITNs) to poor populations may prove ineffective, with the poor reselling donated goods to the non-poor who value them more highly. However, low market demand may be due to liquidity constraints rather than low valuation of nets. The endowment effect also militates against the resale of in-kind transfers. We quantify these two effects through a field experiment in Uganda. Our results indicate that very few nets will be resold by recipient households. In World Development 37(3):607-617, March, 2009 Hogset, Heidi Social Learning, Social Influence and Projection Bias: A caution on inferences based on proxy-reporting of peer behavior April 2010 Hogset, Heidi and Christopher B. Barrett This paper explores the consequences of conflating social learning and social influence concepts and of the widespread use of proxy-reported behavioral data for accurate understanding of learning from others. Our empirical analysis suggests that proxy-reporting is more accurate for new innovations, about which social learning is more plausible, than for mature technologies. Furthermore, proxy-reporting errors are correlated with respondent attributes, suggesting projection bias. Self- and proxy-reported variables generate different regression results, raising questions about inferences based on error-prone, proxy-reported peer behaviors. Self-reported peer behavior consistently exhibits statistically insignificant effects on network members’ adoption behavior, suggesting an absence of social effects. In Economic Development and Cultural Change 58(3):563-589 Social Exclusion and Insurance Failure for the Poorest: On Informal Finance through Social Networks in Kenya’s Smallholder Sector April 2005 Heidi Hogset This study looks at informal finance through social networks among smallholder farmers in Kenya. This paper explores the patterns of economic transfers within networks, and characterizes recipients and providers of informal credit and insurance, as well as the relationship between them and the purposes such transfers serve. Participation in transfer networks depends on one’s resources. The poor engage in frequent, low-value transfers in kind and in exchange labor. The poorest do not engage in cash transfers. Those of intermediate wealth engage more actively in transfers in kind, but not cash. The rich (or non-poor) are also active in transfer networks, and it is they who are able to raise large cash amounts through social networks, either as loans or gifts. As people get wealthier, they engage more in cash transfers and less in transfers in kind. People who have access to formal financial services, i.e., formal banks or Savings and Credit Cooperatives (SACCOs) participate less in transfers through networks. Those who are able to save in banks are less vulnerable to shocks. Women are more active than men in Rotating Savings and Credit Associations (ROSCAs), and they also engage more frequently in bilateral transactions within networks, especially for transfers in kind. Transfer networks are correctly perceived as kinship-based and family members are important sources of unearned income (remittances). Transfers through networks are important for consumption smoothing, in addition to investments in income-generating activities and payment of school fees, but not for assistance when a household member is seriously ill. The failure of social networks to provide support during sickness and death is particularly disturbing viewed in light of the ongoing AIDS crisis which is keenly felt in the villages where the study took place. Presented at the International Conference on "Shared Growth in Africa," July 21-22, 2005, Accra, Ghana Homewood, K. Maasai Pastoralists: Diversification and Poverty June 2006 Homewood, K., E. Coast, S. Kiruswa, S. Serneels, M. Thompson, and P. Trench Sub-Saharan African pastoralism involves highly fluid production systems responding flexibly to variable and unpredictable arid and semi arid rangeland environments. Household wealth is typically subject to stochastic events and most pastoralist groups have a history of entire families shifting in and out of the system as their fortunes have changed. This potential to re-enter the system has been maintained by the often communal nature of land tenure in pastoral societies, alongside the potential to restock through raiding, trading (including wild resources), or cultivation. However, the last hundred years have seen a drastic decline in the commons available for extensive pastoralism. Large areas of land have been given over to alternative uses as pastoral populations have become marginalized within most African nation states. Extensive land loss to conservation and rapid piecemeal privatisation of formerly communal rangelands for agriculture and ranching enterprises are framed within an environmental discourse that invokes Hardin’s Tragedy of the Commons to justify land alienation and subdivision. This process has entailed the loss of access to key dry season land and water resources. Presented at the Policy Research Conference on “Pastoralism and Poverty Reduction in East Africa,” held in Nairobi, Kenya, June 27-28, 2006. Hoogeveen, Johannes G. Poverty and Inequality in Post-Apartheid South Africa: 1995-2000 October 2005 Hoogeveen, Johannes G. and Berk Özler As South Africa conducts a review of the first ten years of its new democracy, the question remains as to whether the economic inequalities of the apartheid era are beginning to fade. Using new, comparable consumption aggregates for 1995 and 2000, this paper finds that real per capita household expenditures declined for those at the bottom end of the expenditure distribution during this period of low GDP growth. As a result, poverty, especially extreme poverty, increased. Inequality also increased, mainly due to a jump in inequality among the African population. Even among subgroups of the population that experienced healthy consumption growth, such as the Coloureds, the rate of poverty reduction was low because the distributional shifts were not pro-poor. In Poverty and Policy in Post Apartheid South Africa, edited by Haroon Bhorat and Ravi Kanbur. Cape Town, South Africa: HSRC Press, 2006. Hu, Chia-Hsin An Investigation into the Relationship Between Household Welfare and Social Capital in Eastern Uganda February 2004 Hu, Chia-Hsin and Ben Jones This paper studies the relationship between social capital and household welfare. Social capital is taken to mean, very simply, ’durable social networks’. The relationship is investigated using survey work conducted in two villages in eastern Uganda. The surveys gathered information on the quality and extent of people’s participation in local organizations, as well as household welfare. To organize the analysis of the data the paper utilizes econometric tools designed for investigating the relationship between dimensions of organizational social capital and household welfare. At the same time, the paper recognizes some of the limitations inherent in relying on econometric work to analyze this relationship. As such, the econometric analysis is limited in examining only social capital as expressed through household participation in village level organizations. Our results show that "organizational social capital", as we have termed it, has only a small effect on household welfare. That said, we also draw on anthropological work conducted in the two survey villages, and from ethnographic material we argue that social capital, as expressed in less institutionalized social networks, has a significant affect on household welfare. In others words, it is the social capital that resides in such networks as personalized relationships, peer groups, or brokerage positions between development projects and the village that has a strongly determinate effect on household. Organizational social capital, which is the type of social capital "captured" in village level survey work, does not help us explain the most significant part of the relationship social capital and household welfare. Final Report for SAGA Competitive Research Grants Program Hundie, Bekele Property Rights among Afar Pastoralists of Northeastern Ethiopia: Forms, Changes and Conflicts June 2006 Hundie, Bekele This study has been conducted in three districts in Afar of Northeastern Ethiopia. The objective is to (1) describe the traditional land use arrangements among pastoralists; (2) explain changes in pastoral customary rights; (2) explain resource-based conflicts among various pastoral groups. The results show that the state is the giant actor behind property right changes especially in areas with better resource endowments. The state-driven changes in customary rights have led to increasing conflicts between pastoralists and the state. It also created disparity among clan members in the level of resource use as it facilitated the exclusion of some clan members. In addition to the state, natural as well as socioeconomic challenges are important in explaining the current changes in land use arrangements. It is also evident that, conflicts nurtured by obscurely defined property rights are extensive among pastoral groups causing humanitarian crisis (especially of the active labor force), loss of assets (primarily livestock), underutilization of pastoral resources by creating “no go” areas, and underutilization of market opportunities. Presented at the Policy Research Conference on “Pastoralism and Poverty Reduction in East Africa,” held in Nairobi, Kenya, June 27-28, 2006. Huysentruyt, Marieke Understanding Declining Mobility and Inter-household Transfers among East African Pastoralists April 2009 Huysentruyt, Marieke, Christoper B. Barrett, and John G. McPeak We model inter-household transfers between nomadic livestock herders as the state-dependent consequence of individuals’ strategic interdependence, resulting from the existence of multiple, opposing externalities—more specifically, a public-good security externality among individuals sharing a social (e.g. ethnic) identity in a potentially hostile environment, and a resource appropriation externality related to the use of common property grazing lands. Our model augments the extant literature on transfers, and is more consistent with the limited available empirical evidence on heterogeneous and changing transfers’ patterns among east African pastoralists. The core principles of our model possibly apply more broadly, for example to long-distance migrants or even ‘foot soldiers’in street gangs. In Economica 76(302): 315-336, April, 2009 Return to MAIN AUTHORS PAGE

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