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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 Sachedina, Hassan Conservation, Land Rights and Livelihoods in the Tarangire Ecosystem of Tanzania: Increasing Incentives for Non-conservation Compatible Land Use Change through Conservation Policy June 2006 Sachedina, Hassan For millennia, pastoralists have shared landscapes with wildlife throughout Africa (Pilgram, Siiriäinen et al. 1990; Homewood and Rodgers 1991; Little, Dyson-Hudson et al. 1999). Throughout the 20th century, this co-existence has been in decline as conservation policy excluded people and livestock from protected areas, and demographic growth and expanding agriculture excluded wildlife use (Ellis and Swift 1988; Pagiola, Kellenberg et al. 1998; Homewood, Lambin et al. 2001; Serneels and Lambin 2001). Concurrently, many pastoral systems across the globe, including those of Maasai pastoralists in Tanzania, are believed to be in decline and under unprecedented pressure to diversify livestock based economies. In East Africa, an estimated 70 percent of wildlife populations are dispersed outside protected areas on land which overlaps with pastoralism (Western and Gichohi 1993). The presence of unfenced and uncultivated rangelands adjacent to protected areas increases the total range of resources available to wildlife, and enhances long-term survival as predicted by island bio-geographic theory (Western and Ssemakula 1981). Community Based Natural Resource Management (CBRNM) is one approach that has been proposed as a way of enhancing protected areas by creating economic incentives for local communities to manage wildlife on their lands and enable wildlife to compete as a form of land use. The economic and ecological impacts of CBNRM in pastoral communities are still largely unknown (Caro 1998). CBNRM projects are being initiated across northern Tanzania encouraged by central government agencies and international conservation organisations, with a focus on establishing revenue generating, community based tourism projects on Village land that has been zoned for conservation. Presented at the Policy Research Conference on “Pastoralism and Poverty Reduction in East Africa,” held in Nairobi, Kenya, June 27-28, 2006. Saha, Jean Claude Education et développement humain en Afrique de l’Ouest: des hauts et des bas. Les cas du Burkina-Faso, de la Côte d’Ivoire et du Sénégal November 2005 Saha, Jean Claude Nous proposons une estimation de l’apport de l’éducation au processus de développement humain au Burkina-Faso, en Côte-d’Ivoire et au Sénégal. Le développement humain est entendu au sens du Programme des Nations Unies pour le Développement (PNUD). Suivant une approche par la valeur de Shapley, nous décomposons les variations annuelles de l’Indicateur de Développement Humain (IDH) de ces pays. D’après les résultats obtenus, le secteur éducatif ivoirien a contribué pour 146,75% au progrès de développement humain réalisé par ce pays entre 1990 et 2004, celui du Sénégal pour 23,77% et celui du Burkina-Faso pour –13,35 %. Mais on déplore l’absence de synergie entre le secteur éducatif ivoirien et les autres aspects du développement humain dans le pays (la santé et le revenu par tête), tout autant que l’on s’inquiète devant le rôle marginal que joue l’éducation au Sénégal et surtout devant le sort du Burkina-Faso où le secteur éducatif a considérablement freiné le développement humain depuis 1990. Un échange d’expérience entre pays de la sous-région est alors souhaitable. Paper prepared for the Regional Conference on “Education in West Africa: Constraints and Opportunities” in Dakar, Senegal, November 1-2, 2005 Sahn, David E. The Relationship between Poverty and Maternal Morbidity and Mortality in Sub-Saharan Africa 2010 Meyerhoefer, Chad and David E. Sahn “Good maternal health is of fundamental importance to a country’s well-being and ability to prosper, and there are few times when maternal health is more at risk than in the period surrounding childbirth. Protecting the health of mothers during reproduction safeguards their future contributions to society and ensures the health and productivity of future generations. If either the health of mothers or their newborn offspring is compromised, there will be serious negative consequences for their families, communities, and the entire process of economic and social development. This is why the United Nations has set as one of its eight Millennium Development Goals (MDGs), the reduction of the maternal mortality ratio (MMR) by two-thirds in the developing world by the year 2015... ” Presented at the AERC/Hewlett Foundation Workshop, “Poverty and Economic Growth: The Impact of Population Dynamics and Reproductive Health Outcomes in Africa” in Brussels, Belgium, November 5-6, 2006 In Reproductive Health, Economic Growth and Poverty Reduction in Africa: Frameworks of Analysis, edited by Olu Ajakaiye and Germano Mwabu. University of Nairobi Press, 2010 Early Academic Performance, Grade Repetition, and School Attainment in Senegal: A Panel Data Analysis January 2010 Glick, Peter and David E. Sahn Little is known in developing country environments about how a child’s cognitive skills manifested in the first years of schooling are related to his or her later educational success, because the panel data needed to analyze this question have been lacking. In this study we take advantage of unique data from Senegal, combining test score data for children from the second grade with information on their subsequent school progression from a follow-up survey conducted seven years later. We find that measures of skills from early in primary school, corrected for measurement error using multiple test observations per child, are very strongly positively associated with later school progression. A plausible interpretation is that parents invest more in a child’s education when the returns to doing so are higher. The results point to the need for remedial policies to target lagging students early on to reduce early dropout. A current policy targeting poorly performing students is grade repetition, which is pervasive in Francophone Africa. Using variation across schools in test score thresholds for promotion to identify the effects of second grade repetition, we find that a repeated student is more likely to leave school before completing primary than a student with similar ability who is not held back (and also does not learn more), pointing to the need for alternative measures to improve skills of lagging children. In World Bank Economic Review 24(1): 93-120, January, 2010 Measuring Intra-Household Inequality: Explorations Using the Body Mass Index April 2009 Sahn, David E. and Stephen D. Younger This paper examines the relationship between level of well-being and inequality at inter-country and intra-household levels, using individuals’ body mass index (BMI) rather than income as the indicator of well-being. BMI is useful for these purposes because (1) it is measured at the individual rather than household level; (2) it reflects command over food, but also non-food resources that affect health status like sanitary conditions and labour-saving technologies; (3) it accounts for caloric consumption relative to needs; (4) it is easily measured; and (5) any measurement error is likely to be random. We do not find any evidence to support the idea of an intra-household or inter-country Kuznets curve. We study the correlations between average household well-being, still measured by BMI, and differences in the BMIs of males and females, parents and children. Here, we find a tendency to protect the BMI of young children when living standards are very low. We find no clear patterns by gender. Perhaps the most striking finding in the paper is that about half of total BMI inequality at the country level is within households. Thus, standard measures of inequality that use household-level data may drastically understate true inequality. Presented at the WIDER Conference on Advancing Health Equity, Helsinki, Finland, September 29-30, 2006, and the CIRPÉE Conference on Health Economics, Université Laval, March 30, 2007 In Health Economics 18(S1): S13-S36, April, 2009 (UNU-WIDER Special Issue on Health and Development) Determinants of HIV Knowledge and Condom Use among Women in Madagascar: An Analysis Using Matched Household and Community Data April 2009 Glick, Peter, Josée Randriamamonjy, and David E. Sahn We estimate the determinants of HIV/AIDS knowledge and related behavior (use of condoms) among women in Madagascar, a country where prevalence remains low but conditions are ripe for a rapid increase in infections. In both rural and urban areas, more educated and wealthier women are more likely to know about means of preventing infection, less likely to have misconceptions about transmission, and more likely to use condoms. Community factors such as availability of health centers and access to roads also are associated with greater HIV knowledge. However, most of the large rural-urban difference in mean knowledge is due not to location per se but to differences in schooling and wealth; rather than simply being geographically targeted, AIDS education efforts must be designed to target and be understood by uneducated and poor subpopulations. In African Development Review 21(1): 147-179, April, 2009 Are Africans Practicing Safer Sex: Evidence from Demographic and Health Surveys for Eight Countries January 2008 Glick, Peter and David E. Sahn We use repeated rounds of Demographic and Health Survey data from eight African countries to examine changes in and determinants of three HIV risk behaviors: age at first intercourse; number of current sexual partners, and use of condoms. As a prelude, we assess the within- country comparability of DHS surveys over time. We find some evidence of changes in sample composition, which is easily handled in a multivariate framework, and find evidence as well of changes in how people respond to questions about HIV behavior. Because of the latter, which likely represents an increase in social desirability bias over time, our estimates of risk reduction may be upper bounds on the true effects. Overall the picture is one of reductions in risk behaviors over recent 4-6 year intervals, especially with respect to condom use; in some cases the changes seem large given the short time periods involved. With some exceptions, however, the extent and pervasiveness of these changes seems inadequate in relation to the urgency of the public health crisis represented by AIDS. With respect to the determinants of behaviors, schooling and wealth have contradictory impacts on risk behavior: they both tend to increase the likelihood of using condoms while (for men) also increasing the demand for additional sexual partners. Presented at the International Union for the Scientific Study of Population (IUSSP) Seminar on “Interactions between Poverty and HIV/AIDS,” Cape Town, South Africa, December 2005. Alternate version in Economic Development and Cultural Change 56(2):397-439, January, 2008 Inequality and Poverty in Africa in an Era of Globalization: Looking Beyond Income to Health and Education August 2007 Sahn, David E. and Stephen D. Younger This paper describes changes over the past 15-20 years in non-income measures of well- being – education and health – in Africa. We expected to find, as we did in Latin America, that progress in the provision of public services and the focus of public spending in the social sector would contribute to declining poverty and inequality in health and education, even in an environment of stagnant or worsening levels of income poverty. Unfortunately, our results indicate that in the area of health, little progress is being made in terms of reducing pre-school age stunting, a clear manifestation of poor overall health. Likewise, our health inequality measure showed that while there were a few instances of reduced inequality along this dimension, there was, on balance, little evidence of success in improving equality of outcomes. Similar results were found in our examination of underweight women as an indicator of general current health status of adults. With regard to education, the story is somewhat more positive. However, the overall picture gives little cause for complacency or optimism that Africa has, or will soon reap the potential benefits of the process of globalization. Presented at the UNU-WIDER Conference on “The Impact of Globalization on the Poor in Africa,” Johannesburg, South Africa, 1-2 December, 2005 Decomposing World Education Inequality August 2007 Sahn, David E. and Stephen D. Younger We decompose global inequality in educational achievement into within- and between- country components. We find that the former is significantly larger. This is different than results for international income inequality, but similar to results for international health inequality. Living Standards in Africa August 2007 Sahn, David E. and Stephen D. Younger This paper substantiates two claims — that Africa is poor compared to the rest of the world and that poverty in Africa is not declining consistently or significantly, in contrast to other regions of the world. We consider poverty in the dimensions of health and education, in addition to income, stressing the inherent conceptual and measurement issues that commend such a broader perspective. We note a lack of consistency in the movement of the poverty measures. During similar periods, we often find them moving in opposite directions. We therefore discuss the need go beyond examining each poverty measure individually, and present an approach to evaluating poverty reduction in multiple dimensions jointly. The results of the multidimensional poverty comparisons reinforce the importance of considering deprivation beyond the material standard of living and provide insight into how to reconcile differing stories that arise from examining each indicator separately. Forthcoming in Sudhir Anand, Paul Segal, and Joseph E. Stiglitz, Debates in the Measurement of Global Inequality, Oxford University Press, 2008. Cognitive Skills among Children in Senegal: Disentangling the Roles of Schooling and Family Background June 2007 Glick, Peter and David E. Sahn We use unique data to estimate the determinants of cognitive ability among 14 to 17 year olds in Senegal. Unlike standard school-based samples, tests were administered to current students as well as to children no longer—or never—enrolled. Years of schooling strongly affects cognitive skills, but conditional on years of school, parental education and household wealth, as well as local public school quality, have surprisingly modest effects on test performance. Instead, family background primarily affects skills indirectly through its impacts on years of schooling. Therefore closing the schooling gaps between poor and wealthy children will also close most of the gap in cognitive skills between these groups. Presented at the Regional Conference on “Education in West Africa: Constraints and Opportunities” in Dakar, Senegal, November 1-2, 2005 This is an expanded version of a paper published in Economics of Education Review 28(2): 178-188, April, 2009. Changes in HIV/AIDS Knowledge and Testing Behavior in Africa: How Much and for Whom? April 2007 Glick, Peter and David E. Sahn Demographic and Health Survey data from six African countries indicate that HIV prevention knowledge is improving and that more Africans are getting tested. Still, in many cases fewer than half of adult respondents can identify specific prevention behaviors; knowledge appears particularly inadequate in countries not yet fully gripped by the epidemic. Schooling and wealth impacts on prevention knowledge generally have either not changed or have increased, meaning that initial disparities in knowledge by education and wealth levels have persisted or widened. HIV messages therefore need to be made more accessible to and/or better understood by the poor and less educated. Paper prepared for the conference “African Development and Poverty Reduction: The Macro-Micro Linkage” Cape Town, South Africa October 2004 In Journal of Population Economics 20(2):383-422, April, 2007 An Assessment of Changes in Infant and under-Five Mortality in Demographic and Health Survey Data for Madagascar September 2006 Glick, Peter, Stephen D. Younger, and David E. Sahn Repeated rounds of nationally representative surveys are an important source of information on changes in the welfare of the population. In particular, policymakers and donors in many developing countries rely heavily on the Demographic and Health Surveys (DHS) to provide information on levels and trends in indicators of the health status of the population, including child survival. The reliability of observed trends, however, depends strongly on the comparability across survey rounds of the sampling strategy and of the format of questions and how interviews ask them. In Madagascar, the most recent (2003/4) DHS indicated very sharp declines in rates of infant and under-five mortality compared with the previous survey from 1997. However, retrospective under-one and under-five mortality data in 1997 and 2003/4 for the same calendar years also show large differences, suggesting that this trend may be spurious. We employ a range of descriptive and multivariate approaches to investigate the issue. Despite evidence of significant interviewer recording errors (with respect to date of birth and age at death) in 2003/4, the most likely source of problems is that the two samples differ: comparisons of time-invariant characteristics of households and of women suggests that the later DHS sampled a somewhat wealthier (hence lower mortality) population. Corrections to the data using hazard survival model estimates are discussed. These suggest a much more modest reduction in infant and under-five mortality than indicated by the raw data for the two surveys. Robust Multidimensional Spatial Poverty Comparisons in Ghana, Madagascar, and Uganda April 2006 Duclos, Jean-Yves, David E. Sahn, and Stephen D. Younger We investigate spatial poverty comparisons in three African countries using multidimensional indicators of well-being. The work is analogous to the univariate stochastic dominance literature in that we seek poverty orderings that are robust to the choice of multidimensional poverty lines and indices. In addition, we wish to ensure that our comparisons are robust to aggregation procedures for multiple welfare variables. In contrast to earlier work, our methodology applies equally well to what can be defined as "union", "intersection," or "intermediate" approaches to dealing with multidimensional indicators of well-being. Further, unlike much of the stochastic dominance literature, we compute the sampling distributions of our poverty estimators in order to perform statistical tests of the difference in poverty measures. We apply our methods to two measures of well-being, the log of household expenditures per capita and children’s height-for-age z-scores, using data from the 1988 Ghana Living Standards Survey, the 1993 Enquête Permanente auprès des Ménages in Madagascar, and the 1999 National Household Survey in Uganda. Bivariate poverty comparisons are at odds with univariate comparisons in several interesting ways. Most importantly, we cannot always conclude that poverty is lower in urban areas from one region compared to rural areas in another, even though univariate comparisons based on household expenditures per capita almost always lead to that conclusion. In World Bank Economic Review 20(1):91-113 The Demand for Primary Schooling in Madagascar: Price, Quality, and the Choice Between Public and Private Providers February 2006 Glick, Peter, and David E. Sahn We estimate a discrete choice model of primary schooling and simulate policy alternatives for rural Madagascar. Poor households are substantially more price-responsive than wealthy ones, implying that fee increases for public schools will have negative effects on equity in education. Among quality factors, multigrade teaching (several classes being taught simultaneously by one teacher) has a strongly negative impact on public school enrollments. Simulations indicate that providing teachers to reduce by half the number of multigrade classes in public schools would lead to modest improvements in overall enrollments, would be feasible in terms of costs, and would disproportionately benefit poor children. In contrast, consolidation of primary schools combined with quality improvement would be ineffective because of the negative effect of distance to school. Other simulations point to limits to a strategy of public support for private school expansion as a means of significantly increasing enrollment rates or education quality; such an expansion may also reduce overall education equity. In the Journal of Development Economics 79(1):118-145, 2006. Improvements in Children’s Health: Does Inequality Matter? August 2005 Sahn, David E. and Stephen D. Younger The literature on the contributions to poverty reduction of average improvements in living standards vs. distributional changes uses only one measure of well-being – income or expenditure. Given that poverty is defined by deprivation over different dimensions, we explore the role of average improvements and distributional changes in children’s health and nutrition using the height of young children as our measure of well-being. Similar to the income literature, we find that shifts in the mean level of heights, not changes in distribution, account for most improvements in heights. Unlike the literature on income inequality, however, there is a positive association between improvements in average heights and reduced dispersion of those heights. In The Journal of Economic Inequality 3(2):125-143, 2005. The Progression through School and Academic Performance in Madagascar Study: Preliminary Descriptive Results March 2005 Glick, Peter, Harivelo Rajemison, Arsène Ravelo, Yolande Raveloarison, Mamisoa Razakamanantsoa, and David E. Sahn This paper is a preliminary analysis of the Etude sur la Progression Scolaire et la Performance Academique en Madagascar (EPSPAM). The study is based on a nation-wide household survey with a special focus on schooling, complimented by academic and life skills tests and additional surveys of local schools and communities. The survey was designed to investigate the household, community, and school-level determinants of a range of education outcomes in Madagascar: primary and secondary enrollment, grade repetition and dropout during primary and lower secondary school cycles, transitions from primary to secondary school, and learning — both academic (math and French test scores) and non-academic ('life-skills'). It also seeks to understand the association of early academic performance, on the one hand, and subsequent school progression and scholastic attainment, on the other. The study also investigates the knowledge and perceptions of parents about the schools in their communities. In addition, the policy environment in education in Madagascar has been very dynamic in the last several years. Therefore the study also evaluates the implementation and impacts of several important recent policies in education, including the elimination of public primary school fees and the provision of books and supplies, as well as a series of administrative reforms such as the professionalization of the chefs CISCO and efforts to make school finances more transparent. Intertemporal Female Labor Force Behavior in a Developing Country: What Can We Learn from a Limited Panel? February 2005 Glick, Peter and David E. Sahn We analyze intertemporal labor market behavior of women in urban Guinea, West Africa using two distinct methodologies applicable to a short (two-year) panel. A multi-period multinomial logit model with random effects provides evidence of unobserved individual heterogeneity as a factor strongly affecting labor market sector choices over time. Results from simpler single period models that condition on prior sector choices are consistent with either heterogeneity or state dependence. Both approaches perform equally well in predicting individual labor market behavior conditional on past choices. In terms of observable characteristics, the estimates confirm the heterogeneous structure of the urban labor market: informal and formal employment appear to differ significantly in terms of skill requirements, compatibility with child care, and costs of entry. In Labour Economics 12(1):23-45, February, 2005 Growth and Poverty Reduction in Sub-Saharan Africa: Macroeconomic Adjustment and Beyond May 2004 Sahn, David E. and Stephen D. Younger We begin this paper by taking a look back at the adjustment, growth, and poverty debate. Our analysis suggests that while the poor do not bear the disproportionate costs of adjustment policies, it is also the case that policy reforms have largely failed to contribute to the alleviation of poverty. We therefore explore the microeconomic, structural, and institutional constraints to growth and poverty reduction. The three areas that we concentrate on in terms of removing the structural and fundamentally microeconomic constraints that impede growth and poverty alleviation are human resource development, vulnerability and risk management, and fiscal management through decentralization. In Journal of African Economies 13(90001):i66-i95 Urban-Rural Inequality in Africa July 2003 Sahn, David E. and David C. Stifel In this paper we examine the relative importance of rural versus urban areas in terms of monetary poverty and seven other related living standards indicators. We present the levels of urban-rural differences for several African countries for which we have data and find that living standards in rural areas lag far behind those in urban areas. Then we examine the relative and absolute rates of change for urban and rural areas, and find no overall evidence of declining differences in the gaps between urban and rural living standards. Finally, we conduct urban-rural decompositions of inequality, examining the within versus between (urban and rural) group inequality for asset inequality, education inequality, and health (height) inequality. In Journal of African Economies 12(4):564-597, 2003 Presented at WIDER (World Institute for Development Economics Research) Conference on Spatial Inequality in Africa, University of Oxford, September 21-22, 2002. Return to TOP OF PAGE Sandefur, Justin Labor Market Flexibility, Wages and Incomes in sub-Saharan Africa in the 1990s June 2005 Geeta Kingdon, Justin Sandefur and Francis Teal This paper provides an overview of how African labor markets have performed in the 1990s. It is argued that the failure of African labor markets to create good paying jobs has resulted in excess labor supply in the form of either open unemployment or a growing self-employment sector. One explanation for this outcome is a lack of labor market ‘flexibility’ keeping formal sector wages above their equilibrium level and restricting job creation. We identify three attributes of labor market flexibility. First whether real wages decline over time, secondly the tendency for wages to adjust in the face of unemployment, and thirdly the extent of wage differentials between sectors and/or firms of various size. Recent research shows that real wages in Africa during the 1990s may have been more downwardly flexible than previously thought and have been surprisingly responsive to unemployment rates, yet large wage differentials between formal and informal sector firms remain. This third sense of the term inflexibility can explain a common factor across diverse African economies - the high income divide between those working in large firms and those not. Those working in the thriving self-employment sector in Ghana have something in common with the unemployed in South Africa - both have very low income opportunities relative to those in large firms. Presented at the International Conference on "Shared Growth in Africa," July 21-22, 2005, Accra, Ghana Sandrey, Ron Has the New Zealand/Australian Closer Economic Relationship (CER) been trade widening or deepening? October 2004 Ron Sandrey and Dirk van Seventer This study finds that export trade widened rather than deepened as a result of the CER trade agreement with Australia. Trade has expanded in those products that were not heavily traded prior to the agreement as opposed to an expansion of “traditional” exports that were traded at the start of the agreement. This finding is therefore consistent with other recent empirical research undertaken on this new aspect of trade expansion, and gives weight to the suggestion that these agreements are beneficial not just in the short or “static” term, but in the longer or “dynamic” term. While often cited as a benefit of bilateral liberalisation, this widening feature of a trade agreement is not generally forecast in traditional computer modelling exercises. Importantly, the analysis of the trade expansion to the ‘rest of the world’ indicated that much of the result may be directly attributable to CER and not a change in worldwide trade patterns. Moreover, this widening was most pronounced in manufacturing lines, reinforcing the value of CER in that it had not merely diverted our traditional (and supply constrained) exports away from third markets. This was underlined by a similar analysis of the “mirror” imports of manufactured products from New Zealand into Australia. This showed an increase post-CER and confirms the trade widening hypothesis. As New Zealand prepares to begin negotiating an FTA with China, this study adds weight to the general conclusion that comprehensive bilateral agreements are likely to produce more welfare benefits than may be forecast by traditional means (ie computer models). It also supports the broad assumption that trade agreements are likely to significantly contribute to a growth and innovation export-oriented drive. 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 Santos, Paulo Persistent Poverty and Informal Credit November 2008 Santos, Paulo and Christopher B. Barrett This paper explores the consequences of nonlinear wealth dynamics for the formation of bilateral credit arrangements to help manage idiosyncratic risk. Building on recent empirical work that finds evidence consistent with the hypothesis of multiple equilibrium poverty traps, and using original primary data on expected wealth dynamics, social networks and informal loans among southern Ethiopian pastoralist households, we find that the threshold at which wealth dynamics bifurcate serves as a focal point at which lending is concentrated. Informal lending responds to recipients’ losses but only so long as the recipients are not “too poor”. Our results suggest that when shocks can have long term effects, loans are not scale-neutral. Furthermore,the persistently poor are excluded from social networks that are necessary to obtain loans given in response to shocks. What do we learn about social networks when we only sample individuals? Not much. May 2008 Santos, Paulo and Christopher B. Barrett Much of the empirical analysis of social networks is based on a sample of individuals, rather than a sample of matches between pairs of individuals. This paper asks whether that approach is useful when one wants to understand the determinants of variables that are inherently dyadic, such as relationships. After reviewing the shortcomings of the data used in the literature, we use Monte Carlo simulation to show that the answer is positive only when relationships are themselves randomly formed, a very special and uninteresting case. Additional work that supports strategies to collect dyadic data as part of surveys usually used by economists seems to be needed. Heterogeneous Wealth Dynamics: On the Roles of Risk and Ability June 2006 Santos, Paulo and Christopher B. Barrett This paper studies the causal mechanisms behind poverty traps, building on evidence of nonlinear wealth dynamics among a poor pastoralist population, the Boran from southern Ethiopia. In particular, it explores the roles of adverse weather shocks and individual ability to cope with such shocks in conditioning wealth dynamics. Using original data, we establish pastoralists’ expectations of herd dynamics and show both that pastoralists perceive the nonlinear long-term dynamics that characterize livestock wealth in the region and that this pattern results from adverse weather shocks. We estimate a stochastic herd growth frontier that yields herder-specific estimates of unobservable ability on which we then condition our simulations of wealth dynamics. We find that those with lower ability converge to a unique dynamic equilibrium at a small herd size, while those with higher ability exhibit multiple stable dynamic wealth equilibria. Our results underscore the criticality of asset protection against exogenous shocks in order to facilitate wealth accumulation and economic growth and the importance of incorporating indicators of ability in the targeting of asset transfers, as we demonstrate with simulations of alternative asset transfer designs. Presented at the Policy Research Conference on “Pastoralism and Poverty Reduction in East Africa,” held in Nairobi, Kenya, June 27-28, 2006. Sarpong, Bruce Export Performance and Investment Behaviour of Firms in Ghana July 2004 Susanna Wolf and Daniel Bruce Sarpong A strong relationship between export performance and investment behaviour at the firm level is expected to complement market access in diversifying Ghana’s exports. A 2003 survey of 100 enterprises in Ghana is used to analyse the factors that influence the investment and exporting behaviour of firms using a simultaneous equation model to allow for the endogeneity of investment and exporting. In addition the different factors that influence the investment and export decisions in different sectors are investigated. However, no significant positive relationship between exporting and investment could be found. There seems rather to be a negative association which might be explained by constraints in the access to capital. On the other hand there are several factors that work in the same direction, for example, younger firms, larger firms and more efficient firms are more likely to invest and more likely to export. In Ernest Aryeetey and Ravi Kanbur (editors), The Economy of Ghana: Analytical Perspectives on Stability, Growth and Poverty, James Currey, 2008. Presented at the ISSER-University of Ghana-Cornell University International Conference on "Ghana at the Half Century," July 18-20, 2004, Accra, Ghana Sarr, Leopold Progression through School and Academic Performance in Senegal: Descriptive Survey Results March 2005 Dumas, Christelle, Peter Glick, Sylvie Lambert, David E. Sahn, and Leopold Sarr This report provides a preliminary descriptive analysis of some of the data from The Progression through School and Academic Performance in Senegal Study, a joint research project of Cornell University, Centre de Recherche en Economie Appliquée (CREA), and INRA. This project is based around a nation-wide household survey with a special focus on schooling, complimented by academic and life skills tests and additional surveys of local schools and communities. The topics covered in this report focus on the household survey and test score data and include: enrollment rates; school attainment; grade repetition; dropouts and progression to secondary school; academic and life skills test scores; and perceptions about education and schooling. The Impact of Family Literacy on the Earnings of Illiterates: Evidence from Senegal January 2004 Sarr, Leopold R. This paper investigates the extent to which the sharing of literacy knowledge within the household affects the labor force participation and the earnings of illiterate workers in Senegal. Using the concept of proximate and isolated illiterates recently developed by K. Basu and J. Foster, I apply an intra-household model of literacy to a Senegalese household dataset. The estimates obtained from different selection bias models provide evidence that parental literacy and education do not capture all sources of external literacy benefits and that illiterate members also benefit from other literate members of the household. It also appears that rural workers and female illiterates tend to participate more in the labor market than their urban and male counterparts. On the other hand, an urban illiterate worker who lives in a household where at least one member is literate is expected to earn a wage that is about 88% higher than that of an isolated illiterate urban worker whereas the earnings of an illiterate female worker are on average 33% higher than the ones of another illiterate female worker whose family’s ratio of literate to illiterate members is one point lower. This suggests that policies targeting isolated illiterate households, in both rural and urban zones as well as illiterate women — who appear to be better recipients of external literacy benefits — within households, are likely to mitigate their vulnerability and thus to reduce the incidence of illiteracy and poverty. Schoch, Mickie Budget Reform as a Means to Strengthen the Link Between Macro and Micro Policies October 2004 Taz Chaponda, Neil Cole, Mickie Schoch, and Chris Gadsden The paper argues that a credible budget provides the link between broad macroeconomic policies and strategies and microeconomic policies facilitating the achievement of development and poverty reduction targets. The paper’s thesis centres around the Medium Term Expenditure Framework (MTEF) which has been lauded as the method to translate broad macroeconomic aggregates into effective public expenditure programmes based on a multi-year fiscal framework. While a number of countries in Africa – most notably South Africa and Uganda – have seen significant benefits, such as increased predictability in resource flows and better planning for microeconomic policies, experiences in other African countries have been mixed. The paper argues that developing credible budgets does not require an ambitious MTEF reform path. What is more important is a commitment to realistic macroeconomic projections, sensible budgeting norms, good accounting practices and regular reporting through transparent budget documents. Paper prepared for the conference “African Development and Poverty Reduction: The Macro-Micro Linkage” Cape Town, South Africa October 2004 Schoombee, Andrie Credit demand and credit rationing in the informal financial sector in Uganda October 2004 Nathan Okurut, Andrie Schoombee and Servaas van der Berg This paper focuses on identifying the factors that influence credit demand and also those that result in the poor being credit rationed by lenders. An understanding of both these sets of determinants could assist policy formulation to enhance the welfare of the poor through improved credit access. In this respect we were fortunate in having a dataset that contains questions not only on actual credit given, but also on loans applied for. This allows us to investigate both credit demand and credit supply, and to model these using observed household and individual characteristics. 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 Seini, A. Wayo Policy Dynamics, Trends in Domestic Fish Production & Implications for Food Security in Ghana July 2004 A. Wayo Seini, V. K. Nyanteng and A. Asantewah Ahene The fishing industry in Ghana started as an artisanal fishery with very simple and low efficient gears and methods operating in very near coastal waters, lagoons, estuaries and rivers. Through government and private efforts to promote production, the fishing industry continued to improve over the years with the development of new gears and methods that had been more efficient than the previous ones. Through government schemes, the use of outboard motors on canoes, introduced in 1959, was very successful and went a long way to create a modern sub-sector of the canoe fisheries. These schemes, particularly the charter party scheme (a hire purchase scheme), also encouraged fishermen to purchase larger fishing boats and gear which they paid for over a period of four years at very low interest rates (Lawson and Kwei, 1974). This paper examines major policy regimes since Ghana’s independence and relates them to trends in domestic fish production. Domestic production is then linked to the implications for food security. There is no doubt that fish is an important commodity in the country’s food security, particularly when the latter is defined beyond availability and accessibility to encompass the nutritional content of a meal that is required to provide a balanced diet and to ensure a minimum daily intake of 2,300 calories. Where food consumption is not balanced from the standpoint of nutrition, some diseases and improper physical developments emerge, such as stunting, underweight and wasting in children, particularly, under-5 years of age. Fish is consumed by many households and among all income groups everywhere in Ghana, largely to supply protein requirements in the diet. Presented at the ISSER-University of Ghana-Cornell University International Conference on "Ghana at the Half Century," July 18-20, 2004, Accra, Ghana Seka, Pierre Roche Corruption, Croissance et Capital Humain: Quels Rapports November 2005 Seka, Pierre Roche The objective of this paper is to explain some of the reasons of the high rate of dropout observed in the system of higher education. It has been shown theoretically that corruption is one of the major factors. Indeed, very talented students, who otherwise could have pushed further their studies, suddenly drop out when they compare the level of well being of those who are well educated with that of those who are not but enriched through corruption. Where do they go? They join the latter in their corruptive activities. Such practice, that somehow is rational, endangers the whole education system. An econometric model has been estimated to show the negative impact of corruption on the registration rate for higher education. The paper ends by calling for the attention of the public authority that if nothing is done to retribute better well educated people, the education system is at high risk of extinction, endangering development efforts that have been made so far. Paper prepared for the Regional Conference on “Education in West Africa: Constraints and Opportunities” in Dakar, Senegal, November 1-2, 2005 Selod, Harris Does City Structure Cause Unemployment? The Case Study of Cape Town October 2005 Rospabe, Sandrine and Harris Selod Several theoretical and empirical findings suggest that the spatial organization of cities can be a source of unemployment among unskilled workers and ethnic minorities, stressing either the role of residential segregation or that of the physical disconnection between work and residence. The present paper investigates this issue in South Africa by focusing on the example of Cape Town, a sprawling and highly segregated city. Using the dataset of the 1998 study on the Migration and Settlement in the Cape Metropolitan Area complemented by local population statistics extracted from the 1996 Census and local employment statistics extracted from the City of Cape Town’s 2000 RSC Levy database, we regress the unemployment probability of a selection of workers in 24 different areas of the city on their individual and household attributes as well as on the characteristics of their locations. Results obtained so far suggest that (i) distance to jobs, (ii) rural origin (especially for women) and (iii) the length of time spent in their present dwelling reduce the employment probability of workers. In Poverty and Policy in Post Apartheid South Africa, edited by Haroon Bhorat and Ravi Kanbur. Cape Town, South Africa: HSRC Press, 2006. Senadza, Bernardin Understanding Poverty in Ghana: Risk and Vulnerability July 2004 Appiah-Kubi, Kojo, Abena D. Oduro, and Bernardin Senadza Poverty, as a reflection of material, social or rights deprivation, is of concern in its own right, hence its reduction has been the focus of economic policy in both developed and developing countries. However, as pointed out by Gibson (2001), people may, in a given time period, be poor either because their mean quantitative proxy indicator for poverty such as income, consumption expenditure or calories falls below the national average (or poverty line) or because they have suffered a temporary shortfall in consumption or income. In other words households or persons may be poor at a point in time either due to intertemporal variability in consumption or income, which is considered as “transient”, or because of the persistence of income or consumption expenditure below the poverty line, i.e. “chronic poverty” (Jalan and Ravallion, 1998). Therefore, for effective poverty reduction programmes, it is important to know not only those who are currently poor but also those who are vulnerable to poverty. In Ernest Aryeetey and Ravi Kanbur (editors), The Economy of Ghana: Analytical Perspectives on Stability, Growth and Poverty, James Currey, 2008. Serneels, S. 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. Shaffer, Paul Epistemology, Normative Theory and Poverty Analysis: Implications for Q-Squared in Practice February 2007 Kanbur, Ravi and Paul Shaffer The turn to the use of mixed qualitative and quantitative (Q-Squared) methods in the analysis of poverty is a welcome development with large potential payoffs. While the benefits of mixing are not in doubt, the tensions involved in so doing have not received adequate attention. The aim of this paper is to address this gap in the “Q-Squared” literature. It argues that there are important differences between approaches to poverty which operate at the levels of epistemology and normative theory. These differences have implications for the numerical transformation of data, the selection of validity criteria, the conception/dimension of poverty adopted and interpersonal comparisons of well-being. In World Development 35(2):183-196, 2007 Shapiro, David Buffering Inequalities: The Safety Net of Extended Families in Cameroon December 2004 Eloundou-Enyegue, Parfait M. and David Shapiro Extended family systems play an important role in buffering socioeconomic inequality in African societies, notably through fosterage of children across nuclear family units. Yet, there is concern that this support system would break down under the influence of globalization and recent economic crises. Whereas previous scholarship to address this concern has focused on trends in rates of family extension/ fosterage, we argue in this paper that a full account of trends in the buffering influence of extended families requires simultaneous attention to trends in (a) fosterage rates, (b) the distribution of fosterage opportunities, (c) the ameliorative effects of fosterage. This study focuses on the buffering influence of fosterage on schooling inequalities. Taking Cameroon as a case study and using the retrospective fosterage and schooling histories of 2,257 children, we examine the historical trends in these three proximate determinants of the buffering influence of extended families. Findings suggest that while the ameliorative effects of fosterage (once children are fostered) have not changed over time, both the rates and the distribution of fosterage opportunities have changed in ways that raise concern for children at the bottom quintile of the resource distribution. Shimeles, Abebe Can Africa Reduce Poverty by Half by 2015? The Case for a Pro-Poor Growth Strategy June 2005 Arne Bigsten and Abebe Shimeles This study uses simulations to explore the possibility of achieving the target of halving the percentage of people living in extreme poverty in Africa by 2015. A pro-poor growth scenario and a constant inequality scenario are compared. It is shown how initial levels of inequality and mean per capita income determine the cumulative growth and inequality reduction required to achieve the target. The simulations show that small changes in income distribution have a large impact on the possibility of halving poverty. It is shown that the trade-off between growth and inequality varies greatly among countries and that their policy choices thus are quite different. In some cases small changes in income distribution can have a large effect on poverty, while in others a strong focus on growth is the only viable option. Presented at the International Conference on "Shared Growth in Africa," July 21-22, 2005, Accra, Ghana Siloma, Morgan Ole Contextualising Conflict: Introduced Institutions and Political Networks Combating Pastoral Poverty June 2006 Zaal, Fred and Morgan Ole Siloma Poverty and conflict both bring to mind images of destitution. Conflict causes destruction, destitution and disruption of society. The resources to which people have access are damaged to the degree that livelihoods are threatened and poverty is increased. Poverty may also lead to conflict as righteous claims on resources are not met (Verstegen 2001) and scarce resources are competed about (Homer-Dixon 1999). However, this last relationship may be a simplification, as there are many other causes for conflict that hide behind this simple explanation. For example, it may be that not the poor among themselves compete for scarce resources, but that parties previously not involved start to compete with the local poor. The poor may not even have the resources to start a conflict, but rather the well off who through a lack of political, social and cultural mechanisms for control, compete freely for access to resources. As conflict-resolution mechanisms are likely to be absent in those cases, there is very little likelihood of conflicts being moderated once they break out unhindered. In fact, conflicts may be the unavoidable outcome in any society where processes of resource access and distribution are not handled through established political institutions and their controlling elites (Verstegen 2001). Presented at the Policy Research Conference on “Pastoralism and Poverty Reduction in East Africa,” held in Nairobi, Kenya, June 27-28, 2006. Simler, Kenneth Estimating utility consistent poverty lines July 2004 Channing Arndt and Kenneth Simler The “Cost of Basic Needs” (CBN) approach to drawing consumption based poverty lines is widely applied and lays credible claim to being the best practice for estimating poverty measures. Unfortunately, a growing mass of evidence indicates that poverty estimates obtained under the CBN approach are often demonstrably utility inconsistent. Here, we introduce an information theoretic approach for estimating utility consistent poverty lines. An example of the approach is provided for the case of Mozambique. The approach represents a powerful addition to the poverty analyst’s toolkit and enhances the attractiveness of the CBN approach for practical poverty measurement problems. 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 Sindzingre, Alice Institutional Foundations for Shared Growth in Sub-Saharan Africa July 2005 Machiko Nissanke and Alice Sindzingre The paper examines the dynamically evolving triangular relationships between institutions, growth and inequality in the process of economic development, in order to deepen the understanding on institutional conditions for pro-poor growth and shared growth. In this specific context, the paper discusses the institutional conditions found in Sub-Saharan Africa, which may have produced the growth pattern that are unequal and against the poor. The analysis shows that Sub-Saharan African countries require transforming institutions for embarking upon and sustaining a development path which would ensure shared growth in years to come. The paper first evaluates the growth-inequality-poverty nexus, as found in the recent literature, which increasingly challenges the trade-off between growth and equity, as postulated in the traditional theories. Various definitions of pro-poor growth are discussed and a sharper definition of the concept of ‘shared’ growth is provided. Definitions of institutions are then examined, as well as the triangular interrelationships between institutions, inequality and poverty. The paper finally analyses specific institutional conditions found in Sub-Saharan Africa that prevent economies from emerging out of low-equilibrium poverty traps that are characterised by low economic growth, unequal distribution of income and wealth as well as unequal access to resources and power. Presented at the International Conference on "Shared Growth in Africa," July 21-22, 2005, Accra, Ghana Söderbom, Måns Exporting from manufacturing firms in Sub-Saharan Africa: Micro evidence for macro outcomes October 2004 Neil Rankin, Måns Söderbom and Francis Teal The poor performance of many African economies has been associated with low growth of exports in general and of manufacturing exports in particular. In this paper we draw on micro evidence of manufacturing firms in five African countries - Kenya, Ghana, Tanzania, South Africa and Nigeria - to investigate the causes of poor exporting performance. Micro empirical work on manufacturing firms has focused on the relationship between export participation and efficiency. The evidence for SSA shows that exporters te nd to be larger, more capital intensive and produce more output per unit of labour than non exporters. We show that firm size is a robust determinant of the decision to export. It is not a proxy for efficiency, for capital intensity, for sector, for time -invariant unobservables or for the fixed cost of entry into exporting. The implication of these findings is that large firms are necessary for exporting. However larger firms are more capital intensive. Small firms may create jobs, they will not be able to export. We also find that efficiency only impacts on the decision to export regionally, defined as within Africa, not internationally. The implications of these findings are discussed. 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 In Journal of African Economies 15(4):671-687, 2006 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 Sowa, Nii K. Does Inflation in Ghana Hit the Poor Harder? April 2005 Andy McKay and Nii K. Sowa One of the defining characteristics of the Ghanaian macroeconomy over the past 40 years has been its high, and often variable, rates of inflation. Inflation was particularly high and variable in the politically turbulent 1970s and early 1980s, but has persisted throughout the gradual economic recovery since 1983. Though inflation has been lower and less variable in the latter period, it still remains high in absolute terms and by comparison with many other countries...This paper focuses on the question of whether the inflation rate for the basket of purchases of the poor is higher than for the population as a whole. In Ernest Aryeetey and Ravi Kanbur (editors), The Economy of Ghana: Analytical Perspectives on Stability, Growth and Poverty, James Currey, 2008. Presented at the ISSER-University of Ghana-Cornell University International Conference on "Ghana at the Half Century," July 18-20, 2004, Accra, Ghana Spielman, David J. Agricultural Sector Investment and the Role of Public-Private Partnership October 2004 David J. Spielman Agricultural research and development (R&D) is critical to the improvement of incomes and livelihoods in sub-Saharan Africa. However, several studies on agricultural R&D suggest that many countries in the region are unable to bring public and private sector assets and resources together as a means of advancing agricultural R&D. This is true not only in the realm of advanced agricultural biotechnologies, but for more conventional forms of R&D as well. Evidence suggests that the constraints to greater cross-sectoral collaboration result from mutually negative perceptions between the sectors, unresolved issues of risk and liability, and high transactions and opportunity costs. A broad range of economic policies could change this, thereby putting the proper incentives in place to meet sub-Saharan Africa’s technological needs and to stimulate growth. 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 Ssewanyana, Sarah Infant Mortality in Uganda: Determinants, Trends, and the Millennium Development Goals January 2005 Ssewanyana, Sarah and Stephen D. Younger Unusually for an African economy, Uganda’s growth has been rapid and sustained for an extended period of time. Further, this growth has clearly translated into substantial declines in poverty for all socio-economic groups and in all regions of the country. Despite this, there is concern in the country that other indicators of well-being are not improving at the same rate as incomes. This paper studies one such indicator, infant mortality. We use three rounds of the Uganda Demographic and Health Surveys to construct a national time series for infant mortality over a long period of time, 1974-1999. We also use these survey data to model the determinants of infant mortality and, based on those results, to examine the likelihood that Uganda will meet the Millennium Development Goal of halving infant mortality by 2015. 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 Alternate version in Journal of African Economies 17(1):34-61, 2008 Steel, William F. Rural and Micro Finance Regulation in Ghana: Implications for Development of the Industry September 2004 William F. Steel and David O. Andah This paper assesses how the policy, legal and regulatory framework has affected — and been influenced by — the development of rural and micro finance institutions (RMFIs) in Ghana, especially in terms of the range of institutions and products available, their financial performance and outreach. The potential of microfinance to reach large numbers of the poor is well understood (Robinson 2001). Questions for regulation are the extent to which a flexible regulatory environment can encourage innovation and a diversity of RMFIs and products serving different market niches not reached by commercial banks, and at what point special legislation may be needed, whether to facilitate commercialization and sustainability of the rural and micro finance (RMF) industry or to protect deposits and ensure the stability of the financial system. Ghana is particularly interesting because its tiered system of different laws and regulations for different types of institutions has evolved largely in response to local conditions and because so many of its institutions are savings-based. The resulting system resembles the tiered approach recommended by the World Bank’s 1999 study of microfinance regulation (Van Greuning et al.) and more recently adopted by Uganda.2 While Ghana’s approach has fostered a wide range of both formal and informal RMFIs, it has not as yet been so successful in achieving strong financial performance, significant scale, and true commercialization of microfinance. In Ernest Aryeetey and Ravi Kanbur (editors), The Economy of Ghana: Analytical Perspectives on Stability, Growth and Poverty, James Currey, 2008. Presented at the ISSER-University of Ghana-Cornell University International Conference on "Ghana at the Half Century," July 18-20, 2004, Accra, Ghana Steiner, Susan The Missing Links—Uganda’s Economic Reforms and Pro-Poor Growth October 2004 Robert Kappel, Jann Lay and Susan Steiner This article illustrates changing growth regimes in Uganda from pro-poor growth in the 1990s to growth without poverty reduction, actually even a slight increase in poverty, after 2000. Not surprisingly, we find that good agricultural performance is the key determinant of direct pro-poor growth in the 1990s as well as lower agricultural growth is the root cause of the recent increase in poverty. Yet after 2000, low agricultural growth appears to have induced important employment shifts out of agriculture, which have dampened the increase in poverty. We also assess the indirect way of pro-poor growth by analysing the incidence of public spending and the tax system and find that indirect pro-poor growth has only been achieved to a limited extend. 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 Stephens, Emma C. Incomplete Credit Markets and Commodity Marketing Behavior February 2011 Stephens, Emma C. and Christopher B. Barrett Seasonal market participation patterns for smallholder farmers in western Kenya indicate that a signicant proportion follow a ‘sell low, buy high’ marketing strategy, in which these households forego opportunities for intertemporal price arbitrage through storage and are observed to sell output post-harvest at prices lower than observed prices for purchases in the subsequent lean season. We use data from the region to examine whether this behavior can be partly explained by the presence of a binding liquidity constraint for these farmers. We estimate a multi-period market participation model in the presence of liquidity constraints and transactions costs using maximum likelihood. Access to credit and off-farm income indeed seem to influence crop sales and purchase behaviors in a manner consistent with the hypothesized patterns. In Journal of Agricultural Economics 62(1): 1-24, February, 2011 Livelihood Strategies in the Rural Kenyan Highlands December 2006 Brown, Douglas R., Emma C. Stephens, James Okuro Ouma, Festus M. Murithi and Christopher B. Barrett The concept of a livelihood strategy has become central to development practice in recent years. Nonetheless, precise identification of livelihoods in quantitative data has remained methodologically elusive. This paper uses cluster analysis methods to operationalize the concept of livelihood strategies in household data and then uses the resulting strategy-specific income distributions to test whether hypothesized outcome differences between livelihoods indeed exist. Using data from Kenya’s central and western highlands, we identify five distinct livelihood strategies that exhibit statistically significant differences in mean per capita incomes and stochastic dominance orderings that establish clear welfare rankings among livelihood strategies. Multinomial regression analysis identifies geographic, demographic and financial determinants of livelihood choice. The results should facilitate targeting of interventions designed to improve household livelihoods. In the African Journal of Agricultural and Resource Economics 1(1):21-35 Steuart, Ian Industrial Strategy and local economic development: manufacturing policy and technological capabilities in Ekurhulen October 2004 Thandi Phele, Simon Roberts and Ian Steuart Ekurhuleni Metropolitan Municipality is one of six metropolitan municipalities created in major urban concentrations. More importantly, it covers the largest industrial concentration in South Africa and in sub-Saharan Africa. The economy of Ekurhuleni reflects the apartheid legacy of minerals-oriented industrialisation, and the growth of an urban labour pool to supply the mines. Ekurhuleni grew on the back of the main concentration of gold mining in the country. This is reflected in the structure of manufacturing. Ekurhuleni accounted for 37 per cent of South African output of machinery and 33 per cent of metal products in 1996, with major markets for each historically being mining.2 The performance of the Ekurhuleni economy has, however, been very poor in recent years and, with the decline in gold mining, unemployment increased sharply to reach 40 per cent in 2002.3 Manufacturing in Ekurhuleni recorded an average annual growth of va lue-added of just 0.4 per cent between 1997 and 2002 (much lower than the national manufacturing annual growth of 2.3 per cent). Regeneration of the industrial base is thus crucial to addressing unemployment and poverty in the region. This paper examines the impact of national developments and policies on the development of industry in Ekurhuleni. It assesses role of local government in industrial development in light of recent literature addressing agglomeration effects, industrial districts, and the deve lopment of local economic competencies and institutions. The analysis draws on recent work on the manufacturing sector in Ekurhuleni and a case study of the foundry industry in particular, focusing on its performance and recent development in terms of firm capabilities, orientation, and the institutional framework. 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 Stifel, David C. The Evolution of Groupwise Poverty in Madagascar, 1999-2005 August 2010 Stifel, David, Felix Forster, and Christopher B. Barrett This paper explores whether there exist differences in groupwise poverty in Madagascar; that is, whether there is a pattern over time of consistently poorer performance among subpopulations readily identifiable by one or more identity markers. Three key messages come out of this analysis. First, there exists a core type of household that remained persistently poor over the 1999-2005 period. These households were largely not members of the dominant ethnic group, land poor, lived in remote areas, and were headed by uneducated individuals, most commonly women. Second, in addition to establishing the existence of persistent differences in poverty across groups, relative differences in returns to education, land and remoteness underscore the existence of differences within groups, as one characteristic affects the returns to another. Third, persistent differences in groupwise poverty is associated with multiple different identities, some of which are offsetting and some of which are reinforcing. For example, women’s higher education tends to offset the disadvantages associated with being a head of household, while remoteness compounds the disadvantages associated with living in female-headed households. Paper presented at workshop hosted by the Centre for Research on Inequality, Human Security and Ethnicity (CRISE): The Persistence of Inequalities, Department of International Development, University of Oxford, April 4, 2008 In Journal of African Economies 19(4):559-604, August, 2010 Agricultural Policy Impact Analysis: A Seasonal Multi-Market Model for Madagascar December 2006 Stifel, David C. and Jean-Claude Randrianarisoa We describe the main features and results of a multi-market model for Madagascar that focuses on income generating activities in an agricultural sector that is characterized by seasonal variability. We find evidence that investments in rural infrastructure and commercial food storage have both direct and indirect benefits on poor households. In Journal of Policy Modeling 28(9):1023-1027, 2006 Urban-Rural Inequality in Africa July 2003 Sahn, David E. and David C. Stifel In this paper we examine the relative importance of rural versus urban areas in terms of monetary poverty and seven other related living standards indicators. We present the levels of urban-rural differences for several African countries for which we have data and find that living standards in rural areas lag far behind those in urban areas. Then we examine the relative and absolute rates of change for urban and rural areas, and find no overall evidence of declining differences in the gaps between urban and rural living standards. Finally, we conduct urban-rural decompositions of inequality, examining the within versus between (urban and rural) group inequality for asset inequality, education inequality, and health (height) inequality. In Journal of African Economies 12(4):564-597, 2003 Presented at WIDER (World Institute for Development Economics Research) Conference on Spatial Inequality in Africa, University of Oxford, September 21-22, 2002. Stone, Priscilla ‘Moving in Place’: Drought and Poverty Dynamics in South Wollo, Ethiopia February 2006 Little, Peter D., Priscilla Stone, Tewodaj Mogues, Peter Castro, and Workneh Negatu This article discusses the impact of drought on poverty dynamics in the South Wollo area of northeastern Ethiopia. Using both survey and anthropological/qualitative data covering a six-year period, the paper assesses which households were able to hold on to assets and recover from the 1999-2000 drought and which were not. It suggests that while the incidence of poverty changed very little during 1997 to 2003 despite the occurrence of a major drought, the fortunes of the poorest improved, but not enough to keep them from poverty. The study concludes by asking how current policies affect patterns of poverty and inequality and what might be done to improve welfare in South Wollo. In Journal of Development Studies 42(2):200-225, 2006 In Understanding and Reducing Persistent Poverty in Africa, Christopher Barrett, Peter Little, Michael Carter (eds.), Routledge, 2007. Stycos, J. Mayone Integrating Education and Population Policy: The Gender-Equity Payoffs of Reducing Pregnancy-Related Dropouts May 2004 Eloundou-Enyegue, Parfait M., J. Mayone Stycos, and Fatou Jah Plausible arguments suggest that policies to avoid pregnancy-related dropouts can help close gender gaps in education in Africa but these payoffs require quantification. This research uses schooling life tables to simulate how the gender gaps in secondary school completion within 23 sub-Saharan African countries would narrow if these countries reduced the incidence of pregnancy-related dropouts. Results suggest that reducing pregnancy-related dropouts is neither indispensable nor sufficient to close current gender gaps in most cases, yet it could halve these gaps in one third of the countries studied. Swallow, Brent M. Fractal Poverty Traps January 2006 Barrett, Christopher B. and Brent M. Swallow This paper offers an informal theory of a special sort of poverty trap, one in which multiple dynamic equilibria exist simultaneously at multiple (micro, meso and/or macro) scales of analysis and are self-reinforcing through feedback effects. Small adjustments at any one of these levels are unlikely to move the system away from its dominant, stable dynamic equilibrium. Governments, markets and communities are simultaneously weak in places characterized by fractal poverty traps. No unit operates at a high-level equilibrium in such a system. All seem simultaneously trapped in low-level equilibria. The fractal poverty traps formulation suggests four interrelated strategic emphases for poverty reduction strategies. In World Development 34(1):1-15, 2006 Dynamic Poverty Traps and Rural Livelihoods December 2004 Barrett, Christopher B. and Brent M. Swallow This chapter brings together two concepts in development economics: (1) the concept of poverty traps, which explains the co-existence of groups of national economies that continually grow, invest and become prosperous with other groups of economies that stagnate, under-invest and remain poor; and (2) the concept of livelihood strategies, which is used to explain the interconnections between asset portfolios, multiplex strategies of groups and individuals, and outcomes for the welfare of the poor. Implications for applied research, rural development policy and planning are drawn out. In Rural Livelihoods and Poverty Reduction Policies, edited by F. Ellis and H. A. Freeman, London, Routledge, 2004. Swinnen, Johan F. M. Supermarkets, International Trade and Farmers in Developing Countries: Evidence from Madagascar September 2005 Minten, Bart, Lalaina Randrianarison, and Johan F. M. Swinnen Global retail companies (“supermarkets”) have an increasing influence on developing countries, through foreign investments and/or through the imposition of their private standards. The impact on developing countries and poverty is often assessed as negative. In this paper we show the opposite, based on an analysis of primary data collected to measure the impact of supermarkets on small contract farmers in Madagascar, one of the poorest countries in the world. Almost 10,000 farmers in the Highlands of Madagascar produce vegetables for supermarkets in Europe. In this global supply chain, small farmers’ micro-contracts are combined with extensive farm assistance and supervision programs to fulfill complex quality requirements and phyto-sanitary standards of supermarkets. Small farmers that participate in these contracts have higher welfare, more income stability and shorter lean periods. We also find significant effects on improved technology adoption, better resource management and spillovers on the productivity of the staple crop rice. The small but emerging modern retail sector in Madagascar does not (yet) deliver these benefits as they do not (yet) request the same high standards for their supplies. Return to MAIN AUTHORS PAGE

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