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SAGA
B16 MVR Hall
Ithaca, NY 14853
(607) 255-8931
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saga@cornell.edu
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SAGA PUBLICATIONS
Included here are Working Papers and Conference Papers. Publications on this page are organized by geographical focus:
MULTI-COUNTRY
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
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
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)
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
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
Smallholder Market Participation:
Concepts and Evidence from Eastern and Southern Africa
August 2008
Barrett, Christopher B.
This paper reviews the evidence on smallholder market participation, with a focus on staple foodgrains (i.e., cereals) in eastern and
southern Africa, in an effort to help better identify what interventions are most likely to break smallholders out of the semi-subsistence
poverty trap that appears to ensnare much of rural Africa. The conceptual and empirical evidence suggests that interventions aimed at
facilitating smallholder organization, at reducing the costs of intermarket commerce, and, perhaps especially, at improving poorer households’
access to improved technologies and productive assets are central to stimulating smallholder market participation and escape from
semi-subsistence poverty traps. Macroeconomic and trade policy tools appear less useful in inducing market participation by poor smallholders
in the region.
Prepared for FAO workshop on Staple Food Trade and Market Policy Options for Promoting Development in Eastern and Southern Africa, Rome, March 1-2, 2007.
In Food Policy 33(4): 299-317, August, 2008
Interpersonal, Intertemporal and Spatial Variation in Risk Perceptions: Evidence from East Africa
August 2008
Doss, Cheryl, John McPeak, and Barrett, Christopher B.
This study investigates variation over time, space and household and individual
characteristics in how people perceive different risks. Using original data from the arid
and semi-arid lands of east Africa, we explore which risks concern individuals and how
they assess their relative level of concern about these identified risks. Because these
assessments were gathered for multiple time periods, sites, households and individuals
within households, we are able to identify the degree to which risk perceptions vary
across time, across communities, across households within a community, and across
individuals within a household. We find the primary determinants of risk rankings to be
changing community level variables over time, with household specific and individual
specific variables exhibiting much less influence. This suggests that community based
planning and monitoring of development efforts that address risk exposure should be
prioritized. We also find that individuals throughout this area are most concerned about
food security overall, so that development efforts that directly address this problem
should be given the highest priority.
In World Development 36(8): 1453-68 2008
Improving Food Aid’s Impact:
What Reforms Would Yield The Highest Payoff?
July 2008
Lentz, Erin C. and Christopher B. Barrett
Developing an integrated model of the food aid distribution chain, from donor
appropriations through operational agency programming decisions to
household consumption choices we simulate alternative policies and sensitivity
analysis to establish how varying underlying conditions — e.g., delivery costs,
the political additionality of food, targeting efficacy — affect the optimal policy
for improving the well-being of food insecure households. We find that
improved targeting by operational agencies is crucial to advancing food
security objectives. At the donor level, the key policy variable under most
model parameterizations is ocean freight costs associated with cargo preference
restrictions on US food aid. In World Development 36(7): 1152-1172, July, 2008
Challenging Orthodoxies: Understanding Poverty in Pastoral Areas of East Africa
July 2008
Little, Peter D., John McPeak, Christopher B. Barrett and Patti Kristjanson
Understanding and alleviating poverty in Africa continues to receive considerable
attention by a range of diverse actors, including politicians, international celebrities,
academics, activists, and practitioners. Despite the onslaught of interest, there
surprisingly is little agreement on what constitutes poverty in rural Africa, how it should
be assessed, and what should be done to alleviate it. Based on data from an
interdisciplinary study of pastoralism in northern Kenya, this article examines issues of
poverty among one of the continent’s most vulnerable groups, pastoralists, and
challenges the application of such orthodox proxies as incomes/expenditures, geographic
remoteness, and market integration. It argues that current poverty debates ’homogenize‚
the concept of ’pastoralist‚ by failing to acknowledge the diverse livelihoods and wealth
differentiation that fall under the term. The article concludes that what is not needed is
another development label (stereotype) that equates pastoralism with poverty, thereby
empowering outside interests to transform rather than strengthen pastoral livelihoods. Overview Paper for the Policy Research Conference on
“Pastoralism and Poverty Reduction in East Africa,”
held in Nairobi, Kenya, June 27-28, 2006 In Development and Change 39(4), pp. 587-611, 2008
Food Systems and the Escape from Poverty and Ill-Health Traps in Sub-Saharan Africa
May 2008
Barrett, Christopher
Millienium Development Goal #1 is to halve extreme poverty ($1/day per person)
and hunger. Progress toward this goal has been excellent at global level, led by China and
India, but woefully insufficient in sub-Saharan Africa. In Africa, a disproportionate share of the extreme poor are “ultra-poor”, surviving on less than $0.50/day per person, a condition that appears both stubbornly persistent and closely associated with widespread severe malnutrition – “ultra hunger” – and ill health. Indeed, ill health, malnutrition and ultra-poverty are mutually reinforcing states that add to the challenge of addressing any one of them on its own and make integrated strategies essential. Food systems are a natural locus for such a strategy because agriculture is the primary employment sector for the ultra-poor and because food consumes a very large share of the expenditures of the ultra-poor. The causal mechanisms underpinning the poverty trap in which ultra-poor, unhealthy and undernourished rural Africans too often find themselves remain only partially understood, but is clearly rooted in the food system that guides their production, exchange, consumption and investment behaviors. Four key principles to guide interventions in improving food systems emerge clearly. But there remains only limited empirical evidence to guide detailed design and implementation of strategies to develop African food systems so as to break the lock of poverty and ill-health traps. This paper was prepared for the Cornell University and United Nations University Symposium on The African Food System and its Interactions with Health and
Nutrition, held at the United Nations, New York City, November 13, and at Cornell University,
November 15, 2007.
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.
Poverty Traps and Resource Dynamics In
Smallholder Agrarian Systems
April 2008
Barrett, Christopher B.
Poverty traps and resource degradation in the rural tropics appear to have multiple and complex, but similar, causes. Market imperfections, imperfect learning, bounded rationality, spillovers, coordination failures and economically dysfunctional institutions all play a role, to varying degrees in different places and times. Pinning down these mechanisms empirically remains a challenge, however, but one essential to the design of appropriate interventions for reducing poverty and environmental degradation in areas where livelihoods depend heavily on natural resources. Prepared for the international conference on
“Economics of Poverty, Environment and Natural Resource Use,”
held at Wageningen University, the Netherlands, May 17-19, 2006
Chapter 2 in Economics of Poverty, Environment and Natural Resource Use, A. Ruijs, R. Dellink, eds., Springer.
Policy Impacts on Schooling Gender Gaps in Developing Countries: The Evidence and a Framework for Interpretation
February 2008
Glick, Peter
In many regions of the developing world girls continue to receive less education than boys.
This paper reviews the evidence on the effects of policies in the education sector and
outside it on household schooling investments in girls and boys, distinguishing between
policies that are ostensibly gender neutral and those that explicitly target girls. It is
frequently (but certainly not universally) found that the demand for girl’s schooling is
more responsive than boys’ to gender neutral changes in school cost or distance as well as
quality. Although these patterns can be interpreted in terms of parental preferences, this
paper shows that they can also plausibly be explained within a human capital investment
framework through assumptions about the nature of schooling cost and returns functions.
Among these policies, increasing the physical accessibility of schools emerges as a
measure that may result in disproportionate enrollment gains for girls. Where gender gaps
are large or persistent, however, direct targeting of girls is probably necessary. Formal
evidence from a number of demand or supply side interventions, including subsidies to
households and to schools to enroll girls and the provision of girls-only schools, suggests
the potential for targeted measures to yield substantial gains for girls. Many other policies,
such as subsidized childcare or flexible school scheduling that address the opportunity
costs of girls’ time, hold promise but for the most part have yet to be subject to rigorous
assessment. The paper discusses methodological problems in such assessments and
concludes with suggestions for future research on policies to close schooling gender gaps.
This is an expanded version of a paper published in World Development 36(9): 1623-46, 2008.
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.
Displaced Distortions:
Financial Market Failures and Seemingly Inefficient Resource Allocation
in Low-income Rural Communities
July 2007
Barrett, Christopher B.
Poor households in rural areas of the developing world commonly lack access to (formal or informal) credit or insurance. These financing constraints naturally spill over into other behaviours and (asset, factor and product) markets as households rationally exploit other market and non-market resource allocation mechanisms to resolve, at least partly, their financing problems. These displaced distortions of financing constraints commonly manifest themselves in allocative inefficiency that may lead researchers and policymakers to mistakenly conclude that poor households routinely make serious allocation errors and to direct policy interventions towards the symptoms manifest in other markets rather than towards the root financial markets failures cause.
July 2007 draft for festschrift volume in honor of Arie Kuyvenhoven
In Development Economics Between Markets and Institutions: Incentives for Growth, Food Security and Sustainable Use of the Environment, Bulte, Erwin and Ruerd Ruben, eds.,
Wageningen, The Netherlands: Wageningen Academic Publishers
Reproductive Health and Behavior, HIV/AIDS, and Poverty in Africa
May 2007
Glick, Peter
This paper examines the complex linkages of poverty, reproductive/sexual health and
behavior, and HIV/AIDS in Africa. It addresses the following questions: (1) what have we
learned to date about these links and what are the gaps in knowledge to be addressed by
further research; (2) what is known about the effectiveness for HIV prevention of
reproductive health and HIV/AIDS interventions and policies in Africa; and (3) what are the
appropriate methodological approaches to research on these questions. With regard to what
has been learned so far, the paper pays considerable attention in particular to the evidence
regarding the impacts of a range of HIV interventions on risk behaviors and HIV incidence.
Other sections review the extensive microeconomic literature on the impacts of AIDS on
households and children in Africa and the effects of the epidemic on sexual risk behavior and
fertility decisions. With regard to methodology, the paper assesses the approaches used in
the literature to deal with, among other things, the problem of self-selection and non-
randomness in the placement of HIV and reproductive health programs. Data requirements
for different research questions are discussed, and an effort is made to assess what
researchers can learn from existing sources such as Demographic and Health Surveys.
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
Forthcoming in edited volume published by the African Economic Research Consortium, Nairobi, Kenya
Understanding the Differential Impact of Institutions and Institutional Interventions on Smallholder Behavior and Livelihoods in Rural Ethiopia
May 2007
Liverpool, Saweda Onipede, Alex Winter-Nelson and Shahidur Rashid
This paper focuses on making the case that: 1) there is differential impact of modern technology adoption on livelihoods for rural households of different asset poverty typologies; 2) this difference can be explained in part, by the differential impact of services provided by various institutions on participation in these modern agriculture practices amongst rural households in different poverty classes; 3) there is a need to assess more closely the nature of constraints faced by different classes of poor agricultural households and the packages offered by different institutional interventions geared towards encouraging farmer participation in various agricultural practices expected to increase their productivity and improve livelihood; and 4) this analysis shows that recognizing target group differences (e.g. using asset poverty typologies) are an important consideration in program development as well as program evaluation. Prepared for the AERC-Cornell Conference on “Bottom-Up Interventions and Economic Growth in Sub-Saharan Africa,” May 31-June 1, 2007,
Nairobi, Kenya
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
Bayesian Herders:
Updating of Rainfall Beliefs In Response To External Climate Forecasts
March 2007
Lybbert, Travis J., Christoper Barrett, John G. McPeak, and Winnie K. Luseno
Temporal climate risk weighs heavily on many of the world’s poor. Model-based climate
forecasts could benefit such populations, provided recipients use forecast information to update
climate expectations. We test whether pastoralists in southern Ethiopia and northern Kenya update
their expectations in response to forecast information. The minority of herders who received these
climate forecasts updated their expectations for below normal rainfall, but not for above normal
rainfall. This revealed preoccupation with downside risk highlights the potential value of better
climate forecasts in averting drought-related losses, but realizing any welfare gains requires that
recipients strategically react to these updated expectations.
In World Development 35(3):480-497
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
Can Information Campaigns Eradicate AIDS? The Effect of HIV Knowledge and Risk Behavior on HIV Status: The Case of Three Sub-Saharan Countries
February 2007
Frölich, Markus and Rosalia Vazquez-Alvarez
AIDS continues to have a devastating effect on many developing economies, par-
ticularly in Sub-Saharan Africa. Given the lack of a vaccine to stop HIV transmission and
the very expensive medical treatment, most public policy emphasis has been placed on edu-
cation and particular information campaigns. In this paper, we examine the impact of AIDS
education from two sides. First, we examine to what extent information campaigns have been
successful in reducing HIV prevalence and incidence. Second, we examine the impact of actual
AIDS knowledge on HIV rates. The basic policy issue can be expressed as follows: Suppose
that everyone knew and understood the basic facts about AIDS, would this reduce HIV rates
to (almost) zero? If so, public policy should target groups with incomplete knowledge. If not,
information campaigns alone are bound to fail and much stronger interventions are required
to eradicate AIDS. Using rich data sets from three Sub-Saharan economies (Kenya, Tanzania
and Ethiopia) we investigate the effect of observed HIV related knowledge on the probability
of catching the virus using data on individuals. Our analysis controls for detailed individual
specific characteristics including variables reflecting innate risk behaviour that may drive the
risk of becoming HIV positive irrespective of HIV related health knowledge. We examine fur-
ther how these effects differ between different groups, thereby identifying target groups that
public information campaigns should direct more attention to. Results so far are preliminary.
Prepared for the AERC-Cornell Conference on “Bottom-Up Interventions and Economic Growth in Sub-Saharan Africa,” May 31-June 1, 2007,
Nairobi, Kenya
Labor Market Activities and Fertility
December 2006
Younger, Stephen D.
“This paper focuses on one aspect of the demographic transition, women’s labor market
activity, and how it relates to the basic variables of fertility and poverty. Just as there
are differences in fertility and mortality in rich and poor countries, there are
differences in women’s time use. In rich countries, women tend to work outside the
home, usually in wage employment on a fixed hourly schedule. In poor countries,
women tend to work at home or, especially in Africa, on their family’s farm or at own-
account activities where time use is more flexible. Understanding the relationship
between the demographic transition and these differences in time use is our main
theme...”
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
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.
An Ordered Tobit of Market Participation: Evidence from Kenya and Ethiopia
May 2006
Bellemare, Marc F. and Barrett, Christopher B.
Do rural households in developing countries make market participation and volume
decisions simultaneously or sequentially? This article develops a two-stage
econometric model that allows testing between these two competing hypotheses
regarding household-level market behavior. The first stage models the household’s
choice of whether to be a net buyer, autarkic, or a net seller in the market. The
second stage models the quantity bought (sold) for net buyers (sellers) based on observable
household characteristics. Using household data from Kenya and Ethiopia
on livestock markets, we find evidence in favor of sequential decision-making, the
welfare implications of which we discuss.
In American Journal of Agricultural Economics 88(2):324-337, May, 2006
Understanding and Reducing Persistent Poverty in Africa
February 2006
Barrett, Christopher B., Michael R. Carter and Peter D. Little
This paper introduces a special issue exploring persistent poverty in sub-Saharan Africa. As a set, these papers break new ground in exploring the dynamics of structural poverty, integrating qualitative and quantitative methods of analysis and adopting an asset-based approach to the study of changes in well-being, especially in response to a wide range of different (climatic, health, political, and other) shocks. In this introductory essay, we frame these studies, building directly on evolving conceptualisations of poverty in Africa.
In Journal of Development Studies 42(2): 167-177, lead article
In Understanding and Reducing Persistent Poverty in Africa, Christopher Barrett, Peter Little, Michael Carter (eds.), Routledge, 2007.
The Economics of Poverty Traps and Persistent Poverty: An Asset-Based Approach
February 2006
Carter, Michael R. and Christopher B. Barrett
Longitudinal data on household living standards open the way to a deeper analysis of the
nature and extent of poverty. While a number of studies have exploited this type of data
to distinguish transitory from more chronic forms of income or expenditure poverty, this
paper develops an asset-based approach to poverty analysis that makes it possible to
distinguish deep-rooted, persistent structural poverty from poverty that passes naturally
with time due to systemic growth processes. Drawing on the economic theory of poverty
traps and bifurcated accumulation strategies, this paper briefly discusses some feasible
estimation strategies for empirically identifying poverty traps and long term, persistent
structural poverty. We also propose an extension of the Foster-Greer-Thorbecke class of
poverty measures to provide a natural measure of long-term welfare status. The paper
closes with reflections on how asset-based poverty can be used to underwrite the design
of persistent poverty reduction strategies.
In Journal of Development Studies 42(2):178-199, 2006
In Understanding and Reducing Persistent Poverty in Africa, Christopher Barrett, Peter Little, Michael Carter (eds.), Routledge, 2007.
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
Reforming the Formula:
A Modest Proposal for Introducing Development Outcomes in IDA Allocation
Procedures
September 2005
Kanbur, Ravi
This paper develops a modest proposal for introducing final outcome indicators in the
IDA aid allocation formula. It starts with a review of the current formula and the rationale
for it. It is argued that this formula, and in particular the Country Policy and Institutional
Assessment (CPIA) part of it, implicitly relies too heavily on a uniform model of what
works in development policy. Even if this model were valid "on average", the variations
around the average make it an unreliable sole guide to the country-specific productivity
of aid in achieving the final objectives of development. Rather, it is argued that changes
in the actual outcomes on these final objectives could also be used as part of the
allocation formula. A number of conceptual and operational objections to this position
are considered and debated. The paper concludes that there is much to be gained by
taking small steps in the direction of introducing outcome variables in the IDA formula,
and assessing the experience of doing so in a few years time.
In Revue d’Economie du Developpement: 2005/2-3 September, Special Issue on Grounds, Allocation and Impact of Aid, AFD/EUDN Conference 2004, pp. 79-99
Improvements in Childrens 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.
Scaling up HIV Voluntary Counseling and Testing in Africa: What Can
Evaluation Studies Tell Us About Potential Prevention Impacts?
August 2005
Glick, Peter
Although there is a widespread belief that scaling up HIV voluntary testing and counseling
(VCT) programs in Africa will have large prevention benefits through reductions in risk
behaviors, these claims are difficult to establish from existing evaluations of VCT.
Considerations from behavioral models and the available data suggest that as VCT coverage
expands marginal program effects are likely to decline due to changes in the degree of client
selectivity, and that potential uptake among those at highest risk is uncertain. The paper also
assesses two other common perceptions about VCT in Africa: that a policy of promoting
couples-oriented VCT would be more successful than one emphasizing individual testing, and
that VCT demand and prevention impacts will be enhanced where scaling up is accompanied by
the provision of anti-retroviral drugs.
In Evaluation Review 29(4): 331-357, August 2005
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
Food Aid Targeting, Shocks and Private Transfers Among East African Pastoralists
July 2005
Lentz, Erin and Christopher B. Barrett
Public transfers of food aid are intended largely to support vulnerable
populations in times of stress. We use high frequency panel data among
Ethiopian and Kenyan pastoralists to test the efficacy of food aid targeting
under three different targeting modalities, food aid’s responsiveness to
different types of covariate shocks, and its relationship to private transfers.
We find that, in this region, self-targeting food-for-work or indicatortargeted
free food distribution more effectively reach the poor than do food
aid distributed according to community-based targeting. Food aid flows do
not respond significantly to either covariate, community-level income or
asset shocks. Rather, food aid flows appear to respond mainly to more
readily observable rainfall measures. Finally, food aid does not appear to
affect private transfers in any meaningful way, either by crowding out
private gifts to recipient households nor by stimulating increased gifts by
food aid recipients.
Organizational Culture, Performance and Public Sector Reforms in Africa:
The Ghanaian Case
July 2005
Francis Owusu
Public sector reform programs implemented across Africa, including the World Bank’s “first” and ‘second” generation reforms, are based on the assumption that all public organizations are
inefficient. This paper argues that this assumption is problematic and has had significant
implications for policy. By failing to recognize that not all public organizations perform poorly,
we ignore any potential lessons that could have been learnt from the experiences of organizations
that have managed to perform effectively under the same social, political, economic and
institutional environment. The study is based on the premise that the performance of an
organization is influenced by the culture within the organization—which results from the ways in which
organizations adapts to the external environment and the ways they ensure internal integration. Some
organizations develop cultures that support, encourage and reward high performance; whereas others
adopt a culture that perpetuates poor performance. Thus, public-sector reforms must be viewed as
changing, or in some cases sustaining, organizational culture. Using Ghana as a case study, the study
highlights lessons that can be learnt from studying differences in the performances of public
organizations. It focuses on three-related issues. First, it addresses one major flaw of past reform
policies—the assumption that all public organizations are ineffective. Second, it explores the relationship
between organizational culture and performance. Third, it provides broad outlines of a comprehensive
public sector reform strategy, centered on changing organizational cultures. Presented at the International Conference on "Shared Growth in Africa," July 21-22, 2005,
Accra, Ghana
Risk and Asset Management in the Presence of Poverty Traps: Implications for Growth and Social Protection
June 2005
Barrett, Christopher B. and Michael R. Carter
This note suggests a behavioral approach to poverty and vulnerability that escapes the standard, troublesome dependence on an arbitrary money-metric poverty line. More importantly, our approach, which is based on an empirically estimable dynamic asset poverty threshold, has immediate implications for both the linkage between poverty, risk and growth and for the design of social protection policies. One can identify the dynamic asset poverty threshold either by testing for asset smoothing behavior or via tests for bifurcated/split accumulation dynamics. We illustrate the concept and the estimation of dynamic asset poverty thresholds through brief applications to Ethiopia and Honduras.
Can Africa Achieve Millennium Development Growth Targets Through Effective
Negotiations of the Doha Development Mandate?
June 2005
William A. Amponsah
The general consensus of opinion in international economic development circles
is that Africa is lagging far behind in global efforts to meet the Millennium Development
Goals (MDGs) by its target date of 2015. Africa is still far from reaching the targeted
goal of an annual growth rate above 7 percent a year required to achieve economic
convergence with other developing countries and to maintain similar quality of life. In
particular, sub-Saharan Africa (SSA) has seen poverty rise and life expectancy decline in
the five years since the Goals were declared in 2000 (United Nations Economic
Commission for Africa, 2005). But achieving the MDGs would provide a unique
opportunity for Africa and its development partners to seriously tackle the important
issue of reducing endemic poverty for the continent. Presented at the International Conference on "Shared Growth in Africa," July 21-22, 2005,
Accra, Ghana
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
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
Costs and Financing of Basic Education and Participation of Rural Families and Communities in Third-World Countries
April 2005
Assié-Lumumba, NDri
This paper focuses on the various types of educational costs, expenses, and financing and the roles of
families and communities. It presents a case study of educational costs
and financing in rural communities in countries around the world, then focuses
on the case of Côte d’Ivoire before the December 1999 Military coup followed by armed
conflicts that started in 2002 leading to the de facto division of the country. The paper considers the substantive and more general family and community participation in the educational process beyond material support. The conclusion
summarizes the main findings and points to new areas of research using comparative
approach. It is however likely that, while the political configuration may change, the administrative
structure that constitutes the framework for educational policy will remain the same.
Therefore this analysis has relevance even for the post-conflict reconstruction and
implementation of education policy implementation including past and new types of
community schools.
Rural Poverty Dynamics: Development Policy Implications
March 2005
Barrett, Christopher B.
This paper summarizes a few key findings from a rich and growing body of research on the nature of rural poverty and, especially, the development policy implications of relatively recent findings and ongoing work. Perhaps the most fundamental lesson of recent research on rural poverty is the need to distinguish transitory from chronic poverty. The existence of widespread chronic poverty also raises the possibility of poverty traps. I discuss some of the empirical and theoretical challenges of identifying and explaining poverty traps. In policy terms, the distinction between transitory and chronic poverty implies a need to distinguish between "cargo net" and "safety net" interventions and a central role for effective targeting of interventions. Prepared for invited presentation to the 25th International Conference of Agricultural Economists, August 17, 2003, Durban, South Africa.
In Reshaping Agricultures Contributions to Society, David Colman and Nick Vink (eds.), Oxford: Blackwell, 2005
Growth, Inequality and Poverty: Some Hard Questions
March 2005
Kanbur, Ravi
This commentary poses a series of progressively harder questions in the economic analysis of growth, inequality and poverty. Starting with relatively straightforward analysis of the relationship between growth and inequality, the first level of hard questions come when we ask what policies and institutions are causally related to equitable growth. Some progress is being made here by the economics literature, but relatively little is known about the second level, harder questionshow a society comes to acquire "good" policies and institutions, and what exactly it is that we are buying into when we accept the number one Millennium Development Goal of the United Nationshalving the incidence of income poverty by the year 2015. In Journal of International Affairs 58(2): 223-232, 2005
On the Relevance of Identities, Communities, Groups and Networks to the Economics of Poverty Alleviation
January 2005
Barrett, Christopher B.
In The Social Economics of Poverty: Identities, Groups, Communities and Networks, Christopher B. Barrett (ed.), London: Routledge, 2005:
This book aims to advance economists’ understanding of such questions
by exploring how individuals’ social and moral identities affect their
membership in communities, groups, and networks, how those identities and
social affiliations affect microeconomic behavior, and how the resulting
behaviors affect poverty. Humans do not live in isolation: their behavior
depends on the relations that shape their world. Variation in relationships can
perhaps lead to predictable variation in behaviors and economic outcomes,
which, in turn, affect social relationships through subtle feedback mechanisms.
Partly as a consequence, the dynamics of human social interactions and the
effects on persistent poverty have become a very active area of economic
research.
Paretos Revenge
January 2005
Kanbur, Ravi
Consider a project or a policy reform. In general, this change will create winners
and losers. Some people will be better off, others will be worse off. Making an overall
judgment on social welfare depends on weighing up the gains and losses across
individuals. How can we make these comparisons? In the 1930s, a strong school of
economic thought led by Lionel Robbins held that economists qua economists have no
business making such judgments. They only have a basis for declaring an improvement
when no such interpersonal comparisons of gains and losses are involved. Only a change
which makes nobody worse off and at least one person better off, can be declared an
improvement.
Such a change is called a Pareto Improvement (PI). If no such changes are
possible, the state of affairs is described as being Pareto Efficient (PE), a Pareto
Optimum, or Pareto Optimal (PO). Named after Vilfredo Pareto, PI and PE are central to
post 1945 high economic theory. After all, PE makes an appearance in the two
fundamental theorems of Welfare Economics. These are that every competitive
equilibrium (CE) is PE, and every PE allocation can be achieved as a CE, under certain
conditions. Through these theorems, the post second world war economic theory of
Kenneth Arrow and Gerard Debreu links back to Lionel Robbins and Vilfredo Pareto,
and thence to Adam Smiths Invisible Hand of competitive markets. From there the links
come full circle back to stances taken in current policy debates on the role of markets and
government.
In Journal of Social and Economic Development 7(1): 1-11, 2005
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.
The African Peer Review Mechanism (APRM):
An Assessment of Concept and Design
November 2004
Kanbur, Ravi
The African Peer Review Mechanism (APRM) has been proposed as a key
element of the New Partnership for Africas Development (NEPAD). It is important that the APRM be thoroughly debated in terms of concept and design. This paper is a contribution to the debate. The paper derives design criteria for peer review mechanisms after looking at some functioning examples. These criteria areCompetence, Independence, and Competition. It is argued that while the APRM is a welcome addition to pan-African institutional structure, its design will have to be improved for it to be truly successful. First, APRM should greatly narrow the scope of its reviews if it is to deliver competent assessments. Second NEPAD should devote significant resources to allow
civil society in the reviewed country to do assessments of their own, and to critique the APRM assessment. In Politikon 31(2):157-166, November, 2004
Are wealthier nations healthier nations? A panel data approach to the determination of human development in Africa
October 2004
Issidor Noumba Many authors did not expect a bright future for the sub-Saharan African countries at
the outset of independence in the 1960s. Today, when we look at the African economic, social,
and political indicators, we notice that these authors were right. African countries continue to
tail the list of developing countries as far as human development is concerned. Poverty is
endemic in the region, HIV/AIDS and traditional infectious diseases constitute a serious
threat to African health status. Life expectancy at birth is very low and HIV/AIDS prevalence
very high.
Assuming that health status indicators are good proxies of human development, this
paper intends to answer the following queries: (i) What is the extent of health disparities in
Africa? (ii) Are wealthier African nations healthier nations? (iii) What are the main
determinants of the health status in Africa. The incipient renewal of concern for poverty and
equity in health leads us also to ask ourselves whether income inequality and inequality in
health status are significant determinants of health outcomes.
A simple descriptive statistics analysis show that health status seems to vary not only
across countries, but also according to the level of economic development. The paradox story
is that wealthier African nations are not necessarily healthier nations. We use the
econometrics of panel data to estimate one version of the traditional production function of
the health services. The results of our estimates show that GNP per capita is an important
determinant of health outcome. Wealthier nations are not always healthier nations, but wealth
(income) matters for health. Income inequality and inequality in health status are also
strongly correlated with the health status indicators. At the end of the day, the study show that
income and inequalities are important determinants of human development in Africa. 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
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
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
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
Multilateral Organisations: Instruments for Donors Foreign Policy?
October 2004
Espen Villanger The empirical literature on foreign aid emphasizes that foreign policy objectives are
important motivations for giving multilateral aid (Cassen 1994, Alesina and Dollar
2000). Some of the recipients that receive the most aid per capita do so because they are
favored in bilateral aid relationships due to their strategic importance. However, the
opportunity for a donor country to use a multilateral organization strategically to
promote its own policy goals has received far less attention. The gain to a donor that is
able to make the World Bank or other multilaterals adapt to this donor’s view on an
issue can be substantial. In that case, all the contributions from the other member
nations will also stand behind the multilateral organizations’ stance in the particular
issue, and recipients may feel compelled to comply with this massive counterpart. Thus,
influencing the multilaterals may give much more leverage to a donor’s foreign
assistance on the foreign policy arena compared to pursuing the same goals bilaterally
with the same amount of aid. The U.S. General Accounting Office indicates the
potential for increased influence when they state that about $2 billion in U.S. paid
capital had supported World Bank loans of nearly $286 billion through cofinancing with
other donors and the private sector. So, if the GOA is right in asserting that U.S. with its
22% of the total donor support to the World Bank is able to take the leadership in
setting the bank’s agenda, then there is little doubt that this strategic behavior can be
effective in achieving U.S. foreign policy goals...
However, even if the principal-agent framework is the work-horse of the
theoretical literature on foreign aid, this literature does not address how some donors’
can be able to influence the objectives of the multilaterals in order to achieve their aims
for the recipient. This gap in the literature is unfortunate since this type of strategic
behavior rise several important questions. First, which mechanisms allows for this type
of interactions? Second, how will this type of influence change the aid allocation of the
other donors? Third, what implications can we draw with regards to improving the
efficiency of the multilateral infrastructure in general?
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
Infrastructure privatisation and poverty reduction in Africa
October 2004
Afeikhena Jerome and Ademola Ariyo Despite the perceived role of efficient infrastructure as critical element for economic
growth, poverty reduction and the attainment of the millennium development goals, there
is clear evidence that the provision of infrastructure in Africa has been much below standard
in terms of quantity and quality. Over the past decade, there has been a change in the
perception of the roles of the public and private sectors in infrastructure development. This
study evaluates the linkages between infrastructure reform and poverty reduction in Africa.
The findings indicate that the results of a decade of regulatory reform, implementation of
the privatization and liberalization agenda, combined with the influx of private
investment in infrastructure have decidedly been mixed. In spite of modest achievements,
especially in telecommunications, there has been a gap between popular perceptions and
reality on ground. Africa’s atypical experience and unique socioeconomic characteristics
are such that the policy preconditions that are indispensable for effective liberalization
and privatization are rarely met. Overall, infrastructure privatization has proceeded
without adequate consideration being given to the needs of the poor. Even in
telecommunications where privatization has improved national access to services through
network expansion, weak regulation has had a negative impact on the poor through poor
service quality and service cutbacks. There is now a significant base of experience around
the world from which lessons can be learned. Infrastructure privatization should be
viewed as a means to an end, and not an end in itself. The goal should be a more efficient
sector delivering quality service while fulfilling its social responsibilities. Privatization is
only an effective means towards the achievement of this goal if it is done in the context
of an appropriate market and regulatory 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
Food Security, Agricultural Technology and Policy - The Case of Maize in Sub-Saharan Africa
October 2004
Göran Djurfeldt and Rolf Larsson This paper deals with the importance of agricultural policy and technology for farmers’
food security and market integration. We draw on data recently collected in interviews
with over 3000 farmers in eight sub-Saharan African countries. The results indicate
that the food production among African smallholders is highly responsive to increased
use of industrial inputs and to marketing opportunities for food crops. In the absence of
a favourable macro environment enhancing increased use of inputs, however, the
majority of farmers remain stuck in poverty and are barely able to meet their own food
needs. In the following we will use maize as an example to demonstrate the crucial role
of the African state in providing the necessary macro conditions for realising the
production potential inherent in increased technology adoption and increased
commercialisation of staple production. This conclusion suggests that development
options in African agriculture are different from those often surmised in the general
development debate. Hence, we argue that policy makers in governments and among
donors often work from assumptions that badly fit existing realities in African
agriculture. We criticise a number of tendencies that recur in debates on agricultural
development in sub-Saharan Africa. They are not internally consistent, and they
seldom occur together, since they typically are associated with different types of actors. 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
Youth labour markets in Africa
October 2004
Murray Leibbrandt and Cecil Mlatsheni This paper makes use of a review of the literature on African labour markets, the
international literature on youth and the labour market and a fifteen country African
data set to analyze the current situation of youth in sub-Saharan labour markets.
Economies in Sub-Sahara Africa are generally viewed as having achieved poor
economic growth over the past four decades or so (Bigsten 1996, Collier & Gunning
1999, Kaplan 1996). This has had an adverse impact on poverty and inequality. On the
whole per capita incomes have fallen since the early 1970s (ADB 1997). Some of the
reasons cited in this literature for the poor growth performance of sub-Saharan Africa
include: lack of openness to trade, lack of financial depth, deficient public services, lack
of social capital, high incidence of shocks and misguided economic policy. The
process of economic development involves the allocation of labour within sectors and
the reallocation of labour between sectors and to the extent that this process is
impeded, the transformation of the economy is slowed and made less efficient (Bigsten
and Horton 1997). Thus the functioning of the labour market is central to economic
growth, income distribution and poverty alleviation and is thus an important (if not the
most important) prong in the various areas that should be considered for policy
intervention. 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
Implications of Genetically Modified Food
Technology Policies for Sub-Saharan Africa
October 2004
Kym Anderson and Lee Ann Jackson The first generation of genetically modified (GM) crop varieties sought to
increase farmer profitability through cost reductions or higher yields. The next generation
of GM food research is focusing also on breeding for attributes of interest to consumers,
beginning with ‘golden rice’, which has been genetically engineered to contain a higher
level of vitamin A and thereby boost the health of unskilled laborers in developing
countries. This paper analyzes empirically the potential economic effects of adopting
both types of innovation in Sub-Saharan Africa (SSA). It does so using the global
economy-wide computable general equilibrium model known as GTAP. The results
suggest that the welfare gains are potentially very large, especially from nutritionally
enhanced GM rice and wheat, and that – contrary to the claims of numerous interests –
those estimated benefits are diminished only slightly by the presence of the European
Union’s current barriers to imports of GM foods. In particular, if SSA countries impose
bans on GM crop imports in an attempt to maintain access to EU markets for non-GM
products, the loss to domestic consumers due to that protectionism boost to SSA farmers
is far more than the small economic gain for those farmers from greater market access to
the EU. 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
Foreign aid and population growth: evidence from Africa
October 2004
Leonid Azarnert This paper investigates the relationship between foreign aid and population growth in Sub-Saharan Africa. Using a panel of African countries over the last four decades, it demonstrates the positive effect of foreign aid on fertility and population growth in this region. 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
Financial Intermediation and Access to Finance in African Countries South of the Sahara
October 2004 Neren Rau
This paper describes the status of financial systems for a number of African countries south of the Sahara, identifying various problems that hinder access to finance, especially for the poor, and subsequently those issues that deter economic performance and development. The countries surveyed were selected on the basis of a range of criteria including: geographical spread, economic size and development, level of financial market development and availability of information. Although Angola, Botswana, Gabon, Ethiopia, Kenya, Mauritius, Mozambique, Nigeria, Senegal and South Africa are the focus countries of this survey, many of the scenarios presented in this paper are applicable to other African countries south of the Sahara. Broad policy measures to tackle the bottlenecks that currently undermine financial systems' responsiveness to the needs of the real economic sector are recommended. 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
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
Financial Development, Political Institutions and Economic Growth in the ECOWAS Sub-Region: An Empirical Analysis
July 2004
George A. Dampare and Jennifer Piesse The enormous cross-country differences in economic development and growth in
recent years, have led to a resurgence of research interest in the determinants of
economic growth, a subject which has been extensively debated. The resultant
literature contains competing explanations of economic development and growth and
the notable ones are the roles of institutions (Easterly and Levine, 2003; and Rodrik
et al 2002), importance of geography, culture and history (Acemoglu et al. 2001) and
quality of macroeconomic policies (Frankel and Romer, 1999; Aryeetey and Fosu,
2002; and Berg and Krueger, 2003). A common characteristic of the series of
research papers that have examined this issue is that they relate to a combination of
developed and developing countries. Interestingly, the results have been very
persuasive, but not conclusive and this characterizes the issue as one of continuous
research importance. Presented at the ISSER-University of Ghana-Cornell University International Conference on "Ghana at the Half Century," July 18-20, 2004, Accra, Ghana
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.
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
Smallholder Identities and Social Networks:
The Challenge of Improving Productivity and Welfare
April 2004
Barrett, Christopher B.
This paper proposes a general framework for resolving the puzzle of how to reconcile the mass of recent evidence on the salutary effects of social capital at the individual level with the casual, larger-scale observation that social embeddedness appears negatively correlated with productivity and material measures of welfare. It advances an analytical framework that not only explains individual productivity or technology adoption behavior as a function of the characteristics or behaviors of others, but that also explains the aggregate properties of social systems characterized by persistently low productivity. Examples from Kenya and Madagascar are used to illustrate the phenomena discussed.
In The Social Economics of Poverty: Identities, Groups, Communities and Networks, Christopher B. Barrett, editor, London: Routledge, 2005.
Mixing Qualitative and Quantitative Methods of
Analyzing Poverty Dynamics
March 2004
Barrett, Christopher B.
This paper outlines my current thinking and recent experience in mixing qualitative and quantitative methods of data collection and analysis so as to gain a firmer and more useful understanding of poverty dynamics, especially in rural Kenya. We first explore the very real differences between qualitative and quantitive poverty analysis methods, differences that make them useful complements. Then we debunk a few myths about differences that do not really exist. Finally, I discuss key lessons learned from four multi-year research projects in Kenya that have tried to implement mixed qualitative and quantitative research methods with a range of researchers from animal science, anthropology, economics, geography, range science, sociology and soil science.
In Quantitative and Qualitative Methods for Poverty Analysis: Proceedings of the Workshop Held on 11 March, 2004, Nairobi Kenya,
Walter Odhiambo, John M. Omiti, and David I. Muthaka, editors,
Nairobi, Kenya: Kenya Institute for Public Policy Research and Analysis (KIPPRA)
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.
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