SAGA Progress Report-2004-Annex-Research-Kenya

s SAGA Progress Report-2004-Annex-Research-Kenya

SAGA
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SAGA PROGRESS REPORT (12/03-12/04) &
UPCOMING WORKPLAN (1/05-12/05)

ANNEX

II. RESEARCH
B. KENYA

By African standards, Kenya enjoys relative abundance of good quality primary data for economic analysis and of skilled researchers doing rigorous, policy-relevant research. SAGA seeks to exploit this comparative advantage through a decentralized design that draws in work from several able economic research institutions in Kenya. SAGA also tries to use this team approach to help improve coordination of policy research and outreach in Kenya through the advancement of a nascent Kenya Policy Research and Outreach Forum (K-PROF). The aim of the individual and collective research efforts and the emergence of K-PROF is to inform debate on high profile policy questions, such as those that underpin the government’s Kenya Rural Development Strategy (KRDS) and Poverty Reduction Strategy Paper (PRSP).

Kenya: Previous Activities

The PRSP has identified agricultural and rural development as Kenya’s number one priority for poverty alleviation and economic growth. The KRDS has emphasized problems of risk and vulnerability, market access, and smallholder empowerment as central to agricultural and rural development. USAID-Kenya is actively addressing these issues through its own program of work (under Mission SOs 6 and 7). Toward those ends, the SAGA-Kenya research program is organized as a set of subsidiary research projects conducted by a consortium of research institutions around two core, interrelated sub-themes: “Reducing risk and vulnerability in rural Kenya” and “Empowering the rural poor”.

SAGA-Kenya Research Program

Research under these sub-themes has been ongoing for more than a year.

Reducing Risk and Vulnerability in Rural Kenya

Under this theme, the team is pursuing interrelated sub-projects on the following subthemes, and expects to hold a policy workshop in the first half of 2005:

The role of producer organizations in reducing smallholder vulnerability: Led by Tegemeo, this sub-project analyzes the impact of producer organizations on smallholder market access and vulnerability to income shocks, price and yield volatility, identifying what organizational functions prove most effective and how these functions are most efficiently and reliably provided, especially to poorer smallholders.
Agricultural marketing systems, price volatility and vulnerability of smallholder producers and poor consumers: Led by the Kenya Institute for Public Policy Research and Analysis (KIPPRA), this sub-project studies changing marketing systems and household strategies for coping with market risk, seeking in particular to explain and identify effective strategies to reverse the apparent widespread retreat toward subsistence production by many smallholders. The KIPPRA project is augmented by Cornell-Syracuse research on livestock markets and price risk faced by pastoralists in the arid and semi-arid lands of northern Kenya.
Improving factor market access to reduce rural vulnerability: Led by the University of Nairobi’s Department of Agricultural Economics, this research focuses in particular on rural land and finance markets, and how increasing land pressure and conflict and the changing shape of liberalizing financial sectors affect smallholders’ security of access to land.
Safety nets in marginal areas: Led by Cornell and Clark Atlanta, with collaboration from Syracuse University (all with non-SAGA funding), this subproject focuses on the interrelationship between public safety nets such as food aid and livestock destocking/restocking programs, and private assistance schemes based on social insurance mechanisms, informal lending and altruistic transfers, particularly in arid and semi-arid areas especially prone to climate, conflict and market shocks.

Empowering the Rural Poor

Under the SAGA-Kenya’s second theme, the team is pursuing interrelated sub-projects on the following sub-themes, and expects to hold a policy workshop in July-August 2004:

The role of producer organizations in enhancing smallholder market participation: Led by Tegemeo, this sub-project is identifying appropriate institutional frameworks for producer organizations so as to enhance small farmers’ participation and efficiency in input and output markets. The Tegemeo project is augmented by dissertation research by a Kenyan economics Ph.D. candidate at Cornell, Andrew Mude, doing closely related research in Muranga District on why coffee cooperatives appear vulnerable to elite capture, undermining the intended empowerment of poor growers.
Decentralization and participation: Led by the Institute of Policy Analysis and Research (IPAR), this sub-project focuses the decentralization of and participation in agricultural extension services in rural Kenya, examining the level, scope, nature and quality of popular participation in decentralized allocation mechanisms, fiscal accountability under these arrangements, and the factors that determine the capacity and effectiveness of the poor participating in and benefiting from these programs.
Community groups and networks: Led by Cornell (on non-SAGA funding), this sub-project studies social networks and community groups and their effects on risk-taking, technology adoption and livelihood strategy choice in rural communities. One component has been funded by the Rockefeller Foundation for a dissertation project by Cornell education Ph.D. candidate David Amudavi, a lecturer at Kenya’s Egerton University. Another component has been funded by Cornell University, the National Science Foundation and the Social Science Research Council, for dissertation field research by Cornell agricultural economics Ph.D. candidate Heidi Hogset.

As Kenya’s lone SISERA member institute, IPAR is “first among equals” and coordinates the SAGA-Kenya program, serving as host or co-host for prospective SAGA small grant awardees, primary contact point for communications between the different institutions, and the logistical coordinator for the upcoming SAGA policy conference. IPAR, KIPPRA, Tegemeo, and the University of Nairobi each have a separate subcontract from Cornell for research under SAGA-Kenya, according to which institution leads a given sub-project, several of which are jointly staffed, encouraging new collaborations. KIPPRA also hosted the successful March 2004 workshop on Mixing Qualitative and Quantitative Methods. The University of Nairobi has hosted the initial activities of the nascent Kenya Policy Research and Outreach Forum (K-PROF). Finally, at the encouragement of Clark Atlanta and Cornell Universities, Tegemeo began exploring the possibility of membership in SISERA. The SAGA research program in Kenya was developed collaboratively through repeated consultations, both in Kenya and via email and by telephone, between Cornell, Clark Atlanta, IPAR, KIPPRA, Tegemeo, the University of Nairobi, USAID-Kenya, USAIDREDSO and USAID-Washington. A series of meetings were held in Nairobi in 2002 and 2003 between SAGA-Kenya Cornell team leader Chris Barrett, Kenyan partners and other collaborators (e.g., Dr. Mesfin Bezuneh of Clark Atlanta University, Dr. John McPeak of Syracuse University). Barrett and all of the Kenya-based principals held coordinating team meetings in Durban, South Africa, where we were all attending the 25th triennial meetings of the International Association of Agricultural Economists, in August 2003 and in Nairobi in March 2004.

It took quite some time to get terms of reference and subcontracts finalized between Cornell and each of the participating institutions, which caused a delayed start to the field research. But the last of the subcontracts was put in place and the last of the budgetary advances were made in November 2003. Primary research has thus been underway for roughly a year for each of the SAGA Kenya institutions.

Mixing Qualitative and Quantitative Methods of Poverty Analysis in Kenya

SAGA organized a workshop on “Mixing Qualitative and Quantitative Methods of Poverty Analysis in Kenya”, hosted by KIPPRA in Nairobi on March 11, 2004. The workshop was attended by 50 or so representatives from various government ministries, the Central Bureau of Statistics, donor agencies (e.g., USAID/Kenya, USAID/REDSO, World Bank, DfID, EU), Kenyan universities and research institutes, international research institutions (e.g., CIMMYT, ICRAF, ILRI), as well as several different national media outlets (print, radio and TV). The program featured an opening address by David Nalo, Permanent Secretary of the Ministry of Planning and National Development, eight papers by scholars from different social science disciplines exploring different dimensions and experiences of mixing qualitative and quantitative methods of poverty analysis in Kenya, and an expert panel discussing how best to integrate qualitative and quantitative methods of poverty analysis in emerging policy-oriented research in Kenya. Highlights of this workshop are found at:

http://www.saga.cornell.edu/saga/q-qconf/qqconf.html.

The event was widely regarded as highly informative and enjoyable. Although there was much interest in the use of mixed methods of poverty analysis within the Kenyan research community, this was the first concerted effort to reflect on how and why such integration might be useful and the means by which research teams can integrate qualitative and quantitative methods successfully. The event drew widespread attention, not just from the SAGA institutions (IPAR, KIPPRA, Tegemeo, University of Nairobi), but also within the Ministries (e.g., Agriculture, Livestock Development), the Kenya Agricultural Research Institute, and various universities, donors and NGOs active in the country.

The papers from the event are currently being edited into a proceedings volume, edited by Drs. John Omiti (IPAR) and Walter Odhiambo (KIPPRA), to be published later in 2004 or early 2005. The volume should serve as a very useful reference for researchers and institutions interested in integrating qualitative and quantitative methods of poverty analysis in the future. The volume includes the following nine original papers:

Enos H.N. Njeru, “Bridging the Qualitative-Quantitative Methods of Poverty Analysis”
Germano Mwabu, “Quantitative Poverty Analysis”
Christopher B. Barrett, “Mixing Qualitative and Quantitative Methods of Analyzing Poverty Dynamics”
Kulundua D. Manda, “Poverty In Kenya: A Review of Quantitative and Qualitative Studies”
Mary Omosa, “Researching Poverty in Rural Kenya: A Sustainable Livelihoods Framework Approach to Measuring the Impact of Agricultural Technologies on Poverty”
Patti Kristjanson, Nelson Mango, Maren Radey and Wilson Nindo, “The Role of Livestock in Pathways out of Poverty: Approach and Findings from Western Kenya”
Anthony K.M. Kilele and Godfrey K. Ndeng’e, “Poverty Mapping: The Case of Kenya”
Nelson Mango, Josephat Cheng’ole, Gatarwa Kariuki and Wesley Ongadi, “Social Aspects of Dynamic Poverty Traps: Cases from, Vihiga, Baringo and Marsabit Districts, Kenya”
Willis Oluoch-Kosura, Paswel Phiri Marenya, Frank Place and Christopher B. Barrett, “Indices and Manifestations of Poverty: Informing anti-poverty Policy Choices”

Kenya Policy Research and Outreach Forum (K-PROF)

Begun in 2002 under the auspices of the USAID-funded BASIS CRSP and SAGA, KPROF has met several times and is slowly evincing real potential to link policy research to policy formulation in Kenya. K-PROF brings together Kenyan research institutions (the SAGA team as well as the Kenya Agricultural Research Institute, the Central Bureau of Statistics, and Kenya-based international research institutions such as the International Livestock Research Institute and the World Agroforestry Centre) with government ministries for the purposes of sharing recent research findings, of availing government and donors of a range of policy research, and of sparking collaboration in emerging policy research issues. The University of Nairobi’s Department of Agricultural Economics took initial leadership of K-PROF. This was informally coordinated by Prof. Willis Oluoch-Kosura, then Department Chair, who organized the initial K-PROF meeting. That meeting took stock of what the various research institutions based in Kenya were doing and how the research outputs could be better used in policy formulation. There was general agreement that there is a need for improved coordination of policy research efforts, especially in the setting of research priorities, sharing of resources through the joint implementation of some activities, and sharing of information among the researchers and policy makers. No formal agreements were reached but the beginnings of fruitful coordination and collaboration were apparent. When Prof. Olouch- Kosura left on sabbatical to help launch a regional effort at improving graduate training in agricultural economics and the African Association of the Agricultural Economists, the next Department Chair, Dr. Joseph Karugia, stepped up to organize a March 2003 KPROF meeting with modest financial support from DfID. When Dr. Karugia left for a position with the World Bank, Dr. Rose Nyikal, the current Department Chair, agreed to take on the convener’s role. On January 27, 2004, they organized another policy researchers and policymaker/stakeholders meeting at KARI headquarters to review the status of the links of research findings to policy making in the country. This meeting featured senior representatives from the Ministry of Planning and KARI, as well as DfID, the World Bank, USAID and the Rockefeller Foundation. The World Bank has followed this with an effort to take stock and synthesize the various research efforts in the agricultural sector in the recent past, identify the gaps and the policy implications, under the direction of Prof. Chris Ackello-Ogutu of the University of Nairobi Department of Agricultural Economics, Dr. John Omiti of IPAR and Mr. James Nyoro of Tegemeo. That effort culminated in a two-day workshop 24-25 June 2004 to discuss the way forward for policy research in the country. That meeting was attended by senior officials of the Ministries of Agriculture, Livestock and Fisheries Development, and Planning, the Kenya Agricultural Research Institute, about six MP members of the Parliamentary committee on Agriculture, and the World Bank. One of the major challenges highlighted during the presentations was the lack of a clear process of collecting, storing and using primary data for policy making processes in the country.

K-PROF is slowly acquiring a life of its own. There are now a few joint policy research efforts underway between the participating organizations, opening up a new chapter in demand-driven research and outreach for evidence-based policy design and implementation in Kenya (e.g., on smallholder dairy, on medicinal plants, on the maize seed industry, on peri-urban agriculture). This is the kind of work K-PROF aims to promote—policymakers can request that the group undertake a specific study in some priority area with the aim of using the results for policy formulation. These assignments are to be carried out in addition to coordination meetings for the group to exchange information and to set policy research priorities, which can sometimes be implemented jointly. SAGA deserves some small credit for helping kick-start this initiative.

Research Papers

Finally, based on previously collected data, several research papers to which SAGA directly contributed have been released, including:

“Decomposing Producer Price Risk: A Policy Analysis Tool With An Application to Northern Kenyan Livestock Markets,” Christopher B. Barrett and Winnie K. Luseno, Food Policy 29 (2004):393-405. This paper introduces a simple method of price risk decomposition that determines the extent to which producer price risk is attributable to volatile inter-market margins, intra-day variation, intra-week (day of week) variation, or terminal market price variability. We apply the method to livestock markets in northern Kenya, a setting of dramatic price volatility where price stabilization is a live policy issue. In this particular application, we find that large, variable inter-market basis is the most important factor in explaining producer price risk in animals typically traded between markets. Local market conditions explain most price risk in other markets, in which traded animals rarely exit the region. Variability in terminal market prices accounts for relatively little price risk faced by pastoralists in the dry lands of northern Kenya although this is the focus of most present policy prescriptions under discussion.
“Understanding Declining Mobility and Interhousehold Transfers Among East African Pastoralists,” Marieke Huysentruyt, Christopher B. Barrett and John G. McPeak, July 2004. We model interhousehold transfers between nomadic livestock herders as the state-dependent consequence of individuals’ strategic interdependence resulting from the existence of multiple, opposing externalities. A public good security externality among individuals sharing a social (e.g., ethnic) identity in a potentially hostile environment creates incentives to band together. Self-interested interhousehold wealth transfers from wealthier herders to poorer ones may emerge endogenously within a limited wealth space as a means to motivate accompanying migration by the recipient. The distributional reach and size of the transfer are limited, however, by a resource appropriation externality related to the use of common property grazing lands. When this effect dominates, it can induce distributionally regressive transfers from ex ante poor households who want to relieve grazing pressures caused by larger herds. As compared to the extant literature on transfers, our model appears more consistent with the limited available empirical evidence on heterogeneous and changing transfers patterns among east African pastoralists.
In Economica 76(302): 315-336, April, 2009
“Bayesian Herders: Updating of Rainfall Beliefs In Response To External Forecasts,” Travis J. Lybbert, Christopher B. Barrett, John G. McPeak and Winnie K. Luseno, Revised March 2006. 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.
“Smallholder Identities and Social Networks: The Challenge of Improving Productivity and Welfare,” Christopher B. Barrett, in Christopher B. Barrett, ed., The Social Economics of Poverty: On Identities, Communities, Groups and Networks (London: Routledge, 2005). 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, largerscale 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.
“Rural Poverty Dynamics: Development Policy Implications,” Christopher B. Barrett, Agricultural Economics (forthcoming). This paper, prepared as a plenary address to the 25th triennial meetings of the International Association of Agricultural Economists, held in Durban, South Africa, 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. The paper uses data from Kenya and Madagascar to illustrate the core points. In Reshaping Agriculture’s Contributions to Society, David Colman and Nick Vink (eds.), Oxford: Blackwell, 2005
“Fractal Poverty Traps,” Christopher B. Barrett and Brent M. Swallow, Published January 2006. 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.
“Poverty Traps and Safety Nets,” Christopher B. Barrett and John G. McPeak in Alain de Janvry and Ravi Kanbur, editors, Poverty, Inequality and Development: Essays in Honor of Erik Thorbecke (Amsterdam: Kluwer, forthcoming). This paper uses data from northern Kenya to argue that the concept of poverty traps needs to be taken seriously and that if poverty traps indeed exist, then safety nets become all the more important. However, as presently practiced safety nets based on food aid appear to be failing in northern Kenya. In Poverty, Inequality and Development: Essays in Honor of Erik Thorbecke, Alain de Janvry and Ravi Kanbur, eds., Norwell, MA: Kluwer Academic Publishers, 2005
“Welfare Dynamics in Rural Kenya and Madagascar ,” Christopher B. Barrett, Paswel Phiri Marenya, John G. McPeak, Bart Minten, Festus M. Murithi, Willis Oluoch-Kosura, Frank Place, Jean Claude Randrianarisoa, Jhon Rasambainarivo and Justine Wangila, February 2006. This paper presents comparative qualitative and quantitative evidence from rural Kenya and Madagascar in an attempt to untangle the causality behind persistent poverty. We find striking differences in welfare dynamics depending on whether one uses total income, including stochastic terms and inevitable measurement error, or the predictable, structural component of income based on a household’s asset holdings. Our results suggest the existence of multiple dynamic asset and structural income equilibria, consistent with the poverty traps hypothesis. Furthermore, we find supporting evidence of locally increasing returns to assets and of risk management behaviour consistent with poor households' defence of a critical asset threshold through asset smoothing.
“Food Aid Targeting, Shocks and Private Transfers Among East African Pastoralists ,” Erin Lentz and Christopher B. Barrett, May 2004. This paper uses 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 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 does 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.

Kenya: Planned Activities

SAGA-Kenya Research Program

SAGA research partners will complete the drafting of policy research papers in the final months of 2004. First drafts of these reports will be presented in an intra-team meeting to be held in Nairobi on Friday, November 19, hosted by the World Bank Country Office, with a videoconference link to Cornell University. Each institution within the team will present preliminary draft presentations that day for comment by the team. These presentations, and the papers from which they are drawn, will subsequently be revised and summarized in short policy briefs for presentation at a policy conference to be held in late January or early February 2005, hosted by IPAR (exact dates and venue to be determined). This event will involve policymakers and donors on the program and will be well-publicized to the Kenya press. The background papers from the policy conference will then be reviewed, revised and edited into a published volume.

K-PROF

Much more is needed to advance and institutionalize K-PROF. A full-time secretariat will be needed with a part-time Director to coordinate such work. To date, this has been somewhat catch-as-catch-can, depending on the initiative and goodwill of individuals overtaxed by their pre-existing responsibilities.

Regional Conference Planning

Discussions are underway with the Office of the President’s Arid Lands Resources Management Program about the possibility of hosting a regional conference on Pastoralists, Poverty and Vulnerability: Policies for Progress, likely in January 2006. The aim of this event would be to draw lessons from research in Ethiopia, Kenya, Somalia, Tanzania, and Uganda on the problems confronting governments, donors and NGOs trying to reduce poverty and vulnerability among pastoralist populations.

The project will also continue to release original working papers funded wholly or partially by SAGA.

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