Infrastructure development and economic growth in China

China is the fastest growing country in the world for last few decades and one of the defining features of China's growth has been investment-led growth. China's sustained high economic growth and increased competitiveness in manufacturing has been underpinned by a massive development of physical infrastructure. In this context, we investigate the role of infrastructure in promoting economic growth in China for the period 1975 to 2007. Overall, the results reveal that infrastructure stock, labour force, public and private investments have played an important role in economic growth in China. More importantly, we find that Infrastructure development in China has significant positive contribution to growth than both private and public investment. Further, there is unidirectional causality from infrastructure development to output growth justifying China's high spending on infrastructure development since the early nineties. The experience from China suggests that it is necessary to design an economic policy that improves the physical infrastructure as well as human capital formation for sustainable economic growth in developing countries.China, Infrastructure, Economic development, Investments, China, Investment, L9 - Industry Studies: Transportation and Utilities, H4 - Publicly provided goods, O1 - Economic development

Industrialization, Exports and the Developmental State in Africa: The Case for Transformation

This essay explores the role of the state in promoting exports and industrialization in the quest for transformation of African economies. It does this by exploring the role of trade in African economies followed by a brief look at the East Asian Developmental state. This is followed by an examination of why many African states have failed at being drivers of transformation. It concludes by examining the potential role of African states in a project of transformation as well as the available avenues and resources for transformation. JEL Categories: O1; O2; O3; N17; N47; N57; N67; N77.Africa; economic development; economic history; exports; industrialization; transformation;.

Land Distributional and Income Effects of the Chinese Land Rental Market

Using panel data of 450 farm households for the period of 1996-2001 in Zhejiang, China, we measured land distributional effect and income effect of the land rental market. It is found that the rental market had contributed for a less equal land distribution among the households, and for the concentration of land to households with higher efficiency. With a land rental market in a dynamic economic development process, improvements in overall production efficiency of the households, however, mainly come from the reduction of land abandonment and the contribution from land changing hands is very limited.Land rental market, distribution, efficiency, land abandonment, Land Economics/Use, Q12, O1, Q15,

Impact of rural poverty reduction strategies: The case of smallholders in Sierra Leone

The present analysis, which exploits one of the first empirical data collected from smallholders in Sierra Leone since the end of the civil war, compares the impact of two poverty reduction strategies targeting smallholders in Sierra Leone: support to rice production is compared with support to coffee and cocoa production in terms of sustainable income generation and contributing to macroeconomic stability and growth. Supporting rice production is intended to help the country regain self-sufficiency in its traditional principle staple. This will help towards improving food security and reducing dependency on volatile world market prices which, for example, with respect to the recent global spike has had dramatic effects on the lowest incomes. Support to cocoa and coffee production on the other hand aims to create and increase income by producing exportable commodities with higher value added. This research addresses strategic options most successful in improving food security and accelerating economic development. Additionally, bottlenecks in terms of inputs, infrastructure and social and economic factors are identified and analysed in order to isolate those which once improved will impact most on productivity. The results are discussed within a broader economic and socio-economic context in particular with respect to enhanced targeting and impact of Official Development Assistance.Agriculture, Poverty, Official Development Assistance, Sierra Leone, Food Security and Poverty, O1, Q1,

A mosaic type of development - the Agri-food Districts experience in Italy

The Italian Industrial Districts (IDs) are now considered in the national and international literature as one of the main factors of the successful and rapid industrial development of Italy after the Second World War. In this paper we outline the general characteristics of the IDs approach and then the distinctive figures of the agrifood districts. A mosaic type of development characterised the geographical distribution of the different agrifood districts in the Italian experience. The different origins of agrifood districts often determines their production and structural characteristics of firms, with a relevant role of SMEs. In many cases, these districts originated from handcraft traditions and specific local demand. Their specialized production is often related to typical or high-quality products. The increasing demand for quality and typical food products might widen the possibility of developing local and regional food districts. In the second part of the paper, we have evaluated the economic performance and technical efficiency of a panel of firms in the meat sector which belong or not to the districts, for the period 1998-2002. Some very interesting results have been obtained from the economic and financial analysis on balance sheets of a large number of firms in the meat processing. The stochastic production frontier has been utilized to measure the 'district effect'. We have noticed that in the last years, the 'district effect' has been reducing according to the general difficulties of Italian industrial sector.Agri-Food Districts, Italian Industrial Districts (IDs), Technical efficiency of a panel of firms, Economic Development, International Development, A1, C23, O1, Q10, Q17,

Finance-Growth Nexus Revisited: Empirical Evidence from Six Countries

This paper investigates the dynamic causal relationship between bank-based financial development and economic growth, and between market-based financial development and economic growth in six countries during the period from 1980 to 2012. The causal relationship was found to vary largely across countries and over time. In general, bank-based financial development seems to Granger-cause economic growth in the UK and only in the long run in Australia. However, there is a feedback loop in Brazil and Australia, but only in the short run for the latter. In Kenya, South Africa and USA, the results support the neutrality hypothesis. The study results further indicate short-run unidirectional causality from market-based financial development to economic growth in the USA. Evidence of the feedback loop was found in Kenya, while the demand-following hypothesis found support only in South Africa and Brazil. However, the neutrality view was supported in Australia and the UK.JEL Codes - E02; G10; G21; O1

A Mosaic Type of Development: The Agri-Food Districts Experience in Italy

The Italian Industrial Districts (IDs) are now considered in the national and international literature as one of the main factors of the successful and rapid industrial development of Italy after the Second World War. In this paper we outline the general characteristics of the IDs approach and then the distinctive figures of the agrifood districts. A mosaic type of development characterised the geographical distribution of the different agrifood districts in the Italian experience. The different origins of agrifood districts often determines their production and structural characteristics of firms, with a relevant role of SMEs. In many cases, these districts originated from handcraft traditions and specific local demand. Their specialized production is often related to typical or high-quality products. The increasing demand for quality and typical food products might widen the possibility of developing local and regional food districts. In the second part of the paper, we have evaluated the economic performance and technical efficiency of a panel of firms in the meat sector which belong or not to the districts, for the period 1998-2002. Some very interesting results have been obtained from the economic and financial analysis on balance sheets of a large number of firms in the meat processing. The stochastic production frontier has been utilized to measure the "district effect". We have noticed that in the last years, the "district effect" has been reducing according to the general difficulties of Italian industrial sector.Agri-Food Districts, Italian Industrial Districts (IDs), Technical efficiency of a panel of firms, Economic Development., International Development, A1, C23, O1, Q10, Q17,

Economic Freedom and the Process of Economic Growth: An Empirical Analysis Based on a New Measure

This paper, relying on a conceptualization of economic freedom in terms of kinds of government actions, develops a new measure of economic freedom. However, this is not art for art’s sake; instead, it allows us to provide an explanation for how particular institutions of economic freedom enhance economic development, a view upon which scholars agree. We develop two concepts related to economic freedom, namely the freedom-compatible and freedom-non-compatible institutions and use them as tools in an analysis of the process of economic growth, especially the relationship between economic freedom and long-run income. The major argument is that freedom-compatible institutions are primary determinants of income, while freedom-non-compatible institutions depend upon them and are partly the outcomes of the growth process itself, a fact which is explained by the Misesian theory of interventionism. Our regression analyses support our theoretical insights. JEL Classification: B53, H10, O1

Economics of Biofortification

Micronutrient malnutrition affects billions of people world-wide, causing serious health problems. Different micronutrient interventions are currently being used, but their overall coverage is relatively limited. Biofortification that is, breeding staple food crops for higher micronutrient contents has been proposed as a new agriculture-based approach. Yet, as biofortified crops are still under development, relatively little is known about their economic impacts and wider ramifications. In this article, the main factors that will influence their future success are discussed, and a methodology for economic impact assessment is presented, combining agricultural, nutrition, and health aspects. Ex ante studies from India and other developing countries suggest that biofortified crops can reduce the problem of micronutrient malnutrition in a cost-effective way, when they are targeted to specific situations. Projected social returns on research investments are high and competitive with productivity-enhancing agricultural technologies. These promising results notwithstanding, biofortification should be seen as a complement rather than a substitute for existing micronutrient interventions, since the magnitude and complexity of the problem necessitate a multiplicity of approaches. Further research is needed to corroborate these findings and to address certain issues still unresolved at this stage.micronutrient malnutrition, public health, biofortification, agricultural technology, impact analysis, developing countries, Food Consumption/Nutrition/Food Safety, I1, I3, O1, O3, Q1,

STOCHASTIC WEALTH DYNAMICS AND RISK MANAGEMENT AMONG A POOR POPULATION

The literature on economic growth and development has focused considerable attention on questions of risk management and the possibility of multiple equilibria associated with poverty traps. We use herd history data collected among pastoralists in southern Ethiopia to study stochastic wealth dynamics among a very poor population. These data yield several novel findings. Although covariate rainfall shocks plainly matter, household-specific factors, including own herd size, account for most observed variability in wealth dynamics. Despite longstanding conventional wisdom about common property grazing lands, we find no statistical support for the tragedy of the commons hypothesis. It appears that past studies may have conflated costly self-insurance with stocking rate externalities. Such self-insurance is important in this setting because weak livestock markets and meager social insurance cause wealth to fluctuate largely in response to biophysical shocks. These shocks move households between multiple dynamic wealth equilibria toward which households converge following nonconvex path dynamics. The lowest equilibrium is consistent with the notion of a poverty trap. These findings have broad implications for the design of development and relief strategies among a poor population extraordinarily vulnerable to climatic shocks.common property, covariate risk, Ethiopia, idiosyncratic risk, poverty traps, social insurance, Risk and Uncertainty, O1, Q12,