Are we done yet? : response fatigue and rural livelihoods

The paper examines an important yet under studied factor affecting the quality of existing micro data on labor supply: response (to survey) fatigue. This underestimation differentially impacts women and youth, leading to meaningful economic and systematic biases in understanding peoples’ livelihoods. As well, non-randomized household rosters systematically list youth and women later, exacerbating losses in reported labor activities. On average, estimated overall losses in terms of unreported labor activities are just under 8%. In the newly applied model these effects are nearly twice as large for women (10%) as for men (5%), and five times larger for youth age 14-24 (10-12%) than for adults age 35-59 (2.1%).International Initiative for Impact Evaluation (3ie)CGIAR Research Program on Policies, Institutions, and Market

Financial needs and the prospects of digital financial services in the agricultural midstream: Phase 1 synthesis

Agricultural commodity value chains (AVCs) are critical for providing income to farmers, creating em ployment opportunities, generating export revenue, and providing affordable and healthy food for con sumers. Agriculture employs 42% of people in South Asia and 53% in sub-Saharan Africa (World Bank, 2022), while agricultural growth has been shown to be three times more effective at poverty reduction than growth in other sectors (de Janvry and Sadoulet, 2009). Though the majority of existing literature has focused on producers and consumers, recent research suggests that value added in the “mid stream” of value chains, the actors between farmgate and final vendors, may be as large as 40% of the total gross value in the agricultural sector (Reardon, 2015; AGRA, 2019). This midstream is comprised predominantly of small and medium size enterprises (SMEs) including traders, transporters, and processors whose potential for growth may be considerably untapped.In general, the high seasonality, geographic dispersion, and unpredictable output of the agricultural sector can make it especially difficult for the financial needs of the midstream to be met, challenges well documented and studied among small-scale producers. While there has been recent, increasing atten tion on the midstream actors in AVCs, focus on their financial needs is rare. If, in fact, they lack much access to financial products, an increase in access could lead to increased employment opportunities in the midstream, as well as more robust growth. Additionally, recent years have seen the emergence of a number of digital financial services (DFS), including mobile money and digital payment systems, digital credit, and digital marketplaces, all of which hold potential for alleviating meaningful constraints among midstream actors in AVCs. The aim of this project was to take stock of what is known about these midstream AVC actors, their fi nancial needs, and the potential of DFS to help meet those needs. In this synthesis, we summarize les sons from the project’s first phase, which included a literature review, analysis of existing microdata, documentation of previous data targeted at the midstream, and interviews with other experts in the field

Finance needs of the agricultural midstream and the prospects for digital financial services

Recent literature suggests that agricultural value chains are changing rapidly and places an increasing focus on the importance of actors and activities taking place in the “midstream” of these value chains, after production and prior to final sale. This article discusses the financial needs of midstream actors in agricultural value chains, emphasizing differences across midstream activities and highlighting how value chain characteristics can influence both financial needs and potential remedies. The paper concludes with a discussion of the prospects of digital financial services to alleviate financial needs of midstream actors

Financial access of midstream agricultural firms in Africa: Evidence from the LSMS-ISA and World Bank enterprise surveys

The midstream of agricultural value chains are rapidly changing in response to shifting domestic and international demand. While the performance of this segment may have important implications for the entire sector, evidence on midstream actors and their financial needs remain thin. We use data from both the Living Standards Measurement Study – Integrated Surveys on Agriculture and the World Bank Enterprise Survey from seven African countries to identify these agricultural midstream firms and assess their access to formal credit, comparing them to other, non-agricultural midstream firms. We find that the identified agricultural midstream firms are larger and more productive than their non-agricultural midstream counterparts and are less likely to report barriers to accessing credit, though overall access levels remain low. Among agricultural midstream firms, those owned or managed by women are more likely to report barriers to accessing credit. Taken together, these findings help build our understanding about the financial needs of micro-, small-, and medium-size enterprises in the agricultural midstream

COVID-19 in rural Malawi: Perceived risks and economic impacts round 2

This note summarizes perceptions of COVID-19 impacts and risks from a panel phone survey of rural households in eight districts in rural Malawi. While the results from the first round conducted in August 2020 were reported in a previous brief, this note will focus on the evolution of indicators from round 1 to round 2, conducted in November 2020. The sample comprises 833 households interviewed in both survey rounds. Two additional follow-up survey rounds are planned for 2021. The survey was originally designed to measure the seasonality of labor activities but was adjusted to assess COVID-19 impacts and perceptions in rural Malawi. Though initial concern of the impact of COVID-19 on Malawi was high at the start of the global pandemic, case numbers stayed relatively low through the end of 2020. Seven-day averages of 50-100 cases during the first survey round had dropped to under 5 in the fourth quarter of the year. Our analysis will examine how people’s perceptions evolved during this period of low infections

COVID-19 in rural Malawi: Perceived risks and economic impacts

Malawi reported its first case of COVID-19 in April and declared a national emergency. Schools, bars and restaurants were closed, international flights suspended, and the economy faced considerable disruptions: quarterly growth projections from July were cut by more than 60% (Saldarriaga Noel et al. 2020). While still concerning, compared to other countries and other parts of the world, the spread of this disease in Malawi has been relatively modest with 5,951 confirmed cases and 184 COVID-19 linked deaths as of November 8, 2020. After accelerating rates of infection in June and July, the rates have decreased over the last two months. In response, there has been a partial return to normalcy, marked by easing COVID-19 restrictions and the reopening of schools at the beginning of September, even while the future trajectory of the disease remains unknown

Value chain surveys: What do they cover, and how well?

While agricultural value chains are rapidly evolving (Reardon, 2015; Reardon et al., 2021; Barrett et al., 2022), research attention has increasingly taken notice of the important role played by actors in the ag ricultural midstream. The agricultural midstream consists of activities that take place after production but before final sale to consumers, with existing literature highlighting transportation, trading/wholesaling, processing/packaging, and storage as key activities (Reardon, 2015; Ambler et al., 2022a). However, even as research on the agricultural midstream has been growing, little is known about the poten tial financial needs or capabilities of midstream actors (Ambler et al., 2022a; Bellemare et al., 2021; Reardon and Minten, 2021). If midstream actors face meaningful financial constraints in growing their businesses, it can hinder employment opportunities, increase consumer food prices, depress agricul tural producer prices, or constrain growth more broadly

Kin transfers as safety nets in response to idiosyncratic and correlated shocks

While formal insurance is widespread in much of the developed world, households in lower-income countries continue to rely heavily on informal risk-sharing networks when faced with unexpected shocks. Kin networks of non-coresident family members may play an important role by providing each other with informal social protection, sharing resources in response to correlated production shocks (rainfall) or idiosyncratic household shocks (sickness and death). Using detailed panel data from Indonesia, we examine how inter-household transfers within a household’s kin network respond to different types of shocks and whether they are able to reduce household vulnerability. We find that households are exposed to meaningful risk from variations in local rainfall in the form of both income and household consumption. Rainfall substantially increases both transfers sent and received by households, suggesting that household and local supply effects dominate demand effects resulting from rainfall fluctuation. Finally, we find modest evidence that transfers reduce vulnerability of consumption to rainfall fluctuations by up to 11%, but do not find strong evidence on the efficacy of formal social protection programs.Non-PRIFPRI1; CRP2; 4 Transforming Agricultural and Rural EconomiesMTID; PIMCGIAR Research Program on Policies, Institutions, and Markets (PIM

Gambling, saving, and lumpy liquidity needs

PRIFPRI3; ISI; 3 Building Inclusive and Efficient Markets, Trade Systems, and Food IndustryMTI

Three Applied Economic Studies on Issues Facing African Youth

This manuscript is comprised of three independent essays in applied microeconomics. Each essay examines a distinct challenge or trend impacting African youth. First, I look at the sports betting industry which has exploded across many African countries over the past decade, targeting young men as its primary consumers. In Kampala, Uganda, the site of my study, nearly one in three young men age 18 to 40 participate in sports betting, spending 8-12% of their weekly income on these activities. The second chapter presents results from an impact evaluation of a sports and youth group program in Monrovia, Liberia. The use of sports and youth programs has become extremely popular for many multilateral and international non-profit organizations' efforts to engage and improve the conditions of marginalized or at-risk youth in developing countries. The final chapter looks at the impact of rainfall shocks on marriage decisions among youth from Burkina Faso, a setting where marriages are determined by households and influenced by financial constraints and economic shocks.In the first essay, "Betting, Saving, and Lumpy Expenditures: Sports Betting in Uganda'', I present evidence from my field study on one of the causes of high betting demand among young Ugandan men. In my paper, I show that financial constraints push many men towards betting in the hopes of payouts desired for unmet liquidity needs. I use a range of experimental and quasi-experimental methods and present four pieces of evidence in support of this claim. Winnings from betting increase the size and likelihood of making large, lumpy purchases, with strongest effects among those with limited ability to save. I then use a randomized intervention to improve an alternative strategy of liquidity generation to betting by distributing a basic commitment savings technology and find that it lowers recipients' demand for betting. Next, I use an experimental prime or nudge, increasing the salience of a desired large expenditure, and find that it increases demand for betting tickets, particularly among those with low ability to save. And finally, I use a randomized budgeting exercise and find that it lowers demand for betting among those who learn that their ability to save is better than previously believed. For people whose ability to save and borrow is inhibited or costly, betting provides an enticing alternative way to generate meaningful sums of liquidity despite imposing considerable losses.My second essay, "Do Sports Change Lives? Evidence from a Randomized Control Trial'', is the product of a joint project with Lori Beaman, Niall Keleher, and Jeremy Magruder. In this project we assess the impact of a popular form of international development program that uses sports both as a direct intervention and also as a point of entry to facilitate engagement with vulnerable youth. The stated ambitions of sports for development programs are typically both admirable and lofty, but we find only limited evidence that the impacts of these programs match their promises. We find evidence of some modest impacts on psychosocial behaviors for young men with moderate improvements in measures of self-esteem and aggressive behavior. We also see an increase in labor force participation for both men and women, although earnings among those working remain unchanged. We also explore whether the research structure required by randomization may have hindered program efficacy. However, it appears that program effects were likely stronger among late registrants who are more likely to have been excluded in the absence of the study. And finally, permitting endogenously formed sports groups may have increased pre-existing social network connections on sports teams. We find that presence of friends does impact program attendance but does not significantly impact program outcomes. In my third essay, "Marriage Markets and Rainfall Shocks: Evidence from Burkina Faso'', I analyze the impact of rainfall shocks on marriage outcomes for young men and women in Burkina Faso. In particular, I use quasi-random variation in rainfall to provide evidence that low rainfall from two years ago causes an increase in the likelihood of marriage for young women by 15%. These effects are strongest among women aged 13-16. In addition, I present evidence that closed marriage markets, where womens' partners are most likely to come from the same local geographic area, respond less to rainfall shocks than areas where marriage markets are likely to be more geographically integrated. This finding is consistent with basic trade theory on market structure and response to simultaneous shifts of supply and demand in opposite directions