Trade liberalization and children: Understanding and coping with children's vulnerabilities

Poverty reduction, Hunger, trade liberalization, Children, Vulnerability, Education, Rural sector,

Does Geography Explain Differences in Economic Growth in Peru?

In Peru, a country with an astonishing variety of different ecological areas, including 84 different climate zones and landscapes, with rainforests, high mountain ranges and dry deserts, the geographical context may not be all that matters, but it could be very significant in explaining regional variations in income and welfare. The major question this paper tries to answer is: what role do geographic variables, both natural and manmade, play in explaining per capita expenditure differentials across regions within Peru? How have these influences changed over time, through what channels have they been transmitted, and has access to private and public assets compensated for the effects of an adverse geography? We have shown that what seem to be sizable geographic differences in living standards in Peru can be almost fully explained when one takes into account the spatial concentration of households with readily observable non-geographic characteristics, in particular public and private assets. In other words, the same observationally equivalent household has a similar expenditure level in one place as another with different geographic characteristics such as altitude or temperature. This does not mean, however that geography is not important but that its influence on expenditure level and growth differential comes about through a spatially uneven provision of public infrastructure. Furthermore, when we measured the expected gain (or loss) in consumption from living in one geographic region (i. e. , coast) as opposed to living in another (i. e. , highlands), we found that most of the difference in log per-capita expenditure between the highland and the coast can be accounted for by the differences in infrastructure endowments and private assets. This could be an indication that the availability of infrastructure could be limited by the geography and therefore the more adverse geographic regions are the ones with less access to public infrastructure. It is important to note that there appear to be non-geographic, spatially correlated, omitted variables that need to be taken into account in our expenditure growth model. Therefore policy programs that use regional targeting do have a rationale even if geographic variables do not explain the bulk of the difference in regional growth, once we have taken into account differentials in access to private and public assets.

Adverse Geography and Differences in Welfare in Peru

regional economics, spatial distribution, welfare, poverty, Peru

Measurement Error in Access to Markets

Studies in the microeconometric literature increasingly utilize distance to or time to reach markets or social services as determinants of economic issues. These studies typically use self-reported measures from survey data, often characterized by non-classical measurement error. This paper is the first validation study of access to markets data. New and unique data from Peru allow comparison of self-reported variables with scientifically calculated variables. We investigate the determinants of the deviation between imputed and self-reported data and show that it is non-classical and dependent on observable socio-economic variables. Our results suggest that studies using self-reported measures of access may be estimating biased effects.

Access to dynamic markets for small commercial farmers: the case of potato production in the Peruvian Andes

"The purpose of this study is twofold. On one hand, the objective is to assess the impact of new and more complex contracting schemes, as opposed to traditional marketing channels, on small farmers' welfare. On the other hand, the study explores which may be the critical factors that determine the small farmers' participation in these institutional arrangements. In this context, two critical factors are stressed. The first one has to do with access to credit and the second one is the size of the agricultural plot. In order to examine the decision of farmers to access the dynamic markets, the paper follows the study of Lapar et al (2003). The paper also follows impact evaluation techniques to identify the differences in the performance of farmers with access to dynamic markets and those without access. As it can be seen, in all cases, the difference between farmers with access and those without access is positive. This implies that having access to dynamic markets has positive impacts on the welfare of farmers. The results show that the farmers linked to the dynamic markets gain two cents of a dollar more per kilogram of potato. ...Our simulations showed that increase of their plot size to a minimum of five hectares (optimal size according to the industry) increases their sales to dynamic markets in 16%. However, the impact of new and more complex contracting schemes, as opposed to traditional marketing channels, could reduce significantly the access gap to dynamic markets by reducing transaction costs, increasing productivity, and increasing scale production through coordination of smallholders." Authors' AbstractPotato production, Market access, Small farmers, Contract farming, Access to credit, Dynamic markets, Impact evaluation, income growth, Transaction costs,

Market integration for agricultural output markets in Peru: the role of public infrastructure

This paper shows the impact that investment in infrastructure may have on the efficiency of agricultural products markets. Using daily price series for the most important agricultural crop in Peru (potato), in 10 cities from 1995 to 2001, we show that there is enough evidence to conclude that agricultural markets are spatially integrated. However we also show that there is short term disequilibria that affect the efficiency with which price information is transmitted across markets. A Threshold Cointegration Model is used to asses the speed of adjustment towards the equilibrium, the presence of transaction costs and the probabilities of successful and failed arbitrage between spatially distributed markets. As was expected, the paper shows that distance and geographic differences are important factors affecting spatial integration and efficiency between markets. However, other elements susceptible of government intervention, such as availability of information (access to local media and telecommunications facilities), road density or access to wholesale markets, are key factors for the reduction of transaction costs and the improvement of spatial integration between markets.Infrastructure, Investment, Rural, Peru

Access to Dynamic Markets for Small Commercial Farmers: The Case of Potato Production in the Peruvian Andes

The study has evaluated which are the most relevant factors that determine that a small farmer switch marketing channels in order to enter into a "dynamic" market; that is, into a market signed by more complex contractual relationships that can absorb increasing amounts of its output. The results show that there are a number of producers that currently are not selling to those markets but they may well do so. Restrictions associated to the degree of organization of the producers, their perception of risk and credit market restrictions may prevent these farmers to gain access to the additional benefits that these new market opportunities have to offer.Market participation, Contractual arrangements, Potato Farmers, Peru, Crop Production/Industries, Marketing, Q13, Q16,

Titling, Credit Constraints and Rental Markets in Rural Peru: Exploring Channels and Conditioned Impacts

This paper constructs a baseline and pursues an overall impact evaluation of the PETT (Programa Especial de Titulación de Tierras), an ambitious rural titling program created in Peru in 1992. The general evaluation of impacts on farmers shows a picture of not many positive effects, at least in the short period of the evaluation (2004-2006) and for a limited sample of farmers located in the Coast and Sierra regions. On average, most income variables (and income composition) do not seem to be impacted by titling, and there are no detectable effects on investments (except for permanent pasture in the Sierra) or other outcome variables, such as credit, land markets, or land conflicts. However, this general picture hides important impacts that may occur for some groups of farmers, or for farmers facing different constraints in the pre-intervention stage. Given the limitations, we investigated in more detail two important channels that are behind the potential impacts of rural titling programs: credit access and use of land rental markets.

Ambiguity Aversion as a Predictor of Technology Choice: Experimental Evidence from Peru

The lack of adoption of new farming technologies despite known benefis is a well-documented phenomenon in development economics. In addition to a number of market constraints, risk aversion predominates the discussion of behavioral determinants of technology adoption. We hypothesize that ambiguity aversion may also be a determinant, since farmers may have less information about the distribution of yield outcomes from new technologies compared with traditional technologies. We test this hypothesis with a laboratory experiment in the field in which we measure risk and ambiguity preferences. We combine our experiment with a survey in which we collect information on farm decisions and identify market constraints. We find that ambiguity aversion does indeed predict actual technology choices on the farm. Un phénomène bien documenté en économie du développement est le nombre peu élevé d’agriculteurs qui décident d’adopter de nouvelles technologies en agriculture, malgré leurs avantages connus. En plus des nombreuses contraintes imposées par le marché, l’aversion au risque prédomine la discussion sur les déterminants de l’adoption de nouvelles technologies. Nous émettons l’hypothèse que l’aversion à l’ambiguïté pourrait aussi être un déterminant puisqu’il est possible que les agriculteurs aient moins d’information sur la distribution du rendement des nouvelles technologies que sur celle des technologies traditionnelles. Nous testons la validité de cette hypothèse avec une expérience en laboratoire sur le terrain où nous mesurons les préférences vis-à-vis du risque et de l’ambiguïté. Nous combinons notre expérience à un sondage portant sur les décisions prises en matière d’agriculture et identifiant les contraintes du marché. Nous constatons qu’effectivement, l’aversion à l’ambiguïté dicte les choix technologiques réels relatifs à la ferme.experimental economics, risk measurement instruments, risk preferences, rural development, technology choice, choix technologiques, développement rural, économie expérimentale, instruments de mesure du risque, préférences vis-à-vis du risque