Something of a Paradox: The Curious Neglect of Agriculture in Development

This paper argues that investment in agriculture has a large and continuing developmental importance in terms of both economic growth and poverty reduction. Moreover, targeted public resources have proven to be indispensable in achieving these results. Both arguments are supported with novel analyses which update and strengthen the traditional case for agriculture-led development with public-sector involvement. But despite the strong case for agriculture-led development strategies, the authors find that over the last three decades the financial resources allocated towards this sector have strongly declined. It is suggested that a shift towards new development paradigms since 1980 might be a significant explanation for this apparent Agricultural Paradox. This conjecture is tested with data on market reform impacts, PRSP contents and analyses of the intellectual resources devoted to the study of agriculture in development by both practitioners and researchers. The authors conclude with a critical discussion of these disturbing trends.

Something of a Paradox: The Neglect of Agriculture in Economic Development

This paper argues that investment in agriculture has a large and continuing developmental importance in terms of both economic growth and poverty reduction. Moreover, targeted public resources have proven to be indispensable in achieving these results. Both arguments are supported with novel analyses which update and strengthen the traditional case for agriculture-led development with public-sector involvement. But despite the strong case for agriculture-led development strategies, the authors find that the financial resources allocated towards this sector have strongly declined over the last three decades, and they suggest that a shift towards new development paradigms since 1980 might be a significant explanation for this apparent Agricultural Paradox. This conjecture is tested with data on foreign aid, public expenditure, PRSP contents, and empirical analyses of the intellectual resources devoted to the study of agriculture in development by World Bank researchers. The authors conclude with a critical discussion of these disturbing trends.Agricultural Productivity, Economic Growth, Poverty Alleviation, Urban Biases, Public Expenditure, Foreign Aid, Washington Consensus., International Development,

Are India’s Gender Imbalances Inducing Higher Household Savings?

Consumer/Household Economics,

Rethinking the global food crisis

From 2003 to their peak in mid 2008, the nominal prices of maize and wheat roughly doubled, while those of rice tripled in a matter of months rather than years. Although fundamental factors were clearly responsible for shifting the world to a higher equilibrium price during this time, there is little doubt that when food prices peaked in June 2008, they soared well above the new equilibrium price. Numerous arguments have been proposed to explain overshooting, including financial speculation, depreciation of the United States (U.S.) dollar, low interest rates, and reductions in grain stocks. However, observations that international rice prices surged in response to export restrictions by India and Vietnam suggested that trade-related factors could be an important basis for overshooting, especially given the very tangible link between export volumes and export prices. In this paper, we revisit the trade story by closely examining monthly data from the largest export markets for rice (Thailand), wheat, maize and soybeans (the United States). In each case, we find that large surges in export volumes preceded the price surges. The presence of these demand surges, together with back-of-the-envelope estimates of their price impacts, suggest that trade events played a much larger and more pervasive role than previously thought. This further implies that improving the international grain markets should be a central focus of the international policy agenda going forward.equilibrium price, export markets, export prices, export restrictions, export volumes, international grain trade, panic purchases, world food crisis,

China's Growth Strategies

Food Security and Poverty, International Development, Political Economy,

Explaining Agricultural Productivity Levels and Growth: An International Perspective

With persistent population growth, a dwindling supply of arable land per capita, and the relatively high income elasticity of demand for food in developing countries, there is a growing need for food supply increases to originate from growth in productivity rather than expansions in inputs. In this paper the authors construct levels of total factor productivity in agriculture for 111 countries covering the years 1970 to 2000. Employing this data in panel and cross-sectional regressions, the authors seek to explain levels and trends in total factor productivity (TFP) in world agriculture, examining the relative roles of environmental and geographical factors, human capital, macroeconomic factors, technological processes resulting from globalization and the Green Revolution, and institutional factors such as measures of land inequality and proxies for urban biases in public and private expenditure. The authors conclude that, in addition to standard explanations of productivity improvements such as human capital, openness and environmental factors, both urban biases and inequality have been major impediments to successful rural development.

Paving the Way for Development: The Impact of Road Infrastructure on Agricultural Production and Household Wealth in the Democratic Republic of Congo

Given its vast land resources and favorable water supply, the Democratic Republic of Congo's (DRC) natural agricultural potential is immense. However, the economic potential of the sector is handicapped by one of the most dilapidated transport systems in the developing world (World Bank, 2006). Road investments are therefore a high priority in the government's investment plans, and those of its major donors. Whilst these are encouraging signs, very little is known about how the existing road network constrains agricultural and rural development, and how these new road investments would address these constraints. To inform this issue the present paper primarily employs GIS-based data to assess the impact of market access on agricultural and rural development (ARD). Compared to existing work, however, the paper makes a number of innovations to improve and extend the generic techniques used to estimate the importance of market access for ARD. First, the DRC road network data is augmented with survey-based data from Minten and Kyle (1999) on agricultural transport times to calculate improved “market access” measures for the DRC. Second, we follow Dorosh et al (2009) in estimating the long run relationship between market access and agricultural production, although we also investigate the relationship with household wealth. Finally, we run simulations of how proposed infrastructure investments would affect market access, and how market access would in turn affect agricultural production and household wealth.Infrastructure, market access, road and river transport, agricultural production, poverty., Agricultural and Food Policy, Crop Production/Industries, Food Security and Poverty, Production Economics,

Land pressures, the evolution of farming systems, and development strategies in Africa: A synthesis

AbstractEvidence assembled in this special issue of Food Policy shows that rising rural population densities in parts of Africa are profoundly affecting farming systems and the region’s economies in ways that are underappreciated in current discourse on African development issues. This study synthesizes how people, markets and governments are responding to rising land pressures in Africa, drawing on key findings from the various contributions in this special issue. The papers herein revisit the issue of Boserupian agricultural intensification as an important response to land constraints, but they also go further than Boserup and her followers to explore broader responses to land constraints, including non-farm diversification, migration, and reduced fertility rates. Agricultural and rural development strategies in the region will need to more fully anticipate the implications of Africa’s rapidly changing land and demographic situation, and the immense challenges that mounting land pressures pose in the context of current evidence of unsustainable agricultural intensification, a rapidly rising labor force associated with the region’s current demographic conditions, and limited nonfarm job creation. These challenges are manageable but will require explicit policy actions to address the unique development challenges in densely populated rural areas

All the Conditions of Effective Foreign Aid

The conclusion that foreign aid will promote economic growth only when allocated towards good policy regimes has been the subject of considerable debate. Aid effectiveness researchers have variously sought to falsify this result or to find other individual conditions of aid effectiveness. However, economic theory suggests that any factor which influences the expected returns to investment may influence the effect of aid on growth even when aid is partly diverted to consumption. To investigate this hypothesis, �all� of the hypothesized conditions of aid effectiveness are individually tested in a cross-country growth specification. From these tests the most significant and robust individual interactions are simultaneously modeled, thereby deriving multiple conditions of aid effectiveness. The paper concludes that aid is more effective in economies experiencing economic shocks or recovering from war, and less effective in countries which are geographically disadvantaged or at war. We also find a previously unidentified condition of aid ineffectiveness: the inflow of foreign direct investment. This finding renews a justified interest in the policy-aid-growth nexus, insofar as domestic policy determines the distribution of aid and FDI flows, which appear to act as substitutes in the growth process.

COVID-19 will mostly spare young children; the economic crisis will not

In a pair of commentaries published in The Lancet in August 2020, we and our colleagues in the Standing Together for Nutrition Consortium (STfN) and the leaders of four UN agencies called for immediate action to address the escalating problems of child malnutrition and excess mortality triggered by the COVID-19 pandemic (Fore et al. 2020; Headey et al. 2020). Although child mortality from the virus itself is low compared to other age groups, the social, economic, and health systems crises it has prompted pose a serious threat to young children’s nutrition, health, and survival in low- and middle-income countries (LMICs)