Land Inequality and Economic Growth: A Dynamic Panel Data Approach

The growing body of literature devoted to study the impact of inequality on economic growth have centred its attention in the income distribution effect, even though the theoretical relationships are more related to assets distributions than to income distribution. While some recent studies have tried to overcome this limitation by introducing indicators of this type, they found a new constraint when dealing only with time-invariant measurements for this explanatory variable. This article provides a theoretical discussion and some novel empirical tests to better understand the relationships between assets distribution and economic growth. We assembled a new panel database that includes observations for more than 30 countries over the last three decades. The data include a time-varying variable for changes in the Land Gini index over this period that enables to overcome the limitations of previous studies that only included time-invariant measurement. A system GMM estimator is used to generate truly unbiased and consistent regression estimates. We explore some of the likely channels through which asset distribution and economic growth may be linked, paying particular attention to the role of secure property rights and the relations between land ownership and education. We find robust and significant negative signs for land inequality in the growth regressions, indicating that changes in asset distribution are an important factor for economic development.land inequality, economic growth, investments, system GMM estimation, International Development, Land Economics/Use, Q15, C23, I3,

Why Nicaraguan Peasants Remain in Agricultural Production Cooperatives

Many Nicaraguan peasants remain members in agricultural production cooperatives despite the change in the policy environment that now supports parcellation of cooperative lands into individual holdings. Institutional factors, such as uncertainty of land ownership rights and difficulties with resolution of cooperative debt, are found to play a dominant role in keeping Nicaraguan peasants in cooperatives.Agribusiness,

Variability in Quality and Management Practices in the Mango Supply Chain from Costa Rica

Produce quality is one of the features of any commodity that everyone has an opinion about, but quality is a complex concept. In one hand, quality is the consumer perception about a certain commodity an as well it is a relationship between all the intrinsic attributes of the commodity. It is argued that homogeneous management activities will increase the quality of the commodity. Reducing waste for example, but in a more generic way will reduce the variability of the commodity plus meeting the costumer needs and preferences. In this experimental article we try to disentangle the managerial activities that have an effect on the variability of the quality. For this purpose we have make use of the dispersion statistics such as standard deviation, standard error, deviation coefficient, meta-analysis and a regression analysis. We conducted a survey and collected 51 interviews of different actors in the supply chain of mango from Costa Rica, beside, we collected 10 mangos from each actor interview to analyze the intrinsic attribute of quality. We developed a proxy of quality as the ratio between the brix and the ph. We conclude that quality variability is affected positively related to technologic variations and socio-economic variations. In the case of the mango supply chain from Costa Rica the management differences among actors are dependent on the closeness to the consumer, therefore, actors closer to the consumer have higher variability in their indexes than those close to the production site.Variability, Supply Chain, Quality, Management, Agribusiness,

Combining internal and external inputs for sustainable intensification

Farmers and local development organizations around the world use and promote a variety of technologies to increase food production. But the high cost of inorganic fertilizers and other agrochemicals often drives farmers to rely on locally available resources instead of purchased, externally produced inputs. So-called low external input agriculture (LEIA) has spread rapidly to different parts of the globe as a challenging alternative to—or, more frequently, a complement to— Green Revolution technologies...The goal of policy, research, and extension should be to help LEIA farmers achieve "sustainable intensification", which refers to the simultaneous increase in returns to land and labor (in the short run) and the maintenance of soil nutrient balances (in the long run).Soil fertility. ,Food production. ,Technological innovations. ,Fertilizers. ,Agricultural research. ,

Poverty Targeting, Resource Degradation and Heterogeneous Endowments A Micro-Simulation Analysis of a Less Favored Ethiopian Village

Persistent and widespread poverty in less favored areas (LFAs) is attributed to fragile natural resources and poor markets. Limited assets may keep households outside the reach of poverty policies targeted at LFAs. We explore in a stylized manner the role of heterogeneous household assets for (1) policies aimed at poverty reduction; (2) within-village income inequality; (3) soil erosion. With a farm-household microsimulation model we analyze for each household in a remote Ethiopian village three sets of policies: technology improvement, infrastructure investment, and off-farm employment through migration or cash for work (CFW) programs. Combating poverty with a single policy, migration reduces the poverty headcount most. Because of self-selection, CFW programs performed best in terms of reaching the poorest of the poor. CFW also reduce within-village income inequality most, while a price band reduction increases income inequality. Only technology improvements imply a trade-off between poverty and soil erosion. Price band and off-farm employment reduce erosion while outperforming technology improvements in terms of poverty reduction. Combining two policies helps poorer households to overcome the limitations of their asset endowments. Combining a cash for work program with a reduction in price bands yields most in terms of poverty reduction and income inequality. This policy complementarity is less important for better endowed households. Reducing the reliance of households on agriculture offers a winwin situation of reducing poverty and maintaining natural resources. Combining policies helps to overcome asset limitations, to target policies to the poorest households and to reduce income inequalities.less-favored areas, farm households, poverty, erosion, micro-simulation, Ethiopia, Food Security and Poverty, Resource /Energy Economics and Policy, C6, Q12, Q56,

The food systems approach: sustainable solutions for a sufficient supply of healthy food

A food systems approach (FSA) is a useful interdisciplinary conceptual framework for research and policy aimed at sustainable solutions for the sufficient supply of healthy food. An FSA analyses the relationships between the different parts of the food system and the outcomes of activities within the system in socio-economic and environmental/climate terms. Feedback loops are a distinguishing factor in systems thinking: they occur between parts of the food chain (production, processing, distribution and consumption) and from the socio-economic and environmental outcomes of food production and consumption (such as food security and soil depletion) back to that production and consumption. The FSA sheds light on non-linear processes in the food system, and on possible trade-offs between policy objectives. Systems thinking also broadens the perspective when seeking solutions for the root causes of problems such as poverty, malnutrition and climate change. The framework offers at least three benefits. First, it provides a checklist of topics that should at the very least be addressed when it comes to improving food security, certainly in relation to other policy objectives. Second, FSA helps to map the impact of environmental and climate changes on food security by pointing to the various vulnerabilities of the food system. In that sense the approach can contribute to the search for possibilities for strengthening the system’s resilience to climate changes. Third, it helps to determine the most limiting factors for achieving food security, and hence identify effective interventions aimed at improving food securit

Internal organization and performances of saving and loan associations: Evidence from rural Tanzania

Subsistence farmers in rural areas of developing countries are usually outside the current reach of banks and formal microfinance institutions. They do not have access to savings accounts, insurance products, and agricultural credit facilities, limiting those farmers’ investment in agriculture. Being at the outreach of those institutions, those farmers established, so-called savings and loan associations, self-managed groups of 20-30 individuals meeting regularly to provide its members a safe place to save and obtain emergency aid and small loans. When efficiently organized, those associations may provide a secure platform to save and access loans to invest in climate-smart agriculture and mitigate income shocks. The objective of this study is to identify the role of the associations in financing agriculture, major bottlenecks and organizational characteristics that might explain their financial performances. We use survey data from 48 savings and loan associations in rural Tanzania with members trained for adopting climate-smart agricultural practices. We identify that 45% of the loans of associations are distributed for agricultural investment purposes and the major bottleneck is to low savings and participation rates, and late repayment or defaults of loans. We find that the size of associations and record-keeping matters. The average amount of loan received per member approximately doubled for associations with twice as many members, and default rates decrease with the accurate financial recording practices. Our findings suggest that savings and loan associations could strengthen the financial resilience of its members by empowering their members through financial record keeping training. At the same time, they can add new members to the associations

Case Study #6-6 of the Program: ''Food Policy For Developing Countries: The Role Of Government In The Global Food System''

11 pp.©Cornell University, Ithaca, New York. All rights reserved. This case study may be reproduced for educational purposes without express permission but must include acknowledgment to Cornell University. No commercial use is permitted without permission.Contract farming is defined as an agreement, which may range from a simple verbal commitment to a written document, between a farmer and a firm, in which the farmer agrees to deliver fresh or partially processed products and the firm commits itself to purchasing the produce under certain agreed price and non-price conditions. Contract farming is usually considered a substitute for poorly functioning or absent markets. The literature on contract farming presents two opposite views of the potential of this alternative market institution as a bridge for trading between smallholders and agroprocessing firms. Some researchers argue that contracts are an adequate mechanism for integrating smallholders into dynamic markets by overcoming the constraints of a failing market. Others warn about the downside of contracting. We present the rationales for different types of contractual regimes between small-scale pepper producers and agroprocessing firms in the northern region of Costa Rica under two market configurations— namely, a competitive market and a local monopsony. Three types of contractual agreements (written contracts, verbal commitments, and no agreement) are found. The analysis is based on a survey of pepper producers using a semistructured questionnaire to obtain data on production systems and marketing arrangements. Pepper is an attractive diversification activity for smallholders because it is a labor-intensive crop, does not require complex technologies or machinery, requires detailed attention and frequent disease control through the cropping cycle, and can reach high, fairly stable yields per hectare. A major drawback is the high entry cost during the start-up phase, stemming from the need for initial investments in crop establishment and the long maturation time before the first harvest. Contracts may help overcome these constraints and permit market entry at a reduced level of uncertainty. A farmer's level and sources of income have a clear effect on his or her contract choice and bargaining power. Income diversification enables farmers to increase their asset specificity in pepper crops,1 even without the insurance provided by contracts. Therefore, pepper companies prefer to offer contracts to less-endowed farmers who have some farming experience but limited income diversification. These farmers are likely to engage in contract farming owing to their limited bargaining power. Even though the enterprise operating in the monopsonistic market also maintains high asset specificity, it is able to buy from some farmers without any prior agreement, since the latter possess limited bargaining options for valuing their asset-specific investments. Farmers with contracts definitely invest more inputs and time in soil maintenance activities on their pepper plots. Resource-providing contracts in the competitive market have a stronger effect on farmers' investments than simple market specification contracts in the monopsonistic market. This finding confirms the literature regarding the importance of resource-providing contracts and vertical integration for sustainable agricultural intensification (Kuyvenhoven and Ruben 2002). Budgetconstrained farmers that intend to tailor their investment decisions in line with the designed technological package may substitute for the default level of fertilizer use with additional labor investments in soil maintenance activities. Your assignment is to recommend a government policy to assure an acceptable level of competition and to facilitate increasing incomes and reduced risks for low-income pepper farmers in Costa Rica.Cornell University Division of Nutritional Science

Governance for quality management in smallholder-based tropical food chains

The paper provides a framework that focuses on the linkages between several key dimensions of supply chain organization and performance of perishable tropical food products. The focus is on the relationship between governance regime and quality management. However, two other but related variables are taken into account because they impact on the relationship between governance and quality management. These variables are channel choice and value added distribution in the supply chain. Governance regime is reflecting how to enhance coordination and trust amongst supply chain partners and how to reduce transaction costs. Quality management is dealing with how to manage food technology processes such that required quality levels can be improved and variability in quality of natural products can be exploited. Governance regimes in relation to quality management practices are discussed to the extent that supply chain partners are able, or are enabled, to invest in required quality improve¬ments. Reduction of transaction costs, creation of trust-based networks and proper trade-offs between direct and future gains may offer substantial contributions to effective quality management and enforcement. This framework has been applied to nine case studies on smallholder-based food supply chains originating from developing countries (Ruben et al., 2007). Three of these case studies are discussed in this paper to illustrate what challenges can be derived from the case studies. The selected case studies concern fish originating from Kenya, mango originating from Costa Rica and vegetables produced in China.Agribusiness, Agricultural and Food Policy,