collective bargaining arrangements closed shops and relative pay this paper uses establishment level data to examine the impact on union nonunion pay differentials of the industrial relations setting in which bargaining takes place the pre entry closed shop is found to be of prime importance for the pay of both skilled and semiskilled manual workers for skilled workers and for semiskilled workers in larger establishments the differentials are found to be insignificantly different from zero in the absence of a pre entry closed shop copyright 1987 by royal economic society

price distortions in agriculture and their effects an international comparison the central thesis of this paper is that agricultural pricing policies pursued by developing countries produce effects which are diametrically opposite to those produced by the pricing policies of many developed countries and that the policies of both are costly in terms of global welfare in general the agricultural sector in developing countries is heavily taxed while that in the developed countries receives substantial price protection the effects of agricultural price distortions on output consumption trade and rural employment are estimated for nine countries in addition the effects of price distortions on the distribution of income between producers and consumers on government revenue and foreign exchange and the net social losses of the policies are calculated the results indicate that there are large income transfers and impacts on migration from the rural to the urban sector in developing countries and from the urban to the rural sector in developed economies

the effects of real exchange rate depreciation on stochastic producer prices in low income agriculture abstract this paper considers the effects of real exchange rate depreciation on stochastic agricultural producer prices in low income agriculture conventional wisdom that real depreciation achieved through nominal currency devaluation stimulates tradables production does not universally hold in the presence of stochastic prices in fact real depreciation is only stimulative in two cases importables that remain importable and nontradables that become exportable garch estimation of time series price data on several commodities from madagascar support the hypotheses generated by the analytical model

effectiveness of fertilizer policy reforms to enhance food security in kenya a macro micro simulation analysis food security represents a key challenge in most sub saharan african countries and in kenya in particular where still a relevant share of the population lives below a minimum dietary energy consump

the money supply and nominal agricultural prices in the early 1970s food and agricultural prices in the united states rose substantially faster than other prices now early in the 1980s farm prices are depressed relative to other prices in the economy numerous explanations of the behavior of nominal agricultural prices in the past decade have been offered these explanations may be broadly divided into two categories the first is the structuralist explanation it argues that real shocks in selected sectors of the economy such as global crop failures raise prices of certain goods these price increases are later validated or accommodated by expansions in the money supply so that the prices of other goods need not decline in contrast monetarist inflation explanations argue that autonomous increases in the money supply lead or cause the price increases and do not just occur ex post to accommodate real shocks ultimately both explanations recognize that without monetary expansion no long run inflation can occur the fundamental difference is

spatial variation of the marginal utility of income and unequal treatment of equals in one of the most famous contributions to the new urban economics literature mirrlees 6 showed that a utilitarian planner able to control the distribution of income or endowments across households the consumption of land or housing and the distribution of population over space would treat households with identical tastes unequally in the sense that utility levels would vary among them at the planner s optimum similar results were obtained by dixit 2 who showed that even more inequality averse social welfare functions than the utilitarian one would result in unequal treatment he concluded that only the rawlsian maximin welfare function would produce the equal treatment outcome 2 this result has generated considerable attention see e g mills and mackinnon 5 because of its apparently paradoxical nature the purpose of this note is to present a new way of thinking about and making plausible the unequal treatment result 3 to develop the intuition recall that in monocentric city models where equals are treated equally that is where households have equal endowments a market equilibrium with free mobility is characterized by equal utilities for all assuming identical preferences as is well known in the absence of congestion or other market failures this market equilibrium is pareto efficient producing the maximum feasible common level of utility imagine now a mirrlees planner coming across such an equal utility equilibrium under what conditions would the planner not want to disturb the market equilibrium clearly a necessary condition for equal treatment to be utilitarian optimal is that the marginal utility of income be the same for all households in the market equilibrium otherwise freezing the allocation of resources in every other respect social

smallholder dairying under transactions costs in east africa abstract it is argued that dairying is vital to future viability of many small farms in east africa and that high transactions costs for dairy production and marketing limit participation by asset and information poor smallholders case studies from kenya and ethiopia illustrate the role of dairy cooperatives in reducing transactions costs analysis of the determinants of producer prices received by a sample of dairy producers near addis ababa suggests that different levels of access to infrastructure assets and information explain why they contemporaneously accept widely different producer prices for fluid milk

calculating levels of protection is it always appropriate to use world reference prices based on current trading status abstract protection measures such as the nominal protection coefficient npc the effective protection coefficient epc the producer subsidy equivalent pse and the consumer subsidy equivalent cse are conventionally calculated using world reference prices based on current trading status under certain conditions the conventional approach can lead to incorrect estimation of the degree and sometimes even the direction of protection this paper spells out the conditions under which use of world reference prices based on current trading status is incorrect and presents data for wheat in pakistan to illustrate how failure to consider these conditions can lead to misleading policy recommendations

inflation and social consensus in the seventies it is widely believed that the two oil price shocks of the i 970s played a major role in the increase in inflation in industrial countries while this hypothesis is consistent with the timing of changes in inflation at the global level it seems to break down when applied to individual countries cross sectionally for example over the period i973 9 switzerland had an average inflation rate of 4 7 while in neighbouring italy inflation averaged i5 6 over the same period furthermore inflation in the pre opec period i97i 2 was actually higher in switzerland than in italy it seems that a supply shock explanation of inflation in the seventies also requires an explanation of why different countries responded so differently to a similar set of shocks at the world level the purpose of this paper is to offer such an explanation and to test the hypothesis with a cross sectional equation accounting for differences in average inflation rates over the period i973 9 in eighteen oecd countries this time period includes the year of the first opec shock i 973 and the following six years up to the time of the second opec shock the hypothesis to be tested is set in the framework of a model similar to that of brunner et al i 980 the key features of the brunner model are that the adjustment of real wage expectations is subject to lags and that labour supply is positively related to the difference between the perceived real wage and the expected or target real wage given these two assumptions a negative supply shock gives rise to a period of stagflation whose intensity will be greater the slower is the speed of adjustment of real wage expectations the model of this paper extends the brunner model in three ways first across countries the speed of adjustment of real wage expectations or targets is assumed to depend positively on the degree of social consensus as proxied negatively by an indicator of average long run strike activity second the model allows for the possibility of inflation inertia or systematically incorrect inflation expectations as well as a sluggish adjustment of real wage expectations third the model incorporates the hypothesis that money supply growth will vary across countries according to variations in inflationary pressures as perceived by governments the first section of the paper provides a discussion of the rationale for the key proposition regarding strikes and social consensus as well as a brief discussion of the role of wage bargaining institutions section ii develops a theoretical model which yields a reduced form cross sectional equation relating the average i 973 9

the potential for agricultural trade among eastern and southern african countries abstract this study investigates the potential for expanding trade in grains and cereals among the countries of eastern and southern africa in the absence of measures of comparative costs and disaggregated bilateral data the method was to determine whether the consumption and production characteristics of the countries imply that trade is below its potential the countries demonstrate characteristics consistent with greater trade in grains and cereals than occurs the region is not a chronic importer of grains except in years of severe drought greater intra regional trade in grains is implied by the significantly different structures of consumption and production across countries these differences suggest that greater grain self sufficiency for each country taken separately might not be efficient but it could be for the region as a whole along with the evidence for differences in consumption and production patterns goes statistical support for the likelihood that the countries could absorb each other s surpluses and fill each other s shortages over time

imperfect information and staggered price setting many keynesian macroeconomic models are based on the assumption that firms change prices at different times this paper presents an explanation for this staggered price setting the authors develop a model in which firms have imperfect knowledge of the current state of the economy and gain information by observing the prices set by others this gives each firm an incentive to set its price shortly after other firms set theirs staggering can be the equilibrium outcome in addition the information gains can make staggering socially optimal even though it increases aggregate fluctuations copyright 1988 by american economic association

forecasting agricultural exports and imports in south africa the implementation of wide ranging policy reforms including trade and exchange rate policies is improving the efficiency of the south african economy and its reintegration into the global economy with rapid export expansion agricultural exports in the southern african customs union increased from r8 14 billion in 1995 to r23 0 billion in 2003 whilst agricultural imports rose from r6 83 billion to r13 84 billion during the same period this article uses alternative approaches to forecasting agricultural exports and imports in south africa the models used include exponential smoothing autoregressive integrated moving average arima vector autoregression var engle granger eg single equation and vector error correction models vecm we found that the arima and eg methods outperform the var and vecm according to theil s u statistic the var outperforms the vecm in forecasting agricultural exports in south africa the combined forecasts have a lower variance compared to individual forecasts ther

global food balances and food security abstract the major structural imbalance in the current global food scene surpluses in developed countries and deficits in developing countries offers opportunity for substantial progress in assuring food security in both the long and the short run to avail of this opportunity requires an understanding of the close connection between food supplies and purchasing power to purchase food massive investment in rural infrastructure is a major component of long term food security since infrastructure is efficiently produced by labor intensive processes food as a wage good is an important input and the global economy would appear to be under using it from an efficiency point of view in the short run food for work offers opportunity for immediate increase in food security as do food subsidy programs it is essential that a large complex of institutions be developed if the current global scene is to result in increased food security it will take time to develop those structures even though food is available now

agriculture and economic development in sub saharan africa and asia this paper is a comparative study of the role of agriculture in economic development in sub saharan africa and asia popular notions of economic duality and agricultural squeeze in sub saharan africa are re examined and new explanations in terms of agrarian structures and resource availabilities are put forward to account for the apparent economic duality in that continent comparison with surplus labour economies of asia highlights the constraints posed by the prevailing agrarian structures for capital accumulation and industrialization in post colonial sub saharan africa policy conclusions from this new perspective are contrasted to the conventional policies focussing on price reform and market liberalization

the causes of africa s food crisis abstract this paper examines the causes of africa s food crisis by examining patterns of food imports the econometric results indicate that the rise in food imports during 1970 87 can be explained by a combination of demographic policy and economic factors which have raised domestic demand for imported food these factors include urban migration peaks in income especially during commodity booms lower international prices of food and distorted exchange rates after accounting for these factors the residual trend in food imports per capita is negative over this period evidence is also presented showing that in ghana policy reforms have led to reverse migration from urban to rural areas

macro prices and structural change the role of macro price policy foreign exchange rates interest rates wage rates and indirectly the rural urban terms of trade or food prices for short in influencing the rate and composition of structural change in an economy has been emphasized recently as a major component of agricultural and food policy timmer falcon and pearson but empirical measurement of factors influencing structural change has largely ignored these price variables the classic study by chenery and syrquin for example measured economic structure by the size of agriculture s share in gross domestic product agshr the same as in this study but it contained only income and country size as explanatory variables although this may make sense in a world where basic price relationships among capital labor food and energy remain more or less constant the 1970s have seen sharp swings in these relationships in fact the two oil price shocks of the 1970s offer an opportunity to model a major perturbation as it ripples through the macroeconomy and into the agricultural sector no other single macroeconomic event in recent history has so opened windows of opportunity for understanding cause and effect relationships between the food and agricultural sector and basic macro price variables the adjustment of the agricultural sector to higher energy prices reflects the net and often conflicting pressures from both the farm and household micro adjustments and the macro adjustment processes not surprisingly the empirical experience from 1960 to 1980 of the seven asia pacific developing countries analyzed in this paper reflects drastically different agricultural sector adjustments the model and empirical specification used here permit such diversity energy prices affect the process of structural change primarily by altering the relative terms of trade between the agricultural and nonagricultural sectors of an economy this effect is caused mostly by macroeconomic pressures on the balance of payments and foreign exchange rates in the face of changed energy prices as schuh suggests agriculture tends to produce a relatively large share of tradable goods and services and thus energyxporting countries usually face a deterioration of the rural urban terms of trade when oil prices rise this causes a more rapid decline in agriculture s share in gross domestic product gdp than would be expected on the basis of the chenery syrquin analysis oil importing countries on the other hand should see improved rural urban terms of trade and a relatively healthier agriculture sector when oil prices rise their agriculture sectors shares in gdp should not decline as rapidly as in the chenery syrquin model

the architecture of economic systems hierarchies and polyarchies the authors present new ways of looking at economic organizations andsystems individuals judgments entail errors they sometimes reject good projects and accept bad projects the architecture of an economicsystem specifying how the decision making units are organized togetherwithin a system who gathers what information and who communicates what with whom affects its performance both because it influences thenature of errors that individuals make within the system and becauseit has a critical effect on the aggregation of individuals errors theperformance of two polar architectures decentralized polyarchical versus centralized hierarchical decision making authorities are analyzed and compared copyright 1986 by american economic association

urbanization informal sector and development abstract urbanization is a universal phenomenon in the postwar world but its qualitative nature is varied across countries some nations have experienced urbanization that accompanied skill upgrading industrialization and the expansion of the urban formal modern sector but others urbanized without such modernization and underwent the expansion of the urban informal traditional sector simultaneously the question that naturally arises is what are the underlying causes for the differences the purpose of the paper is to tackle this question analytically based on a dynamic model of urbanization and development

labour market institutions and economic performance labour markets richard freeman do particular types of labour market institution hold the key to economic success should other countries try to emulate the flexibility of the american labour market or the centralization of swedish style corporatism since 1970 within the oecd there has been a sharp divergence both of economic performance and of indicators of labour market structure the paper uses union density and the degree of wage dispersion across industries to proxy a country s underlying labour market institutions in assessing economic performance it is argued that cross country differences in output growth were much smaller than differences in employment growth for given output growth there is a clear negative relationship between employment growth and real wage growth across countries why do different countries find themselves at different points on this trade off the final part of the paper examines the correlation between indicators of labour market structure and the position on the wage employment trade off it concludes that the degree of wage dispersion across industries is the most important indicator of market structure and that countries with very high or very low dispersion typically the countries with highly centralized or highly decentralized bargaining in the labour market have better employment performance than countries with intermediate degrees of centralization and wage dispersion

local versus central wage bargaining with endogenous investments investment behavior may depend on whether wage bargaining takes place centrally or locally at the firm level the outcome of the wage bargain will in turn depend on previous investments ignoring other differences between the two bargaining regimes endogenous investments imply that wages are lower and profits higher under local wage bargaining than under central bargaining this does not necessarily imply that employment is highest under local bargaining since investments may differ in the two cases with a nash bargaining solution however reasonable assumptions imply that employment is highest under local wage bargaining

correlated equilibrium as an expression of bayesian rationality if it is common knowledge that the players in a game are bayesian utility maximizers who treat uncertainty about other players actions like any other uncertainty then the outcome is necessarily a correlated equilibrium random strategies appear as an expression of each player s uncertainty about what the others will do not as the result of willful randomization use is made of the common prior assumption according to which differences in probability assessments by different individuals are due to the different information that they have where information may be interpreted broadly to include experience upbringing and genetic makeup copyright 1987 by the econometric society

estimating the level of protection the implications of seasonal price fluctuations abstract the nominal protection coefficients npcs effective protection coefficients epcs and producers subsidy equivalents pses are usually estimated from annual prices which are the unweighted average of seasonal prices in the presence of seasonal fluctuations in prices the npcs epcs and pses estimated from annual data can seriously over underestimate the actual protection received by the producers and consumers the bias results from the fact that price and quantity traded normally relate negatively and unweighted average price consistently overestimates the trade weighted average price the bias in the npc estimates is demonstrated both theoretically and empirically in most cases quantity traded at each price is not known and the paper suggests empirical methods for estimating the trade weights

changes needed in agricultural policy for female headed farm families in tropical africa abstract the decline in per capita agricultural production has been reversed somewhat in tropical africa by the structural adjustment programs which have increased producer prices liberalized marketing and devalued currencies but the 30 of smallholder farm households which are female headed will not be assisted much due to their special constraints of shortages of labor and credit lack of extension visits and appropriate labor saving technologies for these households the authors argue improved extension services credit for agricultural inputs small ruminant animals and poultry labor saving devices and craft inputs will be necessary to increase their incomes and levels of living

the effect of policy reforms on agricultural incentives in sub saharan africa in 1981 the world bank s report on subsaharan africa cited trade and exchange rate biases against exports poor macroeconomic and public sector management and a price bias against agriculture as contributing to the region s poor performance and slow growth world bank 1981 1986b since then average per capita income in the region has continued to fall overall agricultural production has grown more slowly than population declining food production per capita has led to rising food imports and for many of the primary agricultural exports africa s share of world trade has fallen steadily from 1970 to 1983 many african governments now agree on the central role of agriculture and the need to strengthen incentives in the sector united nations this paper assesses how reforms in macroeconomic and sector policies have affected agricultural incentives government policies can be broadly classified into three groups macroeconomic policies that affect incentives in all sectors generally agricultural sector policies that affect farm profitability directly by changing commodity and input prices and general and sector specific policies that may affect farm profitability indirectly by changing factor prices and influencing productivity e g public expenditures on research extension and infrastructure this paper analyzes the impact on agricultural incentives of the first two groups of policies the analysis of producer prices presented below is based on data for about twothirds of the countries in sub saharan africa which account for more than three fourths of agricultural gross domestic product gdp country coverage varies by indicator depending in part on whether comprehensive data are available simple averages are used to summarize policy performance across countries in contrast to weighted averages commonly used to assess aggregate economic effects the analysis of producer prices covers one to four principal export crops per country 2

lessons learned in structural adjustment lending in the developing world and implications for eastern europe discussion conditional program assistance which has come to be designated as structural adjustment sa was and still is the order of the day in many countries in africa and elsewhere tweeten mosley and toye also from both methodological and pragmatic viewpoints the experience of several countries which perhaps each in its own way found themselves in the obligation of improving their efficiency through the removal of disincentives and economic distor

a monetary analysis of food price determination erratic food price movements during the 1970s have received much attention in recent literature salathe and boehm found that movements in retail food prices since 1970 have been substantially more volatile than in earlier periods and that the food component of the consumer price index cpi has often displayed an annual rate of change different from that of the total cpi such changes in agricultural prices reflect low price elasticities for food products and the difficulty of predicting weather patterns and their effects on farm output research interest stems from relatively larger recent price changes caused by persistent general inflation and unexpected supply disruptions several recent studies of retail food prices are based on cost push theories these models posit that as input costs faced by food manufacturers rise the increases are passed through to consumers in the form of higher product prices to model cost push behavior changes in components of the marketing bill such as processing packaging and transportation costs are measured and related to subsequent changes in retail product prices examples of such empirical studies are those by lamm heien and lamm and westcott however these models represent only one perspective of the pricing process this paper suggests the use of a family of alternative models in particular by making a clear distinction between changes in nominal and real values a different set of variables is selected to measure each component of overall price change it is argued that not all models can explain behavior of both real and nominal price changes

rationalizable strategic behavior the notion of equilibrium proposed by nash 19 has come to play a dominant role in economic applications of noncooperative games while analyses of nash equilibria have unquestionably contributed to our understanding of economic behavior it would be unreasonably optimistic to maintain that nash solved the problem of noncooperative strategic choice there is a small literature beginning with ellsberg 6 and a much larger oral tradition which argues that nash behavior is neither a necessary consequence of rationality nor a reasonable empirical proposition in this paper i take the view that although there may be various reasons why an agent might select a nash strategy the notion of an equilibrium has little intrinsic appeal within a strategic context when an agent reaches a decision in ignorance of the strategies adopted by other players rationality consists of making a choice which is justifiable by an internally consistent system of beliefs rather than one which is optimal post hoc this point of view is not original indeed most serious justifications of the nash hypothesis embrace such an approach arguing that agents will expect the game to yield a nash outcome and consequently will choose their equilibrium strategies nevertheless when we think in terms of maximizing utility subject to expectations rather than realizations it becomes clear that the nash hypothesis far from being a consequence of rationality arises from certain restrictions on agents expectations which may or may not be plausible depending upon the game being played we are then quite naturally led to ask are there any restrictions of individuals expectations and hence choices which are required by rationality alone rather than by subjective plausibility this paper is concerned with defining justifying characterizing and refining a criterion for rational strategic choice which i label rationalizability

managing adjustment costs political authority and the implementation of adjustment programs with special reference to african countries abstract the degree to which a government implements a program given no disruptive factors depends critically on its legitimate authority to carry out the program and the degree to which management aspects notably management costs of the program were satisfactorily dealt with at the design stage program designers should understand the nature dimensions justification and basis of legitimate authority when the government s legitimate authority is inadequate program designers must advise the government to obtain it a properly designed program should also include measures to speed up entry prevent inefficient exit and minimize unemployment and underutilization of capacity have a framework for ensuring competitive and open markets and arm the program manager with tools to alleviate social tensions arising from certain distributional consequences and to respond to predictable nationalistic preferences

informing food security decisions in africa empirical analysis and policy dialogue discussions of economic and agricultural development in africa have focused heavily in recent years on structural adjustment i e basic policy changes aimed at allowing international and domestic markets to play a greater role in coordinating national economic activities often these structural adjustments and accompanying policies aimed at improving economic performance have been based on several implicit assumptions about how african food systems operate yet for many countries little empirical information has been available to test these assumptions hence designing policies too often becomes an exercise in planning without facts this paper argues that not only is there a need to base food security and structural adjustment policies more firmly on empirical information but that the process by which the information is obtained is as important as the information itself agricultural economists and other social scientists can and increasingly should design policy research in africa in ways that simultaneously increase effective demand for empirical information as an input into the ongoing policy process and augment african capacity continually to inform policy deliberations we illustrate the payoffs to such an approach by drawing on selected experience in several african countries weber

interpreting changes from the 1970s to the 1990s in african agriculture through village studies abstract assessments of the performance of agriculture in sub saharan africa are typically based on official production statistics at national level between the early 1970s and the mid 1990s these often show alarmingly poor rates of growth but there are good reasons to doubt the statistics and their interpretation an alternative is to examine the record from the village level upward this paper looks at the evidence from 26 case studies of change between the mid 1970s and the mid 1980s at the district or village level these suggest less cause for alarm than the national statistics they confirm that access to markets is essential for agricultural development the single biggest idea in the policy reforms of the 1980s but they also underline the importance of the detail of policy in remedying failures in product capital and insurance markets and in public investment in technology

impacts of monetary and macroeconomic factors on food prices in eastern and southern africa eastern and southern africa has been experiencing relatively large increases in real food prices since the early 1980s real food prices in some african countries grew as much as 11 per year during the 1980 1996 period the huge volatility in food prices coincided with the implementation of structural adjustment programmes in several african countries this study examines the impacts of monetary and macroeconomic factors on real food prices in eastern and southern africa using the technique of cointegration and error correction modelling to test the long run relationship between real food prices and the factors that influence their behaviour in selected african countries demand elasticities for food are estimated for selected countries the empirical results show that changes in domestic food production coupled with income trade exchange rate and monetary policies have significant impacts on real food prices with wide implications for food availability and food security in the region

rationalizable strategic behavior and the problem of perfection this paper explores the fundamental problem of what can be inferred about the outcome of a noncooperative game from the rationality of the players and from the information they possess the answer is summarized in a solution concept called rationalizability strategy profiles that are rationalizable are not always nash equilibria conversely the information in an extensive form game often allows certain unreasonable nash equilibria to be excluded from the set of rationalizable profiles a stronger form of rationalizability is appropriate if players are known to be not merely rational but also cautious what constitutes rational behavior in a noncooperative strategic situation this paper explores the issue in the context of a wide class of finite noncooperative games in extensive form the traditional answer relies heavily upon the idea of nash equilibrium nash 17 the position developed here however is that as a criterion for judging a profile of strategies to be reasonable choices for players in a game the nash equilibrium property is neither necessary nor sufficient some nash equilibria are intuitively unreasonable and not all reasonable strategy profiles are nash equilibria the fact that a nash equilibrium can be intuitively unattractive is well known the equilibrium may be imperfect introduced into the literature by selten 20 the idea of imperfect equilibria has prompted game theorists to search for a narrower definition of equilibrium while this research some of which will be discussed here has been extremely instructive it remains inconclusive theorists often agree about what should happen in particular games but to capture this intuition in a general solution concept has proved to be very difficult if this paper is successful it should make some progress in that direction the other side of the coin has received less scrutiny can all non nash profiles really be excluded on logical grounds i believe not the standard justifications for considering only nash profiles are circular in nature or make gratuitous assumptions about players decision criteria or beliefs the following discussion of these points is extremely brief due to space constraints more detailed arguments may be found in pearce 18

the economic and demographic status of female headed households in rural botswana analyzes the economic and demographic status of female headed households in botswana where insufficient economic opportunities force many men to live and work away from home the analysis is based on the rural income distribution survey conducted in 1974 75 by the central statistical office of botswana in which 957 households containing 6475 individuals were interviewed once a month for 23 months the relevant items surveyed were age and sex of household nembers amount and sources of income identity and value of assets use of time extent of education and sex of perceived head of household the analysis recognizes 4 types of households male head with male aged 20 64 present 452 male head with no male 20 64 present 77 female head with male aged 20 64 present 131 and female head with no male aged 20 64 present 277 the primary analysis consists of a comparison of the 1st and 4th of these groups categories 2 and 3 are intermediate positions and their characteristics are less clear cut the income distribution in rural botswana is more unequal than in many other developing countries with female headed households faring especialy poorly on a per adult equivalent basis the welfare attained by members of female headed households is nearly 25 lower than that attained in male headed households such is the case despite the fact that women in botswana have been shown to compare favorably with men in regard to education willingness to work agricultural know how and entrepreneurial ability reasons for womens lower economic status in this country are discussed and policy suggestions to overcome this discrepancy are made

the real exchange rate and macroeconomic performance in sub saharan africa abstract pooled time series and cross section data for 33 countries in sub saharan africa ssa confirm the negative relationship between the real exchange rate rer misalignment and economic performance economic growth imports exports saving and investment macroeconomic instability also slows growth and other indicators of performance higher levels of misalignment are accompanied by higher levels of macroeconomic instability both lower levels of rer misalignment and instability lead to better economic performance the edwards model of rer determination performs well for the region black market premia tend to show a greater degree of misalignment in rer than alternative measures

on endogenous competitive business cycles the belief that the long run equilibrium of a competitive monetary economy that does not experience any exogeneous shocks whether originating from the external environment or from policy should be modelled as a state that is stationary or perhaps growing at a constant rate seems to be deeply rooted in the mind of some economists

is market liberalization compatible with food security storage trade and price policies for maize in southern africa abstract concern for the negative impacts of staple food price fluctuations limits the extent to which governments in low income countries are willing to liberalize their agricultural markets these concerns are legitimate as such price fluctuations can lead to high transactions costs for poor consumers in the short run and low growth in the long run however past government attempts to stabilize food prices completely have been expensive and ineffective use of a dynamic programming optimization model suggests that a different type of policy regime could reduce price variability significantly compared to what would prevail in free markets and could accomplish this at relatively low cost this policy regime includes allowing some official price flexibility with respect to changes in production and world price exporting when regional market opportunities exist and holding considerably lower stocks than in the past

has recovery begun africa s adjustment in the 1980s revisited this article reviews the 1989 debate between the world bank and the economic commission for africa over africa s adjustment and on the basis of most recent statistics concludes that there is little evidence that the region is in throes of a recovery some countries however did relatively better than others in the 1980s and an attempt is made to account for differences in performance it is concluded that success in adjustment results not from world bank international monetary fund programs as such but rather from policy coherence accompanied by healthy movement in key variables namely the real exchange rate and public development expenditure

impacts of structural adjustment programs on african women farmers and female headed households the structural adjustment programs saps initiated by the international monetary fund imf and the world bank and supported by donors are stimulating many tropical african economies through an infusion of foreign exchange increased agricultural prices devaluation of overvalued currencies improved marketing policies trade liberalization and increased competition from the private sector recently however debates about the pros and cons of saps have ensued

alonso s discrete population model of land use efficient allocations and competitive equilibria in his 1964 book w alonso proposed several concepts of land use equilibrium in terms of discrete population however the so called new urban economics has been concerned exclusively with continuous population models it is the authors belief that in order to develop logical foundations for continuous population models it would be useful to go back to the original models of alonso in this paper they focus on the additive land price model of alonso and examine its solution characteristics in particular the authors demonstrate the existence and pareto efficiency of equilibria and the supportability of efficient allocations through additive land price systems copyright 1992 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

food poverty profile and decomposition applied to ghana abstract a new procedure for deriving a food poverty line and estimating a decomposable poverty measure is applied to the 1974 1975 ghana household budget survey a food poverty profile is constructed which estimates the relative contributions of regional and socioeconomic variables to overall food poverty the incidence of food poverty is found to be more prevalent in 1 rural areas and locations close to the sahel and 2 households with many members and illiterate female or self employed heads comparisons of least cost diets and observed diets incorporating tastes suggest that households exercise food preferences which have relatively high costs

agricultural policy in tropical africa is a turnaround possible abstract the food crisis in africa has entered our living rooms through television and the press why is per capita agricultural production lower now than at independence in the early 1960s this article examines the factors responsible and outlines some solutions both external and internal factors have converged to create the crisis low prices to farmers to placate vocal urban consumers inefficient high cost marketing boards governments neglect of agriculture in favor of industry over valued exchange rates lack of foreign exchange and increasing debt burdens externally the depressed world market decreased demand for africa s exports and contributed to the stagnation of the economics drought a population growth rate approaching 3 year and a shortage of human capital added to the crisis

information and economic analysis a perspective ten years ago i delivered a paper before this group with the title information and economic analysis i chose the title deliberately i did not call the subject on which i was speaking the economics of information because to do so would have been to suggest that my topic like the economics of agriculture or the economics of industry or the economics of labour represented another branch of specialisation within economics i wanted to suggest that informational considerations were in fact central to the analysis of a wide variety of phenomena that they constituted a central part of the foundations of economic analysis at the time though economists had long paid lip service to the importance of information there was little formal literature the last decade has seen a burgeoning of the literature it has become to the late 7o s and early 8o s what growth theory was to the early 6o s and it has been greeted with some of the same scepticism there seems to be a myriad ofspecial cases and few general principles the little examples are often contrasted unfavourably with the generality of general equilibrium theory what have we learned have diminishing returns set in are there fruitful directions for future research and if so what are they these are the questions which i wish to address here the work of the past decade has made i think a fundamental and lasting contribution to economic analysis the contributions have been both negative and positive we have learned that much of what we believed before is of only limited validity that the traditional competitive equilibrium analysis though having the superficial appearance of generality in terms of superscripts and subscripts is indeed not very general the theory is not robust to slight alterations in the informational assumptions it is but a special and not very plausible example among the possible set of informational assumptions which can be employed to characterise an economy at the same time the theory has been able to provide insights into phenomena about which the traditional model had nothing to say or which seemed inconsistent or inexplicable within the competitive paradigm it has provided some of the micro foundations for macro economics it has provided the basis of a new theory of the firm of a new new welfare economics and of a theory of economic organisation including a comparison of economic

the effects of recent price liberalization on kenyan peri urban dairy a case study using the policy analysis matrix approach abstract when shortages of dairy products became severe in kenya early in 1992 prices of dairy products were de controlled to improve the incentives to producers the impact of that policy change is examined using the policy analysis matrix pam methodology a case study of the marketing chain involving small holder peri urban dairy producers in the nyeri region is considered the price policy reform removed only between 20 per cent and 30 per cent of the negative policy effects on most dairy producers depending on the technology used the market thus remains non competitive and a single large dairy processor was the biggest beneficiary of the policy change

monopolistic competition and the effects of aggregate demand how important is monopolistic competition to an understanding of the effects of aggregate demand on output we ask the question at three levels can monopolistic competition by itself explain why aggregate demand movements affect output can it together with other imperfections generate effects of aggregate demand in a way that perfect competition cannot if so can it give an accurate account of the response of the economy to aggregate demand movements the answers are no yes and yes

a bargaining model with incomplete information about time preferences etude d un jeu de negociation strategique sequentiel avec information incomplete caracterisation d une classe d equilibres sequentiels appeles equilibres sequentiels de negociation et demonstration de l unicite de cet equilibre

walrasian indeterminacy and keynesian macroeconomics overlapping generations models with or without production or a portfolio demand for money display a fundamental indeterminacy expectations matter and they are not in the short run constrained by the hypotheses of agent optimization rational expectations and market clearing no short run policy analysis is possible without some explicit understanding of how agents expect the economy to respond to the policy in this framework of perfect foresight and market clearing prices it is possible to make keynesian assumptions about the rigidity of money wages and the exogeneity of animal spirits of investors to use the standard is lm apparatus and to derive keynesian conclusions about the short run effectiveness of policy alternatively starting from different but no less rational expectations one can derive the new classical neutrality propositions keynesian macroeconomics is based in part on the fundamental idea that changes in expectations or animal spirits can affect equilibrium economic activity including the level of output and employment it asserts moreover that publicly announced government policy also has predictable and significant consequences for economic activity and that therefore the government should intervene actively in the marketplace if investor optimism is not sufficient to maintain full employment the keynesian view of the indeterminacy of equilibrium and the efficacy of public policy has met a long and steady resistance culminating in the sharpest attack of all from the so called new classicals who have argued that the time honoured microeconomic methodological premises of agent optimization and market clearing considered together with rational expectations are logically inconsistent with animal spirits and the non

the effects of macroeconomic factors on south african agriculture significant research efforts have been devoted to understanding the effects of macroeconomic factors on the agriculture sector analysing the sources of volatility in the industry is critical for designing appropriate policies to stabilize agricultural markets reduce poverty and increase economic growth agriculture is a competitive sector with prices that are more flexible than those in nonagricultural sectors this article uses annual data over the 1957 2004 period and a vector error correction model in investigating the dynamic effects of exchange rates money supply and other macroeconomic variables on the agricultural sector in south africa overall real exchange rates interest rates inflation and money supply m3 shocks have significant and persistent impacts on agricultural output prices received by farmers and farm input prices m3 and interest rate shocks tend to put agriculture in a cost price squeeze agricultural price movements are a source of macroeconomic instability in the country r

is a turnaround in africa possible without helping african women to farm a turnaround in africa is not possible in the short run of at least 1 decade without helping women farmers with hand hoes gain equal access to basic agricultural inputs and resources this is so because women are such active participants in farming it is estimated that for 82 countries women constitute 46 of the agricultural labor force in sub saharan africa and 31 of the force in north africa and the middle east in the long run however a turnaround is possible without helping women to farm because women farmers will be displaced as agricultural intensification occurs but because the intensification process will be extremely uneven both within and between african countries the displacement of women farmers will also be uneven thus their displacement will be blocked or slowed down in regions with sufficient land resources and land extensive family systems extensive male out migration lack of control of animal diseases or the presence of gender neutral incentives to produce in conclusion women farmers in these regions will still be the norm while those in other regions will be displaced as intensification required by a turnaround proceeds to insure that women farmers are not displaced policy planners at international national and local levels should communicate with technical experts and extension specialists about the need to incorporate women as agricultural producers with full access to yield increasing inputs in development projects

interrelationships between monetary instruments and agricultural commodity trade during the last decade agricultural economists have devoted increasing attention to the macroeconomic aspects of agricultural problems indeed a recent presidential address to the american agricultural economics association tweeten centered on the macroeconomics of agriculture given the currency of the monetary approach to macroeconomics it is not surprising therefore that there is also a growing interest in the effects of monetary instruments and monetary phenomena on agricultural commodity trade in this paper i shall discuss what i feel are some of the most pertinent issues that researchers must address in this area before we proceed too far with our discussion it is important to define what i mean by a monetary instrument perhaps arbitrarily i reserve the term monetary instrument for those macroeconomic variables which are primarily determined within domestic or international monetary markets obvious examples are the level of the money supply interest rates and exchange rates i justify the term instrument by noting that as far as the agricultural sector is concerned these variables are by and large predetermined for example the levels of the money supply and interest rates in the united states are to a large extent determined by the policy of the federal reserve similarly the price of the currency the exchange rateis ultimately determined by the demand and the supply for the currency and thus at least partially by governmental policy the first step in any attempt to outline research needs and goals is an identification of what has been done in the past although the literature on the macroeconomics of agriculture is farily large and rapidly expanding eckstein and heien lamm schuh 1976 and tweeten are important examples relatively li tl attention has been given to the effect of monetary instruments on agricultural trade what attention has been given to this area of resea ch has revolved mainly around the role of exchange rates in determining agricultural exports and prices thus it is logical to start our discussion with a brief survey of the literature on exchange rates and agriculture

macroeconomic stabilization policy and trade union behaviour as a repeated game lt is unquestionably true that the presence of trade unions in an economy affects its macroeconomic behaviour by attempting to maintain traditional patterns of relative wages among occupations and industries and by resisting cuts in real wages unions slow macroeconomic adjustment and structural change in response to macroeconomic shocks it is often argued that by insulating groups of workers from competitive pressures wage determination is less associated with market clearing than it otherwise would be overlapping contracts and resistance to relative wage changes thus give aggregate wage inflation mo mentum it would not otherwise have taylor 1980 jackman 1983 trade union bargaining may affect the position of the phillips curve jackman and layard 1982 nickell 1982 a popular argument for the increases in the nairu non acceleratinginflation rate of unemployment which have taken place between 1960 and 1980 in many industrialized countries where unions are strong is that trade unions have grown more militant and their bargaining behaviour has changed in some way this argument goes back at least as far as hines 1964

the costs of indonesian sugar policy a policy analysis matrix approach indonesian sugar policy is a complex web of contradictory policies including mandatory production price supports and fertilizer and credit subsidies the policy analysis matrix pam was developed by monke and pearson to provide a more complete perspective on social profitability and the divergence between private and social costs than other commonly used social cost benefit measures the pam is used to analyze the effects of indonesian sugar policy on sugar production in irrigated and dryland areas on java the main sugar producing region in indonesia and to identify the distribution of resource transfers

liberalization and food price distributions arch m evidence from madagascar abstract there is no well articulated theory of how stochastic food prices respond to economic liberalization measures a surprising oversight in the vast literature on market oriented reforms this paper presents reduced form estimates of the effects of liberalization measures on food commodity prices in madagascar using autoregressive conditional heteroskedastic in mean arch m methods the data indicate that the short term effects of liberalization on the mean and variance of food prices vary substantially by commodity region and season in the long term liberalization increases both the mean and the variance of food prices the abandonment of a quantity rationed state marketing system with administrative pricing also leads to smaller inter regional and interseasonal differences in mean food prices and a sharp increase in price autocorrelation real exchange rates have pronounced positive effects on mean food prices but these effects emerge indirectly rather than directly through induced changes to border parity prices

the impact of prices and macroeconomic policies on agricultural supply a synthesis of available results abstract this paper reviews the literature dealing with the link of agricultural prices and macroeconomic policies to agricultural supply with particular emphasis on sub saharan africa although the study echoes the stylized facts on price elasticities underlined in previous literature reviews the paper points out that our understanding of the quantitative dimensions of agricultural supply response is weak given the importance of this assumed response for growth poverty alleviation and the environment indeed issues such as simultaneity of variables data pooling omission of variables and asymmetry in supply responses to price changes have not been adequately addressed in many instances

the rise in unemployment a multi country study one of the most remarkable features of recent economic history has been the remorseless rise in unemployment throughout the industrialized countries however while the trend to higher unemployment is universal the experience of individual countries also differs widely the increase is especially marked within the european community where unemployment rates rival those reached in the interwar years by contrast in the scandinavian countries and japan unemployment is lower and has risen very much less experience in the united states lies somewhere between these extremes and in the last few years unemployment there has fallen sharply

rural taxation in ethiopia 1981 1989 a policy analysis matrix assessment for net producers and net consumers abstract during the period of socialist rule 1974 1991 ethiopian agriculture was subject to an array of policy interventions this paper uses a policy analysis matrix pam approach to determine the effects of various policies on different types of households and in aggregate the analysis extends the usual use of pams by including consumption requirements and by addressing the variation in the impact of specific policies through time household models are used to quantify the effects of government intervention on both net consumers and net producers of cereals the analysis reveals that although cereal purchases were sometimes subsidized through overvaluation cereal deficit households paid high prices because of market segmentation and experienced reduced incomes due to exchange rate distortions households that tended to be surplus faced substantial indirect taxes through low producer prices results suggest that undistorted markets could enable many farms to accumulate sufficient reserves to cope with production variations but farms with average land availabilities are not sustainable given current technologies even with efficient commodity markets

equilibrium and the core in alonso s discrete population model of land use conventional wisdom tells us that with no market failure and local non satiation of preferences the core is at least as large as the collection of competitive equilibrium allocations we con rm this for a standard model featuring land next we consider the public land ownership version of the model if the role of land ownership and rent distribution is assumed by a government that ploughs back rent at least in excess of its agricultural value to its citizens the equilibrium remains efficient but no longer need be in the core

strategies for sustainable agricultural development in the ethiopian highlands this paper investigates the impacts of population growth market access agricultural credit and technical assistance programs land policies livelihood strategies and other factors on changes in land management natural resource conditions and human welfare indicators since 1991 in the northern ethiopian highlands based on a survey of 198 villages we find that population growth has contributed significantly to land degradation poverty and food insecurity in this region in contrast better market access and some credit and technical assistance programs were associated with improvement or less decline in land quality wealth and food security suggesting the possibility of win win win development outcomes with appropriate interventions land redistribution was associated with adoption of inorganic fertilizer but also with declining use of fallow and declining soil fertility we find also that different land management practices are adopted where different livelihood strategies are pursued suggesting the importance of considering livelihood strategies in technical assistance programs development strategies should be tailored to the different comparative advantages of different locations no one size fits all strategy will work everywhere this abstract was borrowed from another version of this item

subsidized imports currency devaluation and agricultural decline impact on food supply and demand balance in zaire abstract an adjusted small world trade liberalization model with 1984 as the base year was used to predict changes in zaire s net agricultural trade due to export subsidies from developed countries currency devaluation and stagnation in small farm technology given the availability of low cost food grain imports under the us export enhancement program zairian wheat imports increase 8 2 in the intermediate run assuming foreign exchange is available for food imports furthermore if improvements in agricultural technology are not forthcoming output of food and export crops will decline resulting in a loss of revenue from the farm sector and a deterioration in the country s balance of trade however since 1983 currency devaluation appears to have had the largest impact on net trade in food and export crops

the measurement of agricultural price distortion in developing countries the most common means of measuring agricultural price distortion in less developed countries has been through the estimation of variously defined nominal protection coefficients the objectives of this article are a to demonstrate that the coefficients which have been employed are inadequate for measuring price distortion b to develop a suitable method for measuring distortion at each point on domestic marketing chains and c to demonstrate using the example of maize in kenya the potential magnitude and direction of the differences between the conventional coefficients and the distortion coefficients developed in the article

maize pricing policy in eastern and southern africa abstract public sector attempts to determine official producer and consumer prices suffer from a number of problems made more apparent by the process of agricultural market liberalization six measures to ease the financial problems of policy adjustment are identified covering the clarification of the post reform role of official prices the move towards economically based pricing structures the introduction of within year price flexibility to reduce the costs of intervention the incorporation of macroeconomic linkages into the procedures for price setting the use of multi annual analysis and modelling for price determination and the articulation of modified systems of price support as marketing board networks are cut back an important conclusion is the need for a gradual phased approach to price reform

an investigation of the effect of monetary factors on agriculture abstract this paper uses an econometric model to assess some of the effects of macro monetary factors on u s agricultural markets attention is focused on impacts of decreasing increasing the level of domestic credit on agricultural trade prices inventory accumulation and domestic disappearance results show that tight monetary policy lowers prices and increase demand for domestic agriculture however the upward pressure on the exchange rate seriously deteriorates the position of u s exports in international markets

livestock pricing policy in sub saharan africa objectives instruments and impact in five countries abstract livestock pricing policies in many developing countries are often instituted without a good appreciation of the consequences of such policies for allocative efficiency output and trade this paper evaluates in a comparative cross country context the objectives and instruments of livestock pricing policy in five sub saharan african countries ivory coast mali nigeria sudan and zimbabwe during the period 1970 1986 it assesses the extent to which pricing policy objectives have been attained and also estimates the effects of price interventions on output consumption trade and government revenues in order to draw out lessons for the future the empirical results indicate that in comparison with real border prices a certain degree of success was achieved in stabilising real domestic producer prices in the study countries the results also show that since the early 1980s there has been a gradual shift away from taxation of producers however consumers still appear to gain as much as producers in three of the study countries with negative consequences for foreign exchange earnings and government revenues the analysis reveals the importance of domestic inflation and exchange rates as key variables for livestock pricing policies and highlights the need to address the macroeconomic imbalances that cause exchange rate distortions and high domestic inflation at the same time that direct price distortions are being tackled

macroeconomics and agriculture in tunisia this article aims to analyse the impact of changes in the monetary policy and the exchange rate on agricultural supply prices and exports the methodology used is based on the multivariate cointegration approach ten variables are considered interest and exchange rates money supply inflation agricultural output and input prices agricultural supply and exports income and the rate of commercial openness the sample period covers annual data from 1967 to 2002 due to the short sample period two subsystems are considered first long run relationships are identified in each subsystem second both subsystems are merged in order to calculate the short run dynamics the results indicate that changes in macroeconomic variables have an effect on the agricultural sector but the reverse effect does not hold

economic reform programmes and agricultural development macro policy sequencing in ghana 1983 1988 abstract 1983 saw the institution of an economic reform programme as a policy response to economic decline in ghana results indicate achievement of some degree of stabilization and growth agricultural performance was mixed a result partly attributed to poor macro policy sequencing this article highlights the importance of orderly macro policy sequencing for the achievement of growth and development it suggests setting structural measures within demand management measures in a mutually enhancing package consideration of social dimensions of reform programmes and measures to ameliorate hardships among vulnerable groups in initial stages of programmes is emphasized as important for the sustainability of economic reforms

why kill the golden goose a political economy model of export taxation why do governments tax exports at rates that are ultimately self defeating an answer may lie in the time inconsistent nature of a low tax policy using a dynamic model of export taxation i show that the sustainability of a low tax policy depends on three variables the ratio of sunk costs to total costs how heavily future export revenue is discounted and expected future export earnings using data on taxation leadership duration and profitability i test this theory for 32 countries and six crops from sub saharan africa these three variables are statistically and economically relevant predictors of tax regime

the impact of ethanol production on food prices the role of interplay between the u s and brazil abstract food prices have increased rapidly in recent years and so has ethanol production some studies have claimed that there is a connection between the two the main purpose of this paper is to add to this literature by examining the influence that the interplay between brazil and the u s in ethanol production has on food prices specifically and controlling for other variables which have been shown to affect food prices we investigate whether sugarcane ethanol and corn ethanol production have similar impacts on food prices and whether ethanol productivity affects food prices we find a positive significant effect of brazilian market share in world ethanol market on relative food prices we also find that an increase of brazilian cane ethanol area has a negative effect on relative food prices

institutions and short run macroeconomic performance abstract this paper reviews the growing interest in institutions it argues that the explanation for this interest is a fresh awareness of how institutions affect economic performance this connection arises because many economic interaction take the form of one or other of three classic games prisoners dilemma coordination and chicken and the outcome in these games and hence performance of the economy is influenced by the institutional context of these interactions the paper provides a detailed illustration of this argument with a survey of the literature which relates unemployment performances to the institutions of wage setting in oecd countries