differential fertility human capital and development using micro data from 48 developing countries this paper studies changes in crosssectional patterns of fertility and child investment over the course of the demographic transition before 1960 children from larger families obtained more education in large part because they had richer and more educated parents by century s end these patterns had reversed consequently fertility differentials by income and education historically raised the average education of the next generation but they now reduce it while the reversal is unrelated to changes in gdp per capita women s work sectoral composition or health roughly half is attributable to rising aggregate education in the parents generation the results support a model in which rising skill returns lowered the minimum income at which parents invest in education

endogenous lifetime and economic growth abstract endogenous mortality is introduced in a two period overlapping generations model probability of surviving from the first period to the next depends upon health capital that is augmented through public investment high mortality societies do not grow fast since shorter lifespans discourage savings development traps are possible productivity differences across nations result in persistent differences in capital output ratios and relatively larger gaps in income and mortality high mortality also reduces returns on education where risks are undiversifiable when human capital drives economic growth countries differing in health capital do not converge to similar living standards threshold effects may also result

introduction to the special issue on the world food crisis this issue of agricultural economics contains articles on the causes and effects of rising food prices all papers were subject to full double blind peer review on an accelerated basis in an effort to publish the best new research as quickly as possible we received more than 60 submissions referees were given three weeks to respond and authors of candidate papers had an additional week to revise their work before final acceptance articles published use descriptive econometric and simulation methods for both global overviews and case studies

household survey data and pricing policies in developing countries in recent years household survey data from developing countries have increasingly become available and have been increasingly used to cast light on important questions of policy the reform of prices whether agricultural prices consumer taxes subsidies or tariffs has consequences for individual welfare and for government revenues and these can be investigated empirically with household survey data the gainers and losers from price changes can be identified and the magnitudes of their gains and losses measured nonparametric estimation techniques provide a straightforward and convenient way of displaying this information the procedure is illustrated for the effects of rice pricing in thailand using data from more than five thousand rural households estimates of the revenue effects of price reforms are harder to obtain because they require estimates of supply and demand elasticities estimates that are not easily obtained for many developing countries a procedure is presented for estimating price elasticities of demand from spatial price variation as recorded in household survey data the main innovations lie in the appropriate treatment of quality variations and measurement error applications of the procedure in cote d ivoire indonesia and morocco are reviewed

intergenerational income group mobility and differential fertility one question development economists are especially interested in but so far left unanswered is how would the societal income distribution be affected by introducing a family planning program to reduce the reproduction rate of the poor which is usually high in developing countries the purpose of this paper is to search for analytical answers to this question we are able to make definite comparisons about some class of inequality measures of the steady state societal income distributions and these comparisons provide strong theoretical support in favor of the above mentioned family planning program excerpt

the effect of distance and road quality on food collection marketing margins and traders wages evidence from the former zaire abstract food price variation is typical of the food economies of many low income countries the presence or absence of road infrastructure is perceived to be one of the main determinants of this variation this analysis shows that in the case of the former zaire food price dispersion is significant both across products and across regions it is demonstrated that transportation costs explain most of the differences in food prices between producer regions and that road quality is an important factor in the transportation costs however food prices decrease relatively faster than transportation costs increase and traders wages are higher on bad roads

can fao s measure of chronic undernourishment be strengthened abstract in its sixth world food survey released at the 1996 world food summit the food and agriculture organization of the united nations fao reported that 841 million people in developing countries are chronically undernourished this number and its country and regional level disaggregations have proved tremendously useful to countless development aid agencies and researchers in the context of a recent wave of new nationally representative household food consumption and expenditure surveys this paper examines the estimation methodology underlying the food insecurity measure which relies on national aggregate measures of food availability and distribution the paper finds that the measure largely reflects national food availabilities and does not adequately capture people s ability to gain access to food the ultimate key to food security the implications for the indicator s use by policy makers in geographical targeting and tracking changes in food insecurity over time are drawn out the paper concludes by arguing that the time has come to review the potential for employing the new household survey data along with new methods to strengthen the empirical foundations of fao s measure

fertility social mobility and long run inequality dynastic altruistic models with endogenous fertility have been shown to be unable to generate enough intergenerational persistence using a bewley model with endogenous fertility we show that it is possible to recover persistence key ingredients for our result include exponential child discounting discrete number of children diminishing costs of child rearing and an elasticity of intergenerational substitution larger than one our model provides a unified framework of analysis for long run inequality that incorporates fertility choices

the impact of the global food crisis on self assessed food security the paper provides the first large scale survey based evidence on the impact of the global food crisis of 2007 08 using an indicator of self assessed food security from the gallup world poll for the sampled countries as a whole this subjective indicator of food security remained the same or even improved seemingly owing to a combination of strong economic growth and limited food inflation in some of the most populous countries particularly india however these favorable global trends mask divergent trends at the national and regional levels with a number of countries reporting substantial deterioration in food security the impacts of the global crisis therefore appear to be highly context specific

markets transportation infrastructure and food prices in nepal we study transportation infrastructure and food markets in nepal over the period 2002 to 2010 combining monthly price data from thirty seven local and regional markets and seven indian border markets we use a series of autoregressive models to study price determination spatial and temporal price transmission and price variance we account for district level agricultural production correcting for bi directional causality between output and prices using ground station rainfall data in addition to test hypotheses regarding the importance of transportation infrastructure we incorporate information on road and bridge density and fuel costs for both rice and wheat we find strong evidence of local price intertemporal carryover and very weak evidence of price transmission from regional central and border markets to local markets suggesting very low degrees of market integration fuel costs are positively correlated with food prices and road and bridge density are negatively correlated with prices we find evidence of asymmetric effects positive price shocks are correlated with higher subsequent price volatility compared with negative price shocks of similar magnitude roads and bridges are important for moderating price levels and price volatility in nepal s rice and wheat markets which explains roughly half of the spatial and temporal variation in price mark ups between regional and local markets

the geography and causes of food insecurity in developing countries abstract at the 1996 world food summit 186 countries made a commitment to reduce the number of chronically undernourished people by half by 2015 in order to formulate effective policies for reaching this goal a thorough understanding of the location and causes of food insecurity is needed this paper provides a broad overview of the current character of food insecurity in developing countries focusing on two questions 1 why are they food insecure and 2 why are the food insecure to answer the latter question data from 58 developing countries with high prevalences of food insecurity are employed to examine the relative importance of two of food insecurity s most basic causes national food availability and the inability of people to access food due to poverty using child malnutrition as a proxy along with descriptive controls for non food determinants of malnutrition the paper finds little correlation between national food availabilities and food insecurity the group of countries that exhibit the highest severity of food insecurity are those with high poverty and food dietary energy surpluses consistent with the view that poverty is the most widespread cause of food insecurity in the 1990s the paper concludes by considering the implications of the analysis for appropriate geographical and policy targeting to improve food security for the greatest numbers of people at the fastest pace now and into the 21st century

the eastern enlargement of the european union this paper examines the prospects and problems of eastern enlargement it argues that considerations of stability and long run prosperity are the primary reasons why the eu has promised to enlarge eastward and why the central and eastern european nations wish to join while high politics prompted this promise opposition from eu special interest groups is likely to delay fulfilment of the promise for many years if this is the case europe should create a series of intermediate steps that would permit the reintegration of europe to proceed apace if a quick enlargement does occur eu politics is likely to become much more complicated the ceecs would have many votes in the council of ministers yet they would be very different economically to the average eu incumbent

majority rules and incentives a club s majority rule defines the number of members that must approve a policy proposed to replace the status quo since the majority rule thus dictates the extent to which winners must compensate losers it also determines the incentives to invest in order to become a winner of anticipated projects if the required majority is large members invest too little because of a holdup problem if it is small members invest too much in order to become a member of the majority coalition to balance these opposing forces the majority rule should increase in the project s value and the club s enforcement capacity but decrease in the heterogeneity in preferences externalities can be internalized by adjusting the rule with heterogeneity in size or initial conditions votes should be appropriately weighted or double majorities required

income distribution dynamics with endogenous fertility developing countries with highly unequal income distributions such as brazil or south africa face an uphill battle in reducing inequality educated workers in these countries have a much lower birthrate than uneducated workers assuming children of educated workers are more likely to become educated this fertility differential increases the proportion of unskilled workers reducing their wages and thus their opportunity cost of having children creating a vicious cycle a model incorporating this effect generates multiple steady state levels of inequality suggesting that in some circumstances temporarily increasing access to educational opportunities could permanently reduce inequality empirical evidence suggests that the fertility differential between the educated and uneducated is greater in less equal countries consistent with the model

undocumented immigration and income inequality in the native born population of the us econometric evidence according to the theoretical models suggested by chiswick and others the growing presence of undocumented immigrants in the us should have a disequalizing effect on income distribution in the native born population however this proposition has not been subjected to empirical test here an econometric model of income inequality in native born households is constructed and census based estimates of the state distribution of undocumented immigrants are used to estimate model parameters the results show that such immigration has been disequalizing but that the impact has been small ranking behind several other socio economic variables

distributive implications of an aging society abstract the paper reviews recent research on the impact of an aging population on the distribution of income after briefly discussing the demographic conditions responsible for population aging a short account is given of demographic trends in the industrialized world in order to disentangle the many potential channels by which an aging society affects the dispersion of income several levels of aggregation are distinguished the paper differentiates between intra and intergenerational issues between direct and indirect demographic inequality effects and between the distribution of current and lifetime income it emphasizes the critical role of age related redistributive tax transfer systems like public pension schemes and health care systems sources of distributional policy conflicts are identified at both the cross section level and the lifetime level of income inequality the institutional design of intergenerational burden sharing individual disincentive reactions shifts in age income profiles related to cohort size and politico economic repercussions are shown to drive the relation between population aging and income distribution in distinct and partially opposite ways

examining the link between food prices and food insecurity a multi level analysis of maize price and birthweight in kenya in developing countries where many poor people rely on rainfed locally produced food for the majority of their caloric intake shifts in climate and weather patterns can dramatically reduce agricultural productivity the reduction in agricultural productivity reduces overall food availability and ultimately impacts food accessibility putting millions of people at risk for malnutrition in this project we focus on kenya where roughly a third of households are food insecure we examine the relationship of the price of maize and low birth weight to help quantify the impact of local food prices on one outcome of household food insecurity using spatially referenced data from recent kenyan demographic and health survey datasets price data livelihood information and a remotely sensed based measure of local growing season productivity we develop a dataset linking pregnancies occurring from 2001 to 2008 to the spatially and temporally relevant maize price data we construct several regression models to examine the impact of local maize prices and remotely sensed based estimates of crop production on infant birth weight specifically low birth weight the results of the models highlight the importance of including community crop production to evaluate maize price impacts on low birth weight outcomes also because of the positive correlation between pre pregnancy maize prices and birth weight the results suggest that some households may benefit from high prices or that high prices may impact the number of conceptions more generally our work demonstrates that multilevel models that account for community level variation are important for disentangling these complex relationships and can contribute to the discussion of how to design more effective food policies

why are african commodity exchanges languishing a case study of the zambian agricultural commodity exchange abstract food price volatility and high transactions costs remain major problems in african food markets these persistent problems provide a strong theoretical justification for the development of commodity exchanges however the majority of african commodity exchanges remain underdeveloped through a case study of the zambian agricultural commodity exchange zamace this article explores why agricultural commodity exchanges in the region have thus far failed to develop into sustainable trading platforms and identifies the most important changes needed to enhance their performance drawing on interviews and group discussions with the primary participants on zamace five main factors that impede volumes traded on the zamace exchange are identified and analyzed 1 the limited success in attracting financial institutions commitment to commodity exchanges 2 the anonymous nature of trading on a commodity exchange exacerbates the risks associated with contract non compliance and opportunistic behavior 3 the potential for conflict of interest among brokers 4 the potential for market manipulation in a thinly traded market and 5 the high fixed costs that are imposed on actors trading in a thin market exacerbating all these factors is the unpredictability of government intervention in cereal markets

predicting the effects of sugar sweetened beverage taxes on food and beverage demand in a large demand system a censored exact affine stone index incomplete demand system is estimated for 23 packaged foods and beverages and a numeraire good instrumental variables are used to control for endogenous prices a half cent per ounce increase in sugar sweetened beverage prices is predicted to reduce total calories from the 23 foods and beverages but increase sodium and fat intakes as a result of product substitution the predicted decline in calories is larger for low income households than for high income households although welfare loss is also higher for low income households neglecting price endogeneity or estimating a conditional demand model significantly overestimates the calorie reduction

concentration of income and land holdings abstract economic growth is one of the causes of income disparity among countries however some evidence suggests that the maldistribution of land holdings is the underlying factor of the inequality of income kuznets speculates that over the stages of economic growth it is the initial unequal income distribution that induces a high concentration of asset holdings and this in turn contributes to a high concentration of income to resolve this ambiguity the paper introduces latent variables in a path model designed for causal prediction estimation is done by world s partial least squares method prediction is based on the q 2 statistic findings show that for both dcs and ldcs as well as for a sample of all countries the causal predictive direction between concentrations of income and land holdings is from the former to the latter

the infant mortality fertility debate some international evidence the aim of this paper is to analyze empirically the causal relationship if any between infant mortality and fertility in thirty five developing countries the focus is on possible relationships between the infant mortality rate and the fertility rate the hypothesis that infant mortality causes fertility is tested the possibility of a reverse causation is also analyzed a one sided distributed lag test as proposed by granger is employed the results are analyzed in light of several versions of the mortality fertility proposition including demographic transition theory choice theory ricardian theory and the modern economic theory of population excerpt

a microeconomic analysis of the timing of births abstract the effects of personal characteristics wage rates and career structures on the time profile of childbearing among married couples are examined theoretically through an intertemporal microeconomic model of family decisions and empirically by an econometric analysis of british women s childbearing and work histories the effects of the mother s age on the quality of the child and the financial implications of interrupting the mother s career to care for a child are taken explicitly into account the demographic consequences of economic policies are also examined

formal institutions and social capital in value chains the case of the ethiopian commodity exchange we explore whether the creation of the ethiopian commodity exchange ecx and its formal monitoring and enforcement institutions has affected social capital and trust in the ethiopian segment of the sesame value chain consistent with a simple theoretical marketing model our panel data suggest this is indeed the case trade in sesame is increasingly governed by formal rather than informal institutions and in response traders have broadened their trading network rely more frequently on traders with whom they do not have social relations and have reduced the provision of credit that cements personalized relationships they also have lower levels of trust in the intentions and capabilities of their trading partners and attach less weight to trust

income distribution and macroeconomics this paper analyzes the role of wealth distribution in macroeconomics through investment in human capital it is shown that in the presence of credit markets imperfections and indivisibilities in investment in human capital the initial distribution of wealth affects aggregate output and investment both in the short and in the long run as there are multiple steady states this paper therefore provides an additional explanation for the persistent differences in per capita output across countries furthermore the paper shows that cross country differences in macroeconomic adjustment to aggregate shocks can be attributed among other factors to differences in wealth and income distribution across countries

spatial equilibrium and price transmission between southern african maize markets connected by informal trade policies regulating the international grain trade in southern africa sa are motivated by uncertainty regarding private sector performance and in turn private sector performance is generally constrained by the policy environment we study spatial price transmission between sa maize markets where trade is dominated by informal product flows this provides an opportunity to study private sector market performance in a largely unregulated market environment contrary to some existing evidence on the performance of sa grain markets connected by formal trade we find that informally trading markets work quite well long run price equilibrium is consistent with competitive trade price transmission is rapid and potential trade constraints have no disruptive impact on long run relationships nevertheless we do find evidence of occasionally high transfer costs that may impede informal trade flows the conclusion is that a policy focus on encouraging informal trade and lowering informal trade costs would lead to improved market performance

causal relationships between infant mortality and fertility in developedand less developed countries fertility reduction seems to be a nearly universal feature of the development of modern secular societies 5 208 the lagged response of fertility to reductions in mortality manifested in the lack of coordinated fertility control programs has historically resulted in high growth rates of population in the less developed countries e g latin american countries 1 2 over the past two decades the causal relationships between infant mortality and fertility have been a controversial issue 16 29 since the direction of this causality is not established on empirical grounds many existing estimates of fertility demand functions and infant survival production and demand functions are marred by simultaneous equation bias the purpose of this study is to examine the dynamic relationships between infant mortality and fertility by applying time series techniques to the annual data on these variables for economically developed countries and for economically less developed countries first i examine causal relationships within a two variable model infant mortality and fertility rates for a sample of economically developed countries including the western european countries of denmark finland france norway portugal switzerland and the united kingdom the u k and the united states u s a the time periods studied are 1939 74 for most of the european countries 1942 74 and 1944 74 for the u k and 1923 77 for u s a 3

food marketing and pricing policy in eastern and southern africa a survey abstract this article surveys the empirical record of grain marketing and pricing policy in eastern and southern africa over 1930 1995 the paper addresses five key issues with major implications for food policy throughout africa a why the anticipated supply response to market liberalization has not yet occurred b why the common assumption of state taxation of farmers to support a cheap food policy does not apply in most of the countries in the region c why the temporary successes of the state led approach to stimulating smallholder grain production were unsustainable d why the elimination of government food subsidies associated with market reform has not adversely affected consumers and e why the fiscal cost of the marketing systems at least initially worsened rather than improved after the reforms were implemented in most countries the key future challenges for marketing policy are how to develop coordinated and financially sustainable input finance and commodity marketing systems for raising productivity growth in smallholder agriculture while overcoming inherited agricultural dualism and how to mitigate the effects of food price instability in a cost effective manner

measuring food insecurity the frequency and severity of coping strategies abstract defining and interpreting food security and measuring it in reliable valid and cost effective ways have proven to be stubborn problems facing researchers and programs intended to monitor food security risks this paper briefly reviews the conceptual and methodological literature on food insecurity measurment describes a particular method for distinguishing and measuring short term food insecurity at the household level and discusses ways of generalizing the method the method developed enumerates the frequency and severity of strategies relied on by urban households when faced with a short term insufficiency of food this method goes beyond more commonly used measures of caloric consumption to incorporate vulnerability elements of food insecurity as well as the deliberate actions of household decision makers when faced with food insufficiency

mortality fertility and persistent income inequality many developing countries are characterized by high and persistent inequality in the distribution of income while a growing body of literature emphasizes differential fertility as a channel through which income inequality persists this paper investigates differential child mortality differences in the incidence of child mortality among different income groups as a critical link in this regard we incorporate both endogenous child mortality and endogenous fertility in an overlapping generations model we demonstrate that differential child mortality and its interaction with differential fertility can generate an income inequality trap where high risk of child death prevents poor households from adequately investing in education empirical evidence based on cross country micro data support differential child mortality as an important channel for the transmission of inequality as predicted by the model from a policy perspective the results suggest that better access to child health care may be a more promising way to reduce income inequality than providing incentives to lower the family size of poor households

productive government expenditures and long run growth the purpose of this paper is to review some of the recent developments in endogenous growth models specifically our focus is on the growth effects of productive government spending in dynamic general equilibrium models we use a simple overlapping generations model as our basic framework and illustrate the role of taxes and spending we then examine several related issues nonrivalry in publicly provided goods existence and uniqueness of competitive equilibrium endogenous public policy ways of financing public expenditures composition of publicly provided goods and services and private alternatives finally we review some empirical results related to output elasticity of public capital and educational expenditures

prices infrastructure household characteristics and child height household survey data from brazil matched with information collected at the municipio county level are used to examine the relation between parental characteristics primarily education community infrastructure and services and child height data are drawn from 2 sources informacoes basicas municipais 1974 is a periodic survey of 4000 municipios on infrastructure health and education services estudo nacional da despesa familiar 1974 75 is a household survey covering 37000 children under age 8 on income expenditure anthropometry and socio demographic characteristics local food price indices were derived from these data child height is significantly affected by local infrastructure particularly modern sewerage and piped water in urban areas and electricity in rural settings these effects are stronger for children over 2 those of better educated mothers and those in households spending more higher prices for dairy products and sugar are linked to lower urban child height and higher fish prices to lower rural child height significantly for children of illiterate mothers higher prices for meat and rice are associated with taller height possible because men usually eat these foods mothers with elementary schooling can counteract the effects of food prices on child height number of teachers is positively related to height in rural children numbers of nurses and of hospital beds is associated with shorter children suggesting that large hospitals locate in poor urban areas this study has succeeded in identifying some public investments that affect child health

spatial integration transport costs and the response of local prices to policy changes in ghana abstract this paper investigates the respective roles of spatial integration and transport costs in explaining price changes in ghana we introduce a model of price formation and market integration that incorporates the price transmission process between local and central markets and also captures the implications for volatility of local prices we explore the implications of the model for the time path of price adjustments as determined directly and indirectly through the marketing sector we show that the price adjustment process in a local market is determined by the degree of interdependence between that market and the central market in which a price shock originates and estimate the intertemporal and interspatial dynamics of the price adjustment process using data from wholesale maize markets in ghana we find that reductions in local prices and local price variance following the introduction of economic reforms in 1983 can be traced to both local and central market forces but that differences in the degree of market integration have important implications for long run changes in transport costs and the evolution of prices in outlying markets

intergenerational transfers and the fertility income relationship evidence from cross sectional data reveals a negative relationship between family income and fertility this article argues that constraints to intergenerational transfers are crucial for understanding this relationship if parents could legally impose debt obligations on their children to recover the costs incurred in raising them then fertility would be independent of parental income a relationship between fertility and income arises when parents are unable to leave debts because of legal enforcement or moral constraints this relationship is negative when the intergenerational elasticity of substitution is larger than one a case in which parental consumption is a good substitute for children s consumption

food price variability and economic reform an arch approach for ghana changes in maize price levels and variability in ghana are investigated a model of wholesale price determination is reviewed in which grain stocks are held for speculative storage as well as export to neighboring countries in the sahel to test the model an autoregressive conditionally heteroskedastic arch regression is applied to monthly maize data for two markets over the period 1978 93 the regression is used to measure changes in maize price volatility in ghana and to infer the importance of past prices domestic and regional production and commodity storage and trade in explaining these changes

consumer response to maize market liberalization in urban kenya abstract the elimination of consumer food subsidies associated with structural adjustment in africa has been widely thought to exacerbate food insecurity for low income consumers this article determines how urban maize consumption and expenditure patterns have responded to the liberalization of the maize and maize meal markets in kenya the article decomposes changes in maize meal prices attributable to changes in maize grain prices and maize milling margins results are obtained through two random household surveys in nairobi the first having been conducted before and the second after liberalization the main finding of the study is that maize market liberalization has conferred substantial benefits to urban consumers the combined saving to nairobi consumers from lower maize milling costs has been roughly us 10 1 million each year about the same amount that the government of kenya allocates annually to agricultural research results also indicate that the former consumer subsidies conferred through the official marketing channel were untargeted and actually inversely related to household income the subsidies on sifted meal also served to entrench a non competitive market structure that inhibited the development of a lower cost informal milling system these findings are consistent with research results from other eastern and southern african countries showing that the negative effects of eliminating food subsidies in the state marketing system have been largely compensated by relaxing controls on private grain trade which has increased consumers access to less expensive grain products distributed through informal markets

racial inequality trends and the intergenerational persistence of income and family structure racial disparity in family incomes remained remarkably stable over the past 40 years in the united states despite major legal and social reforms previous scholarship presents two primary explanations for persistent inequality through a period of progressive change one highlights continuity because socioeconomic status is transmitted from parents to children disparities created through histories of discrimination and opportunity denial may dissipate slowly the second highlights change because family income results from joining individual earnings in family units changing family compositions can offset individuals changing economic chances i examine whether black white family income inequality trends are better characterized by the persistence of existing disadvantage continuity or shifting forms of disadvantage change i combine cross sectional and panel analysis using current population survey panel study of income dynamics census and national vital statistics data results suggest that african americans experience relatively extreme intergenerational continuity low upward mobility and discontinuity high downward mobility both helped maintain racial inequality yet intergenerational discontinuities allow new forms of disadvantage to emerge on net racial inequality trends are better characterized by changing forms of disadvantage than by continuity economic trends were equalizing but demographic trends were disequalizing as family structures shifted family incomes did not fully reflect labor market gains

estimating the short run poverty impacts of the 2010 11 surge in food prices global food prices have increased substantially since mid 2010 as have prices in many developing countries in this study we assess the poverty impact of the price changes between june and december 2010 in twenty eight low and middle income countries this is done by gathering detailed information on individual households food production and consumption levels for thirty eight agricultural and food commodities to assess the impacts on household welfare this study estimates that this sudden food price surge increased the number of poor people globally but with considerably different impacts in different countries the heterogeneity of these impacts is partly related to the wide variation in the transmission of global prices to local prices and partly to differences in households patterns of production and consumption on balance the adverse welfare impact on net buyers outweighs the benefits to net sellers resulting in an increase in the number of poor and in the depth of poverty we estimate that the average poverty change was 1 1 percentage points in low income countries and 0 7 percentage points in middle income countries with a net increase of 44 million people falling below the 1 25 per day extreme poverty line

higher fuel and food prices impacts and responses for mozambique rising world prices for fuel and food represent a negative terms of trade shock for mozambique the impacts of these price rises are analyzed using various approaches detailed price data show that the world price increases are being transmitted to domestic prices short run net benefit ratio analysis indicates that urban households and households in the southern region are more vulnerable to food price increases rural households particularly in the north and center often benefit from being in a net seller position longer term analysis using a computable general equilibrium cge model of mozambique indicates that the fuel price shock dominates rising food prices from both macroeconomic and poverty perspectives again negative impacts are larger in urban areas the importance of agricultural production response in general and export response in particular is highlighted policy analysis reveals difficult trade offs between short run mitigation and long run growth improved agricultural productivity has powerful positive impacts but remains difficult to achieve and may not address the immediate impacts of higher prices

the effect of changes in the population on several measures of income distribution an economic model is used to explore the relationship between population growth and 2 of the most commonly used income distribution statistics the share of the rich and the poor in total income and the rate of growth of real income of the rich and the poor brazilian statistics applied to the model illustrate the difficulty of interpreting the common inequality measures under conditions of rapid population growth neither income shares nor growth rates can tell much about the degree of progressivity in the growth strategy of a particular country without adjustment absolute income for the base period poor or base period teenagers was greater than reported for either the poor or teenagers however the rise in inequality was also greater for the base period population growth in brazil was seen to be even more regressive than previously thought significant upward mobility was however still possible

rising food prices food price volatility and social unrest can food prices cause social unrest throughout history riots have frequently broken out ostensibly as a consequence of high food prices using monthly data at the international level this article studies the impact of food prices food price levels as well as food price volatility on social unrest because food prices and social unrest are jointly determined data on natural disasters are used to identify the causal relationship flowing from food price levels to social unrest results indicate that for the period 1990 2011 food price increases have led to increases in social unrest whereas food price volatility has not been associated with increases in social unrest these results are robust to alternative definitions of social unrest to using real or nominal prices to using commodity specific price indices instead of aggregated price indices to alternative definitions of the instrumental variable to alternative definitions of volatility and to controlling for non food related social unrest

the developing world is poorer than we thought but no less successful in the fight against poverty a new data set on national poverty lines is combined with new price data and almost 700 household surveys to estimate absolute poverty measures for the developing world we find that 25 of the population lived in poverty in 2005 as judged by what poverty typically means in the world s poorest countries this is higher than past estimates substantial overall progress is still indicated the corresponding poverty rate was 52 in 1981 but progress was very uneven across regions the trends over time and regional profile are robust to various changes in methodology though precise counts are more sensitive

putting the 2007 2008 global food crisis in longer term perspective trends in staple food affordability in urban zambia and kenya abstract staple food prices in cities in eastern and southern africa rose sharply between late 2007 and early 2009 leading to estimates of massive increases in food insecurity and hunger however in assessing the impacts of soaring food prices on urban consumers access to food it is important to consider food price changes relative to changes in per capita incomes in this study we use the case studies of zambia and kenya where data are available on food prices wage rates incomes and other indicators of urban purchasing power to answer two main questions i how did staple food purchasing power at the height of the food price crisis compare to levels over the last 15 years and ii did the food price crisis exacerbate an already declining trend in staple food purchasing power or did it reverse a trend of stable or improving staple food affordability results indicate that staple food purchasing power in urban zambia and kenya improved markedly in the 10 12 years prior to the food price crisis most measures of bread and maize meal affordability at the start of the crisis in 2007 were at levels 1 0 4 3 times higher than in the mid 1990s these gains for urban consumers were slashed but not completely reversed during the food crisis between 2007 and 2009 maize meal and bread were still more affordable in urban zambia than all periods between 1994 and 2003 in urban kenya staple food purchasing power as of 2008 2009 was comparable to levels in 2000 2001 2004 2005 according to some indicators while other measures suggest that the food price crisis reduced staple food purchasing power to levels lower than any other year in the period 1994 1995 2007 2008

specific investments and the eu enlargement abstract this paper analyzes a hold up problem in the eu enlargement process eu specific anticipatory investments of private firms lower the government s outside option the eu takes advantage of the applicants increased dependency and extracts more surplus through entrance conditions that benefit it and impose net costs on applicants if private firms pay less than the full entrance fee in taxes enlargement immiserizes the entrant while in practice an applicant may possess sufficient bargaining power to avoid immiserization the hold up problem reduces its potential gains from joining the eu this result suggests that previous calculations ignoring both the applicants costs of joining the eu and the dynamics of their bargaining position during the negotiations overestimate the welfare effects of membership

the effects of ncpb marketing policies on maize market prices in kenya the government of kenya pursues maize marketing policy objectives through the national cereals and produce board ncpb which procures and sells maize at administratively determined prices and stores maize as a contingency against future shortages a private sector marketing channel competes with the ncpb this article estimates the effects of ncpb activities on the historical path of private sector prices in kenyan maize markets between 1989 and 2004 the analysis is carried out using a reduced form vector autoregression model var estimated with sparse data and imposing only minimal identification restrictions results show that ncpb activities have stabilized maize market prices in kenya reduced price levels in the early 1990s and raised average price levels by roughly 20 between 1995 and 2004 over the past decade the price raising activities of the ncpb have transferred income from urban consumers and a majority of small scale farm households that are net buyers of maize to a relatively small number of large and small scale farmers who are sellers of maize

economic consequences of an aging population pip europe and japan are experiencing the aging of their populations aging implies a restructuring of the economy political issues which arise in an aging society include 1 a voting majority for the interests of the elderly 2 a voting majority of females 3 the domination of the decision power in corporate and similar ruling bodies and 4 unemployment or a long wait for promotion for younger people economic issues of an aging society include 1 population aging often occurs under reduced rates of growth of per capita national income 2 the relative economic status of the elderly very much depends on the currently existing tax transfer systems and 3 the income of families whose head is over age 65 has generally been more unequally distributed than the income for younger families issues concerning the labor supply of the elderly include 1 the availability of pension income and health limitations strongly influence decisions to retire and 2 older workers become disheartened and choose early retirement when facing bad reemployment prospects in general population aging is likely to have its most substantive effect on the overall level of productivity in an economy where technical knowledge is changing rapidly and strong competition necessitates a high degree of adaptability of the labor force

bequest division and income inequality comparative dynamics of markov branching processes the purpose of this paper is to investigate the relationship between income inequality and bequest division rules an old but untouched topic addressed by sir josiah stamp nearly seventy years ago we show that the bequest income transition rule for each child should be linearly combined to form an inter generational income transition rule which dominates the dynamics of the underlying stochastic processes the various bequest division rules correspond to different linear combinations of parent child bequest transition and hence distinct intergenerational mobility matrix under different assumptions about parents information background we derive conditions needed to establish the causal relationship between more equal bequest division and better income distribution in the sense of second degree stochastic dominance

productivity transport costs and subsistence agriculture abstract a defining feature of many poor economies is the large fraction of workers engaged in subsistence agriculture we develop a multi sector multi region model of a poor economy in which it is costly to transport goods across regions in order to study this outcome a key finding is that higher transport costs drive up the size of the agricultural workforce and the fraction in subsistence in a calibrated version of our model we show that the effect of transport productivity is quantitatively important in terms of both allocations and welfare

food versus fuel what do prices tell us abstract sorting out the impacts of biofuels on global agricultural commodity prices is impossible without turning to data and distinguishing between the short run versus the long run impacts using time series prices on fuels and agricultural commodities the aim is to investigate the long run cointegration of these prices simultaneously with their multivariate short run interactions results indicate no direct long run price relations between fuel and agricultural commodity prices and limited if any direct short run relationships in terms of short run price movements sugar prices are influencing all the other agricultural commodity prices except rice with sugar the number one world input for ethanol results indicate increased ethanol production is potentially influencing short run agricultural commodity prices overall results support the effect of agricultural commodity prices as market signals which restore commodity markets to their equilibria after a demand or supply event shock

water scarcity and food import a case study for southern mediterranean countries abstract taking six southern mediterranean countries as a case study this paper addresses the water food challenges facing water scarce countries and the implications for the world food economy by accounting the volume of virtual water embedded in food imports into the countries concerned a close relationship between water endowment and food import dependence is elaborated a projection of the cereal demand suggests an increment of 40 60 percentage points in these countries by 2020 above their 1998 99 levels raising the aggregate volume of cereal imports to around 40 million tons the analysis also finds that the trend of shifting from staple grain crops to higher value cash crops was weak during the past two decades a deteriorating trade deficit for both cereal and noncereal agricultural products was evident in almost all the countries suggesting a rigid and persistent constraint of water scarcity on overall agricultural development the results of this case study highlight two important points a food imports are imperative for compensating water resource deficiency b water scarcity related food imports will continue to expand and impose increasing impacts on the global food economy

jointly determined saving and fertility behaviour theory and estimates for germany italy uk and usa abstract the comparative statics predictions of models of the joint determination of household saving and fertility are derived under various hypotheses self interest altruism of parents towards children altruism of children towards parents etc and compared with those of models which determine saving under the assumption of exogenous fertility country specific saving and fertility equations are then estimated using time series data for germany italy uk and usa for each of the countries considered the estimates are consistent with the hypothesis that saving and fertility are jointly determined by self interested parents and reject the alternative hypotheses the data also show that a self financing expansion of social security discourages fertility and generally raises household saving

the road to specialization in agricultural production evidence from rural china summary many rural poor in developing countries live in areas far away from markets and isolation is a key limiting factor to their livelihood in this paper we use four waves of a primary panel household survey conducted in 17 remote natural villages in china to study how road access shapes farmers production patterns input use and rural poverty we adopt a difference in difference approach by comparing the outcomes of the households in villages with and without road access before and after the introduction of each road our results show that access to roads facilitates specialization in agricultural production in natural villages with better road access farmers plant fewer numbers of crops purchase more fertilizer and hire more labor consequently road connections improve household agricultural income and reduce poverty in addition road access significantly increases local nonfarm income for the relatively poor households but not the rich overall our research provides empirical justification on the importance of rural road on agricultural specialization and poverty reduction especially in isolated and impoverished regions

self selection and the earnings of immigrants this paper analyzes the way in which the earnings of the immigrant population may be expected to differ from the earnings of the native population because of the endogeneity of the decision to migrate the empirical study shows that differences in the u s earnings of immigrants with the same measured skills but from different home countries are attributable to variations in political and economic conditions in the countries of origin at the time of migration excerpt

assessing the effect of oil price on world food prices application of principal component analysis the objective of this paper is to investigate the co movement of food prices and the macroeconomic index especially the oil price by principal component analysis to further understand the influence of the macroeconomic index on food prices we examined the food prices of seven major products eggs meat milk oilseeds rice sugar and wheat the macroeconomic variables studied were crude oil prices consumer price indexes food production indexes and gdp around the world between 1961 and 2005 we use the scree test and the proportion of variance method for determining the optimal number of common factors the correlation coefficient between the extracted principal component and the macroeconomic index varies between 0 87 for the world gdp and 0 36 for the consumer price index we find the food production index has the greatest influence on the macroeconomic index and that the oil price index has an influence on the food production index consequently crude oil prices have an indirect effect on food prices

the dynamics of population growth differential fertility and inequality studies of population growth relative to income distribution from single equation and simultaneous equation models have shown that higher population growth rates increase inequality the reasons for this inequality contain important welfare issues including the fact that different income groups grow at different rates with lower income the fastest the differential fertility of the income groups complicates these issues the lorenz curve has often been used as a foundation of the theory of inequality comparisons and uses cumulative shares of income as a function of cumulative shares of population the mortality rates age of new entrants and the mobility across income groups must be factored in these can be analyzed simultaneously using a multistate life table which describes simultaneous transitions across age groups and states data from brazil was used to test whether increase in the fertility rates of the poor would affect income inequality the results indicate a 100 increase in the fertility of the poor which increases the percentage of poor in the equal fertility case there were decreases in the percent of poor from the original number these results confirm that inequality measures can give conflicting signals and could be inconsistent with real changes in relative welfare analyzing relationships between population growth and inequality is difficult and standard measures are inadequate to test hypotheses about the distribution effects of migration or high fertility it appears to be impossible to differentiate changes in population make up from changes in economic status

rice prices and income distribution in thailand a non parametric analysis rice is a staple crop in thailand significantly entering both household production and consumption this paper examines the effect of rice prices on the distribution of real income across households taking into account household characteristics and geographical location the data set is a large scale survey of 11 893 households simple nonparametric techniques for regression and density estimation are used these methods depend on few assumptions and generate flexible graphical results that are directly informative about the problem at hand the main results are that higher rice prices should benefit all rural households but the largest benefits accrue to rural households in the middle of the income distribution copyright 1989 by royal economic society

meteor showers or heat waves heteroskedastic intra daily volatility in the foreign exchange market this paper seeks to explain the causes of volatility clustering in exchange rates careful examination of intra daily exchange rates provides a test of two hypotheses heat waves and meteor showers the heat wave hypothesis is that the volatility has only country specific autocorrelation alternatively the meteor shower is a phenomenon of intra daily volatility spillovers from one market to the next using the garch model to specify the heteroskedasticity across intra daily market segments we find that the empirical evidence is generally against the null hypothesis of the heat wave using a volatility type of vector autoregression we examine the impact of news in one market on the time path of per hour volatility in other markets

three bubbles and a panic an explanatory review of recent food commodity price events abstract this paper is a summary of the behaviour of food commodity prices in 2007 2008 and a review of the causes of the price increases extracted from a report to the chief scientific advisor to her majesty s government thirtle c piesse j 2008 an explanatory review of the world food commodity price events of 2007 2008 a report to the chief scientific advisor department for innovation universities and skills london the historical background shows that the price spike was much less severe than in the 1970s the conventional wisdom that prices of the main food commodities were falling prior to 2006 is questioned most ceased falling and were quite stable from the 1980s the paper separates the causes of the spike from the underlying changes driving the long run trends the literature on the causes of the spike is critically reviewed and summarised there is a reasonably broad consensus on most of the causes but much less on the impact of the depreciation of the us dollar there are also concluding speculations on the future

the economic rationale for investing in nutrition in developing countries abstract studies of experimental and socioeconomic survey data on the direct productivity effects of nutrition indicate growing though qualified evidence of positive direct effects of nutrition on labor productivity of poorer individuals in developing countries greater productivity effects for nutrition than for formal schooling studies on the indirect productivity effects of nutrition through cognitive achievement schooling and preschool ability also indicate positive productivity effects through these channels therefore for productivity reasons alone policies that favor better nutrition among the poorer members of society merit serious consideration that productivity and equity concerns are in harmony is an important plus

what can new survey data tell us about recent changes in distribution and poverty it has been claimed that in recent times the poor have lost ground both relatively and absolutely even when average levels of living have risen this article tests that claim using household surveys for 67 developing and transitional economies over 1981 94 it finds that changes in inequality and polarization were uncorrelated with changes in average living standards distribution improved as often as it worsened in growing economies and negative growth was often more detrimental to distribution than positive growth overall there was a small decrease in absolute poverty although with diverse experiences across regions and countries almost always poverty fell with growth in average living standards and rose with contraction

rice market integration and food security in nepal the role of cross border trade with india coarse rice market integration between nepal and india is analyzed applying a threshold autoregressive model the price response behaviour of traders is found to be consistent with an asymmetric price adjustment mechanism indicating coarse rice prices in nepal respond to shocks originating in india the results show that adjustments to negative price deviations from long run stable equilibrium are faster than adjustments to the positive ones given a null threshold given that trade flows mainly from india to nepal nepali traders would adjust their prices upward to align with the long run equilibrium value relatively more quickly in the case of negative price deviations than if the price deviations were positive such a high speed of adjustment to negative price deviations could be detrimental to net food buyers food security status in the absence of a price stabilization mechanism however a price stabilization policy in nepal a food deficit and import dependent country would hardly have any effect on prices unless further effort is made to build up the level of national food reserves for short term food security interventions in the current context of structurally low levels of national food reserves an alternative short term policy such as foreign aid in the form of food or income transfers targeting the most vulnerable households to price increases is necessary through social safety net programmes in the long run an improvement of transportation infrastructure between market hubs other than the biratnagar trade basin in the terai nepal and india would contribute to the reduction of transaction costs and create incentives for more competition in formal cross border trade with india in times of negative shocks such as the high food price crisis in 2008 restrictive food trade policies in india will continue to undermine household food security in nepal

population technology and growth from malthusian stagnation to the demographic transition and beyond this paper develops a unied growth model that captures the historical evolution of population technology and output it encompasses theendogenous transitionbetween three regimes that have characterized economic development the economy evolves from amalthusianregime wheretechnologicalprogressis slow andpopulationgrowthprevents anysustainedriseinincomepercapita intoapost malthusianregime wheretechnological progress rises and population growth absorbs only part of output growth ultimately a demographic transition reverses the positive relationship between income and population growth andtheeconomyentersamoderngrowthregimewithreducedpopulationgrowth

threshold arch models and asymmetries in volatility this paper attempts to enlarge the class of threshold heteroscedastic models tarch introduced by zakoian 1991a we show that it is possible to relax the positivity constraints on the parameters of the conditional variance unconstrained models provide a greater generality of the paths allowing for nonlinearities in the volatility cyclical behaviour is permitted as well as different relative impacts of positive and negative shocks on volatility depending on their size we give empirical evidence using french stock returns

household level consumption in urban ethiopia the effects of a large food price shock summary we use survey data to investigate how urban households in ethiopia coped with the food price shock in 2008 qualitative data indicate that the high food price inflation was by far the most adverse economic shock between 2004 and 2008 and that a significant proportion of households had to adjust food consumption in response regression results indicate that households with low asset levels and casual workers were particularly adversely affected by high food prices we interpret the results as pointing to the importance of growth in the formal sector so as to generate more well paid and stable jobs

inequality and growth why differential fertility matters we argue that inequality and growth are linked through differential fertility and the accumulation of human capital we build an overlapping generations model in which dynasties differ in their initial endowment with human capital growth the income distribution and fertility are endogenous due to a quantiy quality tradeoff families with less human capital decide to have more children and invest less in education when initial inequality is high large fertility differentials lower the growth rate of average human capital since poor families who invest little in education make up a large fraction of the population in the next generation a calibrated model shows that this fertility differential effect is quantitatively important we also provide empirical evidence to confirm the links between inequality differential fertility and growth suggested by the model

international migration and nutritional outcomes in tajikistan abstract tajikistan is the country with the largest share of remittances to gdp in the world at the same time it suffers from stubbornly high levels of child malnutrition against which only very slow progress has been made this paper investigates the relationship between international migration and child malnutrition using data from a recent nationally representative household survey there are theoretical reasons to expect that migration may be exerting both positive and negative effects on nutrition and food security so that understanding what the net effect may be is essentially an empirical question our results indicate that migration appears to be playing a positive role in enhancing child growth patterns as measured by height for age z scores in the country we explore some of the possible channels through which this effect might be operating and find that one such channel is by increasing households kilocalorie consumption

transfer costs spatial arbitrage and testing for food market integration conventional tests for food market integration ask often misleadingly whether prices in different locations move together in this paper an alternative methodology the parity bounds model pbm is developed which uses information on transfer costs in addition to food prices to assess the efficiency of spatial arbitrage monte carlo experiments using data generated by a point space spatial price equilibrium model show the pbm to be statistically reliable an application to philippine rice markets demonstrates that the pbm detects efficient arbitrage when other tests do not

rising food prices and undernourishment a cross country inquiry households welfare in developing countries has been hit by dramatic food prices increases which occurred between 2005 and 2008 in this paper we adopt a partial equilibrium approach to analyze the short time effects of a staple food price increase on nutritional attainments as a measure of welfare the analysis consists of first approximating complete food demand systems and then performing household level micro simulations instead of focusing on a single country profile we provide a more complete snapshot by comparing the evidence through a cross country assessment made possible by the use of nationally representative household surveys comparability is assured by the adoption of the same methodological choices in the treatment of the micro data we find that food price spikes not only reduce the mean consumption of dietary energy but also worsen the distribution of food calories further deteriorating the nutritional status of populations we also discovered that access to agricultural land plays a significant role in ensuring adequate nutritional attainments in rural areas and surprisingly even in urban areas

market integration efficiency of arbitrage and imperfect competition methodology and application to u s celery this paper develops and applies a methodology to test for efficiency of interregional commodity arbitrage application of the methodology requires only time series data on prices for alternative cities regions countries or product forms yet the approach is capable of generating evidence on a number of market parameters including market integration arbitrage efficiency the magnitude of marketing margins product substitutability and competitiveness of markets estimation is based on a switching regression model with three regimes efficient arbitrage relative shortage and relative glut results from application of the model to u s celery marketing indicated significant departures from efficient arbitrage for both california and florida celery

implications of higher global food prices for poverty in low income countries in many poor countries the recent increases in prices of staple foods raise the real incomes of those selling food many of whom are relatively poor while hurting net food consumers many of whom are also relatively poor the impacts on poverty will certainly be very diverse but the average impact on poverty depends upon the balance between these two effects and can only be determined by looking at real world data results using household data for ten observations on nine low income countries show that the short run impacts of higher staple food prices on poverty differ considerably by commodity and by country but that poverty increases are much more frequent and larger than poverty reductions the recent large increases in food prices appear likely to raise overall poverty in low income countries substantially

testing market integration a model of spatial price differentials for a tradable good is proposed which avoids the inferential dangers of received methods using static price correlations the proposed method also extracts more information on the causes of price differentials from the same data the method is illustrated using monthly rice price data for postindependence bangladesh including the very substantial regional price shocks during the 1974 famine impediments to market integration are indicated

spatial market integration in the presence of threshold effects a large body of research has evaluated price linkages in spatially separate markets much recent research has applied models appropriate for nonstationary data such analyses have been criticized for their ignorance of transactions costs which may inhibit price adjustments and thus affect tests of integration this analysis utilizes threshold autoregression and cointegration models to account for a neutral band representing transactions costs we evaluate daily price linkages among four corn and four soybean markets in north carolina nonlinear impulse response functions are used to investigate dynamic patterns of adjustments to shocks our results confirm the presence of thresholds and indicate strong support for market integration though adjustments following shocks may take many days to be complete in every case the threshold models suggest much faster adjustments in response to deviations from equilibrium than is the case when threshold behavior is ignored a large amount of empirical research has evaluated the extent to which spatially separate markets are integrated though the term is used loosely in the literature tests of market integration usually consider the extent to which shocks are transmitted among spatially separate markets the integration of markets can have important implications for price discovery and the operation of the market since persistent deviations from integration may imply riskless profit opportunities for spatial traders

multiple regime spatial price transmission with an application to maize markets in southern africa conventional threshold models of price transmission allow for different speeds of adjustment to equilibria depending on the magnitude of price differentials between markets however these models typically assume only one underlying long run equilibrium price relationship in this article we develop a framework for allowing multiple equilibria and multiple speeds of adjustment with regime separation depending on the magnitude of trade flows between regions rather than the magnitude of price differentials applying this framework to maize price transmission between south africa and zambia shows no transmission during periods of high imports when the government was heavily involved in maize importation but stronger transmission during periods of low imports when the government was not importing copyright 2012 oxford university press

differences in food insecurity between adults and children in zimbabwe food insecurity is a serious challenge facing millions of households across africa within these households distinguishing the incidence of food insecurity between adults and children is often difficult because most surveys rely on the reports of adults in this paper we address this shortcoming of previous work by using a survey from over 6000 households in zimbabwe where interviews were conducted with both an adult caregiver and a child using two measures of food insecurity we find that reports of adults and children differ within households with lower reports of food insecurity among children with children in the youngest age groups particularly being protected from food shortages an exception to this general rule though is in better off households where children are often more likely to be food insecure than adults findings also demonstrate the need for multiple measures to comprehensively capture the full picture of food insecurity in the household