credit market constraints consumption smoothing and the accumulation of durable production assets in low income countries investments in bullocks in india in this paper we formulate and estimate a finite horizon structural dynamic model of agricultural investment behavior that incorporates the major features of low income agricultural environments income uncertainty constraints on borrowing and rental markets and the use of investment assets to generate income and smooth consumption the model is fit to longitudinal indian household data on farm profits bullock stocks and pump sets the estimated structural parameters are used to assess the effects on the life cycle accumulation of bullocks agricultural profits and welfare associated with complete markets and bullock liquidity and with second best policies that provide assured sources of income to farmers and weather insurance

the livelihood impacts of cash transfers in sub saharan africa beneficiary perspectives from six countries summary cash transfers cts are a social protection mechanism to reduce the poorest households vulnerability to shocks and build human capital by smoothing consumption and sustaining expenditure on education and social welfare our study examines whether and how cts go beyond welfare objectives to promote livelihoods presenting a cross case analysis using original qualitative data on beneficiary perspectives from six african countries kenya ethiopia malawi lesotho zimbabwe and ghana we explore ct livelihood impacts within household economies and social networks paying attention to gender issues we find that a small but predictable flow of cash improves strategic livelihood choices and stimulates productive investments including through positive effects on beneficiary entry into risk sharing arrangements and networks for economic collaboration levels of household vulnerability and labor constraint nevertheless significantly mediate the ability of cts to consolidate livelihood outcomes the varying availability of economic opportunities plus effective program implementation also shape livelihood impact incorporating beneficiary perspectives brings to the fore the multi dimensionality of ct effects on experiences of poverty and deprivation including gender dynamics and intangibles such as dignity and respect they add powerful realism to the influence of the ct on both immediate survival and livelihood choices beyond this they confirm wider knowledge on productive impact and bring nuance to the conditions under which and mechanisms by which beneficiaries use cts to build productive capability and assets and to make strategic livelihood choices

is there persistence in the impact of emergency food aid evidence on consumption food security and assets in rural ethiopia we identify the impact of emergency food aid programs after the 2002 drought in rural ethiopia on future welfare based on a difference in differences matching estimator participation in food for work increases growth in total consumption and food consumption eighteen months after the drought separately receiving free food raises growth in food consumption but surprisingly negatively impacts food security food for work benefited households in the middle and upper tail of the consumption distribution while the better targeted free food program benefited the poorest evidence suggests these impacts demonstrate accumulated and persistent effects of food aid received in the first twelve months after the drought

cash transfer programme productive activities and labour supply evidence from a randomised experiment in kenya this paper reports analysis of the impact of kenya s cash transfer for orphans and vulnerable children programme on the household decisions on productive activities using data from a randomized experimental design results show that the programme had a positive and significant impact on food consumption coming from home production accumulation of productive assets especially on the ownership of small livestock and on formation of nonfarm enterprise especially for females the programme has provided more flexibility to families in terms of labour allocation decisions particularly for those who are geographically isolated the programme was also found to have reduced child labour an important objective of the programme however we find very little impact of the programme on direct indicators of crop production

migration transfers and economic decision making among agricultural households an introduction abstract the increasing volume of remittances and public transfers in rural areas of the developing world has raised hopes that these inflows may serve as an effective mechanism for reducing poverty in the long term by facilitating investments and raising productivity particularly in agriculture where market failures are most manifest the seven papers in this special issue systematically test the relationship between transfers and productive spending amongst rural households in six different countries overall the studies embrace a less optimistic view of the role of migration and public and private transfers on agriculture with migration as facilitating a transition away from agriculture or to models of less labour intensive agriculture

cash transfer programs and agricultural production the case of malawi cash transfer programs are increasingly utilized to combat poverty and hunger while building the human capital of future generations however they have been faulted by some for failing to build the productive capacity of current generations this article analyzes the impact of the malawi social cash transfer scheme on agricultural production the results show strong increases in ownership of productive agricultural assets in time devoted to household farms and in food types consumed from own production coupled with a sharp decrease in ganyu labor which is often used as a coping mechanism once food stores have been depleted these results are most likely achieved by helping farmers overcome credit and liquidity constraints this research shows that cash transfer programs can help the capacity of extremely poor farm households to expand agriculture production even if the goal of the program is focusing on other dimensions of poverty

the theory of the firm in long run equilibrium in a recent series of articles economists have investigated the comparative statics of the neoclassical firm in a competitive environment with the specific proviso that output price adjusts in response to changes in factor prices the older theory of the firm such as is found for example in paul samuelson 1947 is deficient in this regard metaphors such as short run have been used to gloss over the inconsistency of holding output price constant in the face of changing costs through changing factor prices in this paper a simple yet thorough analysis of a firm in a competitive industry i e a firm facing zero entry and adjustment cost conditions is given new results pertaining to restrictions on the behavior of such firms are offered also the length and complexity of established results is substantially reduced

the case for trend stationarity is stronger than we thought in dejong and whiteman 1991a we concluded that 11 of the 14 macroeconomic time series originally studied by nelson and plosser 1982 supported trend stationarity phillips 1991 criticizes this inference claiming that our procedure is biased against integration and that our results are sensitive to model and prior specification however phillips alternative models and priors bias his results in favour of integration despite these biases phillips own findings indicate that the data provide the greatest relative support to trend stationarity this result is similar to our own 1989 1990 1991b findings concerning the sensitivity of our results the trend stationarity inference is remarkably robust

cash transfers and labor supply evidence from a large scale program in iran abstract this paper examines the impact of a national cash transfer program on labor supply in iran in 2011 iran started monthly deposits of cash into individual accounts covering more than 70 million people and amounting to 28 of the median per capita household income the payments were compensation for the sudden removal of hefty energy subsidies the program has been heavily criticized for its disincentive for work especially for the poor we use panel data to study the causal effect of the transfers on labor supply using exogenous variation in the time households first started receiving transfers and in the intensity of treatment which we define as the share of net transfers from the program in total per capita household expenditures we find no evidence that cash transfers reduced labor supply in terms of hours worked or labor force participation to the contrary we find positive effects on the labor supply of women and self employed men

the firm in short run industry equilibrium comment it has long been recognized that the traditional law of supply and demand valid for the isolated competitive firm need not necessarily hold when considering the individual firm within the greater context of its industry indeed a change in a certain input or output price will in general affect all input and output decisions and these reactions can be expected to trigger other price changes at the industry level in those markets where the industry faces less than infinitely elastic supply or demand the initial response of the individual firm to the original price change may thus be altered by its response to these consequent price changes and perhaps even be completely reversed in his 1982 paper ronald heiner has shown for the special yet important case of an infinitely elastic supply in all factor markets that at least the law of demand will nevertheless hold in the short run for the entire industry provided that demand for its output is normal in the usual sense of a downward sloping schedule this reassuring result is noteworthy in itself but it also commands admiration because it represents one of the few cases where an ambiguity at the micro level is resolved at the macro level by aggregation heiner goes even further in the characterization of the industry s shortrun response by saying that it will be weaker than the response that would arise if demand in the output market were infinitely elastic and conversely stronger than the response that would result if demand in the output market were entirely inelastic pp 555 56 yet in his formal analysis heiner proves a somewhat different and weaker version of this characterization by showing that the industry s short run response must be stronger than the response that would be observed if the output of every firm were fixed it is the purpose of this comment to show that heiner s intuitively more appealing original contention indeed holds and in fact characterizes the industry s short run response more precisely than the version that was actually proven at the same time and perhaps more interestingly i want to generalize heiner s findings by showing that they in essence still apply if the industry also faces in some of its input markets a less than infinitely elastic but normal supply this generalization is obviously relevant for all those industries that are the sole users or at least major users of certain inputs and hence not necessarily small in relation to the size of these input markets by generalizing heiner s notation i use a framework that allows us to deal with an arbitrary number of inputs and outputs and in particular with an arbitrary number and combination of markets in which the industry is confronted with a less than infinitely elastic demand or supply

the impact of ethiopia s productive safety net programme and its linkages abstract this paper assesses the impact of ethiopia s productive safety nets programme psnp the largest social protection programme in sub saharan africa outside of south africa using propensity score matching techniques we find that the programme has little impact on participants on average due in part to transfer levels that fell far below programme targets participants with access to both the psnp and packages of agricultural support are more likely to be food secure to borrow for productive purposes use improved agricultural technologies and operate non farm own business activities however beneficiaries did not experience faster asset growth

transactions costs and agricultural household supply response we develop and estimate a model of supply response when transactions costs create a situation where some producers buy others sell and others do not participate in markets we present two rationales for why producing households may have different relationships to the market proportional and fixed transactions costs using data on mexican corn producers we estimate an empirical model that allows for separate tests of the significance of both types of transactions costs revealing that both fixed and proportional transactions costs matter for the estimation the results provide consistent estimates of supply elasticity and measures of the relative importance of factors determining both proportional and fixed transactions costs

decent rural employment and farm production efficiency empirical evidence from tanzania and ethiopia promoting decent rural employment by creating new jobs in rural areas and upgrading the existing ones could be one of the most efficient pathways to reduce rural poverty this article systematically investigates the impact of decent rural employment on agricultural production efficiency in ethiopia and tanzania the analysis applies an output oriented distance function approach with an estimation procedure that accounts for different technological demographic socioeconomic institutional and decent rural employment indicators data of the 2011 round of living standards measurement study integrated surveys on agriculture for the two countries are used and a set of indicators is derived to proxy core dimensions of decent rural employment the findings of our analysis show that decent rural employment contributes to agricultural production efficiency

the relationship between credit and productivity in chinese agriculture a microeconomic model of disequilibrium credit is an important element in agricultural production systems it allows producers to satisfy the cash needs induced by the production cycle which characterizes agriculture preparation planting cultivation and harvesting of the crops are typically done over a period of several months in which very little cash revenue is earned while expenditures on materials purchased inputs and consumption must be made in cash cash income is received a short time after the harvest in the absence of credit markets farmers would have to maintain cash reserves so as to facilitate production and consumption in the next cycle the availability of credit allows both greater consumption and greater purchased input use and thus increases welfare of the farmers

conditional cash transfers and agricultural production lessons from the oportunidades experience in mexico abstract this paper explores whether cash transfer programmes conditioned on human capital outcomes can influence agricultural production programme impact on food consumption from own production land use livestock ownership and agricultural spending are evaluated using first difference and weighted estimators in which weights are constructed from propensity scores the programme is found to increase the value and variety of food consumed from own production and to increase land use livestock ownership and crop spending impact estimates are found to differ across land use categories and procampo participation results support the hypothesis that transfers influence agricultural production and impacts are greater for households invested in agriculture

on market equilibrium analysis in this paper we develop the implications of competitive market equilibrium for production and household behavior when some prices are endogenously determined the properties of market equilibrium functions are explored including the effects of pricing policy a slutsky type equation relating compensated and uncompensated market equilibrium functions is derived implications for multimarket welfare analysis are presented focusing on the effects of pricing policy and technical change

the generalized composite commodity theorem and food demand estimation this article reports tests of aggregation over consumer food products and estimates of aggregate food demand elasticities evidence that food demand variables follow unit root processes leads us to build on and simplify existing tests of the generalized composite commodity theorem we compute food demand elasticities using a method of cointegration that is shown to apply to a convenient but nonlinear functional form estimates are based on consumer reported expenditure data rather than commercial disappearance data appropriately specified models of consumer demand are central to market analysis it has been established that a valid equilibrium for markets characterized by diverse firms or diverse consumer products depends on downward sloping composite demand curves heiner braulke wohlgenant or on valid indirect utility functions chavas and cox given the large number of consumer food products food demand and price analysis must be implemented at some level of product aggregation improper aggregation can lead to biased estimates of welfare loss associated with public policies biased estimates of consumer and derived demand elasticities and misleading tests of market power testing for consistent aggregation over food products and estimating aggregate consumer food demand elasticities are the subjects of this article by far the most common justification for aggregation has been separable preferences one reason for its popularity has been the lack of a viable alternative tests of the composite commodity theorem hicks leontief lewbel are always rejected because it restricts relative prices within a group to remain fixed over time on the other hand aggregation based on weak separability is often rejected diewert and wales eales and unnevehr

conditional cash transfers adult work incentives and poverty conditional cash transfer cct programs aim to alleviate poverty through monetary and in kind benefits as well as reduce future levels of poverty by encouraging investments in education health and nutrition the success of cct programs at reducing poverty depends on whether and the extent to which cash transfers affect adult work incentives the authors examine whether the progresa program of mexico affects adult participation in the labor market and overall adult leisure time and they link these effects to the impact of the program on poverty using the experimental design of progresa s evaluation sample the authors find that the program does not have any significant effect on adult labor force participation and leisure time their findings on adult work incentives are reinforced further by the result that progresa leads to a substantial reduction in poverty the poverty reduction effects are stronger for the poverty gap and severity of poverty measures

the impact of conditional cash transfers on consumption and investment in nicaragua abstract this article examines the impact of a nicaraguan conditional cash transfer programme on measures of expenditures and productive investment despite clear evidence from a randomised evaluation that the programme increased current expenditures there is little evidence that it increased agricultural or non agricultural investment an estimated marginal propensity to consume out of the transfers of nearly one combined with no effect of cumulative past transfers on current consumption corroborate the direct evidence on investment in contrast to gains made in human capital investment the potential for long term increases in consumption as a result of other forms of increased investment may be limited

demand for farm output in a complete system of demand functions demand interrelationships for farm outputs that are theoretically consistent with consumer demand and marketing group behavior provide important linkages between retail and farm prices a conceptual model based on reduced form specifications for retail and farm prices is formulated and applied empirically to a set of eight disaggregated food commodities this approach circumvents the need for retail quantities which are frequently unavailable for disaggregated food commodities the results are consistent with theory and generally indicate significant substitution between farm and marketing inputs except for poultry derived demand elasticities are at least 40 larger compared to those derived assuming fixed proportions

theory of the firm in short run industry equilibrium a number of economists have studied the long run input behavior eugene silberberg 1974a lowell bassett and thomas borcherding 1 970a b c c e ferguson and thomas saving and paul meyer 1967 of a competitive industry in which entry or exit continues until industry output price moves to the minimum average cost of the marginal firm in the industry however this analysis requires very strong assumptions which severely restrict diversity between firms silberberg 1974a for example assumes all firms production functions are identical except for a scale factor complementary to these long run investigations i will present a compact but thorough analysis of the short run case in which technology and the number of firms are fixed but industry output price responds to aggregate supply changes of existing firms resulting from changes in factor prices in contrast to the long run analysis no assumptions limiting interfirm diversity nor any other restrictions beyond definition of the usual neoclassical firm are needed furthermore results are obtained for industry factor demand which do not necessarily hold for individual firms when they respond to factor prices jointly with other firms in the industry this contradicts the older methodology associated with paul samuelson 1947 in which factor demand responses are derived for firms acting in isolation from each other and their isolated responses are aggregated to obtain the industry factor response for example traditional theory shows input response obeys the law of demand for isolated firms but this standard result no longer holds when a firm adjusts within a larger industry of firms whose collective output response can affect output price thus the law of demand for industry factor behavior cannot be established by aggregation of isolated firm responses however its validity does nevertheless hold in the short run in which the number of firms in the industry is constant therefore the purpose of this paper is to characterize the short run industry level factor demand implications and to show how these implications relate to the traditional theory of isolated firm behavior in addition it is briefly shown how these short run results also imply that the law of demand is likely to hold even in the long run where entry and exit from the industry can occur even for an industry of quite dissimilar firms given the well established literature of the standard neoclassical firm the main body of the paper will confine presentation to required definitions and the statement plus interpretation of the main results all proofs and derivations are reserved for the appendix