forest incomes and rural livelihoods in chiradzulu district malawi abstract this paper examines forest income among rural dwellers in one of malawi s most densely populated districts chiradzulu 160 households were interviewed in two sites only 20 km apart purposely selected on the basis of access to a forest reserve people are extremely poor with 97 having incomes of less than 1 usd day forest income constitutes around 15 of total income only non farm income 47 and agriculture 28 rank higher the poorest segment depends more on forest income than the least poor group but the medium income group exhibits the highest dependence fuelwood constitutes the major source of such income followed by fodder the incomes mainly support current consumption people with better access to the forest reserve have higher total income forest income and relative forest income as revealed through a gini coefficient analysis forest resources have an important income equalizing effect across rural households a particular group of resource poor farmers 8 1 of sample with little access to agricultural land and a high representation of female heads derives an average of 65 of their income from the forest an important policy lesson is that restricting people s access to forest resources can have substantial effects on household livelihoods and welfare and would serve to increase income inequalities in the area livelihood researchers should now recognize the substantial income from forest resources

aid volatility policy and development summary we build on bulir and hamann s analysis of aid volatility bulir a hamann j 2003 aid volatility an empirical assessment imf staff papers 50 1 64 89 bulir a hamann j 2008 volatility of development aid from the frying pan into the fire washington dc imf paper submitted to this special section showing that the conclusions reached depend on the dataset used their argument that the poorest countries have the highest volatility appears not to be correct the impact of volatility on growth is negative overall but differs between positive and negative volatility the mix between responsive components of aid for example programme aid and proactive components for example technical assistance is important finally we conclude that measures which increase trust between donor and recipient and reductions in the degree of donor oligopoly reduce aid volatility without obviously reducing its effectiveness

analyzing nutritional impacts of policies an empirical study for malawi summary widespread malnutrition in developing countries calls for appropriate strategies presupposing good knowledge about nutritional impacts of policies little previous work has been carried out in this direction especially with respect to micronutrients we use representative household data from malawi and develop a demand systems approach to estimate income and price elasticities of food demand and nutrient consumption these estimates are applied for policy simulations given multiple nutritional deficiencies income related policies are better suited than price policies to improve nutrition while consumer price subsidies for maize improve calorie and mineral consumption they can worsen vitamin consumption in urban areas

food insecurity poverty and the malawian starter pack fresh start or false start abstract chronic food insecurity and chronic poverty are closely related in malawi since independence in 1964 national food security has been a key policy objective however until the 1990s less emphasis was placed on the household dimensions of food security and its links with chronic poverty in the last decade a number of initiatives have been used in malawi to tackle the issue of household food insecurity one of the most controversial has been the starter pack programme launched in 1998 initially consisting of a free handout of packs of improved maize seed legumes and fertiliser to every small holder farm household in malawi the scheme under donor pressure was subsequently scaled down to become a form of targeted social safety net programme this paper analyses the strengths and weakness of both the original programme and its scaled down version and assesses the reason for the considerable opposition to the programme from malawi s donor community although starter pack is no longer operative in malawi the malawian experience is used to derive lessons for other countries where household food insecurity is an important dimension of chronic poverty

green revolution in sub saharan africa implications of imposed innovation for the wellbeing of rural smallholders green revolution policies are again being pursued to drive agricultural growth and reduce poverty in sub saharan africa however conditions have changed since the well documented successes of the 1960s and 1970s benefitted smallholders in southern asia and beyond we argue that under contemporary constraints the mechanisms for achieving improvements in the lives of smallholder farmers through such policies are unclear and that both policy rationale and means of governing agricultural innovation are crucial for pro poor impacts to critically analyze rwanda s green revolution policies and impacts from a local perspective a mixed methods multidimensional wellbeing approach is applied in rural areas in mountainous western rwanda here malthusian policy framing has been used to justify imposed rather than induced innovation the policies involve a substantial transformation for rural farmers from a traditional polyculture system supporting subsistence and local trade to the adoption of modern seed varieties inputs and credit in order to specialize in marketable crops and achieve increased production and income although policies have been deemed successful in raising yields and conventionally measured poverty rates have fallen over the same period such trends were found to be quite incongruous with local experiences disaggregated results reveal that only a relatively wealthy minority were able to adhere to the enforced modernization and policies appear to be exacerbating landlessness and inequality for poorer rural inhabitants negative impacts were evident for the majority of households as subsistence practices were disrupted poverty exacerbated local systems of knowledge trade and labor were impaired and land tenure security and autonomy were curtailed in order to mitigate the effects we recommend that inventive pro poor forms of tenure and cooperation none of which preclude improvements to input availability market linkages and infrastructure may provide positive outcomes for rural people and importantly in rwanda for those who have become landless in recent years we conclude that policies promoting a green revolution in sub saharan africa should not all be considered to be pro poor or even to be of a similar type but rather should be the subject of rigorous impact assessment such assessment should be based not only on consistent objective indicators but pay attention to localized impacts on land tenure agricultural practices and the wellbeing of socially differentiated people

getting agriculture moving do markets provide the right signals abstract political discrimination has often pushed the domestic value of agriculture in developing countries below its value in markets at the border this paper seeks to explain the reasons why border prices themselves undervalue the linkages that agriculture has to economic growth in the early stages of development if agriculture is critically important to stimulating and sustaining rapid economic growth those countries that fail to correct this discrimination exact a heavy toll in economic performance furthermore the poorest countries will suffer the most agricultural development and development of the non agricultural economy are closely linked the traditional market mediated linkages form the core of economic analysis of the role of agriculture in economic development providing labour for an industrial work force food for an expanding population with higher incomes savings for industrial investments markets for industrial output export earnings to pay for imported capital goods and raw materials for agro processing industries a second category of linkages is not well mediated by market forces even when markets are working well the impact of agricultural growth on the rest of the economy through non market linkages can be traced using a simple growth accounting framework that examines contributions to the labour force capital investment and the productivity with which these two physical factors are utilised several linkages stand out as likely to be important and potentially measurable because they draw on the efficiency of decision making in rural households the low opportunity cost of their labour resources the opportunity for farm investment without financial intermediaries the potential to earn high rates of return on public investments that correct for urban bias the contribution of food price stability to increased efficiency in investment decisions and the impact of growth in food production on widespread improvement in nutrient intake and labour productivity each of these factors alone as public investment and favourable policy stimulate growth in the agricultural sector should cause an increase in the efficiency of resource allocation and thus higher total factor productivity several of these mechanisms will also serve to speed factor accumulation by increasing the savings rate or improving factor mobility

household risk management and optimal mortgage choice the portfolio of the typical american household is quite unlike the diversie ed portfolio of liquid assets discussed in e nance textbooks the major asset in the portfolio is a house a relatively illiquid asset with an uncertain capital value the value of the house generally exceeds the net worth of the household which e nances its homeownership through a mortgage contract to create a leveraged position in residential real estate other e nancial assets and liabilities are typically far less important than the house and its associated mortgage contract the importance of housing in household wealth is illustrated in figure i this e gure plots the fraction of household assets in housing and in equities against the wealth percentile of the household poor households appear at the left of the e gure and wealthy households at the right data come from the 1989 and 1998 survey of consumer finances the e gure shows that middle class american families from roughly the fortieth to the eightieth percentile of the wealth distribution have more than half their assets in the form of housing even after the expansion of equity ownership during the 1990s equities are of negligible importance for these households 1

differentiated contracts heterogeneous borrowers and the mortgage choice decisions previous analyses of mortgage choice assume that adjustable rate mortagages are standard contracts and estimate bivariate models the authors estimate a multinomial logit model that explicitly treats mortgages as differentiated contracts and provides insights on several important issues the impact of price variables differs significantly across alternative mortgage contracts borrower heterogeneity particularly mobility influences the type of contract chosen and borrowers respond to market conditions as expected when choosing between alternative mortgage contracts copyright 1995 by ohio state university press

is women s ownership of land a panacea in developing countries evidence from land owning farm households in malawi our analysis of a rich representative household survey for malawi where patrilineal and matrilineal institutions coexist suggests that in matrilineal societies the likelihood of high value crop cultivation by a household increases with the extent of land owned by males while the income generated from high value crop production decreases with the amount of land owned by females and the cultivation of high value crops increases household welfare the policy implication is that facilitating female ownership of assets through informal and formal institutions does not on its own increase welfare when appropriate complementary resources and institutions are absent

impact of improved maize adoption on welfare of farm households in malawi a panel data analysis summary this paper assesses rural households decision to use improved maize varieties in malawi and examines its impact on household welfare using a three year household panel data the distributional effect of maize technology adoption is investigated by looking at impacts across wealth and gender groups we applied control function approach and iv regression to control for possible endogeneity of input subsidy and area under improved maize we found that area under improved maize varieties is positively correlated with own maize consumption income and asset holdings we found evidence that improved maize adoption has a stronger impact on welfare of poorer households

the stagnation of smallholder agriculture in malawi a decade of structural adjustment abstract malawi s efforts at structural adjustment have revolved around reforming the marketing and pricing of outputs and inputs in smallholder agriculture in practice the price oriented adjustment policies were not thorough enough and have led to disappointing results there is clearly a need to push for further reforms in pricing however structural adjustment in malawi will have to go beyond just getting prices right policies must also concentrate on structural and institutional weaknesses that constrain smallholder agriculture and contribute to widespread food insecurity and malnutrition

an empirical test of credit rationing in the mortgage market abstract recent theoretical models of credit rationing suggest that mortgages are rationed with nonprice terms on the basis of default risk despite the development of secondary mortgage markets and the deregulation of deposit rates we test this hypothesis using aggregate time series data on fha and conventional mortgage originations fha loans are more expensive for borrowers but provide federal guarantees which protect lenders against default losses for this reason fha loans should be subject to easier credit constraints than conventional mortgages and the fha share of mortgage originations should increase with aggregate default risk default risk is proxied by a bond rate quality spread consistent with previous studies our results imply that default risk induced mortgage rationing persists in the post disintermediation era but that fha programs help offset the overall impact of rationing on housing markets

rural income and poverty in a time of radical change in malawi abstract malawi is one of the poorest countries in africa there is widespread though not universal agreement about the shape of poverty in the country and the policy challenge this sets agriculture continues to be the most obvious means to stimulate broad based rural growth and to provide levels of food security and income needed for the majority rural population a longitudinal study over a decade during which radical policy and political changes occurred provides the data and basis for discussing the appropriate policy directions for reducing poverty

the effectiveness of structural adjustment lending initial evidence from malawi abstract the world bank s new programs of structural adjustment lending are likely to prove most effective with those governments which demonstrate shared ideals in their approach to economic adjustment and policy reform malawi has long been regarded as a country placing great reliance on the market in resource allocation showing restraint in public sector expansion and retaining a strong export orientation the balance of payments difficulties and the deterioration in economic circumstances which began in 1980 did not arise solely from external shocks but the structural adjustment lending programs introduced in 1981 as a means of easing the painful reform process found root in a fertile and responsive policy environment this paper chronicles the first two sals to malawi reviewing in particular the specific policy reforms advocated and required by the bank the extent of their implementation and the provisional effects on the malawi economy

modelling the impact of world bank policy based lending the case of malawi s agricultural sector this article uses a multi market agricultural pricing model to analyse the impact of the world bank s three structural adjustment loans sals to malawi on the smallholder agricultural sector three price policy scenarios are simulated on the model representing zero partial and full compliance with the bank s sal price policy conditionality these scenarios are analysed in terms of their impact on the government budget smallholder real incomes maize production exportable cash crop production and the balance of payments critiques of the bank s programme and the government and bank bargaining strategies are assessed in the light of the modelling results

malawi reforming the state s role in agricultural marketing abstract the role of the state in agricultural marketing activities has been a contentious issue in many countries undergoing structural adjustment this paper examines three examples of smallholder market reform in malawi to illustrate the case for various forms of state involvement and the complexities involved in reducing the state s role when this is required

indicators of collateral misreporting automated valuation models avms are widely used in the valuation of pools of residential mortgages in this paper we provide evidence that high pricing errors in human and automated valuation models as well as rejection of loans with relatively low appraisals may generate the appearance of appraisal bias even when the original appraisals are unbiased we also present evidence that the estimated frequency of appraisal overstatement is quite sensitive to assumptions about loan denial rates due to low appraisals as well as the size of and the correlation between avm and original appraisal pricing errors this paper was accepted by amit seru finance

the impact of agricultural liberalisation on food security in malawi abstract the donor supported structural adjustment programmes have not impacted favourably on livelihoods food security and the general welfare of the poor in malawi this resulted from the prescription of wrong policy packages and limited attention to poverty alleviation policies policies have tended to concentrate on promoting market and price mechanisms less on addressing production constraints and non economic barriers to broad based economic growth there are losers and winners as a result of policy reforms in agricultural produce marketing the losers are mainly the smallholder farmers in the category of net food buyers low income or wage earners in urban and semi urban areas and smallholder farmers in remote areas the winners are smallholder farmers in the category of net food sellers private traders institutional traders and the state marketing agency the paper analyses the impact of pricing policy and market deregulation on the state marketing organisation and on the private marketing system highlighting the lessons to be learned and making recommendations on how to improve the food security situation at the household level

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

credit rationing race and the mortgage market abstract this study applies microdata from the 1983 survey of consumer finances to evaluate the effects of borrower race and default risk in mortgage lending the empirical analysis is based on a probit model of whether borrowers obtain fha or conventional mortgages the former are fully insured and are characterized by easier downpayment constraints but are typically more expensive hence households borrowing through the fha will tend to be credit constrained in the conventional market results of the analysis indicate that variables which proxy lender concerns about default risk and cost have an important effect on the type of loan borrowers obtain empirical estimates also suggest that minority households are significantly less likely to obtain conventional financing than whites even after controlling for various proxies of default risk these results suggest that race effects in mortgage lending may persist for reasons unrelated to borrower default risk

equilibrium price distributions equilibrium price distributions for a homogeneous product consistent with individual incentives are investigated they arise in informationally imperfect markets in which the only primitive datum is the distribution of search costs it is shown that single multi and continuous price distributions are all viable long run phenomena depending on the nature of search costs a method for computing equilibrium price distributions is also provided jevons law of one price has long been an accepted dictum in economic theory in a classroom presentation it still serves sometimes implicitly as a major premise in many micro models of market interaction much of the descriptive theory as well as welfare analysis hinges on this assumption yet one s day to day experience reveals that price differentials are a viable phenomenon and that looking for lower prices may very well be a rewarding activity the prospects of eventually hitting a bargain and the resulting price reduction would more than compensate for the cost incurred during the search process moreover the existence of price dispersions appear to be an empirically stable phenomenon snapshots of markets for relatively homogeneous products reveal substantial and recurring price differentials stigler 1961 and pratt wise and zeckhauser 1979 for example report some evidence supporting this claim an important article by stigler 1961 focused economists attention on the crucial role played by the informational structure of markets it gave rise to the study of the

u turns and full circles two decades of agricultural reform in malawi 1981 2000 abstract this paper traces the evolution of malawi s agricultural policy over the past two decades during this period the world bank has played a key role in shaping policy reform through its adjustment loans three distinct reform phases can be identified 1981 87 when policy was dominated by the dogmatism of the world bank s pricist and state minimalist policies 1988 94 when a more flexible position was taken by both the bank and the malawi government both of whom acknowledged the structuralist critique of earlier policies and 1994 to the present when the reform process in agriculture became more politicized and a schism developed between the bank and the government this latter period is used to illustrate some of the unresolved policy issues pertaining to similar low income agrarian economies

structural change in malawi since independence consequences of a development strategy based on large scale agriculture abstract this paper investigates the nature of the structural change which has occured in the malawian economy since independence and identifies key policies pursued by the government which it is argued have been decisive in shaping this development the salient feature of structural change is shown to be the rapid growth of large scale agriculture associated with an equally rapid transfer of labour into wage employment and a decline in the importance of peasant production the implications of these changes for living standards and future development and policy are considered

a comparative political economic analysis of maize sector policies in eastern and southern africa abstract maize sector policies in eastern and southern africa are characterized by a large and often growing presence of the state yet the scope scale and modalities of state activities vary substantially across countries drawing on data from malawi zambia kenya and mozambique this article compares the relative degree of state intervention in the maize sector we show that relative preferences for output market subsidies input market subsidies trade restrictions or non interventionist approaches reflect the interplay of interest group lobbying patronage networks and ethnic and regional political affiliations these relationships have deep historical roots and have often been intensified in the context of the emergence of multiparty politics we show that interventionist orientations in output markets and trade do not translate into better performance or welfare outcomes input subsidy preferences produce more ambiguous welfare results when the opportunity costs are not fully accounted for

credit rationing in the u s mortgage market evidence from variation in fha market shares abstract this paper examines the nature of mortgage credit rationing across geographic markets and time particular attention is paid to the response of conventional mortgage supply to higher risk conditions associated with regional recessions we develop a series of four indirect tests based on the spatial variation of the fha share of mortgages both endorsements and applications as well as fha and conventional rejection rates results of these four tests indicate that conventional mortgage underwriting criteria do not become more flexible and may even become more demanding when local economic conditions deteriorate this result indicates the use of non price credit rationing in the mortgage market and suggests a special role for fha insured mortgages as a mechanism for maintaining mortgage credit supply in declining housing markets

agricultural commercialisation and food security in rural economies malawian experience this paper contributes to the debate on the nutrition related outcomes of cash crop adoption by using a model with essential heterogeneity and a semi parametric estimation technique the model expl

the political economy of policies for smallholder agriculture summary as the experience of the 20th century has shown implementing policies that increase agricultural productivity among smallholders is a particularly promising strategy to achieve pro poor growth however history also reveals major political challenges to adopting this strategy the paper compares the experience of asian countries that were able to launch a smallholder based green revolution with the experience of african countries that are still struggling with this goal it then reviews the political economy literature to identify the factors that account for these divergent experiences finally the paper develops a conceptual framework to guide empirical research to close the knowledge gaps identified by the review

a time of agric rethinking the failure of agricultural programs in 1970s ghana summary recent interest in a new green revolution in africa has revived debate about state intervention in agricultural markets and biotechnology these debates take for granted that the first wave of green revolution interventions in africa failed to influence small scale food farmers this essay uses oral historical and documentary evidence from ghana s northern region to revisit the evidentiary basis of this assessment tracing how the production of aggregate data and changing interpretive frameworks in the 1970s and 1980s allowed policymakers to ignore the experiences of farmers the essay advocates for the role of micro historical analysis in assessing africa s recent agricultural past

heterogeneity of commercialization gains in the rural economy farmers in low income rural economies often fail to switch to cash crops from staple production despite the positive income effects of commercialization expected by policy makers the literature suggests that market failures prevent households from cash crop adoption but remains inconclusive regarding farmers motives and the effects of commercialization this article contributes to the debate by offering an original approach to the analysis of commercialization outcomes and farmers decisions it consists of applying a model with essential heterogeneity and a semiparametric estimation technique to analyzing harvest value returns to cash cropping using malawian data we show considerable heterogeneity in harvest value returns to cash cropping both within and between groups of farmers choosing different crop portfolios importantly the results imply rational choices based on comparative advantage considerations of farming households farmers self select into the activity where they expect higher gains and adopt cash crops when facing weaker market barriers

maize is life malawi s delayed green revolution abstract the pattern of maize seed development in malawi demonstrates the importance of farmers capacity to articulate their interests through collective action and institutions despite the vital significance of maize as a wage good in malawi limited effective demand for maize seed research prolonged the period of technical stagnation analysis of the institutional factors shaping the demand for maize seed research complements previous work on malawi s political economy the supply of seed technology and adoption with implications for current political changes in that nation the importance of farmers organizations and state commitment to agricultural research in sub saharan africa

off farm labor supply and correlated shocks new theoretical insights and evidence from malawi abstractwe offer new conceptual insights into the understanding of occupational choice in uncertain rural environments with a focus on its ex ante before a shock and ex post after a shock consequences for farmers belonging to different portions of the asset distribution we model theoretically the choice between relatively safe subsistence farming higher return but higher risk cash crop activities and off farm labor conditional on preexisting asset allocation and look at the general equilibrium labor market implications of correlated shocks our results backed by evidence from malawi challenge some stylized perceptions in the literature on consumption smoothing via off farm labor supply

the effect of state foreclosure laws on loan losses evidence from the mortgage insurance industry this paper analyzes the effect of three major provisions of state foreclosure laws procedure redemption period and provision for deficiency judgment on loan losses as reflected in the claims paid by private mortgage insurers and the fha it also explores the significance of the incentive conflict between the lender and the insurer in terms of the presence or absence of a coinsurance relationship and the existence of a deficiency judgment the results demonstrate that foreclosure laws have a significant effect on loan losses and that the existence of a deficiency judgment affects the incentive conflict between lender and insurer copyright 1990 by ohio state university press

donors and domestic policy makers two worlds in agricultural policy making in recent decades many developing countries have moved from taxing their agricultural sector to subsidizing it a phenomenon referred to as overshooting using ghana and uganda as case study countries this study aims to contribute to explaining this phenomenon by examining the role of policy beliefs the study is based on the advocacy coalition framework and relies on discourse analysis as analytical method in depth interviews with policy actors in both countries served as empirical basis a quantitative analysis of the transcripts was used to identify different discourse coalitions and a qualitative analysis was conducted to examine the discourses and identify their underlying policy beliefs the paper identified far reaching differences in the agricultural policy beliefs between domestic policy makers and donors regarding the question what does it actually take to develop small holder agriculture the evidence from this analysis highlights the role that divergent policy beliefs can play in influencing agricultural policy choices

fraudulent income overstatement on mortgage applications during the credit expansion of 2002 to 2005 treating fraudulently overstated income on mortgage applications as true income can lead to incorrect conclusions on the nature of the mortgage credit supply expansion toward marginal borrowers from 2002 to 2005 a positive gap between zip code level income growth calculated from mortgage applications and income growth from the irs likely reflects mortgage fraud not an improvement in home buyer income in support of the credit supply view mortgage credit for home purchase expanded significantly more in low credit score neighborhoods on both the extensive and intensive margins from 2002 to 2005 even though these neighborhoods deteriorated on many measures of income prospects

evaluating the effectiveness of inter regional trade and storage in malawi s private sector maize markets abstract this paper evaluates the effectiveness of the private sector maize marketing system in malawi using threshold autoregression models two dimensions of maize market performance are evaluated 1 inter regional trade and spatial price transmission and 2 storage and seasonal price relationships in both cases threshold autoregression models which account for nonlinearities predicted by economic theory are applied results indicate that spatial price transmission and seasonal price patterns in private sector maize markets in malawi are generally consistent with long run competitive inter regional trade and storage behavior and that in most cases shocks to long run equilibrium are arbitraged away quickly this suggests the private sector in malawi is generally doing a good job of transporting maize from surplus to deficit regions and smoothing maize consumption between harvests

green gold burley tobacco smallholder agriculture and poverty alleviation in malawi abstract the abolition in 1990 of the estate monopoly on cultivation of burley tobacco is expected to play an important role in reducing poverty among smallholders in malawi a nationwide survey in 1993 shows that smallholder households cultivating burley also grow more hybrid maize use more fertilizer and are more food secure but resource poor households particularly those headed by women face land and labor constraints on burley adoption burley and hybrid maize increase the demand for hired labor but not enough to absorb the growth in the rural labor force broad based poverty alleviation requires technology and programs targeted at the majority of smallholders with holdings of 0 5 hectares or less

home is where the equity is mortgage refinancing and household consumption applying a permanent income model with exogenous liquidity constraints and mortgage behavior household refinancing when mortgage interest rates are historically high and rising a persistent empirical puzzle is explained using data from the panel study of income dynamics households experiencing an unemployment shock and having limited initial liquid assets to draw upon are shown to have been 25 more likely to refinance 1991 94 on average such liquidity constrained households converted over two thirds of every dollar of equity they removed into current consumption as mortgage rates plummeted 1991 94 producing an estimated expenditure stimulus of at least 28 billion