rafmacalaba/datause-encoder-data huggingface dataset:
share of middle class in the total population are reported for Asia by 2050: 70 percent in India, 75 percent in China, and 80 percent in Indonesia after using a US$2 to US$4 per day, per person measure to define middle class [ADB 2011]).

Ultimately, evidence shows that the reduction of extreme poverty, as critical as it may be, does not necessarily imply an automatic increase in the middle class, much less in the magnitude needed for substantive changes to take place in the world demand for food.

# **5. Conclusions**

Asia has seen substantial progress in the fight against hunger and malnutrition, accompanied by impressive economic growth and poverty reduction. Unfortunately, this has not been a regionwide story, but one limited to beacons of prosperity (such as China and Vietnam), alongside dismal missed opportunities (such as India and Pakistan). Economic growth alone and, more importantly, poverty reduction on its own, will not do the job of eradicating hunger and malnutrition. Nor will only the increased production of food.

A right combination of sound domestic policies and global (regional) public goods is needed— along with economic growth, poverty reduction, and increased food production. Asia is currently in a decisive position to reduce uncertainties that are affecting the levels and volatility of global food prices. It can become a leader of good policies, such as by avoiding panic behavior when agile international trade is most needed. Asia is currently developing smart agricultural practices that simultaneously improve yields, adapt better to extreme weather, and sequester greenhouse gas emissions. There are multiple examples from the region of such practices, but Asia must still 15
# **Government Role in Pakistan Agriculture:'**

# _Major Reforms_ **_are Needed_**

# 1. Introduction

In PakiFtan, as in many other countries, the government's role in agriculture has been extensive. The Government of Pakistan seems to have defined 'public goods" or market failure quite loosely, and the public sector role has been increasing until recently. The public expenditure program and public institutions are the major instruments through which public policies regarding agriculture are implemented. All these combined -- public policy, the public expenditure program, and public enterprises -- detennine the nature and extent of the government's role in agriculture.

The purpose of tlis paper is to review the government's role in agriculture to see whether it has helped or hurt agriculture. The paper has four parts. First, it briefly outlines the major policy objectives of the government in agriculture. Section II looks at how price, trade, and other government policies (such as macroeconomic policies) affect the incentives in, and performance of, the sector. Third, the paper looks at the size, composition, and efficiency of public expenditures. This section also examines how public enterprises have performed, and whether they have promoted or hindered growth of agriculture. Fourth, the paper outlines what changes in government policies and role are needed for an improvement in the performance of the sector.

# Policy Objectives in Agriculture

Govermment papers and documents outline the agricultural policy goals of the govermnment -- goals that have direct impact on the sector. In addition, the government influences sectoral performance by other policies such as macroeconomic policies. Sector-specific policies includes agricultural pricing and marketing policies and so on. Economy-wide policies such as trade and commercial policies have an indirect effect on the sector. Agricultural policy objectives are generally outlined rather broadly. The key elements of policy goals include obtaining a high agriculture growth rate (in e:scess of population growth), increasing productivity of the sector, pursuing an export-oriented strategy, conserving and developing natural resources, promoting institutional development, bringing social and economic equity to the agrarian structure, and focusing on small fanners and _barani_ (rain-fed) area development. These policy objectives in principle influence government actions and expenditures in agriculture.

It is difficult to judge the stance of policy from such broad objectives. At the level of objective setting, problems can arise since objectives may lead to conflicting policies. For ' This paper is based on the World Bank report, Pakistan - A strategy for Sustainable Agricultural Growthp I (Report No. 13092). The Bank report was prepared by Rashid Faruqee with assistance from Kevin Carey. Moazem Mahmood, Nadeem Rahi, A. R_ Salemi, Tayyeb Shabbir, Derek Byerlee, Omar Nomar, Sarfraz Qureshi, and Yusuf Choudhury prepared background notes, and papers for the Bank report The authors particularly acknowledge the contributions of Messrs. Sarfraz Qureshi and Tayyeb Shabbir to this paper.
O.A.M.D.G.

samples and models<sup>21</sup> , and is consistent with our theoretical model in the presence of migration. Guerrilla violence makes it ‘cheaper’ to migrate as it destroys assets, but assets pay off if carried to a safe place, so it makes sense to compensate for destroyed assets if a decision to migrate has been taken. The turning point of the U depends on whether we consider a sample of people who report a salary, or a sample that includes people with only asset income as well. With the sample of the waged only, the tip of the U ranges between 8 and 9 attacks, and with the bigger sample, it is at about 11 attacks per year per 100,000 inhabitants, which means about 200 people in any sample experience a rising relationship. This means that in any case for the majority of households, the relationship between violence and savings is indeed negative.<sup>22</sup> The behavior of the homicide rate is independent of model and specification, but dependent on the sample. In a sample with waged people only (but irrespective of whether only their salary or also their asset income is regarded), the homicide rate is insignificant. A full sample, however, including people who report only asset income, sees an inverted U shape of the homicide rate, peaking at about the 8<sup>th</sup> decile of our sample. However, in every specification, the effect of common delinquency is more than outweighed by the effect of guerrilla violence; the coefficients on the guerrilla attack rate are about ten times or more the size of the coefficients on the homicide rate. An additional guerrilla attack (be it kidnapping or a thrown gas canister) per 100,000 inhabitants has more than ten times the effect of an additional murder (in 80% of the cases committed by common delinquents<sup>23</sup> ). In summary, the key result of our theoretical model is supported. - Note that this regression did not account for migration

> 21 The results are actually also robust to considering only positive savings as savings, i.e. setting all negative ‘savings’ to zero, and to specifications excluding the capture rate or including further household controls, as well as excluding municipalities with the top 5% of guerrilla or delinquent violence as outliers.

> 22 This suggests that, with the same controls, the impact of violence on consumption should be in a hump-shape and positive for most households. This is indeed the case; we do not report results for reasons of space.

> 23 Ministerio de Defensa (2001)
Figure 3. The Severe Stunting, Wasting, and Underweight for Children under 5 in PNG <!-- Start of picture text --> 70.00%<br>60.00%<br>50.00% Stunting (z-score <-2)<br>Severe stunting (z-score <-3)<br>40.00%<br>Wasting (z-score <-2)<br>30.00%<br>Severe wasting (z-score <-3)<br>20.00% Underweight (z-score <-2)<br>Severe underweight (z-score <-3)<br>10.00%<br>0.00%<br>Overall Southern Highlands Momase Islands<br><!-- End of picture text --> Data source: HIES 2009-2010 The extent of overlap of children under 5 who are stunted, underweight or wasted is not small. In PNG, 3.6 percent of children under 5 are both stunted and wasted; 16.7 percent of children are both stunted and underweight. These children are more likely to suffer from severe and lifethreatening malnutrition.

The incidence of undernutrition is not evenly distributed across the regions. The stunting rate is high across all the regions but extremely high at 61.5 percent in the Highlands Region. The Islands Region has the lowest stunting rate at 38.1 percent. Contrary to the distribution of stunting rate, wasting rate and underweight rate are the highest among the Islands Region at 29.2 percent. This is similar to the findings in National Nutrition Survey 1982-83, National Nutrition Survey 2005 and the HIES 1996.

# _Malnutrition and Age_

The stunting and underweight rate sharply rises in the first 24 months. This is similar to the findings in National Nutrition Survey 2005, which measured height from 6 months onwards. The stunting rate rises quickly from 6 month onwards to 2 years and remains stable till 59 months. Figure 4 shows the association between malnutrition and age for both boys and girls under 5 years old. The nutrition status is worse for boys than for girls. The wasting rate shows the opposite trend. This is mostly driven by the fact that wasting is a measure of weight for height and children are much more stunted than underweight, thus, the case of wasting decreases with age.

A closer examination of stunting and age by wealth quintiles showed that the trend for the first 24 months was similar across the five quintiles. However, there is a mild bend in the curve for the richest quintiles while the stunting rate plateaus for the poor quintiles (Figure 5). This implied that even in the better-off quintiles, children suffered from suboptimal breastfeeding and complementary food in the first 24 months.

7
Carrying out evaluations across different settings and at different scales can throw light on what influences the outcomes, whether it is politics, the behavior of elites, the capacity of local or national governments, or the presence or absence of social capital.<sup>68</sup> This is the objective of the DIME initiative of the World Bank, which includes many IDA-financed projects. It is also essential to take into account positive or negative externalities of the project. A form of externality that is frequent is the fact that many donors often hire the best and most capable administrators away from their government jobs (where social returns to their labor are higher) to work in their PIU (project implementation unit). The extreme form of spillover effect is an economy-wide program—for which classic impact evaluation tools are inadequate since no explicit assignment process is evident and externalities are pervasive (Ravallion, 2005).

Last but not least, when careful impact evaluation demonstrates that a particular policy is helpful for developing countries, the main problem is replication. Even if the evaluation is externally valid so that, if replicated in other places and periods, similar results could be obtained, the issue is the practice of development by bilateral and multilateral donors that have a tendency to be subject to fashions and to produce development projects like sausages.

# **Conclusions**

From this assessment of the influence of ideas on IDA operations, we can draw at least four useful conclusions.

The World Bank, because of its organizational structure, which allows its staff to learn from its projects and policies (e.g., the presence of an ex post evaluation group drawing lessons from its activities), and because it has nurtured a cadre of good researchers, has been a major contributor to development economics through data, research and by fostering interactions between operational staff, policymakers and

> 68 Deaton (in Banerjee ed., 2007) writes that some types of evidence may not be useful outside of very specific circumstances. He cites as an example the famous _Worms_ paper of Miguel and Kremer (2004) saying that “the results of one experiment in Kenya (in which there was in fact no randomization, only selection based on alphabetical order) hardly prove that de-worming is always the cheapest way to get kids into school” since the rate of re-infection depends on whether children wear shoes and whether they have access to toilets.

56
**Annex Table 5: Composition of Food Exports, Imports and Net Imports in Sub-Saharan African Countries**

|||Exports(|$million)|||Imports|($million)|||Net Impor|ts($millio|n)|Net Im|ports as %|of All Impo|rts|
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|Country (No. of Country)|1980/81|1990/91|2000/01|2004/05|1980/81|1990/91|2000/01|2004/05|1980/81|1990/91|2000/01|2004/05|1980/81|1990/91|2000/01|2004/05|
|**Raw Food, excl. Cash Crops**|||||||||||||||||
|Sub-Saharan Africa, All (47)|1,609|1,836|2,924|4,117|1,745|1,605|2,910|5,446|-137|231|14|-1,329|-0.3|0.5|0.0|-1.1|
|SSA Middle-income (8)|911|1,059|1,743|2,439|179|322|634|1,182|733|737|1,109|1,257|5.0|4.9|<br>3.9|2.5|
|SSA Low-income (39)|697|778|1,181|1,678|1,566|1,284|2,276|4,264|-869|-506|-1,094|-2,586|-2.5|-1.7|-2.4|-3.4|
|SSA Oil Exporters (7)|229|135|297|449|794|346|979|1,783|-566|-210|-682|-1,333|-2.9|-1.9|<br>-4.0|-4.0|
|SSA Civil Conflict States (5)|131|74|71|86|166|136|130|264|-35|-62|-60|-178|-0.7|-1.1|<br>-1.0|-2.5|
|Other SSA Low-income(27)|338|569|813|1,143|606|803|1,166|2,218|-269|-234|-353|-1,074|-2.4|-1.8|-1.5|-3.0|
|**Meats & Dairy Products**|||||||||||||||||
|Sub-Saharan Africa, All|307|293|419|465|237|304|667|1,221|70|-11|-248|-756|0.1|0.0|<br>-0.3|-0.6|
|SSA Middle-income|83|107|256|207|43|75|230|544|40|32|26|-338|0.3|0.2|0.1|-0.7|
|SSA Low-income|224|186|163|259|194|230|437|677|30|-43|-274|-419|0.1|-0.1|-0.6|-0.5|
|SSA Oil Exporters|76|30|49|143|120|99|202|371|-45|-69|-152|-227|-0.2|-0.6|<br>-0.9|-0.7|
|SSA Civil Conflict States|117|52|64|82|15|33|43|64|102|20|21|17|2.1|0.3|<br>0.4|0.2|
|Other SSA Low-income|32|104|50|34|59|97|193|242|-27|7|-142|-209|-0.2|0.0|-0.6|-0.6|
|**Grains & Cereals**|||||||||||||||||
|Sub-Saharan Africa, All|481|220|259|225|1,334|1,036|1,919|3,618|-852|-816|-1,661|-3,393|-1.7|-1.8|-2.2|-2.7|
|SSA Middle-income|286|154|195|150|106|207|324|506|180|-53|-129|-356|1.2|-0.3|-0.5|-0.7|
|SSA Low-income|195|66|64|75|1,228|829|1,596|3,112|-1,032|-763|-1,531|-3,038|-2.9|-2.5|-3.3|-4.0|
|SSA Oil Exporters|104|9|16|6|584|140|671|1,222|-480|-131|-655|-1,215|-2.5|-1.2|<br>-3.8|-3.6|
|SSA Civil Conflict States|1|0|5|2|136|85|69|157|-135|-85|-64|-155|-2.8|-1.5|-1.1|-2.2|
|Other SSA Low-income|91|57|43|67|508|604|855|1,734|-417|-547|-813|-1,667|-3.7|-4.2|-3.5|-4.7|
|**Vegetable & Fruits, excl. Nuts**|||||||||||||||||
|Sub-Saharan Africa, All|787|1,302|2,225|3,402|117|179|250|458|671|1,123|1,975|2,944|1.3|2.5|<br>2.6|2.3|
|SSA Middle-income|516|791|1,278|2,066|21|27|62|103|494|765|1,216|1,963|3.4|5.1|<br>4.2|3.9|
|SSA Low-income|272|510|947|1,336|95|152|187|355|176|358|759|981|0.5|1.2|1.6|1.3|
|SSA Oil Exporters|49|96|232|299|58|61|66|108|-8|35|166|191|0.0|0.3|<br>1.0|0.6|
|SSA Civil Conflict States|12|22|2|2|7|13|15|32|6|9|-13|-29|0.1|0.2|<br>-0.2|-0.4|
|Other SSA Low-income|210|392|713|1,035|31|78|106|215|179|314|607|819|1.6|2.4|2.6|2.3|

Note: See classifications of country groups and product categories in Appendix Tables 1-4.

Source: Based on partners data from UN COMTRADE Statistics.

41
agreement. These advantages may be particularly salient as production becomes increasingly fragmented in global value chains.<sup>8</sup>

**_H4_** _: The effectiveness of PTAs in attracting FDI fades with geographic and cultural distance between two countries, (assuming investors value PTAs for their trade-creating benefits)._

# **4. Empirical Analysis**

# _4.1. Data_

The data for this study come from an original survey of investors and potential investors in four countries: Brazil, Korea, South Africa, and India. The “Potential Investor Survey,” a joint project by UNIDO and the World Bank, included interviews with 713 firms, randomly drawn from registries that contain all firms with revenues of at least $25 million and operating in one of five sectors: finance and insurance, manufacturing, wholesale trade, retail trade, and transportation and warehousing (See Table 1).<sup>9</sup> To deal with selection bias problems in other investors’ surveys, the sample contains not just firms that invest abroad but also companies that considered investing but have decided not to do so, as well as firms that are focused on the domestic market. The interviews were conducted in person and over the phone in 2009-2011.<sup>10</sup>

**Table 1** . Survey respondents by country and sector

|**Sector**|**Brazil**|**India**|**South Africa**|**Korea,**<br>**Rep. **|**Total**|
|---|---|---|---|---|---|
|Manufacturing|55|150|34|166|**405**|
||40.4%|82%|36.9%|59.5%|**58.7%**|
|Wholesale trade|13|3|1|24|**41**|
||9.6%|1.64%|1.1%|8.6%|**5.9%**|
|Retail trade|22|6|25|31|**84**|
||16.2%|3.28%|27.2%|11.1%|**12.2%**|
|Transportation & warehousing|22|0|1|32|**55**|
||16.3%|0%|1.1%|11.5%|**7.9%**|
|Finance & insurance|24|24|31|26|**105**|
||17.6%|13.1%|33.7%|9.3%|**15.2%**|
|**Total**|**136**|**183**|**92**|**279**|**690**|

Source: Gomez-Mera et al (2014) Firms were asked a variety of questions concerning their motivations for investing abroad, as well as the different economic, political, and cultural factors influencing their choice to invest or not in a specific destination. Data from the survey suggests that most firms are market-seeking: accessing new markets was 8 Indeed, almost 30% percent of investors in our sample said the main ways in which they benefited from a PTA concerned the increased size of the export market, while 23% and 16% mentioned reduction in the costs of trade and access to raw materials, respectively. Yet, these trade costs reducing benefits of PTAs will fall the further away the potential investment destination, given the higher transaction costs associated with trading with faraway markets. Thus, if investors value PTAs primarily because of their trade-related effects, the relevance of these agreements may decrease with distance.

> 9 The rationale for excluding natural resources and focusing largely on manufacturing and services was that while investment in natural resources continues to account for a significant proportion of total FDI, its drivers and patterns of geographical expansion tend to differ markedly from investment in manufacturing and services. 10 See Gomez-Mera et al. (2014).

9
**Table 6. Intra-Class Income Correlations within Rural Districts**

||**Total per cápita**<br>**income**|**Agricultural**<br>**production**<br>**Income**|<br>**Livestock**<br>**production**<br>**Income**|**Labor**<br>**Income**|
|---|---|---|---|---|
|Violent shock|0.010|0.044|0.012|0.107|
||(0.011)|(0.016)|(0.011)|(0.025)|
|N Vilt Shk|0.042|0.046|0.000|0.089|
|o oen oc|(0.014)|(0.014)|(0.009)|(0.018)|

Standard errors in parenthesis. Source: CLS-WILL: first wave – household questionnaire.

**Table 7. Markets for Agricultural Produce (Percentage of Rural Districts)**

||**Violent**<br>**Shock**|**No violent**<br>**shock**|**Difference**<br>**between**<br>**means (t-**<br>**test)**|
|---|---|---|---|
|Wholesale or intermediaries|0.649|0.565||
||(0.481)|(0.498)||
|Guilds or cooperatives|0.081|0.130||
||(0.275)|(0.337)||
|Markets at the municipalities|0.162|0.198||
||(0.371)|(0.400)||
|General public|0.095|0.092||
||(0.295)|(0.290)||
|Other|0.014|0.015||
||(0.116)|(0.123)||
|Number of communities|74|131||

Standard errors in parenthesis *** p<0.01, ** p<0.05, * p<0.1 Source: CLS-WILL: first wave – community questionnaire.

39
36 policy making and therefore should not be immune from institutional and social variables. In fact, in the sample of countries used in this paper, the number of veto players is a significant, positive determinant of the independence of radio and television stations.3> This raises the issue of whether greater information has an effect on government policy making independent of institutions and information.

Table 4 takes regression 3 in Table 3, focusing on radio and TV independence, and adds the checks variables and a control for income per capita. In regression 1 of Table 4, political variables retain the predicted signs, but only the time to the next election are significant at conventional levels. Again, though, theory suggests that information variables should have their greatest influence in countries where elections are most competitive. Countries that exhibit competitive elections (EIEC=7) are split nearly evenly between those which forbore and those that did not. Looking only at these countries, in regression 2, the significance of all of the variables rises notably. In the more competitive electoral systems that are assumed in models of voter information and political behavior, the independence of the media is a significant determinant of the decision to forbear, even controlling for checks and balances and the horizon of decision makers. These results hold for both the independence of newspapers and the availability of statistical information.

drops out.

35 The coefficient results for checks, social polarization due to ethnic fractionalization and land area, all statistically significant, are 0.18, -4.9 and 0.17. Ethnic fractionalization (taken from from Taylor and Jodice 1983) is the probability that two individuals randomly selected from a country do not belong to the same ethnic or linguistic group. To make it an appropriate measure of social polarization, it is transformed so that high and low values of fractionalization equal low values of polarization. Similar results are obtained using the fraction of the population coming from the same ethnic or linguistic group from Sullivan (1991). Area is from the CIA World Factbook.
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