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Shanta Devarajan's blog

Commodity price shocks

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The steep decline in the prices of commodities (oil, minerals, metals) following the global financial crisis is clearly having an effect on African countries. But the effect is asymmetric between importers and exporters of commodities. For instance, oil importers, who suffered in 2008 from the sharp increase in oil prices (reaching $140 a barrel), will benefit from the decline in oil prices, whereas the reverse is true for oil exporters. Using the latest commodity forecasts available, my colleague

The human crisis

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My colleague Justin Lin says that it is important not to let the global financial crisis become “a human crisis.” Nowhere is this truer than in Africa. Although spared the first-round effects of banking failures, Africa is already facing the second-round impacts of declining capital flows, slowing remittances, stagnating foreign aid and falling commodity prices and export revenues. The c

Using economics to fight AIDS

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I gave one of the keynotes (based on joint work with Markus Goldstein) at the recent ICASA 2008 in Dakar, Senegal on the title of this post. The fight against AIDS involves allocating scarce resources to multiple uses; and contracting, avoiding, preventing, testing for, and treating the disease all involve behavioral choices.

Fertilizer Subsidies in Malawi

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At a recent AERC research workshop in Nairobi, I made a comment about African governments’ not spending enough money on public goods, and spending too much on private goods such as fertilizers. The comment seemed to have struck a nerve. Several people in the audience pointed out that, in Malawi, fertilizer subsidies have increased cereal production, so government spending on fertilizers was not such a bad thing. Going beyond the general arguments that these fertilizer subsidies often don’t reach farmers (they’re

Delivering basic services in low-accountability environments

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In the midst of the very serious resumption of violence in Democratic Republic of Congo, an interesting debate has broken out between Paul Collier and Adekeye Adebajo on the question of who should deliver basic services in post-conflict societies. Paul suggests these services be provided by non-state actors, such as NGOs and church groups. Dr.

Africa and “Bretton Woods II”

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As world leaders gather in Washington later this week to discuss coordinated solutions to the global financial crisis, the question of restructuring the international financial architecture, which has remained more or less what was decided at the Bretton Woods conference of 1944, has come up.

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