The World Bank - Working for a world free of poverty

Views menu

Syndicate content
End Poverty

About us

About

This blog is maintained by Shanta Devarajan, the Chief Economist of the Africa Region at the World Bank.

Rural Development

Some (Possibly Heretical) Thoughts on Agriculture

Submitted by Shanta on Wed, 2009-10-21 08:22

Since the publication of the 2008 World Development Report, there has been a vigorous discussion in the development community about agriculture; today’s publication of the World Bank’s Agriculture Action Plan is a milestone in that process.  To stimulate further discussion on the subject, here are some thoughts from a garden-variety economist.

1. The oft-quoted statement, “GDP growth originating in agriculture is about four times more effective in raising incomes of extremely poor people than GDP growth originating from other sectors,” is an arithmetical point, not an economic point.  It simply reflects the fact that 75 percent of the world’s poor depend on agriculture for their livelihoods.

Your Comments on Africa's Successes

Submitted by Shanta on Wed, 2009-10-07 10:58

The African Successes post has generated a vigorous exchange of ideas.  I appreciate receiving your comments on the study, your suggestions for success stories, and your views on development approaches that have worked and those that have not.  

Many of you felt, as I do, that we need to highlight Africa’s recent successes.   Your responses voiced strong support for a focus on education, knowledge and dissemination, health, private-sector development, agriculture (irrigation and fertilizer), community-level development, governance, infrastructure, and information and communication technology.  

Les Réussites Africaines

Submitted by Shanta on Wed, 2009-10-07 10:47

Ces dernières années, de nombreux pays africains ont commencé à faire preuve d’un dynamisme remarquable.

Le taux de croissance  enregistré au Mozambique est fulgurant, affichant une moyenne annuelle de 8 % sur plus de dix ans. Le Kenya est devenu l'un des plus importants fournisseurs mondiaux de fleurs coupées. Le service M-Pesa, qui permet d’effectuer des transferts d’argent à partir d’un téléphone mobile, rencontre un succès grandissant tandis que le programme KickStart aide les petits agriculteurs à irriguer leurs cultures à moindre coût. Le tourisme rwandais fleurit depuis qu’il s’est axé sur la vie des gorilles et dans la ville de Lagos au Nigéria, les nouvelles infrastructures du BRT (réseau de transport rapide par bus) facilite un développement urbain plus efficace. En deux mots, l’Afrique est en train de vivre une réelle transformation.

African Successes

Submitted by Shanta on Thu, 2009-09-17 11:44

In recent years, a broad swath of African countries has begun to show a remarkable dynamism.  From Mozambique’s impressive growth rate (averaging 8% p.a. for more than a decade) to Kenya’s emergence as a major global supplier of cut flowers, from M-pesa’s mobile phone-based cash transfers to KickStart’s low-cost irrigation technology for small-holder farmers, and from Rwanda’s gorilla tourism to Lagos City’s Bus Rapid Transit system, Africa is seeing a dramatic transformation.  This favorable trend is spurred by, among other things, stronger leadership, better governance, an improving business climate, innovation, market-based solutions, a more involved citizenry, and an increasing reliance on home-grown solutions.  More and more, Africans are driving African development. 

The global economic crisis of 2008-09 threatens to undermine the optimism that Africa can harness this dynamism for long-lasting development.  In light of this, it might be useful to re-visit recent achievements.  The African Successes study aims to do just that.

The study will identify a wide range of development successes (see list), from which around 20 cases will be selected for in-depth study.  The analysis of each successful experience will evaluate the following: (1) the drivers of success—what has worked and why; (2) the sustainability of the successful outcome(s); and (3) the potential for scaling up successful experiences.  African success stories offer valuable insights and practical lessons to other countries in the region. 

I welcome your comments and suggestions for success stories. Click here to see the list of what we have come up with so far.

Useful Reading on Africa: Links of the week for Sept. 4, 2009

Submitted by Shanta on Fri, 2009-09-04 13:05

Here is some good reading on Africa:

- As Africa grows richer, there are reasons to be pessimistic about its ability to capitalize on the benefits of a reduction in population growth, says The Economist. One reason is that one in two Africans is a child, which means that traditional ways of caring for children in extended families are breaking down.

- Did you know that the IMF not always preaches tight budgets? Hugh Bredenkamp, Deputy Director of the IMF’s Strategy, Policy, and Review Unit explains why this is the case sometimes in the IMF blog.

A Daughter Deficit in Africa?

Submitted by Shanta on Thu, 2009-08-27 10:10

An excellent special issue of the New York Times magazine on Women and Development  had an article on the “daughter deficit”—the phenomenon, observed in India and China, of many fewer girls than boys being born, and surviving to age 5.  Up to now, I had been thinking of this as an Asian phenomenon, associated with cultural values in India and China.  But the finding by my colleagues Jed Friedman and Norbert Schady, reported in this blog , that in Africa the mortality rate from a drop in income is about twice as high for girls as for boys, makes me think that the daughter deficit (or “son preference”) may be coming to Africa. 

Truth and reconciliation through technology

Submitted by Gözde Isik on Mon, 2009-03-02 18:41

Liberia, once one of the richest countries in Sub-Saharan Africa, is now the second poorest country in the world, after 14 years of civil war left the country in ruins. Only recently--with the first democratically held election since the end of the war and intensive foreign aid flows--has Liberia begun showing positive signs towards economic and social recovery. Paving the way to recovery, The Truth and Reconciliation Commission of Liberia (TRC) was set up in 2005 by the interim government to investigate and report human rights violations that occurred during the civil conflict by providing a platform for both victims and perpetrators to share their experiences. But with all infrastructure having been destroyed, it has proved almost impossible for Liberians living outside of Monrovia to access the TRC hearings and have a say in the process of reconciliation. 

Fertilizer Subsidies in Malawi

Submitted by Shanta on Wed, 2008-12-17 10:17

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 stolen by middlemen) and that they benefit large (and hence less poor) farmers more, I suggested that even the Malawi case is not clear-cut. 

As Maggie McMillan points out, it was improved seeds and the relaxation of farmers’ credit constraints that contributed most to the improved yield in Malawi: “Low fertilizer use is indeed one of the Africa’s most vexing challenges. But subsidizing is only a band-aid, masking its high cost and low productivity without sustaining growth. Such band-aids can be useful, but they can also be a distraction, drawing attention away from the interventions needed for large-scale improvements."

Poverty in Africa and elsewhere

Submitted by Shanta on Wed, 2008-10-15 09:12

Poor people are poor because markets fail them and governments fail them.  That markets fail them is well-known.  Failures in capital markets mean that young people cannot get loans to finance their education; imperfect or nonexistent insurance markets mean that poor people will not get decent health care if left to unfettered markets; economies of scale as well as the simple fact that basic services such as water are necessities mean that markets will not ensure that poor people will get the services they need to survive.  As Roy Radner, a former professor of mine once put it, “When you allocate resources by market prices, you discriminate against poor people.”

To overcome these failures—that is, to protect the poor—governments step in.  They finance and provide primary education and basic health care; they subsidize water and electricity so poor people can afford these services.  Unfortunately, these well-intentioned government interventions lead to failures of their own.  In Ugandan public schools, teachers are absent 27 percent of the time; health workers in primary health centers are absent 37 percent of the time.  Only one percent of the money allocated to non-salary spending in Chad reached the health clinics.  These “government failures” are sometimes as pernicious as the market failures they were intended to correct.  They are also difficult to overcome because various interest groups who benefit from the status quo may resist reform. 

Is information the solution?

Submitted by Shanta on Thu, 2008-10-02 15:52

Chris Blattman is right to question my enthusiasm for information as the solution to seemingly intractable development problems. (By the way, thanks for the complimentary plug for AfricaCan, Chris).  Information by itself is not useful unless people can do something with it.  And we’re talking about poor people, who typically have very little power. But if enough poor people have access to the same information, they may be able to mobilize and enforce better performance from service providers or public officials. This is the reasoning behind the work on citizen report cards, public expenditure tracking surveys, community monitoring, and the like.

A recent note by Stuti Khemani explores why community monitoring of health care in Uganda appeared to work so well, while a similar program for schools in Uttar Pradesh (UP), India didn’t.  She suggests three reasons: differences in the level of NGO activism in the two countries; differences between health and education; and the political economy of service delivery (teachers unions are very powerful in UP).  The latter is particularly troubling because another rationale for information campaigns is when reforms in service delivery are blocked for political reasons.  What then can we do?