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Aid, Agriculture and Poverty in Developing Countries

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  • Paul Mosley
  • Abrar Suleiman

Abstract

The authors make two contributions to the debate on aid-effectiveness, illustrating that for impact on poverty what matters is not just the level but also the composition and stability of aid. One specific implication of this for aid policy is that aid most effectively reduces poverty if it supports public (and other) expenditures which are supportive of agricultural development. Regression analysis confirms that these are not only direct expenditure on agriculture, but also on education and infrastructure, and military expenditure has a negative impact. Three factors appear to be particularly conducive to the development of stable pro-poor expenditure patterns (and in particular pro-agriculture expenditure patterns). These are expenditure strategies which protect the poor against risk, the development of stable relations between governments and aid donors, and long-term political commitment to pro-poor strategies by government. The argument is pursued partly by panel-data econometric analysis of developing countries as a whole, and partly by case studies of sustained and non-sustained green revolutions in heavily aid-dependent countries in Africa. Copyright � 2006 The Authors; Journal compilation � 2006 Blackwell Publishing Ltd.

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Bibliographic Info

Article provided by Wiley Blackwell in its journal Review of Development Economics.

Volume (Year): 11 (2007)
Issue (Month): 1 (02)
Pages: 139-158

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Handle: RePEc:bla:rdevec:v:11:y:2007:i:1:p:139-158

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References

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  1. Jayne, T. S. & Jones, Stephen, 1997. "Food marketing and pricing policy in Eastern and Southern Africa: A survey," World Development, Elsevier, vol. 25(9), pages 1505-1527, September.
  2. Fan, Shenggen & Hazell, P. B. R. & Thorat, Sukhadeo, 1998. "Government spending, growth and poverty: an analysis of interlinkages in rural India," EPTD discussion papers 33, International Food Policy Research Institute (IFPRI).
  3. Hans P. Binswanger, 2000. "The Growth Performance of Agriculture in Subsaharan Africa," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 82(5), pages 1075-1086.
  4. Freebairn, Donald K., 1995. "Did the Green Revolution Concentrate Incomes? A Quantitative Study of Research Reports," World Development, Elsevier, vol. 23(2), pages 265-279, February.
  5. Edward L. Glaeser & David Laibson & Bruce Sacerdote, 2002. "An Economic Approach to Social Capital," Economic Journal, Royal Economic Society, vol. 112(483), pages 437-458, November.
  6. Collier, Paul & Dollar, David, 2002. "Aid allocation and poverty reduction," European Economic Review, Elsevier, vol. 46(8), pages 1475-1500, September.
  7. Abigail Barr, 2003. "Trust and expected trustworthiness: experimental evidence from zimbabwean villages," Economic Journal, Royal Economic Society, vol. 113(489), pages 614-630, 07.
  8. Paul Mosley, 2002. "The African green revolution as a pro-poor policy instrument," Journal of International Development, John Wiley & Sons, Ltd., vol. 14(6), pages 695-724.
  9. Lele, Uma & Goldsmith, Arthur A, 1989. "The Development of National Agricultural Research Capacity: India's Experience with the Rockefeller Foundation and Its Significance for Africa," Economic Development and Cultural Change, University of Chicago Press, vol. 37(2), pages 305-43, January.
  10. Paul Mosley & Abrar Suleiman, 2005. "Budget support, conditionality and poverty," Working Papers 2005012, The University of Sheffield, Department of Economics, revised Jun 2005.
  11. Paul Mosley & John Hudson & Arjan Verschoor, 2004. "Aid, Poverty Reduction and the 'New Conditionality'," Economic Journal, Royal Economic Society, vol. 114(496), pages F217-F243, 06.
  12. Brautigam, Deborah A & Knack, Stephen, 2004. "Foreign Aid, Institutions, and Governance in Sub-Saharan Africa," Economic Development and Cultural Change, University of Chicago Press, vol. 52(2), pages 255-85, January.
  13. Burnside, Craig & Dollar, David, 1997. "Aid, policies, and growth," Policy Research Working Paper Series 1777, The World Bank.
  14. Michael Johnson & Peter Hazell & Ashok Gulati, 2003. "The Role of Intermediate Factor Markets in Asia's Green Revolution: Lessons for Africa?," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 85(5), pages 1211-1216.
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Citations

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Cited by:
  1. Bergh, Andreas & Nilsson, Therese, 2011. "Globalization and Absolute Poverty – A Panel Data Study," Working Paper Series 862, Research Institute of Industrial Economics.
  2. John Hudson & Paul Mosley, 2007. "Aid Volatility, Policy and Development," Working Papers 2007015, The University of Sheffield, Department of Economics, revised Oct 2007.
  3. repec:gen:geneem:13041 is not listed on IDEAS
  4. Olubode-Awosola, O.O. & van Schalkwyk, H.D. & Jooste, A., 2008. "Mathematical modeling of the South African land redistribution for development policy," Journal of Policy Modeling, Elsevier, vol. 30(5), pages 841-855.
  5. Patrick GUILLAUMONT, 2009. "Aid effectiveness for poverty reduction: macroeconomic overview and emerging issues," Working Papers P05, FERDI.
  6. Hudson, John & Mosley, Paul, 2008. "The macroeconomic impact of aid volatility," Economics Letters, Elsevier, vol. 99(3), pages 486-489, June.
  7. Patrick Guillaumont, 2011. "Aid effectiveness for poverty reduction:macroeconomic overview and emerging issues," Working Papers halshs-00554285, HAL.
  8. Patrick GUILLAUMONT, 2009. "Aid effectiveness for poverty reduction: macroeconomic overview and emerging issues," Working Papers P05, FERDI.
  9. Tchale, Hardwick & Sauer, Johannes, 2008. "Soil Fertility Management And Maize Productivity In Malawi: Curvature Correct Efficiency Modeling And Simulation," 2007 Second International Conference, August 20-22, 2007, Accra, Ghana 52077, African Association of Agricultural Economists (AAAE).
  10. Been‐Lon Chen & Shun‐Fa Lee, 2012. "Intersectoral Spillovers, Relative Prices and Development Traps," Review of Development Economics, Wiley Blackwell, vol. 16(2), pages 243-261, 05.
  11. Alain McLaren, 2013. "Asymmetry in price transmission in agricultural markets," Research Papers by the Department of Economics, University of Geneva 13102, Département des Sciences Économiques, Université de Genève.

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