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Estimating the impact of rural investments in Nepal

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Author Info

  • Dillon, Andrew
  • Sharma, Manohar
  • Zhang, Xiaobo

Abstract

As a largely rural society, most people in Nepal still depend upon agriculture as their major livelihood strategy. Therefore, it is important to improve the allocation efficiency of limited public expenditures to promote agricultural growth and poverty reduction. However, evaluating the returns of public investment is limited by methodological challenges. We use hedonic and panel data methods to examine the returns to different types of rural public investments including roads, irrigation and extension advice. The use of diverse identification strategies reduces the risk of using a narrower set of results driven primarily by a particular methodology. We find that rural roads and irrigation are one of the most productive public expenditures according to the benefit-cost ratio calculations, though the magnitudes of these ratios depend on methodology.

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Bibliographic Info

Article provided by Elsevier in its journal Food Policy.

Volume (Year): 36 (2011)
Issue (Month): 2 (April)
Pages: 250-258

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Handle: RePEc:eee:jfpoli:v:36:y:2011:i:2:p:250-258

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Web page: http://www.elsevier.com/locate/foodpol

Related research

Keywords: Public expenditure Rural infrastructure Agriculture;

References

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  1. Jacoby, Hanan G., 1998. "Access to markets and the benefits of rural roads," Policy Research Working Paper Series 2028, The World Bank.
  2. Mogues, Tewodaj & Ayele, Gezahegn & Paulos, Zelekawork, 2007. "The bang for the birr: Public expenditures and rural welfare in Ethiopia," IFPRI discussion papers 702, International Food Policy Research Institute (IFPRI).
  3. Stefan Dercon & Daniel O. Gilligan & John Hoddinott & Tassew Woldehanna, 2009. "The Impact of Agricultural Extension and Roads on Poverty and Consumption Growth in Fifteen Ethiopian Villages," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 91(4), pages 1007-1021.
  4. Jimenez, Emmanuel, 1995. "Human and physical infrastructure: Public investment and pricing policies in developing countries," Handbook of Development Economics, in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 3, chapter 43, pages 2773-2843 Elsevier.
  5. Fan, Shenggen & Zhang, Linxiu & Zhang, Xiaobo, 2002. "Growth, inequality, and poverty in rural China: the role of public investments," Research reports 125, International Food Policy Research Institute (IFPRI).
  6. S. Mansoob Murshed & Scott Gates, 2005. "Spatial-Horizontal Inequality and the Maoist Insurgency in Nepal," Review of Development Economics, Wiley Blackwell, vol. 9(1), pages 121-134, 02.
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Cited by:
  1. Barbier, Edward B., 2013. "Structural change, dualism and economic development : the role of the vulnerable poor on marginal lands," Policy Research Working Paper Series 6456, The World Bank.
  2. Barbier, Edward B., 2012. "Natural capital, ecological scarcity and rural poverty," Policy Research Working Paper Series 6232, The World Bank.
  3. Arndt, Channing & Strzepek, Kenneth & Thurlow, James, 2011. "Climate Change and Infrastructure Investment in Developing Countries: The Case of Mozambique," Working Paper Series UNU-WIDER Research Paper , World Institute for Development Economic Research (UNU-WIDER).

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