The Role of Infrastructure in Mitigating Poverty Dynamics: The Case of an Irrigation Project in Sri Lanka
AbstractAlthough it is known that access to physical infrastructure enhances household welfare, there are hardly any micro-econometric studies that analyze the role of infrastructure in mitigating chronic and transient poverty. This paper aims to bridge this gap in the existing literature by evaluating the impact of a large-scale irrigation project implemented in Sri Lanka. We extend the seasonal consumption smoothing model of Paxson (1993) by introducing endogenous credit constraints. We collected unique household-level monthly panel data over a period of two years. According to the point estimates, with irrigation accessibility, per capita food and non-food consumption expenditures increase by around 20% and 45%, respectively, on average, and the probability of binding credit constraint is reduced by 5.6% during the dry season. The latter result implies that irrigation enhances households’ access to the credit market which, in turn, contributes to further reduction in transient poverty. These empirical results suggest that irrigation infrastructure has a positive impact on reducing both chronic and transient poverty. The structural estimation results support the validity of our theoretical framework.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by International Association of Agricultural Economists in its series 2009 Conference, August 16-22, 2009, Beijing, China with number 51461.
Date of creation: 2009
Date of revision:
Poverty Reduction; Role of Infrastructure; Monthly Panel Data; Consumer/Household Economics; Food Consumption/Nutrition/Food Safety; Food Security and Poverty; Risk and Uncertainty; O16;
Other versions of this item:
- Sawada Yasuyuki & Sugawara Shinya & Shoji Masahiro & Shinkai Naoko, 2014. "The Role of Infrastructure in Mitigating Poverty Dynamics: The Case of an Irrigation Project in Sri Lanka," The B.E. Journal of Economic Analysis & Policy, De Gruyter, vol. 14(3), pages 28, July.
- Sawada, Yasuyuki & Shoji, Masahiro & Sugawara, Shinya & Shinkai, Naoko, 2010. "The Role of Infrastructure in Mitigating Poverty Dynamics:The Case of an Irrigation Project in Sri Lanka," Working Papers 4, JICA Research Institute.
- O16 - Economic Development, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Stephen P. Zeldes, .
"Consumption and Liquidity Constraints: An Empirical Investigation,"
Rodney L. White Center for Financial Research Working Papers
16-88, Wharton School Rodney L. White Center for Financial Research.
- Zeldes, Stephen P, 1989. "Consumption and Liquidity Constraints: An Empirical Investigation," Journal of Political Economy, University of Chicago Press, vol. 97(2), pages 305-46, April.
- Stephen Zeldes, . "Consumption and Liquidity Constraints: An Empirical Investigation," Rodney L. White Center for Financial Research Working Papers 24-85, Wharton School Rodney L. White Center for Financial Research.
- Jappelli, Tullio, 1990. "Who Is Credit Constrained in the U.S. Economy?," The Quarterly Journal of Economics, MIT Press, vol. 105(1), pages 219-34, February.
- Takashi Kurosaki, 2006. "The measurement of transient poverty: Theory and application to Pakistan," Journal of Economic Inequality, Springer, vol. 4(3), pages 325-345, December.
- Kevin M. Murphy & Andrei Shleifer & Robert W. Vishny, 1988.
"Industrialization and the Big Push,"
NBER Working Papers
2708, National Bureau of Economic Research, Inc.
- Jacoby, Hanan G. & Minten, Bart, 2008.
"On measuring the benefits of lower transport costs,"
Policy Research Working Paper Series
4484, The World Bank.
- Jacoby, Hanan G. & Minten, Bart, 2009. "On measuring the benefits of lower transport costs," Journal of Development Economics, Elsevier, vol. 89(1), pages 28-38, May.
- Newey, Whitney K & Powell, James L & Walker, James R, 1990.
"Semiparametric Estimation of Selection Models: Some Empirical Results,"
American Economic Review,
American Economic Association, vol. 80(2), pages 324-28, May.
- Robert M. Townsend, .
"Risk and Insurance in Village India,"
University of Chicago - Population Research Center
91-3a, Chicago - Population Research Center.
- Lee, Lung-Fei, 1982. "Some Approaches to the Correction of Selectivity Bias," Review of Economic Studies, Wiley Blackwell, vol. 49(3), pages 355-72, July.
- Flavin, Marjorie A, 1981. "The Adjustment of Consumption to Changing Expectations about Future Income," Journal of Political Economy, University of Chicago Press, vol. 89(5), pages 974-1009, October.
- Esther Duflo & Rachel Glennerster & Michael Kremer, 2006.
"Using Randomization in Development Economics Research: A Toolkit,"
NBER Technical Working Papers
0333, National Bureau of Economic Research, Inc.
- Duflo, Esther & Glennerster, Rachel & Kremer, Michael, 2008. "Using Randomization in Development Economics Research: A Toolkit," Handbook of Development Economics, Elsevier.
- Duflo, Esther & Glennerster, Rachel & Kremer, Michael, 2007. "Using Randomization in Development Economics Research: A Toolkit," CEPR Discussion Papers 6059, C.E.P.R. Discussion Papers.
- Alderman, H. & Paxson, C.H., 1992.
"Do the Poor Insure? A Synthesis of the Literature on Risk and Consumption in Developing Countries,"
164, Princeton, Woodrow Wilson School - Development Studies.
- Alderman, Harold & Paxson, Christina H & DEC, 1992. "Do the poor insure? A synthesis of the literature on risk and consumption in developing countries," Policy Research Working Paper Series 1008, The World Bank.
- Fan, Shenggen & Zhang, Xiaobo, 2004. "Infrastructure and regional economic development in rural China," China Economic Review, Elsevier, vol. 15(2), pages 203-214.
- Van de Walle, D., 1996. "Infrastructure and Poverty in Vietnam," Papers 121, World Bank - Living Standards Measurement.
- Lee, Lung-Fei, 1978. "Unionism and Wage Rates: A Simultaneous Equations Model with Qualitative and Limited Dependent Variables," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 19(2), pages 415-33, June.
- Timothy Besley & Robin Burgess, 2003. "Halving Global Poverty," Journal of Economic Perspectives, American Economic Association, vol. 17(3), pages 3-22, Summer.
- Brockerhoff, Martin & Derose, Laurie F., 1996. "Child survival in East Africa: The impact of preventive health care," World Development, Elsevier, vol. 24(12), pages 1841-1857, December.
- Ekaterini Kyriazidou, 1997. "Estimation of a Panel Data Sample Selection Model," Econometrica, Econometric Society, vol. 65(6), pages 1335-1364, November.
- Datt, Gaurav & Ravallion, Martin, 1998.
"Why Have Some Indian States Done Better Than Others at Reducing Rural Poverty?,"
London School of Economics and Political Science, vol. 65(257), pages 17-38, February.
- Datt, Gaurav & Ravallion, Martin, 1996. "Why have some Indian states done better than others at reducing rural poverty?," Policy Research Working Paper Series 1594, The World Bank.
- Jalan, Jyotsna & Ravallion, Martin, 2001.
"Does piped water reduce diarrhea for children in rural India ?,"
Policy Research Working Paper Series
2664, The World Bank.
- Jalan, Jyotsna & Ravallion, Martin, 2003. "Does piped water reduce diarrhea for children in rural India?," Journal of Econometrics, Elsevier, vol. 112(1), pages 153-173, January.
- Paxson, Christina H, 1993.
"Consumption and Income Seasonality in Thailand,"
Journal of Political Economy,
University of Chicago Press, vol. 101(1), pages 39-72, February.
- Dollar, David & Kraay, Aart, 2002.
" Growth Is Good for the Poor,"
Journal of Economic Growth,
Springer, vol. 7(3), pages 195-225, September.
- Jacoby, Hanan C, 2000.
"Access to Markets and the Benefits of Rural Roads,"
Royal Economic Society, vol. 110(465), pages 713-37, July.
- Canning, David & Bennathan, Esra, 2000. "The social rate of return on infrastructure investments," Policy Research Working Paper Series 2390, The World Bank.
- Besley, Timothy & Coate, Stephen, 1992. "Workfare versus Welfare Incentive Arguments for Work Requirements in Poverty-Alleviation Programs," American Economic Review, American Economic Association, vol. 82(1), pages 249-61, March.
- Abhijit Vinayak Banerjee & Alice H. Amsden & Robert H. Bates & Jagdish Bhagwati & Angus Deaton & Nicholas Stern, 2007. "Making Aid Work," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262026155, December.
- Hahn, Jinyong, 1996. "A Note on Bootstrapping Generalized Method of Moments Estimators," Econometric Theory, Cambridge University Press, vol. 12(01), pages 187-197, March.
- Jalan, Jyotsna & Ravallion, Martin, 1998. "Transient Poverty in Postreform Rural China," Journal of Comparative Economics, Elsevier, vol. 26(2), pages 338-357, June.
- Michael Lokshin & Ruslan Yemtsov, 2005. "Has Rural Infrastructure Rehabilitation in Georgia Helped the Poor?," World Bank Economic Review, World Bank Group, vol. 19(2), pages 311-333.
- Xiaobo Zhang & Shenggen Fan, 2004.
"How Productive Is Infrastructure? A New Approach and Evidence from Rural India,"
American Journal of Agricultural Economics,
Agricultural and Applied Economics Association, vol. 86(2), pages 492-501.
- Zhang, Xiaobo & Fan, Shenggen, 2001. "How productive is infrastructure?: new approach and evidence from rural India," EPTD discussion papers 84, International Food Policy Research Institute (IFPRI).
- Shoji, Masahiro & Aoyagi, Keitaro & Kasahara, Ryuji & Sawada, Yasuyuki, 2010. "Motives behind Community Participation," Working Papers 16, JICA Research Institute.
- Teguh, Dartanto & Nurkholis, Nurkholis, 2011. "Finding out of the Determinants of Poverty Dynamics in Indonesia: Evidence from Panel Data," MPRA Paper 41185, University Library of Munich, Germany.
- Yasuyuki Sawada & Ryuji Kasahara & Keitaro Aoyagi & Masahiro Shoji & Mika Ueyama, 2013.
"Modes of Collective Action in Village Economies: Evidence from Natural and Artefactual Field Experiments in a Developing Country,"
Asian Development Review,
MIT Press, vol. 30(1), pages 31-51, March.
- Sawada, Yasuyuki & Kasahara, Ryuji & Aoyagi, Aoyagi & Shoji, Masahiro & Ueyama, Mika, 2012. "Modes of Collective Action in Village Economies:Evidence from Natural and Artefactual Field Experiments in a Developing Country," Working Papers 47, JICA Research Institute.
- Sellamuttu, Sonali Senaratna & Aida, Takeshi & Kasahara, Ryuji & Sawada, Yasuyuki & Wijerathna, Deeptha, 2013. "How Access to Irrigation Influences Poverty and Livelihoods:A Case Study from Sri Lanka," Working Papers 59, JICA Research Institute.
- Aida, Takeshi, 2011. "Social Capital as an Instrument for Common Pool Resource Management:A Case Study of Irrigation Management in Sri Lanka," Working Papers 33, JICA Research Institute.
- Kurosaki, Takashi, 2012. "Urban Transportation Infrastructure and Poverty Reduction: Delhi Metro's Impact on the Cycle Rickshaw Rental Market," PRIMCED Discussion Paper Series 24, Institute of Economic Research, Hitotsubashi University.
- Majumder, Rajarshi, 2012. "Removing poverty and inequality in India: the role of infrastructure," MPRA Paper 40941, University Library of Munich, Germany.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (AgEcon Search).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.