IDEAS home Printed from https://ideas.repec.org/p/fpr/resrep/160.html
   My bibliography  Save this paper

The bang for the birr: Public expenditures and rural welfare in Ethiopia

Author

Listed:
  • Mogues, Tewodaj
  • Ayele, Gezahegn
  • Paulos, Zelekawork

Abstract

"During the past decade and a half, Ethiopia's approach to promoting development and improving the lives of the country's rural population has been driven by a government strategy called Agricultural Development–Led Industrialization (ADLI). This strategy's main goal is to encourage fast, broad-based development within the agricultural sector in order to power economic growth. While ADLI considers regulatory, trade, market, and other policies to be key engines of agricultural growth, it also focuses on increasing public expenditure in agriculture and road infrastructure, as well as in social sectors that are perceived as contributing to agricultural productivity. Thus, Ethiopia's public expenditure policy is at the heart of the policy measures emerging from ADLI. Given budget constraints, it is essential to examine the relative contributions that different types of public investments make to welfare. An improved understanding of investment outcomes will have important implications for expenditure policy, especially in terms of the portfolio composition of public resources. This research report explores and compares the impacts of different types of public spending on rural household welfare in Ethiopia. Most previous studies examining the link between public expenditure and development outcomes either explore how the size of overall public expenditure or public investment affects growth or poverty, or they correlate spending in one economic sector with outcomes in that sector or with broader measures of welfare. Both types of studies can provide useful input into policymaking decisions. However, there is a striking lack of research aimed at examining how the composition of public spending affects key development outcomes—a particularly policy-relevant question. This study fills that gap. It compares the impact of different types of public spending through a three-stage analysis. The first stage assesses the impact of access to different sector-specific services on rural household consumption and the productivity of households' private assets, differentiating these effects by geographic region. The second stage determines the contribution of different types of public spending to key sector-specific outcomes. The final stage of the analysis draws on the first two to estimate the effect on rural welfare of a unit increase in public spending across different sectors." from text

Suggested Citation

  • Mogues, Tewodaj & Ayele, Gezahegn & Paulos, Zelekawork, 2008. "The bang for the birr: Public expenditures and rural welfare in Ethiopia," Research reports 160, International Food Policy Research Institute (IFPRI).
    • Handle: RePEc:fpr:resrep:160
    as

    Download full text from publisher

    File URL: http://www.ifpri.org/sites/default/files/publications/rr160.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Stefano Paternostro & Anand Rajaram & Erwin R. Tiongson, 2007. "How Does the Composition of Public Spending Matter?," Oxford Development Studies, Taylor & Francis Journals, vol. 35(1), pages 47-82.
    2. Lopez, Ramon & Galinato, Gregmar I., 2007. "Should governments stop subsidies to private goods? Evidence from rural Latin America," Journal of Public Economics, Elsevier, vol. 91(5-6), pages 1071-1094, June.
    3. Teferra, Mengistu, 2002. "Power sector reforms in Ethiopia: options for promoting local investments in rural electrification," Energy Policy, Elsevier, vol. 30(11-12), pages 967-975, September.
    4. Wolde-Ghiorgis, W., 2002. "Renewable energy for rural development in Ethiopia: the case for new energy policies and institutional reform," Energy Policy, Elsevier, vol. 30(11-12), pages 1095-1105, September.
    5. Dominique van de Walle, 2003. "Are Returns to Investment Lower for the Poor? Human and Physical Capital Interactions in Rural Vietnam," Review of Development Economics, Wiley Blackwell, vol. 7(4), pages 636-653, November.
    6. Jung, Hong-Sang & Thorbecke, Erik, 2003. "The impact of public education expenditure on human capital, growth, and poverty in Tanzania and Zambia: a general equilibrium approach," Journal of Policy Modeling, Elsevier, vol. 25(8), pages 701-725, November.
    7. Jayne, T. S. & Govereh, J. & Mwanaumo, A. & Nyoro, J. K. & Chapoto, A., 2002. "False Promise or False Premise? The Experience of Food and Input Market Reform in Eastern and Southern Africa," World Development, Elsevier, vol. 30(11), pages 1967-1985, November.
    8. 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).
    9. Kloos, Helmut, 0. "Primary health care in Ethiopia under three political systems: Community participation in a war-torn society," Social Science & Medicine, Elsevier, vol. 46(4-5), pages 505-522, February.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Mogues, Tewodaj & Ayele, Gezahegn & Paulos, Zelekawork & Fan, Shenggen, 2006. "How Effective is Public Spending? Public Investment Composition and Rural Welfare in Ethiopia," 2006 Annual meeting, July 23-26, Long Beach, CA 21258, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    2. Mulugetta, Yacob, 2008. "Human capacity and institutional development towards a sustainable energy future in Ethiopia," Renewable and Sustainable Energy Reviews, Elsevier, vol. 12(5), pages 1435-1450, June.
    3. Escobal, Javier, 2005. "The Role of Public Infraestructure in Market Development in Rural Peru," MPRA Paper 727, University Library of Munich, Germany.
    4. Edward Batte Sennoga & John Mary Matovu, 2013. "Public Spending Composition in Uganda and its Implications for Growth and Poverty Reduction," Public Finance Review, , vol. 41(2), pages 227-247, March.
    5. Kanayo Kingsley Ogujiuba & Kizito Ehigiamusoe, 2014. "Capital Budget Implementation in Nigeria: Evidence from the 2012 Capital Budget," Contemporary Economics, University of Economics and Human Sciences in Warsaw., vol. 8(3), September.
    6. Khalid Zaman & Bashir Khilji, 2014. "A note on pro-poor social expenditures," Quality & Quantity: International Journal of Methodology, Springer, vol. 48(4), pages 2121-2154, July.
    7. Kebede, Kassahun Y. & Mitsufuji, Toshio, 2017. "Technological innovation system building for diffusion of renewable energy technology: A case of solar PV systems in Ethiopia," Technological Forecasting and Social Change, Elsevier, vol. 114(C), pages 242-253.
    8. World Bank, 2013. "Republic of Senegal Basic Agricultural Public Expenditure Diagnostic Review," World Bank Publications - Reports 20141, The World Bank Group.
    9. Birner, Regina & Resnick, Danielle, 2010. "The Political Economy of Policies for Smallholder Agriculture," World Development, Elsevier, vol. 38(10), pages 1442-1452, October.
    10. Gustavo Anríquez & William Foster & Jorge Ortega & César Falconi & Carmine Paolo De Salvo, 2016. "Public Expenditures and the Performance of Latin American and Caribbean Agriculture," IDB Publications (Working Papers) 95696, Inter-American Development Bank.
    11. Anríquez, Gustavo & Foster, William & Ortega, Jorge & Falconi, César & De Salvo, Carmine Paolo, 2016. "Public Expenditures and the Performance of Latin American and Caribbean Agriculture," IDB Publications (Working Papers) 7839, Inter-American Development Bank.
    12. Trotter, Philipp A. & McManus, Marcelle C. & Maconachie, Roy, 2017. "Electricity planning and implementation in sub-Saharan Africa: A systematic review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 74(C), pages 1189-1209.
    13. Kelly, Valerie A., 2005. "Farmers' Demand for Fertilizer in Sub-Saharan Africa," Staff Paper Series 11612, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    14. Seong-Hoon Cho & Suhyun Jung & Roland K. Roberts & Seung Gyu Kim, 2012. "Interrelationship between poverty and the wildland--urban interface in metropolitan areas of the Southern US," Applied Economics, Taylor & Francis Journals, vol. 44(11), pages 1405-1416, April.
    15. Suhyun Jung & Seong-Hoon Cho & Roland K. Roberts, 2015. "The impact of government funding of poverty reduction programmes," Papers in Regional Science, Wiley Blackwell, vol. 94(3), pages 653-675, August.
    16. Haider A. Khan, 2007. "Social Accounting Matrix: A Very Short Introduction for Economic Modeling," CIRJE F-Series CIRJE-F-477, CIRJE, Faculty of Economics, University of Tokyo.
    17. Maisonnave, Hélène & Mamboundou, Pierre Nziengui, 2022. "Agricultural economic reforms, gender inequality and poverty in Senegal," Journal of Policy Modeling, Elsevier, vol. 44(2), pages 361-374.
    18. Zhang, Yingqiang & Eriksson, Tor, 2010. "Inequality of opportunity and income inequality in nine Chinese provinces, 1989-2006," China Economic Review, Elsevier, vol. 21(4), pages 607-616, December.
    19. Kym Anderson, 2006. "Reducing Distortions to Agricultural Incentives: Progress, Pitfalls, and Prospects," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(5), pages 1135-1146.
    20. McNamara, Paul E. & Ulimwengu, John M. & Leonard, Kenneth L., 2010. "Do health investments improve agricultural productivity? Lessons from agricultural household and health research," IFPRI discussion papers 1012, International Food Policy Research Institute (IFPRI).

    More about this item

    Keywords

    Public investments; Public spending; Rural welfare;
    All these keywords.

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:fpr:resrep:160. See general information about how to correct material in RePEc.

    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 CitEc recognized a bibliographic reference but did not link an item in RePEc 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/ifprius.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.