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Community-Based Development and Aggregate Shocks in Developing Countries: The Experience of an NGO in Pakistan

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  • Kurosaki, Takashi
  • Khan, Hidayat Ullah
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    Abstract

    This paper empirically investigates whether a community-based development (CBD) approach is effective in mitigating the ill effects of aggregate shocks. The analysis is based on a three-year panel dataset of approximately 600 households in rural Pakistan where a local NGO has implemented CBD interventions. The results show that the mitigating effect was absent when the control group included both non-member households in villages under CBD interventions and households in villages without such interventions. On the other hand, within the former type of villages, a strong spillover effect from member to non-member households was found, mitigating the ill effects of aggregate shocks. Furthermore, CBD interventions accompanied by micro infrastructure construction or microcredit provision were found to be effective in mitigating the ill effects. These results suggest the possibility that whether a CBD approach mitigates aggregate shocks depends on the type of intervention and the nature of market failures.

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    File URL: http://hermes-ir.lib.hit-u.ac.jp/rs/bitstream/10086/26481/1/No54-dp.pdf
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    Bibliographic Info

    Paper provided by Institute of Economic Research, Hitotsubashi University in its series PRIMCED Discussion Paper Series with number 54.

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    Length: 40 p.
    Date of creation: Mar 2014
    Date of revision:
    Handle: RePEc:hit:primdp:54

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    Related research

    Keywords: community-based development; consumption smoothing; aggregate shocks; microfinance; Pakistan;

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    1. Khan, Hidayat Ullah & Kurosaki, Takashi & Miura, Ken, 2011. "The Effectiveness of Community-Based Development in Poverty Reduction: A Descriptive Analysis of a Women-Managed NGO in Rural Pakistan," PRIMCED Discussion Paper Series 13, Institute of Economic Research, Hitotsubashi University.
    2. Bardhan, Pranab & Mookherjee, Dilip, 2005. "Decentralizing antipoverty program delivery in developing countries," Journal of Public Economics, Elsevier, vol. 89(4), pages 675-704, April.
    3. Khwaja, Asim Ijaz, 2009. "Can good projects succeed in bad communities?," Journal of Public Economics, Elsevier, vol. 93(7-8), pages 899-916, August.
    4. Katherine Casey & Rachel Glennerster & Edward Miguel, 2012. "Reshaping Institutions: Evidence on Aid Impacts Using a Preanalysis Plan," The Quarterly Journal of Economics, Oxford University Press, vol. 127(4), pages 1755-1812.
    5. Marc F. Bellemare & Christopher B. Barrett & David R. Just, 2013. "The Welfare Impacts of Commodity Price Volatility: Evidence from Rural Ethiopia," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 95(4), pages 877-899.
    6. Asim Ijaz Khwaja, 2004. "Is Increasing Community Participation Always a Good Thing?," Journal of the European Economic Association, MIT Press, vol. 2(2-3), pages 427-436, 04/05.
    7. Labonne, Julien & Chase, Robert S., 2011. "Do community-driven development projects enhance social capital? Evidence from the Philippines," Journal of Development Economics, Elsevier, vol. 96(2), pages 348-358, November.
    8. Takashi Kurosaki, 2005. "Determinants of Collective Action under Devolution Initiatives: The Case of Citizen Community Boards in Pakistan," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 44(3), pages 253-269.
    9. Anju Vajja & Howard White, 2008. "Can the World Bank Build Social Capital? The Experience of Social Funds in Malawi and Zambia," Journal of Development Studies, Taylor & Francis Journals, vol. 44(8), pages 1145-1168.
    10. Vijayendra Rao & Ana Maria Ibanez, 2005. "The Social Impact of Social Funds in Jamaica: A 'Participatory Econometric' Analysis of Targeting, Collective Action, and Participation in Community-Driven Development," Journal of Development Studies, Taylor & Francis Journals, vol. 41(5), pages 788-838.
    11. Nkonya, Ephraim M. & Phillip, Dayo & Mogues, Tewodaj & Pender, John L. & Kato, Edward, 2009. "Impacts Of Community-Driven Development Programs On Income And Asset Acquisition In Africa: The Case Of Nigeria," 2009 Conference, August 16-22, 2009, Beijing, China 50537, International Association of Agricultural Economists.
    12. Park, Albert & Wang, Sangui, 2010. "Community-based development and poverty alleviation: An evaluation of China's poor village investment program," Journal of Public Economics, Elsevier, vol. 94(9-10), pages 790-799, October.
    13. Arimoto, Yutaka, 2011. "Participatory Rural Development in 1930s Japan: The Economic Rehabilitation Movement," PRIMCED Discussion Paper Series 14, Institute of Economic Research, Hitotsubashi University.
    14. Khan, Hidayat Ullah & Kurosaki, Takashi & Miura, Ken, 2011. "The Effectiveness of Community-Based Development in Poverty Reduction : A Descriptive Analysis of a Women-Managed NGO in Rural Pakistan," CEI Working Paper Series 2011-4, Center for Economic Institutions, Institute of Economic Research, Hitotsubashi University.
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