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Rural Policies and Poverty in Tanzania: an Agricultural Household Model-Based Assessment

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  • Luca Tiberti
  • Marco Tiberti

Abstract

The main objective of this study is to develop a robust and comprehensive tool to evaluate the effect on households’ welfare of different agricultural policies in Tanzania. This is done through a non-separable agricultural household model where production and consumption decisions are considered. In particular, we look at labour market failure, since this is among the major constraints in a context like rural Tanzania. Non-separability implies that production and consumption decisions are interlinked and that labour allocation is likely to be determined by shadow wages rather than market wages. A two-stage estimation strategy is adopted: the shadow price of family labour is first estimated and then included into the production and demand systems. The impact of a number of agricultural policies on poverty is then estimated. In particular, we evaluate the impact of policies established by the Agricultural Sector Development Programme, as well as changes in food prices.

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Bibliographic Info

Paper provided by CIRPEE in its series Cahiers de recherche with number 1229.

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Date of creation: 2012
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Handle: RePEc:lvl:lacicr:1229

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Keywords: Agricultural household models; poverty; agricultural policies; Tanzania;

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  1. Olson, Dennis & Zoubi, Taisier A., 2011. "Efficiency and bank profitability in MENA countries," Emerging Markets Review, Elsevier, vol. 12(2), pages 94-110, June.
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  3. Dorward, Andrew & Kydd, Jonathan & Morrison, Jamie & Urey, Ian, 2004. "A Policy Agenda for Pro-Poor Agricultural Growth," World Development, Elsevier, vol. 32(1), pages 73-89, January.
  4. Pauw, Karl & Thurlow, James, 2010. "Agricultural growth, poverty, and nutrition in Tanzania:," IFPRI discussion papers 947, International Food Policy Research Institute (IFPRI).
  5. Fulginiti, Lilyan E. & Perrin, Richard, 1990. "Argentine Agricultural Policy in a Multiple-Input, Multiple-Output Framework," Staff General Research Papers 277, Iowa State University, Department of Economics.
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  8. Hazell, Peter B. & Haggblade, Steven, 1990. "Rural - urban growth linkages in India," Policy Research Working Paper Series 430, The World Bank.
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  10. Jacoby, H.G., 1990. "Shadow Wages And Peasant Family Labor Supply; An Econometric Application To The Peruvian Sierra," Papers 73, World Bank - Living Standards Measurement.
  11. Christian H.C.A. Henning & Arne Henningsen, 2007. "Modeling Farm Households' Price Responses in the Presence of Transaction Costs and Heterogeneity in Labor Markets," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 89(3), pages 665-681.
  12. Henning, Christian H.C.A. & Henningsen, Arne, 2007. "AJAE Appendix: Modeling Farm Households' Price Responses in the Presence of Transaction Costs and Heterogeneity in Labor Markets," American Journal of Agricultural Economics Appendices, Agricultural and Applied Economics Association, vol. 89(3), August.
  13. Ravallion, Martin & Datt, Gaurav, 1996. "How Important to India's Poor Is the Sectoral Composition of Economic Growth?," World Bank Economic Review, World Bank Group, vol. 10(1), pages 1-25, January.
  14. de Janvry, Alain & Fafchamps, Marcel & Sadoulet, Elisabeth, 1991. "Peasant Household Behaviour with Missing Markets: Some Paradoxes Explained," Economic Journal, Royal Economic Society, vol. 101(409), pages 1400-417, November.
  15. Haggblade, Steven & Hazell, Peter B. R. & Reardon, Thomas, 2009. "Transforming the rural nonfarm economy: Opportunities and threats in the developing world," Issue briefs 58, International Food Policy Research Institute (IFPRI).
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