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Aid, agriculture and poverty in developing countries

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Author Info
Paul Mosley () (Department of Economics, The University of Sheffield)
Abrar Suleiman () (Department of Economics, The University of Sheffield)

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Abstract

We make two contributions to the debate on aid-effectiveness, illustrating that for impact on poverty what matters is not just the level but also the composition and stability of aid. One specific implication of this for aid policy is that aid most effectively reduces poverty if it supports public (and other) expenditures which are supportive of agricultural development – these, our regression analysis confirms, are not only direct expenditure on agriculture, but also education and infrastructure, and military expenditure has a negative impact. Three factors appear to be particularly conducive to the development of stable pro-poor expenditure patterms (and in particular pro-agriculture expenditure patterns). These are expenditure strategies which protect the poor against risk, the development of stable relations between governments and aid donors, and long-term political commitment to pro-poor strategies by government. The argument is pursued partly by panel-data econometric analysis of developing countries as a whole, and partly by case studies of sustained and non-sustained green revolutions in heavily aid-dependent countries in Africa.

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File URL: http://www.shef.ac.uk/content/1/c6/03/91/72/SERP2005010.pdf
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Paper provided by The University of Sheffield, Department of Economics in its series Working Papers with number 2005010.

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Length: 28 pages
Date of creation: Jun 2005
Date of revision: Jun 2005
Handle: RePEc:shf:wpaper:2005010

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  1. Brautigam, Deborah A & Knack, Stephen, 2004. "Foreign Aid, Institutions, and Governance in Sub-Saharan Africa," Economic Development and Cultural Change, University of Chicago Press, vol. 52(2), pages 255-85, January.
  2. Craig Burnside & David Dollar, 2000. "Aid, Policies, and Growth," American Economic Review, American Economic Association, vol. 90(4), pages 847-868, September. [Downloadable!] (restricted)
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  3. Fan, Shenggen & Hazell, P. B. R. & Thorat, Sukhadeo, 1998. "Government spending, growth and poverty: an analysis of interlinkages in rural India," EPTD discussion papers 33, International Food Policy Research Institute (IFPRI). [Downloadable!]
  4. Collier, Paul & Dollar, David, 2002. "Aid allocation and poverty reduction," European Economic Review, Elsevier, vol. 46(8), pages 1475-1500, September. [Downloadable!] (restricted)
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  5. Paul Mosley & Abrar Suleiman, 2005. "Budget support, conditionality and poverty," Working Papers 2005012, The University of Sheffield, Department of Economics, revised Jun 2005. [Downloadable!]
  6. Paul Mosley, 2002. "The African green revolution as a pro-poor policy instrument," Journal of International Development, John Wiley & Sons, Ltd., vol. 14(6), pages 695-724. [Downloadable!]
  7. Abigail Barr, 2003. "Trust and expected trustworthiness: experimental evidence from zimbabwean villages," Economic Journal, Royal Economic Society, vol. 113(489), pages 614-630, 07. [Downloadable!] (restricted)
  8. Jayne, T. S. & Jones, Stephen, 1997. "Food marketing and pricing policy in Eastern and Southern Africa: A survey," World Development, Elsevier, vol. 25(9), pages 1505-1527, September. [Downloadable!] (restricted)
  9. Freebairn, Donald K., 1995. "Did the Green Revolution Concentrate Incomes? A Quantitative Study of Research Reports," World Development, Elsevier, vol. 23(2), pages 265-279, February. [Downloadable!] (restricted)
  10. Paul Mosley & John Hudson & Arjan Verschoor, 2004. "Aid, Poverty Reduction and the 'New Conditionality'," Economic Journal, Royal Economic Society, vol. 114(496), pages F217-F243, 06. [Downloadable!] (restricted)
  11. Fan, Shenggen & Hazell, Peter & Thorat, Sukhadeo, 2000. " Government Spending, Growth and Poverty in Rural India," American Journal of Agricultural Economics, American Agricultural Economics Association, vol. 82(4), pages 1038-51, November. [Downloadable!] (restricted)
  12. Edward L. Glaeser & David Laibson & Bruce Sacerdote, 2002. "An Economic Approach to Social Capital," Economic Journal, Royal Economic Society, vol. 112(483), pages 437-458, November. [Downloadable!] (restricted)
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