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

Author

Listed:
  • Kurosaki, Takashi
  • Khan, Hidayat Ullah

Abstract

This paper empirically investigates whether a community-based development (CBD) approach is effective in mitigating the ill-effect 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. Results show that the mitigating effect was absent when the control group includes both non-member households in villages under CBD interventions and households in villages without such interventions. On the other hand, a strong spillover effect within the former types of villages 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 effective in mitigating the ill-effects. These results indicate a possibility that whether a CBD approach mitigates aggregate shocks depends on the type of interventions and the nature of market failures.

Suggested Citation

  • Kurosaki, Takashi & Khan, Hidayat Ullah, 2014. "Community-Based Development and Aggregate Shocks in Developing Countries-The Experience of an NGO in Pakistan-," Economic Review, Hitotsubashi University, vol. 65(2), pages 168-186, April.
    • Handle: RePEc:hit:ecorev:v:65:y:2014:i:2:p:168-186
    DOI: 10.15057/27352
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    More about this item

    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • L31 - Industrial Organization - - Nonprofit Organizations and Public Enterprise - - - Nonprofit Institutions; NGOs; Social Entrepreneurship
    • D12 - Microeconomics - - Household Behavior - - - Consumer Economics: Empirical Analysis

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