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Public Investment In Irrigation And Training, Growth And Poverty Reduction In Ethiopia

Author

Listed:
  • Lulit M Beyene

    (IESD Research, P.O.Box 12469, Addis Ababa, Ethiopia)

  • Ermias Engida

    (Ethiopian Development Research Institute General Abebe Dumtew St, Addis Ababa, Ethiopia)

Abstract

This paper analyzes the impacts of public investment in small-scale irrigation and farmer training on growth and agriculture-led development, on food security, and on poverty in Ethiopia. We use a dynamic Computable General Equilibrium (CGE) model linked to a microsimulation model based on the latest household income and expenditure survey, in a topdown approach. All public investments are assumed to increase total factor productivity through increased supply of skilled labor and/or irrigated land. We find that investing in farmer training alone has great potential to increase growth, food security and poverty reduction, given that the economy is labor-intensive. Investing in training combined with irrigation has even greater impacts. An irrigation only approach will not yield the expected results if agricultural labor does not have the required skills. The irrigated agriculture sector has great potential despite its small size. However, for the impact to be notable, important investments are required in the first place to increase the share of irrigated agriculture versus the rain-fed. An agriculture-led development is less likely to occur because: i) of weak forward and backward production linkages between agriculture and manufacturing sectors; ii) a significant share of manufacturing inputs is imported; iii) the resulting contraction in private investment which restrains expansion of the manufacturing and services sectors

Suggested Citation

  • Lulit M Beyene & Ermias Engida, 2016. "Public Investment In Irrigation And Training, Growth And Poverty Reduction In Ethiopia," International Journal of Microsimulation, International Microsimulation Association, vol. 9(1), pages 86-108.
  • Handle: RePEc:ijm:journl:v:9:y:2016:i:1:p:86-108
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    References listed on IDEAS

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    1. Shenggen Fan & Xiaobo Zhang, 2008. "Public Expenditure, Growth and Poverty Reduction in Rural Uganda," African Development Review, African Development Bank, vol. 20(3), pages 466-496.
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    5. Huang, Qiuqiong & Rozelle, Scott & Lohmar, Bryan & Huang, Jikun & Wang, Jinxia, 2006. "Irrigation, agricultural performance and poverty reduction in China," Food Policy, Elsevier, vol. 31(1), pages 30-52, February.
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    Citations

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    Cited by:

    1. Nicholson, Charles F. & Stephens, Emma C. & Kopainsky, Birgit & Jones, Andrew D. & Parsons, David & Garrett, James, 2021. "Food security outcomes in agricultural systems models: Current status and recommended improvements," Agricultural Systems, Elsevier, vol. 188(C).
    2. Hounnou, E. Fèmi & Dedehouanou, Houinsou & Zannou, Afio & Aguey, Segnon & Biaou, Gauthier, 2021. "Effects of Agricultural Public Investments on Economic Growth and Households’ Welfare in Benin: An Applied General Equilibrium Analysis," 2021 Conference, August 17-31, 2021, Virtual 315002, International Association of Agricultural Economists.
    3. Kamenya, Madalitso A. & Hendriks, Sheryl L. & Gandidzanwa, Colleta & Ulimwengu, John & Odjo, Sunday, 2022. "Public agriculture investment and food security in ECOWAS," Food Policy, Elsevier, vol. 113(C).
    4. Kamenya, Madalitso A., 2020. "The impact of public agricultural investment on food security and nutrition in ECOWAS," Research Theses 334764, Collaborative Masters Program in Agricultural and Applied Economics.

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    More about this item

    Keywords

    CGE model; public policy; poverty; Ethiopia;
    All these keywords.

    JEL classification:

    • D58 - Microeconomics - - General Equilibrium and Disequilibrium - - - Computable and Other Applied General Equilibrium Models
    • O55 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Africa
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

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