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Food-For-Work For Poverty Reduction And The Promotion Of Sustainable Land Use: Can It Work?

Listed author(s):
  • Holden, Stein T.
  • Barrett, Christopher B.
  • Hagos, Fitsum

Food-for-work (FFW) programs are commonly used both for short-term relief and long-term development purposes. In the latter capacity, they are increasingly used for natural resources management projects. Barrett, Holden and Clay (forthcoming) assess the suitability of FFW programs as insurance to cushion the poor against short-term, adverse shocks that could, in the absence of a safety net, have permanent repercussions. In this paper we explore the complementary question of FFW programs' potential to reduce poverty and promote sustainable land use in the longer run through induced changes in investment patterns. FFW programs commonly aim to produce or maintain potentially valuable public goods necessary to stimulate productivity and thus income growth. Among the most common projects are road building, reforestation, and the installation of terracing or irrigation. In the abstract, public goods such as these are unambiguously good. There is a danger, however, that such programs could discourage private soil and water conservation and crowd out private investment. How important are such effects and when are these effects small or large and when and how can they be reduced? How do market characteristics, timing and design of FFW programs affect this? When, where and how can FFW programs more efficiently reduce poverty and promote more sustainable land management? The paper aims to answer these questions. Much recent empirical research has focused on the shorter-term targeting issue of whether FFW and related workfare programs efficiently target the poor (Dev 1995, Von Braun 1995, Webb 1995, Subbarao 1997, Clay et al. 1998, Devereux 1999, Jayne et al. 1999, Ravallion 1999, Teklu and Asefa 1999, Atwood et al. 2000, Gebremedhin and Swinton 2000, Haddad and Adato 2001, Jalan and Ravallion 2001). Much less research has been focused on the longer-term effects of FFW. Yet the large share of hunger worldwide arises due to chronic deprivation and vulnerability, not short-term shocks (Speth 1993, Barrett 2002). Also most of the FFW programs in Ethiopia have long-term development goals and are formally distinguished from the disaster relief FFW programs (Aas and Mellemstrand 2002). It is therefore appropriate to evaluate these programs based on their long-term goals and not only on the basis of short-term targeting. In a case study in Tigray Aas and Mellemstrand (2002) found that the FFW recipients considered the long-term benefits of FFW as more important than the short-term benefits of food provision. FFW programs may produce valuable public goods. For example, Von Braun et al. (1999) report multiplier effects of a FFW-built road in the Ethiopian lowlands. Public provision of public goods may be socially desirable because private investment in soil and water conservation and tree planting may be well below socially optimal levels due to poverty and market imperfections (Holden, Shiferaw and Wik 1998, Holden and Shiferaw 2002, Holden and Yohannes 2002, Pender and Kerr 1998), tenure insecurity (Gebremedhin and Swinton 2000, Holden, Benin, Shiferaw and Pender 2003), lack of technical knowledge and coordination problems across farms (Hagos and Holden 2002). There is, however, also a danger that FFW programs crowd out private investments (Gebremedhin and Swinton 2000). We analyze these issues using multiple methods. First, section II introduces a simple theoretical framework for understanding the analytically ambiguous effects of FFW programs on sustainable land use patterns. We first present the basic intuition in a static framework to illustrate the selection, crowding out and targeting issues, before generalizing it to a dynamic model to illustrate the possible insurance and crowding in effects of FFW. Section III then uses an applied, dynamic bio-economic farm household model applied to a less-favoured area in Ethiopia to investigate via numerical simulation how household welfare and land use patterns vary with changes in environmental and FFW program design parameters. Section IV presents econometric evidence based on survey panel data from northern Ethiopia to assess the relationship between FFW and private investment in conservation. Section V discusses our findings and fleshes them out a bit with further empirical evidence. Section VI concludes.

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Paper provided by Cornell University, Department of Applied Economics and Management in its series Working Papers with number 14759.

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Date of creation: 2003
Handle: RePEc:ags:cudawp:14759
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  1. Shiferaw, Bekele & Holden, Stein T., 1998. "Resource degradation and adoption of land conservation technologies in the Ethiopian Highlands: A case study in Andit Tid, North Shewa," Agricultural Economics, Blackwell, vol. 18(3), pages 233-247, May.
  2. Jalan, Jyotsna & Ravallion, Martin, 1999. "Income gains to the poor from workfare - estimates for Argentina's TRABAJAR Program," Policy Research Working Paper Series 2149, The World Bank.
  3. Pender, John L. & Kerr, John M., 1998. "Determinants of farmers' indigenous soil and water conservation investments in semi -arid India," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 19(1-2), September.
  4. Holden, Stein & Shiferaw, Bekele, 2004. "Land degradation, drought and food security in a less-favoured area in the Ethiopian highlands: a bio-economic model with market imperfections," Agricultural Economics, Blackwell, vol. 30(1), pages 31-49, January.
  5. Haddad, Lawrence James & Adato, Michelle, 2001. "How effectively do public works programs transfer benefits to the poor?," FCND briefs 108, International Food Policy Research Institute (IFPRI).
  6. K. Subbarao, 1997. "Public Works as an Anti-Poverty Program: An Overview of Cross-Country Experience," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(2), pages 678-683.
  7. Christopher B. Barrett & Peter Arcese, 1998. "Wildlife Harvest in Integrated Conservation and Development Projects: Linking Harvest to Household Demand, Agricultural Production, and Environmental Shocks in the Serengeti," Land Economics, University of Wisconsin Press, vol. 74(4), pages 449-465.
  8. Jayne, Thomas S. & Strauss, John & Yamano, Takashi & Molla, Daniel, 2002. "Targeting of food aid in rural Ethiopia: chronic need or inertia?," Journal of Development Economics, Elsevier, vol. 68(2), pages 247-288, August.
  9. Clay, Daniel C. & Molla, Daniel & Habtewold, Debebe, 1999. "Food aid targeting in Ethiopia: A study of who needs it and who gets it," Food Policy, Elsevier, vol. 24(4), pages 391-409, August.
  10. Mesfin Bezuneh & Brady J. Deaton & George W. Norton, 1988. "Food Aid Impacts in Rural Kenya," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 70(1), pages 181-191.
  11. Holden, Stein T. & Shiferaw, Bekele & Wik, Mette, 1998. "Poverty, market imperfections and time preferences: of relevance for environmental policy?," Environment and Development Economics, Cambridge University Press, vol. 3(01), pages 105-130, February.
  12. Barrett, Christopher B., 1999. "Stochastic food prices and slash-and-burn agriculture," Environment and Development Economics, Cambridge University Press, vol. 4(02), pages 161-176, May.
  13. Stein Holden & Hailu Yohannes, 2002. "Land Redistribution, Tenure Insecurity, and Intensity of Production: A Study of Farm Households in Southern Ethiopia," Land Economics, University of Wisconsin Press, vol. 78(4), pages 573-590.
  14. Teklu, Tesfaye & Asefa, Sisay, 1999. "Who Participates in Labor-Intensive Public Works in Sub-Saharan Africa? Evidence from Rural Botswana and Kenya," World Development, Elsevier, vol. 27(2), pages 431-438, February.
  15. Shiferaw, Bekele & Holden, Stein T., 2001. "Farm-level benefits to investments for mitigating land degradation: empirical evidence from Ethiopia," Environment and Development Economics, Cambridge University Press, vol. 6(03), pages 335-358, July.
  16. Jayne, T. S. & Strauss, John & Yamano, Takashi & Molla, Daniel, 2001. "Giving to the Poor? Targeting of Food Aid in Rural Ethiopia," World Development, Elsevier, vol. 29(5), pages 887-910, May.
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