Scholarly Works, Agricultural and Applied Economics
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Browsing Scholarly Works, Agricultural and Applied Economics by Subject "1402 Applied Economics"
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- Economic Impacts of the COVID−19 Lockdown in a Remittance‐Dependent RegionGupta, Anubhab; Zhu, Heng; Doan, Miki Khanh; Michuda, Aleksandr; Majumder, Binoy (Wiley, 2020)The economic impacts of COVID-19 lockdowns on poor and vulnerable households living in rural areas of developing countries are not well understood due to a lack of detailed micro-survey data at the household level. Utilizing weekly financial transaction data collected from households residing in a rural region of India, we estimate the impacts of India’s COVID-19 lockdown on household income, food security, welfare, and access to local loan markets. A large portion of households living in our study region is reliant on remittances from migrants to sustain their livelihoods. Our analysis reveals that in the month immediately after India’s lockdown announcement, weekly household local income fell by INR 1,022 (US$ 13.5), an 88% drop compared to the long-term average with another 63% reduction in remittance. In response to the massive loss in earnings, households substantially reduced meal portions and consumed fewer food items. Impacts were heterogeneous; households in lower income quantiles lost a higher percentage of their income and expenditures, but government food aid slightly mitigated the negative impacts. We also find an increase in the effective interest rate of local borrowing in cash and a higher demand for in-kind loans, which are likely to have an adverse effect on households who rely on such services. The results from this paper have immediate relevance to policymakers considering additional lockdowns as the COVID-19 pandemic resurges around the globe and to governments thinking about responses to future pandemics that may occur.
- Harmful algal blooms and toxic air: The economic value of improved forecastsMoeltner, Klaus; Fanara, Tracy; Foroutan, Hosein; Hanlon, Regina; Lovko, Vince; Ross, Shane D.; Schmale, David G. III (2021-02)The adverse economic impacts of harmful algal blooms can be mitigated via tailored forecasting methods. Adequate provision of these services requires knowledge of the losses avoided, or, in other words, the economic benefits they generate. The latter can be difficult to measure for broader population segments, especially if forecasting services or features do not yet exist. We illustrate how Stated Preference tools and Choice Experiments are well-suited for this case. Using as example forecasts of respiratory irritation levels associated with airborne toxins caused by Florida red tide, we show that 24-hour predictions of spatially and temporally refined air quality conditions are valued highly by the underlying population. This reflects the numerous channels and magnitude of red tide impacts on locals' life and activities, which are also highlighted by our study. Our approach is broadly applicable to any type of air quality impediment with risk of human exposure.
- Inter-temporal Changes in Well-being During Conditions of Hyperinflation: Evidence from ZimbabweLarochelle, Catherine; Alwang, Jeffrey R.; Taruvinga, Nelson (Oxford University Press, 2014-03-01)In the last decade, the economy of Zimbabwe underwent unprecedented stress and change. Starting in 2000, land reform began with farm invasions. This process eventually evolved into government-guided fast-track land reform. During this process, the international community imposed sanctions, and these factors, together with a severe drought, led to a reduction in availability of the main food staple. Inflationary pressures built and were exacerbated by foreign exchange shortages. The economy slowed due to debt overhang and dwindling investment caused in part by increased uncertainty. Several factors contributed to deterioration of the value of the Zimbabwean Dollar and by mid-2007, hyperinflation became rampant. The economic crisis began to abate in 2008 and political agreements signed in 2008 and implemented in 2009 led to further stabilization. As Zimbabwe moves forward, it is important to understand the conditions faced by the poor, and how they have changed during the period of hyperinflation. To do so, this paper uses 2001 and 2007/8 nationally representative household data and an asset index to avoid reliance on money-metric measures during the period of hyperinflation. An asset index is constructed using polychoric principal component analysis for both periods. A profile of well-being in 2001 is obtained using consumption expenditures, which helps calibrate asset index poverty lines. The 2001 data are used to generate small-area poverty estimates for both survey years and to validate the robustness of the findings from the asset index. The asset index holds its own when compared to standard consumption expenditure methods and small area estimation-based predictions, providing confidence in our findings. Urban asset poverty declined during 2001-2007, but extreme poverty increased. Rural asset poverty and extreme poverty worsened between 2001 and 2007. For the best-educated households, poverty increased significantly. Conditions of communal and resettlement workers deteriorated, reflecting worsening economic conditions in rural areas.
- A local general-equilibrium emergency response modeling approach for sub-Saharan AfricaFilipski, Mateusz; Gupta, Anubhab; Kagin, Justin; Husain, Arif; Grinspun, Alejandro; Caccavale, Oscar Maria; Daidone, Silvio; Giuffrida, Valerio; Greb, Friederike; Hooker, Joseph; Sandstrom, Susanna; Fletcher-Taylor, Julian; Taylor, J. Edward (Wiley, 2021-12-05)Swift response models are vital tools for emergency assistance agencies. The COVID-19 pandemic revealed the lack of economic models for short-run policy relevant research to anticipate local impacts and design effective policy responses. The most direct effects of the pandemic and lockdown tended to be concentrated in urban areas; however, markets quickly transmitted impacts to rural areas as well as among poor and non-poor households. General equilibrium modeling is a tool of choice to capture indirect, spillover effects of exogenous shocks. This article describes an unusual micro general-equilibrium (GE) modeling approach that we developed to quickly simulate impacts of the pandemic and lockdowns on poor and non-poor rural and urban households across sub-Saharan Africa. Monte Carlo bootstrapping was used to construct four stylized regional GE models from 34 existing local economy-wide impact evaluation (LEWIE) models. Simulations revealed that the pandemic and policy responses to curtail its spread were likely to affect rural households at least as severely as urban households. Simulated income losses are greater in poor households in both urban and rural settings. These findings are relatively consistent across models spanning sub-Saharan Africa. Because COVID-19 impacts are so far-reaching, all types of economies experience downturns. Our research underlines the importance of modeling assumptions. We find total annualized impacts of around a 6-percent loss of GDP, smaller than estimates from single-country models that ignore price effects, such as SAM-multiplier models, but in line with The World Bank's baseline forecast of a 5.2% contraction in global GDP in 2020. The largest negative impacts are on poor rural households.
- Poverty analysis using small area estimation: an application to conservation agriculture in UgandaFarris, Jarrad; Larochelle, Catherine; Alwang, Jeffrey R.; Norton, George W.; King, Caleb B. (Wiley, 2017-11-01)Poverty analyses in developing countries rely primarily on estimates of household consumption. Consumption is more stable than income as households can more easily smooth it over time (Deaton and Zaidi, 2002). Although consumption data are an important component of poverty analysis, their collection is time-consuming and expensive. Comprehensive consumption surveys ask households to report consumption of as many as 300 to 400 items (Pape and Mistiaen, 2015)...
- Promoting Behavioral Change Using Text Messages: A Case Study of Blackberry Farmers in EcuadorCarrión-Yaguana, Vanessa D.; Alwang, Jeffrey R.; Barrera, Victor H. (Cambridge University Press, 2020-08)This study measures the effect of text message receipt on behavioral change by Ecuadorean blackberry farmers. We examine whether text messages affect knowledge about specific technologies or serve as reminders to farmers to employ practices as part of their crop management strategy. Drawing from well-known theories of behavioral change, we identify pathways relevant to technology adoption. We then describe results from a randomized experiment and measure the impact of the intervention through these pathways. Results suggest that in the blackberry context, timely text messages remind farmers about recommended practices and increase adoption. Effects on knowledge enhancement are not significant.
- The Role of Risk Mitigation in Production Efficiency: A Case Study of Potato Cultivation in the Bolivian AndesLarochelle, Catherine; Alwang, Jeffrey R. (Wiley-Blackwell, 2013-06-01)Using a stochastic production frontier to model potato production in Bolivia, we quantify the costs of environmental and activity diversification in the form of efficiency losses and yield forgone. We find that efficiency decreases with the number of fields in a geographic cluster, distance between the dwelling and a particular field, discontinuity between fields, and off-farm income. However, environmental diversification is more detrimental than activity diversification. Using spatial analysis of field and household efficiency measures we assess production vulnerability to climatic shocks and the potential of environmental diversification in mitigating shocks. We find important spatial clusters of low and high efficiency at the field-level suggesting that climatic shocks influence efficiency measures. Household-level efficiency measures exhibit random spatial patterns suggesting that on average households can mitigate the adverse effects of shocks through environmental diversification.
- School attendance and economic shocks: Evidence from rural ZimbabweOryoie, Ali Reza; Alwang, Jeffrey R. (2018-07-19)Unpredicted shocks such as weather, pests or price changes affect agricultural households negatively or positively. The shocks have two opposite effects (income and substitution) on parents’ investments in the human capital of their children, and it is not predictable from theory whether the income effect or the substitution effect of a shock has a greater impact on the investments. Therefore, it is unknown whether human capital investments (i.e. sending children to school rather than having them work) are procyclical or countercyclical. In this paper we show how hyperinflation may affect investments in the education of children by their parents using three data-sets from Zimbabwe. We find that human capital investments are countercyclical (the substitution effect dominates) in rural areas of Zimbabwe during a shock. Therefore, policymakers in Zimbabwe need to be worried about decreased schooling of children during positive shocks in the rural areas.