Consistent Estimation of a Censored Demand System and Welfare Analysis: The 2012 VAT Reform in Spain

This paper analyses the effects that the 2012 VAT reform in Spain had on households’ welfare, focusing on a major expenditure group: food and non‐alcoholic beverages. Households’ demands are modeled as a two‐stage Quadratic Almost Ideal Demand System, which is then estimated by means of a consistent two‐step estimator introduced in Tauchmann ( 2010 ) and not previously used in studies of this type. This procedure allows consistent imposition of the traditional parameter restrictions that utility maximisation requires in the context of a censored model. Our results show that the welfare loss and the increment in the tax bill increase with income. We also show that expenditure on food and non‐alcoholic beverages grows less than proportionately with income. Consequently, households with lower income experience a greater welfare loss relative to their income levels. In short, the 2012 VAT reform in Spain, focusing on this expenditure group, can be considered as regressive.     

Technology,production environment,and household income: Assessing the regional impacts of technological change

This paper clarifies the factors determining the welfare effects of improved agricultural technologies when technology diffusion is unevenly distributed across production environments Household-level income effects are shown to depend primarily on: (a) whether the economy is open or closed with respect to world markets; (b) whether households are net consumers or net producers of the commodity for which technological change occurs; (c) whether households are adopters or non-adopters of the new technology; (d) the degree to which labor is mobile across agricultural regions; and (e) government intervention in commodity and/or factor markets. A review of recent empirical work indicates considerable variation in the relative strength of these various factors across countries, and that assumptions regarding the mechanism by which commodity prices are determined – endogenously as in a closed economy, or exogenously as in an open economy – is especially critical.     

Tariff Liberalisation,Price Transmission and Rural Welfare in China

China's tariff liberalisation as part of its WTO accession application and eventual agreement has been thoroughly analysed in the literature. However, much of this literature is based on forward‐looking ex‐ante analyses and few studies provide empirical evidence on its actual impact. We fill in this gap by evaluating empirically the welfare effects of China's actual tariff liberalisation on Chinese farmers during the 1997–2010 period. By estimating the domestic market price effects of China's tariff liberalisation and the associated wage earning effects, we find that on average Chinese farmers were able to gain more from reduced consumption prices than they would lose from reduced agricultural and wage income due to tariff liberalisation. Welfare gains over time are estimated to be positively correlated with the actual degrees of tariff liberalisation, implying that relatively more gains were realized immediately before and after China's WTO accession in 2001, as compared to the more recent period when relatively little liberalisation was carried out. Farmers’ rising non‐agricultural income and increasing consumption shares of non‐agricultural products are important determinants of these positive average welfare effects. Moreover, welfare gains from tariff liberalisation are shown to be distributed unevenly across Chinese provinces and income levels, with farmers located in coastal provinces and at higher income levels gaining more than their counterparts in remote provinces and at lower income levels.     

Cereal price shocks and volatility in sub‐Saharan Africa: what really matters for farmers’ welfare?

The lack of information as well as some misperceptions about the distinction between the welfare consequences of higher versus more volatile cereal prices has limited the effectiveness of policy interventions during the recent food crises in many developing countries. This article proposes an integrated empirical strategy to investigate and compare the different effects of these two phenomena and tests it using nationally representative household survey data from four sub‐Saharan countries. Results show that the negative impacts of a cereal price increase substantially outweigh the effects of price volatility on household welfare across the entire income distribution. The amplitude and the distribution of those effects depend heavily on specific factors, such as: the weight of food consumption over total expenditure; the budget share devoted to cereals; the substitution effect among food groups; and the relative number of net sellers versus net buyers accessing the market. We also show that volatility mainly harms the poorest quintile of the population.     

Contract farming: opportunity cost and trade‐offs

An important literature has established that participation in contract farming leads to higher incomes and has a number of other beneficial effects on the welfare of participating households. Yet no one has looked at the opportunity cost of and the various trade‐offs involved in participating in contract farming. I look at the relationship between participation in contract farming and income from (i) livestock, (ii) labor markets, (iii) nonfarm businesses, and (iv) agricultural sources other than livestock and contract farming and (v) unearned income. Using data from Madagascar, I find that participation in contract farming is associated with a 79% decrease in how much income per capita the average household derives from labor markets and a 47% decrease in how much income per capita it derives from nonfarm businesses, but also with a 51% increase in how much income per capita the average household derives from agricultural sources other than livestock and contract farming, possibly due to technological spillovers. Thus, even though contract farming has been shown to improve welfare in multiple ways in this context, it looks as though those gains come at the cost of an “agricultural involution” on the part of participating households, who seem to turn away from non‐agricultural activities. This has important implications for structural transformation narratives.     

The impact of agricultural and household technologies on women: a conceptual and quantitative analysis in Burkina Faso

Agricultural technologies (new cultivars, inorganic fertilizers, soil-and water-conservation techniques) in Sub-Saharan Africa have been primarily introduced to male farmers by male-dominated extension services on the family plots. These yield-increasing, input-intensive technologies increase the demand for farm labor. So, not only do men obtain most of the direct benefits from the introduction of technology but this labor-intensive technology also increases the demands on women's time for additional labor. This raises the question: Are the combined effects of agricultural technologies beneficial or detrimental to women? We first develop a labor-market model that examines the impact of agricultural and household technologies on labor allocation and income determination within the household. We then discuss the important issue of how household labor-allocation decisions and division of income are made within the family in Sub-Saharan Africa. We use a programming model to estimate the effects of these technologies on household incomes and the income of women. The results indicate that the impact of agricultural technologies depends on the type of decision-making prevailing in the household. In contrast, household technologies increase the welfare of women regardless of the type of decision-making. However, with bargaining behavior, agricultural technologies do benefit women and there is some empirical support for this type of household behavior in Sub-Saharan African households.     

THE SMALL-FARM PROBLEM IN AUSTRALIA*

The nature of the small-farm problem in Australia is discussed from a welfare point of view. The situation is examined industry by industry where data are available. It is suggested that while the average level of farm income in Australia compares well with non-agricultural earnings, there are some industries with very significant numbers of low income farms.     

农业技术进步、空间效应与城乡收入差距基于省级面板数据的分析

目的 通过构建空间计量模型，实证检验2007—2018年我国农业技术进步对城乡收入差距的直接影响和空间溢出效应。方法 文章基于我国31个省（区、市，不含港澳台）的面板数据，利用空间杜宾模型，并设置邻接矩阵、地理距离矩阵和经济距离矩阵，分析农业技术进步对城乡收入差距的影响，并进一步将农业技术进步分解为农业前沿技术进步和农业技术效率。结果 （1）中国省域城乡收入差距具有显著的空间集聚特征，呈现出“高—高”和“低—低”的空间分布特征。（2）农业技术进步不仅有利于缩小当地城乡收入差距，还可以通过空间溢出效应促进邻近地区城乡收入差距的缩小。（3）农业前沿技术进步对当地城乡收入差距的缩小具有显著的促进作用，但对邻近地区的溢出效应不明显；农业技术效率则具有明显的空间溢出效应。结论 农业技术进步有助于缩小城乡收入差距。要继续加大农业科技投入，进行农业科技创新，提升农业技术效率，同时加强省际间的交流与合作，促使区域间农业技术的创新、转化与扩散。     

The distributional effects of the Hilmer reforms on the Australian gas industry*

We analyse changes in the Australian gas industry during 1990s that were motivated by the Hilmer Reforms. We estimate the effects on real household income of the changes by combining a computable general equilibrium model with a microsimulation model. Although the structural changes were significant in their effects on the gas industry, they are estimated to have had minor effects on real household income in all Australian regions owing to the small size of the gas industry and household gas consumption at that time, and low importance of gas as an input to other industries. The changes are estimated to have slightly increased income inequality owing to the redistribution of income from labour to other primary factors.     

Employment Dynamics and Linkages in the Rural Economy: Insights from Senegal

Evidence on rural wage employment is thin and lacks nuance for different employment sources, insights on dynamic effects, and an understanding of the channels of effects. We assess conceptually and empirically the direct and indirect welfare effects of entry and continuation in different types of wage employment in rural Senegal. Using panel data, fixed effects and first-difference estimation, we show substantial positive welfare and linkage effects. We find that participation in wage employment increases per capita income by 143%, and reduces poverty, poverty gap and food insecurity by, respectively, 63%, 89% and 48%. While the direct effect on income is larger for non-agricultural and contractual wage employment, the indirect income effects through self-employment are more pronounced for agricultural and casual wage employment. Our results imply that job creation is important for rural development, that wage employment in agriculture can lead to considerable growth multiplier effects, and that synergies exist between large-scale and small-scale agriculture.     

Food Price Pass‐Through and the Role of Domestic Margin Services

The recent volatility in international agricultural markets has drawn attention to the impact of rising international agricultural prices and the induced price‐insulating measures on consumer food prices. Analyses based on simulation models on this topic typically ignore the role of domestic margin services. We extend the standard Global Trade Analysis Project (GTAP) model to allow for variations in the share of domestic margin services in consumed food across countries. This approach enables us to differentiate consumer prices from producer prices. Following the extension, the results show that domestic margin services reduce the consumer food price volatility for all countries, especially in high‐income countries, where the share of domestic margin services in final food consumption is higher. The effect of price‐insulating border policies is also reduced in the extended model. We find that our extension of the GTAP model greatly improves simulations of the 2007 surge in international agricultural prices. We validate our extension of the GTAP model by showing that the econometrically estimated food price pass‐through is decreasing with income and thus, is smaller in high‐income countries.     

Welfare Impacts of Alternative Public Policies for Agricultural Pollution Control in an Open Economy: A General Equilibrium Framework

A general equilibrium approach is used to evaluate the welfare impacts of alternative policies for reducing agricultural pollution in an open economy with preexisting distortions caused by income taxes and agricultural subsidies. The policies examined here include the removal of distortionary agricultural subsidies. We find that even though these distortions are small compared to others in the economy, removing them and imposing nitrogen reduction subsidies and/or output taxes can enhance welfare and reduce nitrogen pollution; thereby leading to a substantial double dividend. The relative efficiency of the alternative policies examined here depends on the level of the nitrogen reduction target.     

Robust Comparisons of Malnutrition in Developing Countries

We use Demographic and Health Surveys (DHS) to make international and inter–temporal welfare comparisons. While most poverty analyses rely on expenditures or income, we use anthropometric measures of nutrition as indicators of living standards. The advantages are that we observe individual—not household—well–being, deflators and exchange rates are unnecessary, and measurement techniques are similar across surveys. We test the robustness of the headcount results, and find that applying higher order Foster–Greer–Thorbecke poverty measures adds little information; although stochastic dominance testing of nutrition distributions reveals that changes in malnutrition are sensitive to the choice of the "nutrition poverty line."     

Does ‘Protection for Sale’ Apply to the US Food Industries?

This paper tests the Protection for Sale model in terms of the structure of protection and how realistic the estimated domestic welfare weight is relative to campaign contributions. Using data from US food manufacturing, empirical results support the key predictions for the structure of protection when either all food manufacturing industries or most of the general population is assumed to be politically organised. The domestic welfare weight is estimated as low as 0.837, the lowest econometric estimate to date, underlining that protection is for sale and that, with a qualified ‘yes’, the model fits the data for these industries.     

林改后农户对集体公益林投入意愿影响因素分析——以天保工程区武隆县、会理县和玉龙县为例

文章运用文献分析、问卷调查与计量经济分析相结合的方法对林改后影响农户对集体公益林投入意愿的因素进行分析。结果显示,家庭总收入、家庭林业收入、户主文化程度等因素对农户投入意愿的选择影响显著。提出完善公益林补偿机制、搞活公益林经营机制、加强公益林政策宣传、增加农户林业收入、促进公益林建设等建议。     

Are agro-clusters pro-poor? Evidence from Ethiopia

Governments and development agencies increasingly promote agro-clusters as a pathway to improving smallholder incomes and ensuring inclusive rural development through mitigating production and market risks. However, there is very limited empirical evidence to support this promise. We use a large farm household survey of about 4000 smallholder farmers in Ethiopia growing cereals like teff, maize, wheat, maltbarley and sesame to examine the relationship between agro-clusters and smallholder welfare and poverty. Using instrumental variable estimators, we establish a positive association between agro-clusters, household income and per capita income. Agro-clusters are also shown to reduce poverty and poverty gaps. Our results are robust over different agro-cluster proxies and alternative estimators, such as the augmented inverse probability weighting estimator. We also show that our findings are unlikely to be driven by omitted variable bias. Moving beyond average effects and in the interest of understanding heterogeneous effects, we use quantile regressions at different income levels. We find that agro-clusters are associated with welfare gains for all households. However, the most significant gains are observed for the wealthier households. Despite this regressive association, our findings suggest that agro-clusters may be useful in making farming more profitable with significant welfare implications.     

林业产业演进动因探析

归纳出驱动林业产业演进的影响因素,建立了林业产业演进的动力模型,深入分析了产业演进驱动力之技术创新、供给因素、需求因素、国际因素、政策及制度五大因素作用于林业产业演进的过程及机理。     

Regulating Broiler Contracts: Tournaments versus Fixed Performance Standards

Grower discontent with tournaments as mechanisms for settling poultry contracts can largely be attributed to the group composition risk that tournaments impose on growers. This article focuses on the welfare effects of a widely advocated regulatory proposal to prevent integrator companies from using tournaments and replace them with schemes that compare performance to a fixed standard. The analysis shows that the mandatory replacement of tournaments with fixed performance standards, absent any rules that regulate the magnitude of the piece rate, can decrease grower income insurance without raising welfare. However, replacing tournaments with fixed performance standards can simultaneously increase income insurance and welfare, provided that the magnitude of the piece rate is also regulated.     

一带一路背景下中国水电企业非自愿移民工作的风险——基于水电移民政策与实践差异性

基于水电工程实践,从前期准备、移民安置实施、收入恢复3个阶段对国际水电非自愿移民风险机理进行探讨,认为中国水电开发企业应加强全阶段的风险识别与评估,尊重当地政策规范与国际惯例要求,增强服务移民的意识,建立可持续的利益共享机制,减缓非自愿移民风险。     

China's Accession to the World Trade Organization: What Is at Stake for Agricultural Markets?

We analyze the impact of China's accession to the World Trade Organization on major crop and livestock markets using the Food and Agricultural Policy Research Institute (FAPRI) modeling framework. We incorporate expected changes in consumer income, textile production, and trade policies as exogenous shocks to the baseline model. Following accession, revenues decline in China's livestock, grain, and oilseed industries, while cotton production prospers despite increased imports. Chinese consumers benefit from lower food prices, with vegetable oil, dairy, and meat consumption increasing significantly. Argentina, Brazil, Canada, the European Union, and the United States are the greatest beneficiaries from expanded agricultural trade with China.