Understanding farmers’ preference for traits of chickens in rural Ethiopia

Traditional poultry production plays an irreplaceable role in the sustenance of livelihoods in rural Ethiopia. Ironically, however, much has been done to replace indigenous poultry breeds with exotic genetic resources regardless of the importance producers and consumers attach to attributes of the resources. This study aims at informing policy to establish effective indigenous poultry breeding and conservation programs. Discrete choice experiment (DCE) was employed to generate data. Designing of the DCE involved identification, definition, and measurement of attributes of adaptive, productive, and sociocultural importance considering the multiple functions of village chickens. Random parameters logit and the generalized multinomial logit (G‐MNL) models were used to estimate taste parameters. Economic values of traits of chickens were estimated using the utility in willingness‐to‐pay (WTP) space approach, based on G‐MNL model formulation. The results show that important traits of chickens to farmers are mothering ability, diseases resistance, and meat and eggs taste. These findings question the appropriateness, at least in the prevailing production system, of the Ethiopian national government's effort to improve productivity in village poultry by targeting specialized egg‐layer improved chickens. The findings also suggest that poultry breeding programs aiming to provide readily acceptable breed technology by farmers need to prioritize traits of adaptive importance, and mothering ability, instead of focusing on egg productivity only. The key implication is that the unique qualities of the indigenous poultry breeds need to be carefully identified and prioritized before resorting to those that proved to be successful in different production systems.     

Is inflation targeting or the fixed exchange rate more effective for attracting FDI into developing countries?

This article investigates which monetary policy regime – inflation targeting or the fixed exchange rate – is more effective for attracting FDI inflows into developing countries. Using propensity score matching and the difference-in-differences estimator, we find no evidence that adopting an inflation targeting regime would be more effective than adopting a fixed exchange rate, and vice versa, in encouraging FDI inflows.     

Real exchange rate misalignment and business cycle fluctuations in the Asia-Pacific

Real exchange rate (RER) misalignment, which is the deviation between the actual real exchange rate from its equilibrium, occurs frequently among developing countries. Studies have shown that RER misalignment may have negative economic implications, such as a decline in economic growth, exports, and export diversification and an increased risk of currency crises and political instability. Using quarterly data for 22 sample countries from 1990 to 2018, this paper investigates the impact of RER misalignment on business cycles in the Asia-Pacific by employing a panel vector autoregression involving consumer price index (CPI) inflation, output gap, short-term interest rates, and RER misalignment. We find that RER overvaluation may reduce CPI inflation and short-term interest rates. We also find that the Asia-Pacific region is highly heterogeneous in that the output gaps of some countries, particularly from the Southeast Asian region, are more susceptible to RER misalignment shocks.