Does food aid have disincentive effects on local production? A general equilibrium perspective on food aid in Ethiopia

This paper examined impacts of food aid on domestic food production employing a computable general equilibrium modelling technique and using data from Ethiopia. The simulation experiments have shown that food aid has unambiguous disincentive effects on domestic food production. The removal of food aid caused a modest increase in food prices but this stimulated food production. Employment and income generation effects of the latter outweighed the adverse effect of the former. Consequently, the removal of food aid led to improvements in aggregate household welfare. Contrary to some concerns in the food aid literature that any reduction in food aid would hurt the poor, the simulation experiments suggested that actually poor rural households and urban wage earners are the ones who benefit most in absence of food aid but entrepreneurs are more likely to encounter a marginal welfare decline. We have distinguished between in-kind food aid and cash equivalent transfers in order to isolate the disincentives that in-kind transfers would make to domestic production from those that are related to household purchasing power problem. The expansionary effect of removing food aid becomes significantly larger when it is accompanied by cash equivalent payments because the latter would provide demand side stimulus to agriculture while the removal of in-kind transfers would stimulate supply side, with the supply and demand side effects reinforcing each other. In our modelling framework, the only adverse effect would be a modest deterioration in the external current account, because the expansionary effects of food aid would cause imports to rise but exports to fall.     

Does peer monitoring influence choices between cash and food? Findings from a field experiment

To explore whether choices for transfers are influenced by peer monitoring, we examine private versus public choices among monetarily equivalent values of cash and food in northern Kenya. Many northern Kenyan communities face high-levels of chronic food insecurity and are tightly-knit, often sharing food aid transfers. Yet, humanitarian cash transfers are relatively new to the area. Whether cash will be subject to the same sharing norms is not well understood. Utilizing a randomized block experiment, we find that assigning a respondent to choose in front of peers decreases the likelihood of choosing a cash transfer relative to at least some food. We argue that peer monitoring decreases the value of cash relative to food in two inter-related ways. Choosing food in public, first, provides an opportunity for respondents to publicly demonstrate a commitment to local food aid sharing norms. Second, choosing cash in public may be riskier since cash does not yet have established sharing norms. A critical implication is that transfer choices and retargeting of resources within the community can be influenced by use of public or private discussions when eliciting community views, especially in communities where sharing is a salient social norm.     

Linking small farmers to modern retail through producer organizations – Experiences with producer companies in India

Since the early 2000s, India’s agro-food sector has undergone rapid transformations towards greater market share of modern food retail. This has impacted Indian agriculture and farmers as supermarkets re-organize supply chains towards more explicit forms of coordination. Compared to other developing countries, little has been said in the Indian context about what role farmer organizations can play to help smallholder farmers specifically, improve their position in those emerging value chains. In this paper, I address this gap and demonstrate that producer companies are a promising tool to strengthen famers’ position in their relationship with supermarket chains in India, but one which needs further improvement.     

Women’s agricultural work and nutrition in South Asia: From pathways to a cross-disciplinary,grounded analytical framework

In this systematic review, we aim to examine the impact of women’s work in agriculture on maternal and child nutrition in South Asia. Building on previous reviews supported under the Leveraging Agriculture for Nutrition in South Asia (LANSA) consortium, and recent published literature, we include findings from new LANSA research. While mapping literature onto the gender-nutrition pathways linking agriculture to nutrition (Kadiyala et al., 2014), we also point to conceptual and methodological directions for further exploration emerging from our work. Key amongst these are a focus on seasonality, poverty, and gender relations, moving beyond both an exclusive focus on women as a unified and homogenous group, and agriculture as an unchanging and common set of activities and production processes. Our analysis suggests the need for a more contextualised approach, and for a richer cross-disciplinary framework for effectively addressing the ways in which women’s work mediates agriculture’s role in improving child and maternal nutrition in South Asia.     

Leveraging agriculture for nutrition in South Asia: What do we know,and what have we learned?

Despite significant improvements over recent decades, rates of undernutrition remain high in South Asia, with adverse impacts on morbidity and mortality. Overweight/obesity, among children and adults, is now an additional and major public health concern. While agriculture has the potential to improve nutrition through several pathways, this potential is currently not being realised in the region. The Leveraging Agriculture for Nutrition in South Asia (LANSA) research consortium (2012–2018) set out to improve understanding about how agriculture and related food policies and programs in South Asia (specifically in India, Bangladesh, Pakistan and Afghanistan) can be better conceptualised and implemented in order to enhance impacts on nutrition outcomes, especially those of young children and adolescent girls. This paper provides a snapshot of the agriculture-nutrition nexus in the region, outlines the pathways through which agriculture can influence nutrition outcomes, elaborates on the objectives of the LANSA research consortium within this context, and highlights the core findings of the six papers that form the body of this Special Issue. The paper ends with five key lessons that have emerged from this research, during this decade.     

How do the state’s organisational capacities at the micro- and macro-levels influence agriculture-nutrition linkages in fragile contexts?

This paper systematically reviews the evidence on what capacities the state requires to leverage agriculture for nutrition in fragile contexts, maintaining a focus on state in South Asia (especially India). It uses the framework of what the state ought to do (in terms of pathways), can do (in relation to parts of the enabling environment it is able to deliver) and is willing to do (addressing constraints in terms of political choices). The results of the search were sorted into three further themes: capacity of the state to intervene systemically and intersectorally; engage with participatory and locally relevant understandings of agriculture-nutrition linkages, and to create, maintain and engage in formal spaces for dialogue.     

Trade subsidies,export bans and price stabilization: Lessons of Bangladesh–India rice trade in the 2000s

During the world food price crisis of 2007–08, rice importing countries suffered through a sharp increase in international rice prices and disruptions in supply as several rice exporters restricted trade to mitigate their domestic price increases. Perhaps no country was more affected by these disruptions than Bangladesh. Our analysis shows that prior to the 2007 crisis, when Bangladesh imported an average of nearly 1 million tons of rice per year from India, domestic wholesale prices of rice in Bangladesh were co-integrated with import parity prices of subsidized Below Poverty Line (BPL) rice. When in mid-2007, India sharply curtailed exports, rice prices surged in Bangladesh.Model simulations show that a relatively small increase in private consumer stocks equivalent to about 2 weeks of normal consumption could account for the large surge in domestic prices in Bangladesh and that an additional 300,000 tons (in addition to approximately 700,000 tons of net rice distribution that actually occurred) would have been sufficient to stabilize prices in the November 2007–April 2008 period. The Bangladesh analysis thus shows that in spite of the uncertainty in international markets, careful planning, timely interventions and openness to trade can substantially reduce requirements for public stockholding.     

One more tool for the food aid toolbox? Experimental evidence on food aid packaging

International food assistance reaches more than 90 million people per year, much of it through in-kind programs that distribute food. Several key aspects of in-kind programs—what food is shipped, when and from where it is sourced—have been changed to improve program effectiveness and efficiency, becoming helpful tools in the modernized in-kind food assistance toolbox. Packaging—in what food is shipped—remains an unstudied and underused tool despite more than 50 million bags per year passing through in-kind supply chains, affecting program effectiveness and efficiency. We conduct an experiment with 46 shipments using different packaging materials and sizes to measure the effect of packaging on shipment quality, cost, and timeliness. Analyzing the data with randomization tests, we find that, relative to the current materials, new materials maintain shipment quality and cost while improving timeliness and in some cases may reduce cost. One promising material that balances cost and effectiveness is a bag with a biopesticide applied, designed to prevent insects from reproducing. We also find that, relative to the current size, larger bags may improve costs at least in the domestic portion of the supply chain. Donors and their partners should consider packaging as one more tool in the modernized food assistance toolbox. As the toolbox continues to fill, the coming opportunity and challenge to identify situations where the various tools work in complementary ways.     

Evolving dairy markets in Asia: Recent findings and implications

This paper is an overview of important findings regarding the ongoing evolution of Asian dairy markets based on a series of new economic investigations. These investigations provide systematic empirical foundations to assess Asian dairy markets with their new consumption patterns, changing industries, and trade prospects under different domestic and trade policy regimes, with four case studies (China, India, Japan, and Korea), a prospective analysis of future regional patterns of consumption, and a policy analysis of trade liberalization of Asian dairy markets. The overview distills the findings of these new investigations and integrates them in the earlier economic literature; it draws policy implications, and identifies lessons for countries outside of Asia, especially for emerging exporters in Latin America.     

Rethinking aquaculture for resource-poor farmers: perspectives from Bangladesh

Expectations about the unfulfilled potential of aquaculture as a source of animal protein for the poor of Bangladesh are currently running high. Evidence suggests that social and economic constraints to intensification are as yet poorly understood and may constitute an important barrier to improving resource utilisation. Both public sector agencies and NGOs are currently engaged in a range of aquaculture initiatives. This paper critically surveys a selection of ongoing aquaculture research and extension programmes. It is suggested that current approaches are unlikely to benefit those with low incomes in Bangladesh, since there are problems with both the conceptualisation of the `problem of aquaculture' and the types of institutional arrangements being deployed to tackle it. The paper ends with several recommendations about future priorities in terms of the nature and style of aquaculture research.     

Risks and spatial connectivity evidence from food price crisis in rural Indonesia

This paper examines the impact of the agricultural commodity price surge globally experienced in 2007/2008 and thereafter on income growth of agricultural producers and non-producers using recent panel data from Indonesia. First, during this period, producers experienced significantly higher earnings and total income growth than non-producers (narrowing their income gap). Second, the negative effect on non-producers’ real incomes was smaller in spatially well-connected areas, where, to mitigate the impact, private transfers (such as remittances) as well as employment incomes increased among non-producers. In contrast, government programs did not effectively cushion the income shock. Therefore, informal insurance was more effective than formal government-funded social protection programs to mitigate the crisis shock.