After the Green Revolution Sustainable and equitable agricultural development

Despite impressive results, the Green Revolution has encountered major problems of equity, stability and sustainability, calling for a ‘new phase’ of agricultural research and development. In this article four indicators of agricultural performance—productivity, stability, sustainability and equitability —are defined. Agro-ecosystems are described as a hierarchy ascending from the level of the individual plant or animal all the way to national systems linked by international trade, and it is argued that development cannot be based on any one level. This is demonstrated with a discussion of international constraints on sustainable and equitable development, the necessary national policies, and the needs of rural households. In conclusion, the article summarizes the research and development priorities for the new phase of development.     

The environmental effects of economic growth and globalization in Sub-Saharan Africa: A panel general method of moments approach

The study examines the impact of economic growth and globalization on environmental quality and sustainability proxied by carbon dioxide emissions and Adjusted National Savings respectively as well as the satisfaction of the Environmental Kuznets Curve hypothesis for 36 Sub-Saharan African countries using panel data for the period 1990 to 2013 and the system General Method of Moments estimation technique. The results reveal a positive relationship between economic growth and environmental quality and sustainability. Evidence of the satisfaction of the Environmental Kuznets Curve hypothesis for both environmental quality and sustainability was also observed. Globalization was found to have a worsening effect on both environmental quality and sustainability and its negative effect outweighs the positive income effects on environmental quality and sustainability. We recommend that Sub-Saharan African countries strengthen their environmental norms in their effort to increase growth and participate in globalization through the use of cleaner technologies and products as well as reducing the depreciation of natural and fixed capital through investments in green infrastructure and nature-based projects while increasing educational expenditure and combating the ecological crises that arise from environmental quality degradation.     

PRODUCER TURNOVER AND PRODUCTIVITY GROWTH IN DEVELOPING COUNTRIES

The reallocation of resources, either across sectors or acrossproducers within a sector, can serve as a potential source ofproductivity growth. New research findings exploit comprehensivemicroeconomic data on the manufacturing sectors of Chile, Colombia,and Morocco to document resource shifts as producers enter,expand, contract, and exit operation. The micro-level adjustmentis substantial; between 25 and 30 percent of the total numberof manufacturing jobs turn over each year. In the short run,the productivity effects of this turnover are modest becausethe new plants that come on line are only slightly more productivethan the ones they replace—and both are typically small.In the longer term, however, the turnover generates more substantialincreases in productivity because the new firms that surviverecord substantial productivity gains in their early years.Moreover, firms that exit are typically on a downward productivityspiral and would probably have dragged down sectoral efficiencyfarther if they had continued in operation.      

Modeling the Impact of Agricultural Growth and Government Policy on Income Distribution in India

This article uses a limited general equilibrium model to investigatethe growth and equity effects of a variety of economic and technicalchanges and selected agricultural policies in India. It exploreshow changes in food prices, rural wages, and farm profits associatedwith the Green Revolution period affected income distributionbetween net buyers and sellers of food. The model shows thatincome gains from the Green Revolution initially accrued tothe wealthier rural groups but that after 1972–73 theywere transferred to urban consumers and that by 1980–81the per capita incomes of poor and wealthier rural groups alikewere barely above their respective 1960–61 levels. Themodel is also used in counterfactual analysis of the impactof changes in technological, demographic, investment, taxation,and income redistribution variables. Its findings indicate theimportance of trade policies for the nature of the equity outcomesfrom agricultural growth and suggest that a reduction in populationgrowth and an increase in nonagricultural employment and incomeare required to convert agricultural growth into reduced ruralpoverty.     

INTERPRETING RECENT RESEARCH ON SCHOOLING IN DEVELOPING COUNTRIES

Policymakers in developing countries have long been troubledby the undesirable, but apparently unavoidable, choice betweenproviding broad access to education and developing high-qualityschools. Recent evidence, however, suggests that this is a badway to think about human capital development. Grade repetitionand high dropout rates lead to a significant waste of resourcesin many school systems. Students in quality schools, however,respond in ways that reduce such inefficiencies, perhaps evensufficiently to recoup immediately investments in quality. Promoting high-quality schools, however, is more difficult thanmany have thought, in part because research demonstrates thatthe traditional approach to providing quality—simply providingmore inputs—is frequently ineffective. Existing inefficienciesare likely to be alleviated only by the introduction of substantiallystronger performance incentives in schools and by more extensiveexperimentation and evaluation of educational programs and schoolorganizations. Incentives, decentralized decisionmaking, andevaluation are alien terms to education, in both industrialand developing countries, but they hold the key to improvementthat has eluded policymakers pursuing traditional practices.      

HOUSEHOLD RESPONSES TO PUBLIC HEALTH SERVICES: COST AND QUALITY TRADEOFFS

The effectiveness of government investments in health care dependson the public's response to price and quality as well as onwhether these expenditures actually improve health outcomes.Consumers, even those in low-income households, are willingto pay fees for better health care if the fees translate intoimproved access and reliability. But when prices rise withouta concomitant improvement in services, malnutrition and childmortality rates increase. The availability of basic health carehas a relatively greater impact on households with low incomesor low education, or both, than does the provision of more specializedservices. This article describes the types of services for whichhouseholds indicate they are willing to pay increased fees.It also indicates the potential gains from improving these services,as well as the consequences of moving faster on cost recoverythan on providing improved or better-targeted services.      

财政分权与经济增长可持续性——基于情势转换与聚类视角的分析

经济增长可持续性不仅取决于增长速度还取决于增长稳定性。本文利用我国245个地级市1978—2014年间面板数据和马尔科夫情势转换聚类面板模型,从情势转换与聚类视角考察了地级市经济增长动态特征,识别出不同的动态增长模式及其可持续性,进而剖析了财政分权的影响。研究表明,地级市经济增长呈现出三种动态增长模式,这三种模式在平均增速、增长状态及其持续期、增长波动性进而在增长可持续性方面存在明显差异。支出分权显著增加了地级市归属为低增长、高波动模式的概率,不利于经济可持续增长,而在1994年分税制改革后则产生了较积极的作用。收入分权总体有利于增强经济增长可持续性,1994年分税制改革后,受地方纵向财政失衡加剧的不利影响,这一积极作用有所减弱。增加地方财政自给度(即增加地方收支分权匹配度、减小地方纵向财政失衡)有利于增强经济增长可持续性,这一作用在1994年分税制改革后表现得更为突出。本文研究结论对优化完善财税体制以有效促进经济可持续增长具有良好启示。     

The Role of Long-Term Finance: Theory and Evidence

Improving the supply of long-term credit to industrial firmsis considered a priority for growth in developing countries.A World Bank multicountry study looks at whether a long-termcredit shortage exists and, if so, whether it has had an impacton investment, productivity, and growth. The study finds thateven after controlling for the characteristics of individualfirms,businesses in developing countries use significantly less long-termdebt than their counterparts in industrial countries. Researchersare able to explain the difference in debt composition betweenindustrial and developing countries by firm characteristics;by macroeconomic factors; and, most importantly, by financialdevelopment, government subsidies, and legal and institutionalfactors. The analysis concludes that long-term finance tends to be associatedwith higher productivity. An active stock market and an abilityto enter into long-term contracts also allow firms to grow atfaster rates than they could attain by relying on internal sourcesof funads and short-term credit alone. Importantly, althoughgovernment-subsidized credit markets have increased the long-termindebtedness of firms, there is no evidence that these subsidiesare associated with the ability of firms to grow faster. Indeed,in some cases subsidies are associated with lower productivity.      

财政分权与经济增长可持续性——基于情势转换与聚类视角的分析

经济增长可持续性不仅取决于增长速度还取决于增长稳定性。本文利用我国245个地级市1978—2014年间面板数据和马尔科夫情势转换聚类面板模型,从情势转换与聚类视角考察了地级市经济增长动态特征,识别出不同的动态增长模式及其可持续性,进而剖析了财政分权的影响。研究表明,地级市经济增长呈现出三种动态增长模式,这三种模式在平均增速、增长状态及其持续期、增长波动性进而在增长可持续性方面存在明显差异。支出分权显著增加了地级市归属为低增长、高波动模式的概率,不利于经济可持续增长,而在1994年分税制改革后则产生了较积极的作用。收入分权总体有利于增强经济增长可持续性,1994年分税制改革后,受地方纵向财政失衡加剧的不利影响,这一积极作用有所减弱。增加地方财政自给度(即增加地方收支分权匹配度、减小地方纵向财政失衡)有利于增强经济增长可持续性,这一作用在1994年分税制改革后表现得更为突出。本文研究结论对优化完善财税体制以有效促进经济可持续增长具有良好启示。     

Ecology, History, and Development: A Perspective from Rural Southeast Asia

The process by which different ecological conditions and historicaltrajectories interacted to create different social and culturalsystems resulted in major differences in economic developmentperformance within Southeast Asia. In the late 19th century,Indonesia, the Philippines, and Thailand commonly experiencedvent-for-surplus development through exploitation of unusedlands. Nevertheless, different agrarian structures were created.Indonesia's development was mainly based on the exploitationof tropical rain forest under Dutch colonialism. It resultedin the bifurcation of the rural sector between rice-farmingpeasant proprietors and large plantations for tropical exportcrops based on hired labor. In the Philippines, exploitationof the same resource base under Spanish rule resulted in pervasivelandlessness among the rural population. Relatively homogeneouslandowning peasants continued to dominate in Thailand, wheredelta plains that were suitable only for rice production formedthe resource base for development. These different agrarianstructures associated with different social value systems haveaccounted for differential development performance across thethree economies in the recent three decades.      

COVID-19 and time-frequency connectedness between green and conventional financial markets

Against the backdrop of the exponentially growing trend in green finance investments and the calls for green recovery in the post-COVID world, this study presents the time-frequency connectedness between green and conventional financial markets by using the spillover models of Diebold and Yilmaz (2012) and Baruník and Křehlík (2018). Covering a sample period from January 01, 2008, to July 31, 2020, we aim to explore the dynamics of connectedness between conventional and green investments in fixed income, equity, and energy markets. Additionally, we determine the role of market-wide uncertainty in altering the connectedness structure by performing a subsample analysis for the ongoing COVID-19 pandemic crisis period. Our results show that competing energy investments are not connected, and there is only one-way spillovers from the conventional bonds in the fixed-income investments. Additionally, we observe a low (high) intergroup connectedness for conventional (green) investments. Moreover, the frequency-based analysis shows that connectedness between these competing markets is more pronounced during the short-run. The subsample analysis for the pandemic crisis period shows similar results except for the disconnection between bond markets in the short-run frequency. Our time-varying analysis shows peaks and troughs in the connectedness between climate-friendly and conventional investments that suggest different global events such as the Eurozone Debt Crisis and Shale Oil Revolution drives the association between alternate investments. Similarly, we observe an enhanced connectedness during the recent COVID-19 period, suggesting that financial stability would be a significant factor in determining the smooth transition to green investments.     

Reducing the Incidence of Low Birth Weight in Low-Income Countries Has Substantial Economic Benefits

Reducing the incidence of low birth weight not only lowers infantmortality rates but also has multiple benefits over the lifecycle. This study estimates the economic benefits of reducingthe incidence of low birth weight in low-income countries, boththrough lower mortality rates and medical costs and throughincreased learning and productivity. The estimated economicbenefits, under plausible assumptions, are fairly substantial,at about $510 per infant moved from a low-birth-weight status.The estimated gains are primarily from increases in labor productivity(partially through more education) and secondarily from avoidingcosts due to infant illness and death. Thus there may be manyinterventions to reduce the incidence of low birth weight thatare warranted purely on the grounds of saving resources or increasingproductivity.      

R&D productivity following first-time CIO appointments

Prior studies find that firms announcing the appointment of a new chief information officer (CIO) are rewarded by stock price increases, suggesting that the market expects new CIOs to add longterm value to the firm. In this paper, we examine whether first-time CIO appointments result in improved R&D productivity. We focus on R&D investments because one role of IT management is to aid in discovery and management of growth opportunities. Successful R&D activities are designed to create the type of knowledge-based, growth-critical assets (new or improved products, better distribution methods, etc.) that effective IT management would be expected to assist. After controlling for industry performance, we find that the productivity of R&D improves significantly after the appointment of a new CIO for appointments before 1999 (1997–1998) but not for appointments in later years (1999–2007), and that productivity improvements over the entire sample period occur for CIO appointments by firms with superior IT capabilities. Our results for R&D investments suggest that new CIOs improve the way IT is managed and improve their firms' approach to knowledge management.     

USING RANDOMIZED CONTROL DESIGNS IN EVALUATING SOCIAL SECTOR PROGRAMS IN DEVELOPING COUNTRIES

Seven case studies—from Bolivia, Colombia, Indonesia,Mexico, Nicaragua, Taiwan (China), and Turkey—demonstratethe feasibility of conducting rigorous impact evaluations indeveloping countries using randomized control designs. Thisexperience, covering a wide variety of settings and social programs,offers lessons for task managers and policymakers interestedin evaluating social sector investments. The main conclusions are: first, policymakers interested inassessing the effectiveness of a project ought to consider arandomized control design because such evaluations not onlyare feasible but also yield the most robust results. Second,the acute resource constraints common in developing countriesthat often make program rationing unavoidable also present opportunitiesfor adopting randomized control designs. Policymakers and programmanagers need to be alert to the opportunities for buildingrandomized control designs into development programs right fromthe start of the project cycle because they, more than academicresearchers or evaluation experts, are in the best positionto ensure that opportunities for rigorous evaluations are exploited.      

Evaluating the Impact of Conditional Cash Transfer Programs

Several developing economies have recently introduced conditionalcash transfer programs, which provide money to poor familiescontingent on certain behavior, usually investments in humancapital, such as sending children to school or bringing themto health centers. The approach is both an alternative to moretraditional social assistance programs and a demand-side complementto the supply of health and education services. Unlike mostdevelopment initiatives, conditional cash transfer programshave been subject to rigorous evaluations of their effectivenessusing experimental or quasi-experimental methods. Evaluationresults for programs launched in Colombia, Honduras, Jamaica,Mexico, Nicaragua, and Turkey reveal successes in addressingmany of the failures in delivering social assistance, such asweak poverty targeting, disincentive effects, and limited welfareimpacts. There is clear evidence of success from the first generationof programs in Colombia, Mexico, and Nicaragua in increasingenrollment rates, improving preventive health care, and raisinghousehold consumption. Many questions remain unanswered, however,including the potential of conditional cash transfer programsto function well under different conditions, to address a broaderrange of challenges among poor and vulnerable populations, andto prevent the intergenerational transmission of poverty.      

The Effect of Mandatory Extraction Payment Disclosures on Corporate Payment and Investment Policies Abroad

I examine how mandatory extraction payment disclosures (EPD)—a policy solution intended to discourage corporate payment avoidance in the oil, gas, and mining industries—affect fiscal revenue contributions and investments by multinational firms in foreign host countries. Using the staggered adoption of EPD across firms headquartered in Europe and Canada, I find that disclosing companies increase their payments to host governments, decrease investments, and obtain fewer extraction licenses relative to non-disclosing competitors. These effects are stronger for firms that face a high risk of public shaming, operate in corrupt host countries, and have a high exposure to bribery-prone payments, suggesting that EPD increases the reputational cost of corporate behavior that could be perceived as exploitative. The resulting reallocation of investments from disclosing to non-disclosing firms reduces drilling productivity and resource production in host countries, consistent with uneven disclosure regulation distorting capital allocation.     

THE COSTS AND BENEFITS OF SOIL CONSERVATION: THE FARMERS' VIEWPOINT

Most countries in Central America and the Caribbean depend heavilyon agriculture; efforts to sustain and improve the sector'sproductivity are therefore crucial to the region's economicdevelopment and to the welfare of its people. Land degradationis thought to pose a severe threat to the sustainability ofagricultural production. Yet despite long-standing concern aboutthis threat and dramatic claims of environmental damage, surprisinglylittle empirical analysis has been done on the causes and severityof land degradation problems in the region and on how best totackle them. Meanwhile, many of the conservation programs designedto address the problems have fallen short of expectations. Oftenfarmers have not adopted the recommended conservation practicesor have abandoned them once the project ended. The research presented in this article attempts to bridge theempirical gap, using cost-benefit analysis to investigate thenature and severity of the soil degradation problem and to assessthe cost-effectiveness of proposed solutions. Because soil degradationproblems tend to be site-specific, the analysis is rooted incase studies, and because conservation programs stand or fallon the participation of farmers, the study's main focus is onthe profitability of the measures and the deterrents to theiradoption from the farmers' point of view.      

DEVELOPMENT, THE ENVIRONMENT, AND THE SOCIAL RATE OF DISCOUNT

This article examines the role of the discount rate in makingdecisions that will have significant implications for the environment.The authors begin by providing a rationale for discounting ingeneral and by describing the main factors that determine thediscount rate. These factors—the private and social ratesof time preference, the opportunity cost of capital, risk anduncertainty, and the interests of future generations—allhave an environmental dimension. The article goes on to examinethat dimension and to explore the connections between the choiceof the discount rate and environmental concerns, such as excessiveexploitation of natural resources, inadequate investment inconservation, and insufficient attention to the irreversibleloss of certain environmental resources. The authors conclude that, in general, environmental concernsare not best addressed by lowering the discount rate—anaction that might have both benefits and costs for the environment.A more promising course would be to incorporate a criterionof sustainability into certain aspects of decisionmaking. Howsuch a criterion could be made operational is touched upon butnot developed in this article.      

THE IMPACT OF HEALTH AND NUTRITION ON EDUCATION

Child health and nutrition are strongly associated with educationalachievement. But associations do not necessarily indicate causality;estimates generally are likely to be biased in one directionor the other. As a result analysts and policymakers should havemuch less confidence in findings about the effect of healthon schooling success than has been claimed in previous surveys.The evidence is more nuanced and qualified than is often recognizedbut may still support the conclusion that health may have considerableeffects on postschooling productivity. Policy implications pointtoward providing public subsidies for the collection, analysis,and dissemination of information about the links between healthand education; and toward providing services to improve thehealth of poor children.      

Can India meet the increasing food demand by 2020?

India's Green Revolution has evolved at an environmental cost, which is perhaps irreversible. The economic growth has become increasingly dependant upon the use of non-renewable resources such as chemical fertilizers, pesticides, oil and coal. India now follows a rapid development path, which is similar to the past growth patterns of most western nations. Whether or not such a growth blueprint would be environmentally sustainable under Indian conditions is questionable since rapid economic growth tends to positively influence environmental degradation. India is a land of villages with 700 million people living in over 600,000 villages, many in the enormous drylands. As the Tata Visiting Chair, I had the opportunity to study the rural development projects implemented by a non-profit agency (Sadguru Foundation) that harvests rainwater to improve irrigation and livelihood of rural people using check dams and lift irrigation systems in western India. This paper has examined how India's remote drylands can be transformed to achieve a ‘Sustainable Green Revolution’ to meet India's future food demands without creating serious negative consequences to natural environment. If the model highlighted in this paper is adopted all across the vast drylands of India and other parts of Asia, Africa and South America, it would certainly increase agricultural output, guarantee future food security, protect natural resources, and above all exterminate the greatest insult to human dignity—poverty!