A quantitative determination of the food security status of rural farming households in the Northern Province of South Africa

The majority of South Africans living in rural areas are food insecure despite high levels of national food self-sufficiency. The household food security position of two groups of rural farming households in the Venda region was evaluated quantitatively: one group produces vegetables that are sold or consumed locally, the other group produces cash crops – mangoes and other subtropical fruits. Using the collected data, food availability and energy, protein and fat requirements were calculated and balances derived. It was found that more than 80 per cent of the households had a negative balance of energy, protein and fat intake. The average energy, protein and fat coverage consumption was the same for both groups of farmers. A number of agricultural determinants were tested, but only non-agricultural determinants were found to be significant. These include household size, household (food) expenditure and proportion of the budget spent on food.     

Gold options,an attractive investment instrument for the non-U.S. investor — the case of the Belgian and Dutch investor

Summary Gold has always been an investment instrument whose popularity is closely linked to economic and political instability. Since gold transactions occur in U.S. dollars any investor with a non-U.S. dollar base currency will therefore assume exchange risk exposure. Empirical evidence is given that the gold price has historically varied inversely with the strength of the U.S. dollar. The investor whose base currency is not the dollar, i.e. the Belgian franc or Dutch guilder, incurs less risk when investing in gold than his dollar counterpart.     

Testing the Empirical Relationship between Best Management Practice Adoption and Farm Profitability

Several "best management practices" (BMPs) aimed at reducing movement of nutrients, pesticides, and sediment into surface water resources have been developed and promoted by Extension and other agencies over the past several years. This study utilizes actual farm-level economic and BMP adoption data to rigorously analyze the relationship between BMP use and farm profitability. Results indicate that adoption of nutrient BMPs has a significant positive effect on net farm income (NFI) for wheat and corn, while herbicide BMP adoption, particularly use of BMPs related to the application of atrazine on corn, has a small (but statistically significant) negative impact on income. Adoption of soil conservation BMPs is not shown to have a statistically significant impact on farm income.     

Improving the estimation of total factor productivity growth: capital operating time in a latent variable approach

Measuring labor and capital services accurately is essential to obtaining reliable estimates of production functions and total factor productivity (TFP) growth. Using data on the operating time of capital, a series that exists for the French business sector, greatly improves the measurement of effective capital services in production. The ensuing estimation results are consistent with Cobb–Douglas technology under constant returns to scale, with the factor elasticities not statistically different from their income shares. In the same framework, TFP growth is estimated as a latent variable and found to be less volatile than accounting residuals, negatively correlated with employment, and free of cyclicality. It is statistically best estimated as a first-order autoregressive process, with an autoregressive coefficient of 0.95. Total factor productivity growth was estimated to have declined steadily between the mid-1970s and mid-1990s, but the rate of decline has diminished since then.     

Seven Ways to Deal with a Financial Crisis: Cross‐Country Experience and Policy Implications1

This article presents a taxonomy of financial restructuring strategies that have been used by national policy makers to manage financial crises in the past. The goals of financial restructuring are to preserve or, if necessary, restore the debtor‐creditor relationships on which the economy depends for efficient allocation of capital, and to do so at minimal cost. Costs include not only the direct costs to taxpayers of financial assistance, but also—and likely more important—the indirect costs to the economy that stem from misallocations of capital and incentive problems resulting from the restructuring. Countries typically apply a combination of tools, including decentralized, market‐based mechanisms as well as government‐managed programs. Market‐based strategies generally aim to strengthen the capital base of financial institutions and borrowers using some mix of debt forgiveness and capital infusions. Government‐led restructuring strategies include the establishment of entities to which non‐performing loans are transferred as well as government‐assisted sales of domestic financial institutions, often to foreign entrants. Market‐based mechanisms can provide low‐cost ways of resolving the coordination problems faced by countries in the wake of massive debtor and creditor insolvency, particularly when those mechanisms are effective in achieving the desirable objective of selectivity—that is, devoting taxpayer resources only to those borrowers and banks that, with temporary assistance, will be capable of sustaining themselves in the future. But limiting their range of application mainly to developed economies, such market‐based mechanisms also depend on an efficient judicial system, a credible supervisory framework and authority with sufficient enforcement capacity, and lack of corruption in implementation. Although government‐managed programs may not seem to depend as heavily on well‐functioning legal and regulatory institutions, such approaches—especially the transfer of assets to government‐owned asset management companies—also rely to some extent on such institutions. Asset management companies are less likely to achieve their goal of resolving the overhang of debt at reasonable cost when legal and political institutions are weak and ownership of domestic creditors and debtors is highly concentrated. Especially in such cases, complexity and failure to consider incentive problems when designing specific rules governing financial assistance can aggravate moral hazard problems, unnecessarily raising the costs of resolution. Resolution mechanisms tend to be most successful when—like across‐the‐board debt forgiveness programs implemented through redenominations of debt—they are simple in design and afford quick resolution of outstanding debts, offering little discretion to governments while providing incentives for the private sector to work down the remaining debt overhang.     

Is ethical money financially smart? Nonfinancial attributes and money flows of socially responsible investment funds

We study the money flows into and out of socially responsible investment (SRI) funds around the world. In their investment decisions, investors in SRI funds may be more concerned with ethical or social issues than with fund performance. Therefore, SRI money flows are less related to past fund returns. Ethical money is less sensitive to past negative returns than are conventional fund flows, especially when SRI funds primarily use negative or Sin/Ethical screens. Social attributes of SRI funds weaken the relation between money inflows and past positive returns. However, money flows into funds with environmental screens are more sensitive to past positive returns than are conventional fund flows. Stock picking based on in-house SRI research increases the money flows. These results give evidence on the role of nonfinancial attributes, which induce heterogeneity of investor clienteles within SRI funds. We find no evidence of a smart money effect, as the funds that receive more inflows neither outperform nor underperform their benchmarks or conventional funds.     

Corporate social responsibility reporting: A comprehensive picture?

This study develops a content analysis framework that provides information on the comprehensiveness of corporate social responsibility (CSR) reporting, an important aspect of social and environmental accountability. Comprehensive reporting, as defined here, requires three types of information for each disclosed CSR item: (i) vision and goals, (ii) management approach, and (iii) performance indicators. The feasibility of the framework to assess the comprehensiveness of CSR reporting is demonstrated using the 2005 annual reports of a sample of publicly traded Belgian companies. The content analysis reveals a low level of comprehensive reporting. This finding complements those of prior studies on the completeness of CSR reporting and, therefore, feeds the debate regarding the extent to which CSR reporting can be considered a mechanism for discharging social and environmental accountability.     

Macro and Micro Perspectives of Growth and Poverty in Africa

This article reviews trends in poverty, economic policies, andgrowth in a sample of African countries during the 1990s, drawingon the better household data now available. Experiences havevaried. Some countries have seen sharp drops in income poverty,whereas others have witnessed marked increases. In some countriesoverall economic growth has been pro-poor and in others not.But the aggregate numbers hide systematic distributional effects.Taking both macro and micro perspectives of growth and povertyin Africa, the article draws four key conclusions. First, economicpolicy reforms (improving macroeconomic balances and liberalizingmarkets) appear conducive to reducing poverty. Second, marketconnectedness is crucial to enable participation in the gainsfrom economic growth. Some regions and households by virtueof their remoteness were left behind when growth picked up.Third, education and access to land emerge as key private endowmentsto help households benefit from new economic opportunities.Finally, rainfall variations and ill health have profound effectson poverty outcomes, underscoring the significance of socialrisk management in poverty reduction strategies in Africa.