Experimental Strategies for Preference Information Acquisition: A Lattice Path Treatment

This paper investigates strategies for the acquisition of consumer preference information by a market researcher. Such preference information is obtained by the market researcher through an experimental process that entails polling consumers about their preference profiles with a view to completely specifying the preference order. In this paper, we limit the focus to one or two consumers.In this environment, the experiments are pairwise comparisons between resource bundles about which there is no a-priori preference information. Each such experiment can have three possible signals: one bundle is more preferred, indifferent, or less preferred over another. Choice of an experiment in the experimental sequence is important because different choices result in different average amounts of information.For the analysis the paper establishes a link between preference theory and lattice path counting. Combinatorial arguments that allow the market researcher to calculate quantities of information at the start of the information acquisition process are presented. A recursion for finding the impact of choosing different experiments on the average values of information gain is constructed. The paper studies how the experiments chosen subsequently can affect the elimination of other experiments from the experimental set and thus have an effect on the efficiency of information acquisition. The measures derived could be used by the market researcher as a benchmark with which to compare information gathering strategies.     

Modelling variety in consumption expenditure on food in India

In this paper we compute nutrient‐income elasticities for two macronutrients (calories and protein) and five micronutrients (calcium, thiamine, riboflavin, carotene and iron) using an all‐India sample of rural households for 1994. We show that in each case the respective elasticities are positive and significant. This lends support to our hypothesis that an increase in income would increase nutrient intake by varying amounts, contrary to some assertions. We then compute differences in the elasticity of substitution for non‐poor and poor across commodity groups and show that these differences, while significant, are small. This further corroborates our conclusion that increases in income of the poor would lead to greater increases in their nutrient intake as compared to the non‐poor, although the magnitudes will be small.     

On the Targeting of the Employment Guarantee Scheme in the Indian State of Maharashtra

Contrary to a widely held view, the targeting of the Employment Guarantee Scheme in the Indian state of Maharashtra was unsatisfactory and worsened over the period 1979–89. Among the participants, from a large group the non-poor became the majority. Some of them were in fact (moderately) affluent. The share of female participants – especially of poor female participants – also diminished. As a result, the overall share of poor in EGS earnings fell sharply. Although a greater targeting accuracy does not necessarily imply a greater poverty impact for a given outlay, some improvements in the design and implementation of this scheme are likely to enhance both. This revised version was published online in July 2006 with corrections to the Cover Date.     

Temporal variation of capture of anti‐poverty programs: rural public works and food for work programs in rural India

Using National Sample Survey data for rural India we examine the incidence of capture in two workfare programs in rural India: the Rural Public Works and the Food for Work Programs for 1993–1994 and 2004–2005 respectively. We discover a high degree of program capture among the general population. Among the traditionally backward groups in Indian rural society – but with considerable variation in their living standards – there appears to be a higher degree of capture among SC (Scheduled Castes), than among ST (Scheduled Tribes). Targeting among SC worsened over time. There was an increase in capture by the fourth quintile (of household per capita expenditure) of SC, ST and landowners. This may be reflective of a varying degree of collusion between the elite and the program implementing agencies (e.g. village councils) over time. Thus, potential benefits of workfare get undermined. We also provide evidence to suggest that income‐based targeting could outperform social group based targeting.     

Do rural public works influence agricultural wages? The case of the employment guarantee scheme in India

Abstract

Since growth alone will not make a significant difference to agricultural wages in an oligopsonistic labour market, a case is made out for special employment programmes along the lines of the Employment Guarantee Scheme (EGS) in the Indian state of Maharashtra. The EGS has a substantial effect on agricultural wages—especially long‐term. Diminution of income supplementation through this scheme, following a sharp reduction in the share of poor participants, was thus partly offset by higher agricultural wages. To the extent that this income diminution reflected exclusion of the poor from the EGS because of deficiencies in its design and implementation, prompt remedial action would enhance significantly their bargaining power vis‐a‐vis that of large landholders.     

“Capture” of anti-poverty programs: An analysis of the National Rural Employment Guarantee Program in India

Using pooled household level data for the Indian states of Rajasthan and Andhra Pradesh we find that the size of landholdings is a negative predictor of participation in the National Rural Employment Guarantee Program (NREGP). In state level analysis this pattern survives in Rajasthan but reverses in Andhra Pradesh where we notice a positive relationship. This paper examines whether this sign reversal in Andhra Pradesh is indicative of program capture in Andhra Pradesh and better targeting in Rajasthan. We compare land inequality, ratio of NREG and slack season agricultural wage rates, political interference, and geographical remoteness across the two states and conclude that program capture may be an issue in Andhra Pradesh, largely because of these reasons. We also find evidence of complementarity between NREGP and the Public Distribution System (PDS), implying that the real income transfer through food subsidy needs supplementation.     

Government Policies and Sources of Latecomer Firms' Capability Building: A Learning Story from Brazil

Millennium goals aim to halve poverty in developing countries by 2015. As a distinction is not drawn between the persistently and transiently poor, there is a risk that strategies designed to accelerate growth to achieve the desired reduction in an overall index of poverty may be preferred to those that benefit the persistently poor. Besides, in the absence of a disaggregation of these goals into rural and urban components, rural poverty reduction may not get the priority it deserves. Finally, the feasibility of the millennium goals is not plausible. While the growth rates required for achieving these goals do not differ much from those recorded in recent years, their sustainability is not self-evident. Moreover, as income inequality has increased in recent years, the poverty reduction due to a given growth rate is lower. But these goals are nevertheless useful in drawing attention to pervasive deprivation in developing countries, and to the need for a determined and co-ordinated effort by the development community in reducing it substantially in the not-too-distant future.     

Economic Liberalization and the Vintages of Machinery Imports in Developing Countries: An Empirical Test for India's Imports from the United Kingdom

Drawing upon new World Bank poverty data, the analysis examines the feasibility of attaining the Millennium Development Goal of halving extreme poverty (MDG1) when the interrelationships between finance, institutions, trade liberalization, growth and poverty are taken into account. The authors' econometric results suggest a slowing down of poverty reduction in the more recent years since 2000. They also confirm: the role of better institutions in income growth, poverty reduction, trade openness and financial development; the role of financial development in economic growth; and the positive effect of capital liberalization on financial development. Simulations for different regions show that MDG1 is attainable in most regions if the historical growth rate is maintained over 2006–15. However, improvements in institutional quality are crucial for halving extreme poverty in sub-Saharan Africa.     

Rural Public Works and Poverty Alleviation--the case of the employment guarantee scheme in Maharashtra

This paper focuses on the poverty alleviating potential of the Employment Guarantee Scheme (EGS) in (the Indian state of) Maharashtra. A point of departure is the shift of emphasis from the static to the dynamic effects of the EGS targeting, measured in terms of individuals moving into and out of poverty, over the period 1979-84. An assessment is made of whether the EGS prevents the vulnerable from falling into poverty or enables the poor to move out of poverty, by distinguishing between the protective and promotional roles of the scheme. Simulations involving a wide range of poverty thresholds and different assumptions about the distribution of EGS earnings reveal that the poverty alleviating potential is limited in most cases. If, however, a larger EGS outlay is combined with more accurate targeting, the potential is substantially greater. Larger outlays are feasible if other rural public works are merged under the EGS. If this is combined with a reallocation in favour of backward areas, the targeting may improve substantially.     

Income and Expenditure Switching Among the Impoverished During Structural Adjustment in India1

The impoverishment during 1991–1993 was largely a result of policy reforms. In the absence of income switching, the impoverishment would have been greater. The patterns of income switching differed among the three Indian states, viz. Andhra Pradesh, Maharashtra and Karnataka. Confining the analysis to household expenditure on food, medical care and education, however, little, if any, expenditure switching occurred. To some extent, the effects of household expenditure cuts were compounded by cuts in public expenditure. But, given the aggregate expenditure categories, there is a risk of overstating the effects on the poor. A more fundamental concern nonetheless remains. Given the acute deprivation of a large segment of the rural population, it is imperative that public provision of basic goods and services is strengthened. A case in point is the public distribution system for food (PDS). Despite the revamping, the benefits to the poor have not increased while the subsidy has. Short of drastic reforms, it is unlikely that the cost-effectiveness of the PDS will improve.