Ousmane Badiane

Spatial integration, transport costs, and the response of local prices to policy changes in Ghana

The purpose of this paper is to investigate the respective roles of spatial integration and transport costs in explaining price changes in Ghana. A fundamental question that remains unanswered in most countries undergoing economic reform is to what extent local markets respond to structural and macroeconomic policy changes. The objective of this paper is to explore this question theoretically and empirically, and to assess the respective roles of spatial integration and transport costs in explaining price changes following economic reforms in Ghana.

Evidence on Key Policies for African Agricultural Growth

It is widely agreed that reducing poverty in Africa south of the Sahara (SSA) depends largely on stimulating growth in agriculture. To this end, heads of state in Africa rallied to form the pan-African Comprehensive African Agriculture Development Programme (CAADP) with the goal of raising investments and improving strategy implementation. However, while implementing an agricultural agenda under the CAADP framework, more and more countries have realized that increasing public investment in agriculture alone is not enough. Policy can play an important role not only to make public investment more efficient, but also is crucial for incentivizing private sector and farmer investment in agriculture. Against this backdrop this paper takes stock of current agricultural policies in SSA with a view to identifying policies that are working as well as areas for improvement. The paper examines policies to encourage the adoption of agricultural inputs, initiate greater private-sector investment in agriculture and agro-industries, and manage price volatility while encouraging openness. The paper further reviews successful land tenure policies and property rights systems, reviews the evidence on the synergies between agriculture and nutrition, and examines how CAADP is laying the institutional architecture for improved policy formulation in Africa. In general, the paper finds that although substantial progress has been made, there is considerable scope for improvement. This is not surprising given the relatively primitive and deeply rooted nature of smallholder farming in Africa. Evidence synthesized in the paper supports the view that most policies cannot be implemented in isolation. Rather, policies tend to be most effective when implemented along with complementary policies and public investments.

Vocational Training and Agricultural Productivity: Evidence from Rice Production in Vietnam

Abstract The paper examines the impact of farmers’ educational attainment on agricultural productivity. More specifically, it evaluates how farmers with vocational training perform compared to those with traditional educational training. A stochastic production frontier and inefficiency effects model is estimated using nationally representative household survey data to analyze the relationship between farmers’ educational attainment and agricultural productivity in Vietnam, while controlling for factors such as gender and farmers’ health status. The results indicate higher returns to vocational training in terms of its impact on raising agricultural productivity, as compared to primary and secondary education. Our findings confirm that significant productivity and welfare gains can be achieved through the promotion of education schemes tailored to the specific technical needs of smallholder or poor farmers. The lack of impact from primary and secondary education signals the need to adjust the curricula of nontraditional educational programmes in rural areas to respond to the technical and other skill needs of farmers. In other words, one general curriculum for everyone may not reap the highest returns to primary and secondary education investment in the context of countries with large farming populations. The originality of the paper resides also in the use of disaggregated education data in terms of formal and non-formal education. In addition, unlike previous studies, the production frontier function and the inefficiency segment are jointly estimated using a one step maximum likelihood estimation (MLE) procedure which guarantees both consistency and efficiency for estimated parameters.

Macro-economic Models: Comparative Analysis of Strategies and Long Term Outlook for Growth and Poverty Reduction Among ECOWAS Member Countries

The Common Agricultural Policy of ECOWAS (ECOWAP) was adopted in January 2005, following a close consultation among member states and regional professional organizations. The adoption came <2 years after the launch of the Comprehensive Africa Agriculture Development Program (CAADP) under the New Partnership for Africa’s Development (NEPAD), an initiative of the African Union. In March 2005, ECOWAS organized, in Bamako, Mali, the Regional Implementation Planning Meeting for CAADP in West Africa. The meeting reviewed the objectives, targets, and principles of CAADP and their alignment with ECOWAP, and confirmed the latter as the political as well as institutional framework for the implementation of the former in the West Africa region. In May 2005, ECOWAS and the NEPAD Secretariat developed a joint ECOWAP/CAADP action plan for the period 2005–2010 for the development of the agricultural sector.

Tapping Potentials of Innovation for Food Security and Sustainable Agricultural Growth: An Africa-Wide Perspective

While in the past, increased use of inputs and expansion of agricultural land accounted for a good part of agricultural growth in Africa, improvements in productivity will need to be a major driver of growth in the future. Thus, agricultural innovations are needed to sustainably increase productivity, i.e. output per unit of all inputs, while maintaining environmental quality and resources. Such innovations require enhanced investments in research and development. This study identifies potentials in agriculture and food systems in Africa for enhanced food security. For maximum impact, the Special Initiative “One World – No Hunger” of BMZ needs to take note of the whole African landscape of actions in agriculture and food security. Therefor this study provides a detailed review of related ongoing and recent initiatives, in order to help identify in what ways investments under the “One World – No Hunger“ Special Initiative from a broad strategic perspective might best connect and serve in coherent and complementary ways to increase food and nutrition security and sustainable agricultural productivity growth. Innovations in the agricultural sector are key to ensure food security and achieve the right to food. Investments in the agricultural sector are crucial not only to increase food production but also because the returns on investments in terms of poverty reduction effects are often highest in in this sector. Furthermore, food insecurity and violent conflicts are inextricably interlinked with food insecurity being both a driver and a consequence of violent conflicts and related refugee flows. African countries have recently made major commitments to invest in agriculture. The Comprehensive Africa Agriculture Development Programme (CAADP), that was initiated in 2003 and has been reinforced by the Malabo Declaration in 2014, is now the reference point and measure of commitment in Africa. With CAADP, African countries committed to spend 10% of their total public expenditures on agriculture to achieve an annual agricultural growth rate of 6%. Other African and international initiatives, including new partnerships between African governments, donors and the private sector like the New Alliance for Food Security and Nutrition or Feed the Future, have since been launched to support the CAADP process. Investment opportunities differ across Africa. In view of the above mentioned goals, it is suggested here that development investments by Germany target countries which reveal potentials indicated by 1. having a track record of political commitment to foster sustainable agricultural growth, as indicated by performance under CAADP, and 2. showing actual progress in sustainable agricultural productivity driven by related innovations, as indicated by comprehensive productivity measurement and innovation actions on the ground, and 3. prioritizing actions for hunger and malnutrition reduction and showing progress (for instance measured by the Global Hunger Index), but where agricultural and rural development and nutrition interventions are likely to make a significant difference, as indicated by public policy and room for civil society actions. The records and potentials of 42 African countries are identified accordingly, using comprehensive assessments of agronomic, economic and governance criteria that can be transparently tracked.

Regional Trade and Volatility in Staple Food Markets in Africa

This paper deals with the role of regional trade in fostering the resilience of domestic food markets. Using country production and trade data from FAOSTAT database, a series of simple indicators are calculated that shed light on the potential for domestic markets stabilization through trade among African countries within Regional Economic Communities, including the Common Market for Eastern and Southern Africa (COMESA), the Economic Community of West African States (ECOWAS), and the Southern African Development Community (SADC). A regional, economy-wide multimarket model is then used to simulate changes in current productivity levels and trade costs. The findings reveal that it is possible to significantly boost the pace of regional trade expansion and thus its contribution to creating more resilient domestic food markets through modest reduction in the overall cost of trading, a similarly modest increase in crop yields, or the removal of barriers to trans-border trade.

Lessons Learned and Future Challenges

The contributions of this book can be understood as a continuation of the ongoing evidenced-based debate on the role of agriculture and participatory policy processes in reducing poverty. In this context, the economic modelling approaches presented in this book provide new insights into the agricultural versus nonagricultural growth nexus. Besides growth-poverty linkages, these particularly include nutrition-growth-poverty linkages and policy-growth linkages to identify key sectors and key policies within an effective Pro-Poor-Growth-strategy. In contrast to existing approaches, the political process has been explicitly integrated into this quantitative analyses. Thus, the derived CGPE approach allows a more comprehensive growth-poverty analysis, including not only the impact of biased political incentives, but also the lack of adequate political knowledge and ownership, respectively, as a source of low political performance. Political knowledge is reflected by policy beliefs which in turn are formed by political agents through communication and observational learning processes organized in policy networks. Effective participatory policy processes are characterized by policy network structures implying stakeholder influence that reflects both, the size of the society groups represented and the specific political knowledge of the stakeholder organizations. Apart from stakeholders, voters also play an important role in determining effective participatory policy processes. Voter behavior, i.e. the importance of policy versus non-policy voting motives, significantly determines both, governmental incentives and lobbying influence. While non-policy voting implies policy failure due to government capture and low government accountability, policy voting limits government performance depending on the extent to which voters’ policy beliefs are biased. Future challenges correspond to three areas: (1) modelling complex policy-growth linkages via policy impact functions (2) designing effective communication between science and political practice that allow an effective policy learning and (3) modelling voter behavior, especially the formation of voter beliefs in a political mass communication processes.

Policy Support Through Modeling and Evaluation: Methodological Challenges and Practical Solutions

A critical challenge for all policymakers wrestling with economic development and poverty reduction in Africa—as well as everywhere else in the world—is how to assess which programs and policies actually work. A corollary to this challenge is to identify, among the programs that do work, those that provide the best value for money. Methodological challenges include the development of adequate quantitative economic modelling tools for a comprehensive growth poverty analysis in an economywide framework. An even greater challenge, however, is for the knowledge and insights generated from economic modeling to find their way into the decision making process. In this context, the present volume contains a selection of tools and methodologies that can help to tackle the complexities of the analysis of policy processes and outcomes under the implementation of the CAADP agenda. The contributions go beyond the state-of-the-art methods and tools applied for quantitative policy impact analyses, as they also examine the process behind the choice of policies and the factors that determine the likelihood of their adoption and implementation.