After applying the procedures, the analysis result reveals that the estimated long-run relationship is integrated, but it is apparent that both grant and openness are negatively related with the left hand side of the variable at a highly significant level. On the other hand human capital formation is positively related at a very significant level. Thus, the coefficient of human capital formation (gross enrollment ratio) supports the notion that long run real GDP growth in Ethiopia is influenced by human capital formation, which is in line with New Growth Theory. That is, the labour force development has a significant impact on changing the country economic progress. However, the coefficient for aid (grant) and openness measures are not in line with the a-priori theoretical assumptions stated in the previous discussion of this paper. Despite the goal of the donor and the expectation of the Ethiopian government aid contribution to economic growth is negative. A possible explanation for this may be that aid is not utilized appropriately. Experience indicates that aid given to Ethiopia is often more influenced by the decision of the donor rather than by the Ethiopian authorities, and/or due to the aid tying which is often made by most bilateral and some multilateral donors. The negative impact of openness of the economy or trade could be due the unbalanced relationship between export earnings and import payments. Besides the main export good of Ethiopia is coffee and as the prices for this good fluctuate strongly, the earnings from exports are not steady. This determines that while the prices for imported goods rises it detract resources from the domestic uses.
response to rainfall shocks, represented by the 1995 rainfall shock. 10 However, the amount of food aid delivered in response to shocks seems small compared with the amount of food aid determined by the inertia/chronic poverty measurements. When decomposing the average predicted value of total food aid per capita (5.92 Ethiopian Birr over eight-months) into food aid allocated in response to inertia and chronic poverty and food aid allocated in response to shocks 11 , we find that the lion’s share of all food aid (87 percent =(5.17/5.92)*100) has been allocated in response to inertia and chronic poverty (as well as the other community characteristics), and that only a small part (13 percent = (0.75/5.92)*100) has been allocated in response to shocks. While these results may partly follow from the fact that only 20 percent of the crop area was damaged, 12 they are in keeping with Dercon and Krishnan who also report a limited response of food aid to shocks in their purposively selected sample of 15 villages in Ethiopia surveyed three times between 1994 and 1995. Nonetheless, to judge how effective food aid is in mitigating the effect of shocks on child growth, we also need to know how food aid reception and plot damage affect child growth. We revisit this issue in section 5, which discusses the empirical results on the effect of the different child growth determinants on child growth.
The empirical result from the investment equation estimated shows that aid has a significant positive impact on investment in the long run. Its positive impact is not limited only to the long run but also aid finances investment in the short run. On the other hand, volatility of aid by creating uncertainty in the flow of aid has a negative influence on domestic capital formation activity. In addition, inflation and saving are found to have a negative influence on investment. However, in the short run saving has got a significant positive impact on investment and inflation’s effect is similar. The result further shows that debt serving appeared insignificant. The paper also examined the growth impact of aid, among other variables and its interaction with policy index. The policy index is constructed as a weighted sum of budget deficit, openness and credit access to the private the sector to capture fiscal, trade and monetary policy. Although this index provides a good idea of a country’s policy stance, we believe that it is not broad enough for a typical developing country like Ethiopia. Therefore, the policy index is augmented by major telephone lines per 1000 people (tele) and is relatively broad. Tele is used as indicator (proxy) for infrastructure policy.
We observe important differences in coffee management practices and intensity of coffee production among members of certified and non-certified cooperatives. Members of the FT-certified cooperative have younger coffee shrubs that require more care and are more likely to till the soil (86%), to apply animal manure (76%), to manually weed (91%) and slash the undergrowth (91%) than the non-certified farmers. Moreover, they supply only dried coffee as the FT cooperative does not have a washing station. Drying coffee in accordance with standard requirements includes carefully constructing beds and using mats for coffee drying and timely handling during the drying process; which is relatively labor intensive. Labor-intensive cultivation and drying practices among FT farmers—which are only to some extent directly related to certification requirements—result in an average labor use per ha of coffee that is about three times as high as labor use among non-certified farmers. Org-certified farmers have, on average, a larger coffee area and a higher importance of coffee in total land use, and are less likely apply tillage (25%), animal manure (27%), weed management (71%) and slash undergrowth (52%) than non-certified farmers. They, however, use more labor per ha compared to non-certified farmers but substantially less than FT farmers. Farmers in the FT-Org-certified scheme cultivate their coffee area most intensively with, on average, 4200 coffee shrubs per ha but use the least labor per ha as they are less to likely apply tillage (18%), compost (13%) and slash undergrowth (56%). RA-certified farmers are specialized in coffee production with an average of 74% of their land allocated to coffee and the largest average coffee area, but their coffee shrubs are significantly older. They use more labor than non-certified farmers mainly to dry their coffee to the RA standards. RA certifies only (semi-)forest coffee, whereas households produce also garden coffee which does not qualify according to RA criteria and is hence not certified (please note that this is because there are four coffee production systems in Ethiopia: forest, semi-forest, garden and plantation. Forest coffee is collected from undisturbed natural forest; semi-forest coffee is produced in managed forest; garden coffee is produced in a household’s homestead either with scattered shade trees and/or in intercropped with other crops; and plantation coffee is cultivated and intensively managed by investors). RA accepts and pays a premium only for dry (semi-)forest coffee cherries while farmers can still sell their fresh coffee from semi-(forest) and garden to the cooperative, though this coffee does not end up in the supply chain as RA-certified coffee.
Table 1 shows that domestic absorption (the sum of private consumption, government consumption and investment) exceeds GDP by around 10%, by definition reflected in a trade deficit of identical magnitude. The investment share (13%) is lower than in other low-income countries. 3 Compared to these, Malawi’s economy is relatively open, with the sum of exports and imports representing 75% of GDP. In US dollars, GDP per capita in 1998 was US$160. Since 1990, aggregate annual growth has been close to 4%, in excess of population growth. Among the absorption components, private consumption has increased while investment and government consumption have declined. On the supply side, agriculture has outperformed the other sectors. The current account of the balance of payments (Table 2) shows that agriculture has a strong trade surplus whereas industry and, to a lesser extent, services record significant deficits. The current account deficit (foreign savings) is smaller than the trade deficit due to a net transfer surplus. On the income side of the current government accounts (Table 3), taxes contribute around 75% with the rest covered by transfers (grants) from the rest of the world. On the spending side, the main item is government consumption. The surplus (government savings) is close to the value of foreign transfers received, i.e., current government revenues are just about sufficient to finance current operations. The bulk of investment is carried out by the government (Table 4). Given that government investment exceeds government savings, there is an over-all deficit in the government budget. All but a small part of investment is financed by the outside world, either explicitly (as foreign savings) or implicitly (as grant aid to the government). 4
The theoretical discussion has shown that aid modality should matter in the aid- decentralization-growth nexus. We therefore distinguish between ﬁve diﬀerent aid types (each as share of GDP): grants, loans, technical assistance, humanitarian aid, and total net ODA. A meaningful measure to compare the relevance of the diﬀerent aid types is to relate them to the total net ODA. We thereby ﬁnd that at the end of the 1990s, which is our last observation period, about 88% of the total net ODA was composed of grants, while 12% was spent as loans (net). About one third of the total net ODA is classiﬁed as technical assistance. This aid type includes development assistance in terms of building up local infrastructure, schools, or health care, and it incorporates the public advisory of the government in general, which also includes expenditures in donor countries. This is why technical assistance cannot be declared as the provision of local public goods, as one might ﬁrst presume. Humanitarian (food) aid amounts to only 3% of the total net ODA. Aside from these diﬀerent spending categories, we are also able to distinguish between bilateral and multilateral aid. This distinction might also be important in the aid-growth nexus, as single countries may
the growth of the agricultural sector in China between 1981 and 2004 Have been estimated to have four times more impact on reducing poverty rates than growth in either the manufacturing or services sectors (Ravallion, 2008). Since most of those below the poverty line in China live in rural areas, the development of these areas has predictably lifted hundreds of millions of people out of extreme poverty. The relatively fair distribution of land has also helped to reduce the proportion of people below the poverty line. Furthermore, the development of agriculture laid the basis for the huge growth of the manufacturing sector which China has experienced, since it freed up large numbers of surplus rural laborers who could find employment in factories and industries. China has also put much effort and investment into agricultural R&D (research and development), which has helped to develop new technologies and foster technical innovations. In contrast, the agricultural sector in many African countries is still relatively underdeveloped with many outdated practices still found. The vast majority of Africa’s population lives in rural areas. Proportionately, even more people live in rural areas of Africa today than was the case in China at the beginning of its reform period. It is consequently clear that agriculture and rural development is key to reducing poverty rates in Africa as well. Developing a strong agricultural sector may also be a good basis for subsequently creating a strong manufacturing sector, as it has proved to be in China. At the same time, it must be recognized that Africa’s demographic, climactic and political conditions are very different from those in China when it commenced reforms. Africa is far less densely populated than China, with a relatively abundant supply of land. Furthermore, state institutions in Africa are often less strong and stable than those in China, thus their capacity to implement policies in the countryside will have to be built up. However, Africa do not necessarily need to adopt in total the chinese rural reform models as Africa does not have the same farming system with china , but the message is Africa need to design its own model in accordance with its demography, climatic and political condition so that it can improve and raise productivity in rural areas and also establish policies to protect them.
Numerous studies suggested different causes for poverty in a country. Some contended that the cause of poverty in developing economies, among other things, is that the poor does not have access to credit from formal banks for the purpose of working capital as well as investment for their small businesses (Jean-Luc, 2006). Hence, improving access to financial services is an important development tool, because it helps in creating employment opportunities for unemployed and increases their income and consumption, which would in the final analysis reduce poverty. Access to financial services to the poor also facilitates economic growth by easing liquidity constraints in production, by providing capital to start up new enterprises or adapt new technologies, and by helping producers to assume production risks. To this end, many developing economies have developed and have been providing credit to the poor through microfinance schemes. The experience of several Asian, African as well as Latin American countries could be a typical example for this (Mayer, 2002).
If domestic savings are not sufficient to meet requirements of investment then a country has to rely on foreign savings and borrowing from external sources. External debt comes in the form of unilateral borrowing, multilateral borrowing, and borrowing from a consortium or donor agencies etc. Foreign borrowing allows the country to consume and invest beyond the limits of domestic production and is helpful for economic growth. Financing development-related projects with the help of foreign lenders could help the country to build its production capacity and smooth the progress of economic growth. Particularly, external borrowing enables a country to finance capital formation not only by using domestic savings but also foreign capital surplus. Indeed, much of the fast growth witnessed throughout the developing world during the 1950s to 1970s can be safely attributed to the easy availability of foreign aid, most of which carried very low interest rates or was in the form of grants. However, an addiction to foreign aid can, as it has, slow down efforts to achieve self-reliance and undercut efforts to raise domestic saving and investment and severe debt service obligations could hamper the long-term growth potential of a country. Pakistan, India, Sri Lanka and Bangladesh present examples of both phases of external borrowings in relation to growth, the incapacity to achieve self-reliance etc.
One prevalent view is that aid has a positive effect on growth, but only if recipient countries exhibit certain characteristics, such as good policy and institutional environments and favorable geography. In other words, while aid does not appear to have a uniformly positive growth effect when considered along with standard determinants of growth, there is evidence that it raises growth in particular environments. This “conditional” view of aid effectiveness has typically focused on the quality of recipient countries’ policies as, for instance, with Burnside and Dollar (2000). Recent work that supports this view and focuses on other country characteristics includes: Collier and Dehn (2001), which finds that increasing aid to countries suffering from negative export price shocks raises growth; and Collier and Hoeffler (2002), which concludes that aid is very effective in post-conflict situations where good policies are implemented. But even within this set of studies, divergent conclusions emerge as to exactly which country characteristics are important. Using the same specification as Burnside and Dollar (2000) but including additional data, Easterly et. al. (2003) find no evidence of a significant relationship between aid and growth conditioned on the quality of policies. Guillaumont and Chauvet (2001) also do not find that good policy is significant, and conclude instead that aid works best in
If the number of poor people as many as 100 people and a population of 1000 people, the PHI of 0.1 or 10 percent. The World Bank uses US $ 1.25 and US $ 2 per person per day (international poverty index) as the poverty line. Although this indicator has been used widely in a variety of studies on poverty, but the index is considered to be rather simple because it ignores the calculation of the percentage of expenditure (income) of the poor to the poverty line. In Indonesia, the poverty measure is often based on the approach used by the BPS. Prior to 1993, BPS poverty line (poverty line) is based on the amount of rupiah spent to meet the needs of food equivalent to 2,100 calories per day per person. This figure is often called the food poverty line (food poverty line). In this approach is considered as a "imejiner" because total spending is assumed to all be spent on the needs of calories. Since 1993, BPS approach basic needs (basic needs approach) by entering the calculation of food and non-food needs. For minimum food needs have been 52 types of food (respectively for urban and rural areas) and the amount equivalent to 2,100 calories. In SUSENAS (National Social Economic Survey) has been used to obtain the implicit price of the poverty line. This methodology is considered to be simpler and easier to understand in relation to the needs of the data to determine the poverty line. Sedang to minimum non-food requirement includes 46 kinds of commodities consisting of housing, clothing, education, health, transport, durable goods and miscellaneous goods and services. Non-food expenditure component does not distinguish between urban and rural areas. Thus, the total poverty line was obtained from the sum of the food and non-food needs. In 1999, in order to better adjust to the current
Weitz (1917) pointed out that the vast number of families who constitute the main agricultural cultural work force, agriculture should not be seen as merely an occupation of source of income to them rather it is a way of life particularly as evident in the traditional societies. This is true of Nigeria where more families have turned agriculture into a culture not because they earn a living or employment, but just to satisfy conventional .imposed culture by engaging in subsistence farming and particularly in co-operating the disguised employment problem. Also, Heidhues, (1995) in his own contribution to the literature like other researchers absented in respect of Nigeria that no matter how much development, agriculture will retain its dominance in the economy for many decades to come. More importantly he observed that only agriculture and particularly from agricultural report that the economy can receive its principal stimulus to the economy's growth. Thus his argument though look like a fallacy as the economy now enjoy more agricultural product even on the emergence of oil in Nigeria, therefore the importance of agriculture cannot be underestimated.
8 Contrary to the arguments in favour of the trickle-down effect of economic growth on poverty, the second view asserts that economic growth does not improve the lives of the very poor, but instead improves the circumstances of the middle to rich classes. This results in an increase in inequality and consequently leads to poverty (Todaro, 1997). This view is supported by studies such as Parel (2014), Basu and Mallick (2008), Fishlow (1995) and Dreza and Sen (1990) among others. Norton (2002), however, argues that the use of the word ‘trickle down- effect’ is a misnomer; growth actually entails a cascade, not a trickle since the study finds that
As an innovative povertyalleviation theory, Precision povertyalleviation is far from enough in terms of research breadth and depth, and there is a big gap be- tween theoretical research and practical operation. At present, some scholars analyze and study the dialectical thinking logic of Precision povertyalleviation from the perspective of philosophy. For example, Xie Pingan’s Philosophical Thinking On “ Precision PovertyAlleviation ” describes the specific meaning, characteristics, methods and practical significance of “Precision poverty allevia- tion” from a philosophical perspective . The author also thinks that accurately grasp internal cause and external cause for povertyalleviation, the poor people and the poor areas is the internal cause, support units, cadres and policy is the external cause, “only to catch the regional poverty internal cause, both the ex- ternal cause at the same time, by flexible and reasonable measures, suit the re- medy to the case, can really make in the phase of poverty population out of po- verty.”  It from the particularity of contradiction and all from the reality to discuss the precision of povertyalleviation philosophical method. Some scholars think about Precision povertyalleviation from the perspective of theory and re- ality. For example, Wang Sitie believes that Precision povertyalleviation is a po- verty alleviation method that USES scientific and effective procedures to pre- cisely identify, precisely assist and precisely manage poverty-stricken objects ac- cording to different environments and conditions of poverty-stricken farmers in different poverty-stricken areas . Li Kun, Ye XingJian in Precision PovertyAlleviation in Rural Areas: Theoretical Basis and Practical Situation Analysis claim that accurate povertyalleviation of poverty reduction concept such as is both a pro-poor type means of poverty reduction from traces the rights poverty of theory and inclusive growthpoverty concept, the concept of participatory po- verty alleviation, and collaborative anti-poverty theory, trickle-down theory and pro-poor theory, and pay attention to the cooperative povertyalleviation mul- ti-party participation, coordination . Wang Sangui and Guo ZiHao believe that the most basic definition of Precision povertyalleviation is that poverty al- leviation policies and measures should be Precision at the truly poor families and population, and various factors and obstacles leading to poverty should be fun- damentally eliminated through Precision assistance to the poor population, so as to achieve the goal of sustainable povertyalleviation .
Actually, the above are the part and parcel of the ailments and features of what is obtainable in Nigeria. There is denial of opportunity and choice of work, education, place of settlement andregular violation of human right by the leaders and the people. The average populace is not fully empowered to have a say on issues and policies affecting them. Inability to secure enough to feed self and family members have resulted to upsurge of different forms of crimes such as obtaining by tricks, robbery, corruption, ritual killing, kidnapping, prostitution amongst others. The situation compelled few Nigerians to accept being refugees in another country even when there is no war.In addition, the land ownership system cut-off many Nigerians from access to land for farming or erecting a living batcher and embargo on public sector employment in some establishments, poor infrastructure, non-conducive environment for business activity, epileptic power supply, lack of portable water, low investment in the country gave rise to inability to secure a job or delve into business so as to generate income to improve living standard. Besides, no bank credit facilities to assist indigent students or local entrepreneurs who want to improve education or business venture. Hence, the people of the country are caught up in the vicious circle of poverty.
The aim of this working paper is to provide delegates attending the British Academy Dissemination event at the University of Dundee on 07 Sep 2011, a broad overview of how poverty is understood and engaged with in the Indian context in general and in the southern state of Kerala in particular. In the opening section, a brief discussion is carried out on the different institutions that are involved in povertyalleviation in India. The next section by tracing the various phases in the conceptualisation of poverty in India, shows how in spite of a predominant use of ‘income-poverty’ (i.e. families who do not earn enough so to buy food that would give them the stipulated minimum calorie in their diet) as the broad definition within the policy making arena, there has now been a gradual inclusion of a multi-dimensional definition of poverty. The third section takes the discussion further with a particular focus on the state of Kerala. The final section provides a summary of the various categories of povertyalleviation programmes that are formulated across India.
More recent studies have examined the impact of non-farm income on income inequality in developing countries (Adams, 1994). The findings reveal that certain types of non-farm activities have an inequality-decreasing effect. Other studies have also focused on revenue generated from forests; amount of forest products harvested and export figures at national level. Other studies have revealed that some of the poorest are disproportionately dependent on forestry income (Reddy and Chakravarty 1999, Jodha 1992). To majority of people in rural arrears, forests are their habitat and satisfy practically all their needs. Forest products enable poor people to secure a living during adverse conditions, and obtain fodder for livestock and fuel for cooking. Forests therefore, provide direct means of survival to poor segment of the rural population. The poor have less land and hence are dependent on forestry for a greater share of their total income (Arnold, 1998). The dependence is measured not only by the products they provide, but also by the non-tangible services they offer. However, the total contribution of forests and trees to poverty reduction is difficult to quantity. Those who collect them, with the amount collected varying according to seasonality, access and options, consume a significant proportion of forest products. Most of the available information is descriptive and often extremely situation specific. While studies on fuel wood or specific forest products have been conducted, censuses and surveys do not usually include information on household-level use or activities for a more complete range of forests products (Byron and Arnold, 1999). It is estimated that one quarter of the world’s poor depend directly or indirectly on forests for their livelihood (World Bank, 2000b) although the nature of the dependence vary greatly (Shepherd, Arnold and Bass, 1999). Forest contribution to livelihoods thus encompasses income from agriculture (shifting cultivation), as well as income from forest products. Forest-related income include revenue from sale of crops or livestock for which forest nutrients or fodder were essential (Shepherd, Arnold and Bass, 1999). By this way, forests act as reserve or safety net, providing both subsistence and income in times of crop failure, shortfall, and unemployment or other emergency or hardship, or to meet exceptional needs. The foregoing study, therefore, examined the various ways in which forests help to alleviate rural poverty for people living in a forest environment. This paper is limited to discussing the role played by forests in alleviating rural poverty in Kenya. Several measures of poverty have been suggested.
process, India has become one of the largest economy in the world. According to the National Sample Survey results, people living below poverty line have dramatically come down during the post economic reform era. People living below poverty line (BPL) came down from 45.3% in 1993-94 to 37.2% in 2004-05 and further to 21.9% in 2011-12. The percentage of persons below the Poverty Line in 2011-12 has been estimated as 25.7% in rural areas, 13.7% in urban areas and 21.9% for the country as a whole (Planning Commission). The proportion of children under three years of age who are underweight decreased from 43 percent in NFHS-2 to 40 percent in NFHS-3. According to the National Sample Survey data of the 66th round (2009-10) Average dietary energy intake per person per day was 2147 Kcal for rural India and 2123 Kcal for urban India. The proportion of households with calorie intake below average Kcal per consumer unit per day was 42.5% for rural and 45% for urban households. In 2011-12, India had 270 million persons below the Tendulkar Poverty Line as compared to 407 million in 2004-05, that is reduction of 137 million persons over seven year period. India accounts for one-third of the world poor, people living on less than USD 1.25 (about Rs 65) per day, a World Bank report (2013) on poverty has said. Urbanization in this country is mainly due to acute poverty in rural areas rather than due to the economic opportunities in urban areas. One half of India’s poor is located the three states of Bihar, Uttar Pradesh and Madhya Pradesh. Maharashtra, West Bengal and Odisha account for 22.5% of poverty. About two thirds of India’s population live in rural areas, and almost 170 million of them are poor (NSSO). Although many rural people are migrating to cities, 3 out of 4 of India’s poor people live in the vast rural parts of the country (NSSO). Poverty is deepest among scheduled castes and tribes in the country’s rural areas. India’s poorest people include 50 % of members of scheduled tribes and 40 % of people in scheduled castes (NSSO).On the map of poverty in rural India, the poorest areas lie in parts of Rajasthan, Madhya Pradesh, Uttar Pradesh, Bihar, Jharkhand, Chhattisgarh, Odisha and West Bengal. As per the latest NSSO survey reports there are over 80 million poor people living in the cities and towns of India. The Slum population is also increasing and as per estimates over 61.80 million people were living in slums. With over 575 million people, India will have 41% of its population living in cities and towns by 2030 of its nearly 1 billion inhabitants, an estimated 260.3 million are below the poverty line, of which 193.2 million are in the rural areas and 67.1 million are in urban areas (NSSO).