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Trade and Poverty in Rural Africa The role of nutrition, population dynamics, and farm productivity William A. Masters Purdue University www.agecon.purdue.edu/staff/masters Woodrow Wilson Center -- April 15, 2005. How do African farmers respond to shocks?. physical capital livestock soils!
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Trade and Poverty in Rural AfricaThe role of nutrition, population dynamics, and farm productivityWilliam A. MastersPurdue Universitywww.agecon.purdue.edu/staff/mastersWoodrow Wilson Center -- April 15, 2005
How do African farmers respond to shocks? • physical capital • livestock • soils! • human capital • nutrition • children • social capital • networks (as opposed to markets) • conflict (as opposed to cooperation)
Consumption levels have fallen to be among the world’s lowest Data and projections on childhood underweight, 1995-2015
Undernutrition is the developing world’s leading cause of ill-health Attribution of disease burden to major risk factors (estimates for high-mortality developing countries, 2000)
The rural poor are particularly undernourished Stunting by residence and wealth Source: FAO (2004), The State of Food Insecurity in the World 2004. Rome, FAO.
Poverty is closely linked to institutions and social capital
Food-crop output has been a key difference between Africa and Asia
To raise food-crop productivity, Africa has a lot of catch-up to do
The pace of farm productivity growth is driven by new-variety adoption
R&D levels vary across countries but have not grown over time
R&D has varied but high payoffs Estimated return to agricultural research and extension (%/year) Source: Alston, J.M., M.C. Marra, P.G. Pardey, and TJ Wyatt. 2000. "Research returns redux: A meta-analysis of the returns to agricultural R&D." Australian Journal of Agricultural and Resource Economics, 44(2): 185-215.
…and sustaining sufficient public investment has been difficult!
New funding mechanismsmay be helpful • The value of successful food-crop techniques spreads widely among low-income people • Private firms can’t recover costs • Donors have difficulty contracting for appropriate R&D or dissemination efforts • …but welfare gains can be measured, so donors could pay innovators after adoption • payments can be proportional to gains • innovators can choose what data to submit • secretariat can spot-check and certify accuracy
Conclusions • To facilitate trade for the poorest people, local food-crop productivity must rise • To improve nutrition, health and schooling • To free resources for other things • African farmers face unusual obstacles • Including much less of the public R&D needed to generate appropriate new varieties • Donors can and do fund R&D programs directly, but contracting is difficult • A proposd way to facilitate investment is at: www.earth.columbia.edu/cgsd/prizes • .