Food-for-work (FFW) programs are commonly used both for short-term relief and long-term development purposes. This paper assesses the potential of FFW programs to reduce poverty and promote sustainable land use in the longer run.
There is a danger that such programs distort
labor allocation or crowd out private investments and therefore have
unintended negative effects. We explore this issue using survey evidence
from northern Ethiopia that we use to motivate a simple theoretical
model, a more detailed version of which we then implement through an
applied bio-economic model calibrated to northern Ethiopia. The analysis
explores how FFW project outcomes may depend on FFW project design,
market conditions, and technology characteristics. We show that FFW
programs may either crowd out or crowd in private investments and
highlight factors that condition whether FFW promotes or undercuts
sustainable land use.
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