Does Relative Income Matter for the Very Poor? Evidence from Rural Ethiopia

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Does relative income have an impact on subjective well-being among extremely poor people? Contrary to the findings in developed countries, where relative income has shown a significant and negative impact on subjective well-being, this study (based on different definitions of reference groups) suggests that relative income does not affect subjective well-being among the very poor people in northern Ethiopia.

 

Experiments

Estimating Returns to Soil and Water Conservation Investments: An Application to Crop Yield in Kenya

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The authors investigated the impact of soil and water conservation (SWC) investment on farm productivity in Kenya. They focused on plots with and without SWC, testing whether increased SWC is beneficial for yield and affects input levels, input returns, and crop characteristics.

Agriculture

Fast Track Land Reform and Agricultural Productivity in Zimbabwe

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EfD Authors:

The author investigated the Zimbabwean Fast Track Land Reform Program’s (FTLRP) impact on the agricultural productivity of its beneficiaries. The data revealed significant differences between beneficiaries and a control group of communal farmers in household and parcel characteristics and input usage.

 

Agriculture

Environmental Policy, Fuel Prices, and the Switch to Natural Gas in Santiago, Chile

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EfD Authors:

The author analyzes the role of environmental policies and energy cost savings in the switch to natural gas by stationary sources in Chile. There is skepticism about using market-based policies (economic instruments) in the developing world—permit trading programs versus emissions fees. This paper produces new evidence of the role of environmental regulations and market forces in a successful air-quality improvement program in Chile, a less-developed country.

Policy Design

Taxes, Permits, and the Diffusions of a New Technology

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EfD Authors:

The author looks at the effects of the choice between taxes and permits on the pattern of adoption of a new emissions abatement technology. The regulator determines the optimal ex-post amount of emissions before firms start to adopt the technology. Each firm decides when to adopt, considering benefits, costs, and advantage gained over their rivals, producing a sequence of adoption that is “diffused” into the industry over time.

Policy Design

Trade, GMOs, and Environmental Risk: Are Policies Likely to Improve Welfare?

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Controversy over the EU import ban on food from genetically modified organisms (GMOs) forced the EU to change course and institute a mandatory labeling scheme. This study first examined how different policies for the production and use of GMOs might influence the market outcome in consumer food markets. Second, it evaluated the welfare effects of the policy measures, finding that mandatory labeling often increases both domestic welfare and global welfare, while trade bans more likely decrease global welfare.

 

Policy Design

Determinants of Household Fuel Choice in Major Cities in Ethiopia

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This paper examines the multiple fuel choices of urban households in major Ethiopian cities, using panel data collected in 2000 and 2004. The results suggest that as urban and rural households’ total expenditures rise, they use more types of fuels (including wood) and spend more on the fuels consumed. The results also support arguments that multiple fuel use better describes the fuel-choices of households in developing countries, as opposed to the idea that households switch to more expensive but cleaner fuels as incomes rise.

 

Energy