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Marc F. Bellemare Posts

Published May 24, 2013

Can Urban Agriculture Help with Food Security?

UPDATE (June 26, 2013): It turns out that the paper I had initially linked to in the post below appears to have plagiarized the following paper by Alberto Zezza and Luca Tasciotti:

Zezza, A., and L. Tasciotti (2010), “Urban Agriculture, Poverty, and Food Security. Empirical Evidence from a Sample of Developing Countries,” Food Policy 35(4): 265-273.

If you compare the two abstracts, they are eerily similar to one another. My apologies to Alberto and Luca. I will publish a post rectifying the situation in the next few business days.

(ORIGINAL CONTENT EDITED OUT.)

Published May 22, 2013

Is Industrial Policy the Key to Haiti’s Economic Development?

At the industrial park, female workers wearing chartreuse aprons and headscarves stream out of the blue factory buildings on their lunch break. Frandline Joseph sits outside. She sews for Sae-A and says she doesn’t like the work: “I don’t have time to sit.”

But she also says that she had no job before her current one, and life has improved since finding employment. “Now I work for 200 gourdes,” [Note: $5 daily — MFB.] she says, and can pay her daughter’s school fees in a country with a virtually non-existent public education system. “Before the park, I worked for nothing.”

Her story is similar to other published accounts, and that of Rosedaline Jean, a 22-year-old who’s worked for Sae-A for five months. “Before, I lived only by the grace of God,” says Jean. “Although I don’t have a husband or children, my life wasn’t easy because I wasn’t working. When I got here, a lot changed in my life.

“This isn’t the ideal job,” she continues, “but it’s better than nothing. I don’t intend to make a career in this job. I plan to start a business, and I’m already saving for it. But it’s difficult, because my salary is practically nothing.”

From an article by Tate Watkins in The Atlantic.

Continue readingIs Industrial Policy the Key to Haiti’s Economic Development?
Published May 21, 2013

The Miracle of Microfinance?

This paper reports on the first randomized evaluation of the impact of introducing the standard microcredit group-based lending product in a new market. In 2005, half of 104 slums in Hyderabad, India were randomly selected for opening of a branch of a particular microfinance institution (Spandana) while the remainder were not, although other MFIs were free to enter those slums. Fifteen to 18 months after Spandana began lending in treated areas, households were 8.8 percentage points more likely to have a microcredit loan. They were no more likely to start any new business, although they were more likely to start several at once, and they invested more in their existing businesses. There was no effect on average monthly expenditure per capita. Expenditure on durable goods increased in treated areas, while expenditures on “temptation goods” declined. Three to four years after the initial expansion (after many of the control slums had started getting credit from Spandana and other MFIs), the probability of borrowing from an MFI in treatment and comparison slums was the same, but on average households in treatment slums had been borrowing for longer and in larger amounts. Consumption was still no different in treatment areas, and the average business was still no more profitable, although we find an increase in profits at the top end. We found no changes in any of the development outcomes that are often believed to be affected by microfinance, including health, education, and women’s empowerment. The results of this study are largely consistent with those of four other evaluations of similar programs in different contexts.

A new working paper (older, ungated copy here) by Duflo et al. The emphasis is mine.

This is consistent with another careful study (link opens a .pdf file) by Crépon et al. of the impact of microfinance in Morocco, where there authors also find that microfinance has no discernible impact on the usual development indicators (i.e., consumption, health, education, etc.)

To be sure, microfinance does appear to have some impacts, as the abstract above indicates — just not the miraculous impacts that are often touted by microfinance advocates.