Marc F. Bellemare Posts

As promised, here is the third of eight lectures I have given at the University of Copenhagen in May for a course title Causal Inference with Observational Data.

Stay tuned for lectures 4 to 8 over the next few weeks as I revise them.

If you’ve been reading this blog for more than a few months, you may remember that I was invited to teach a course titled Causal Inference with Observational Data by the University of Copenhagen’s Department of Food and Resource Economics. I co-taught the course from May 14 to 18 with my Copenhagen colleague Arne Henningsen–I taught the lectures, and he taught the labs.

I wanted to make the lectures for the course publicly available bit by bit, and so today I am posting the first two lectures: 1. Introduction, and 2. Causality. I will be posting lectures 3 to 8 over the next few weeks.

Speaking of causality, Judea Pearl–a pioneer of causality, with his eponymous textbook–has a new popular-press book out discussing his pioneering work and the Causal Revolution of the last 30 years, titled The Book of Why. I started reading it last week and it is excellent.

Also, a post last month by Matt Bogard drew my attention to this American Journal of Public Health article, in which the author argues that authors (and reviewers and editors) should stop being afraid to use the word “causal,” arguing that “being explicit about the causal objective of a study reduces ambiguity in the scientific question, errors in the analysis, and excesses in the interpretation of the results.”

The article’s clever title aside, I feel as though this might be a public health-specific problem. In the literature in which I work, the causal goal of the typical study, although often implicit, is usually pretty obvious, and by talking of associations and being gun-shy regarding using the word “causality,” we are only exercising the proper caution necessary when speaking to policy makers, who often exhibit wishful thinking.

I have been working on the topic of contract farming for 12 years. Although two thirds of my dissertation were about sharecropping, the third and last essay was about contract farming.

Given that it is the topic on which I have written the most so far in my career, at the end of last year, I pitched the idea of writing a review of the empirical economics literature on contract farming to a journal editor colleague. The end result, written with my doctoral student Jeff Bloem, is here.

Here is the abstract:

Although many urban areas around the world have grown steadily in recent years, the structural transformation, wherein an economy goes from relying primarily on agriculture and natural resources to relying primarily on manufacturing, has eluded many developing countries. In those countries, contract farming, whereby processors contract out the production of some agricultural commodity to growers, is often seen as a means of spurring the development of an agribusiness sector, and thus launch the structural transformation. As a result, contract farming has been extensively researched by economists and other social scientists over the last 30 years. We review the findings of the economics literature on contract farming and discuss its implications for development policy and research. In so doing, we highlight the methodological weaknesses that limit much of the literature on contract farming in answering questions of relevance for policy. Despite valiant research effort, many of the core features of contract farming imply substantial challenges for researchers aiming to study the question “Does contract farming improve welfare?” We conclude with a discussion of where we see the literature on contract farming evolving over the next few decades.

Comments are not only welcome, they are eagerly solicited.