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This chapter looks at food system innovations and digital technologies as important drivers of productivity growth and improved food and nutrition security. The analysis emphasizes a mix of research feasibility and technology-enabling policy factors necessary to realize pro-poor benefits. Given their transformative potential and the urgency of developing the enabling R&D and policy trajectories required for impact, we highlight genome editing bio-innovations, specifically CRISPR-Cas9, to address sustainable agricultural growth; and digital technologies, including remote sensing, connected sensors, artificial intelligence, digital advisory services, digital financial services, and e-commerce, to help guide the operations and decision-making of farmers, traders, and policymakers in agricultural value chains.The analysis points to the need to close critical gaps in R&D investments, capabilities, and enabling policies and regulations to accelerate the scaling and adoption of innovations. At the global level, the engagement of low- and middle-income countries (LMICs) with global players should be facilitated to strengthen intellectual property (IP) access and the management of innovations; and North–South, South–South, and triangular cooperation should be promoted to strengthen LMICs’ regulatory capabilities. At the national level, countries need to invest in science-based participatory approaches to identify and adapt technologies to local conditions; close regulatory gaps through evidence-based frameworks that enable the rapid development, deployment, and safe use of innovations; close institutional and human capacity gaps by addressing limitations in institutional capacities and coordination, while training a new generation of scientists with the skills needed to develop and deliver innovations; develop an understanding of political economy factors for a nuanced knowledge of actors’ agendas to better inform communications and address technology hesitancy; close digital infrastructure gaps in rural areas by promoting simultaneous investments in digital infrastructure and electrification, reducing data costs, and improving digital literacy; and develop sustainable business models for digital service providers to help them achieve profitability, interoperability, and scale to reach a sustainable critical mass, and thus facilitate the adoption of food system innovations.

This article examines the implications of urban growth on youth migration decisions in Nigeria. We use night light intensity data combined with Living Standards Measurement Study‐Integrated Surveys on Agriculture data, as an indicator of urban growth and associated economic opportunities. Employing alternative econometric approaches that exploit the spatial and temporal differences in urban growth as proxied by night light intensity, we find that urban growth in potential migrant destinations encourages youth migration. We also find heterogeneous responses to urban growth among various groups of youth as well as varying responses to different types of migration. Broadly, women and those youth with more education are more likely to migrate, while those in households with livestock are less likely to migrate. Often, however, the effects are complex and varied. For example, land and physical asset ownership encourage temporary migration; but greater land ownership discourages permanent migration, while physical assets have insignificant effects. Our results from Nigeria show that policy makers concerned about rural–urban youth exodus should adopt a differentiated, in terms of targets, and multidimensional policy approach to reap the benefits of urbanization while avoiding its negative consequences.

Without changes in consumption, along with sharp reductions in food waste and postharvest losses, agricultural production must grow to meet future food demands. The variety of concepts and policies relating to yield increases fail to integrate an important constituent of production and human nutrition - biodiversity. We develop an analytical framework to unpack this biodiversity-production mutualism (BPM), which bridges the research fields of ecology and agroeconomics and makes the trade-off between food security and protection of biodiversity explicit. By applying the framework, the incorporation of agroecological principles in global food systems are quantifiable, informed assessments of green total factor productivity (TFP) are supported, and possible lock-ins of the global food system through overintensification and associated biodiversity loss can be avoided.

We analyse implications of financial sector dynamics for fiscal expenditure multipliers in recessionary conditions. A new stock-flow consistent model is developed in which a financial sector with four financial instruments is integrated with the real sector. The transmission of policy innovations occurs through balance sheet effects. Higher government expenditure increases aggregate demand in the economy. This reduces the perceived probability of default on financial institutions’ loans, increases asset valuations, and leads financial institutions to reduce interest rate spreads. Expectations of higher future wealth and a reduction in credit constraints supports consumption growth. Stronger balance sheets across institutions and lower interest rates increase investment. The interaction between growth and balance sheet valuations creates financial accelerator effects though its impact on financial sector risk-taking. Inflows of foreign savings can increase the multiplier further than would be the case in a closed economy constrained by domestic savings. The results show that fully modelling interactions between real and financial sectors generates fiscal multipliers higher than have been found for South Africa in other types of model.

Climate change is one of the most complex challenges facing South Africa as the country designs plans and policies for future economic growth and development. Higher temperatures and more variable rainfall are already affecting the economy and are expected to continue for decades. The degree to which climate change affects different regions in South Africa is likely to vary significantly, characterized by wide ranges in the direction and magnitude of change in key climate variables, especially precipitation. These uncertainties interact with South Africa’s growth and development challenges and complicate planning and policy formation in support national development objectives. This chapter presents key research on changes in climate experienced in South Africa in recent years, along with projected changes in years to come. It illustrates the uncertainties related to climate change and the key channels through which climate change affects the economy. The economic and developmental impacts of such changes are presented along with the lessons for adaptation policy. As energy will be a key focus area for mitigation efforts in the country, this chapter also outlines the implications of such a transition and the factors that need to be accounted for in limiting the impacts on vulnerable populations.

We present results from large ensembles of projected twenty-first century changes in seasonal precipitation and near-surface air temperature for the nation of South Africa. These ensembles are a result of combining Monte Carlo projections from a human-Earth system model of intermediate complexity with pattern-scaled responses from climate models of the Coupled Model Intercomparison Project Phase 5 (CMIP5). These future ensemble scenarios consider a range of global actions to abate emissions through the twenty-first century. We evaluate distributions of surface-air temperature and precipitation change over three sub-national regions: western, central, and eastern South Africa. In all regions, we find that without any emissions or climate targets in place, there is a greater than 50% likelihood that mid-century temperatures will increase threefold over the current climate’s two-standard deviation range of variability. However, scenarios that consider more aggressive climate targets all but eliminate the risk of these salient temperature increases. A preponderance of risk toward decreased precipitation (3 to 4 times higher than increased) exists for western and central South Africa. Strong climate targets abate evolving regional hydroclimatic risks. Under a target to limit global climate warming to 1.5 °C by 2100, the risk of precipitation changes within South Africa toward the end of this century (2065–2074) is commensurate to the risk during the 2030s without any global climate target. Thus, these regional hydroclimate risks over South Africa could be delayed by 30 years and, in doing so, provide invaluable lead-time for national efforts to prepare, fortify, and/or adapt.

Since 2007, large and unexpected declines in generation costs for renewable energy systems, particularly solar but also wind, combined with policy measures designed to limit greenhouse gas emissions, have created a paradigm shift in energy systems. Variable renewable energy now dominates total investment in electricity power generation systems. This dominance of variable renewable energy in investment has thrust the systems integration task of matching electricity supply with demand to center stage, presenting new challenges for energy policy and planning as well as for the institutional organization of power systems. Despite these challenges, there is ample reason to believe that variable renewables will attain very high levels of penetration into energy systems, particularly in regions well endowed with solar and wind potential. Similar to their success with mobile phone telephony, many developing countries have a significant opportunity to leapfrog directly to more advanced energy technologies that are low cost, reliable, environmentally more benign, and well suited to serving dispersed rural populations.

We consider the interplay of climate change impacts, global mitigation policies, and the economic interests of developing countries to 2050. Focusing on Malawi, Mozambique, and Zambia, we employ a structural approach to biophysical and economic modeling that incorporates climate uncertainty and allows for rigorous comparison of climate, biophysical, and economic outcomes across global mitigation regimes. We find that effective global mitigation policies generate two sources of benefit. First, less distorted climate outcomes result in typically more favorable and less variable economic outcomes. Second, successful global mitigation policies reduce global fossil fuel producer prices, relative to unconstrained emissions, providing a substantial terms of trade boost of structural fuel importers. Combined, these gains are on the order of or greater than estimates of mitigation costs. These results highlight the interests of most developing countries in effective global mitigation policies, even in the relatively near term, with much larger benefits post-2050.

This introductory paper sets out the rationale for revisiting questions surrounding biofuel futures in Southern Africa and exploring the case for the establishment of a regional market. This contrasts with most research that has focused upon benefits and risks of production and consumption for individual countries. The analysis in this issue suggests that while benefits exist, the key challenges that have stifled production and consumption to date would need to be overcome. Unlocking trade requires relaxing requirements for South African manufacturers to source all their feedstock domestically. Key among factors to encourage production is resolving agricultural investment processes, particularly designing inclusive business models and clarifying land acquisition processes.

The last 10 years have witnessed a surge in international focus on the long-term health and socioeconomic impacts of malnutrition. Here, we employ a rights consistent approach to evaluate the nutritional welfare of children under 5 years in Malawi, Mozambique, Tanzania, Zambia, and Zimbabwe. Specifically, we apply a first order dominance (FOD) approach to multidimensional welfare measurement. In this context, nutritional welfare dimensions are treated as rights. With the FOD approach, comparisons across time and space adhere to key principles set forth in the Universal Declaration of Human Rights. For comparison, we also apply the Alkire-Foster (AF) approach, which is well known for its application in the United Nations Development Programme's Multidimensional Poverty Index. Indicators relevant to the nutritional welfare of young children are drawn from Demographic and Health Surveys (DHS) from the early- to mid-2000s and the most recent data point. Four common welfare indicators crucial to child nutrition are employed in both the FOD and AF approaches: stunting/wasting, drinking water, sanitation facilities, and mother's education. Over time, all countries advanced the nutritional wellbeing of children at the national and rural levels. Malawi made the most pronounced gains improving its rank among the 5 countries considered from fourth to second among nations and among urban areas. Though Mozambique made substantial progress in access to urban and rural water, rural sanitation, and urban education, relatively small gains in stunting and wasting widened the nutritional welfare gap with its neighbors. Nationally, nutritional welfare levels in Mozambique remain notably low ranking below the rural areas in all other countries. Even urban areas in Mozambique are ranked below rural Malawi and rural Zimbabwe. Stagnation or decline in access to safe urban water and/or sanitation, as well as nutrition in Mozambique, prevented advance in the urban areas of Mozambique, Tanzania, Zambia, and Zimbabwe.

This paper is concerned with the recovery phase from the severely depressed levels of economic activity that occurred in April 2020 with a focus on measures to accelerate recovery in the short term. We first consider available information on economic performance during the pandemic. Overall, the recovery has been rapid but unbalanced. In most sectors, production has returned close to 2019 levels so has aggregate household spending. To analyze recovery, we model policy impacts over four quarters. Simulations combine Covid intervention polices combined with alternative financing options. All scenarios are run from the 4th Quarter of 2020 to the 3rd Quarter of 2021. The most aggressive option, funded by reduced government savings, adds 2% to GDP over the period of observation. Financing matters. If the most aggressive intervention is financed by raising taxes of the top decile, a 0.7% increase in GDP is achieved. All intervention plans are strongly progressive. Further, even in the most aggressive scenario financed by reduced government savings, the government debt to GDP ratio actually declines higher GDP and higher tax collections as a consequence of greater economic activity more than fully offset the increment to government debt. We conclude that the South African government has been justified in considering and implementing aggressive intervention policies. Maintenance of these policies is appropriate as long as public health measures to restrain spread of Covid-19 also constrain economic activity. At the same time, there is little scope to expand interventions before the economy encounters the structural constraints that were severely depressing economic growth rates pre-pandemic. Assuming vaccines will allow return to more normal behavior towards the end of 2021, government needs to consider both tapering of extraordinary Covid-19 support programs and addressing structural growth constraints.

This paper considers different approaches to modelling the economic impact of the COVID-19 pandemic/lockdown shocks. We review different modelling strategies and argue that, given the nature of the bottom-up recession caused by the pandemic/lockdowns, simulation models of the shocks should be based on a social accounting matrix (SAM) that includes both disaggregated sectoral data and the national accounts in a unified framework. SAM-based models have been widely used to analyze the impact of natural disasters, which are comparable to pandemic/lockdown shocks. The pandemic/lockdown shocks occurred rapidly, in weeks or months, not gradually over a year or more. In such a short period, adjustments through smooth changes in wages, prices and production methods are not plausible. Rather, initial adjustments occur through changes in quantities, altering demand and supply of commodities and employment in affected sectors. In this environment, we use a linear SAM-multiplier model that specifies a fixed-coefficient production technology, linear demand system, fixed savings rates, and fixed prices. There are three different kinds of sectoral shocks that are included in the model: (1) changes in demand due to household lockdown, (2) changes in supply due to industry lockdown, and (3) changes in demand due to induced macro shocks. At the detailed industry level, data are provided for all three shocks and the model imposes the largest of the three. We applied the model on a monthly time step for the period March to June 2020 for four countries: US, UK, Mexico, and South Africa. The models closely replicate observed macro results (GDP and employment) for the period. The results provide detailed structural information on the evolution of the different economies month-by-month and provide a framework for forward-looking scenario analysis. We also use the SAM-multiplier model to estimate the macro stimulus impacts of policies to support affected households. The model focuses attention on the structural features of the economy that define the multiplier process (who gets the additional income and what do they do with it) and provides a more nuanced analysis of the stimulus impact of income support programs than can be done with aggregated macro models.

Interest is growing in the research literature in exploring how child nutrition is affected by sociocultural practices, such as polygyny. However, evaluation of the effect of polygyny on child nutrition is hindered by the complexity of the relationship. This paper investigates the effect of polygyny on anthropometric outcomes while recognising that unobservable household characteristics may simultaneously influence both the decision to form a polygynous union and the ability of the household to adequately nourish children. We apply an instrumental variable approach based on the occurrence of same-sex siblings in a woman’s first two births to generate exogenous variation in polygyny. Using data from the 2008 and 2013 Nigeria Demographic and Health Surveys, we find a detrimental effect of polygyny on child undernutrition. Our results show that the effect of polygyny is substantially reduced when we control for household characteristics, suggesting that part of the link between polygyny and child undernutrition is mediated through these channels. Nevertheless, the estimated coefficients of polygyny remain sizeable and strongly statistically significant even after controlling for these characteristics. Polygynous families may have different behavioural childcare practices, and/or the reduced bargaining power of women associated with polygynous families could be associated with higher rates of child undernutrition.

Absent vaccines and pharmaceutical interventions, the only tool available to mitigate its demographic effects is some measure of physical distancing, to reduce contagion by breaking social and economic contacts. Policy makers must balance the positive health effects of strong distancing measures, such as lockdowns, against their economic costs, especially the burdens imposed on low income and food insecure households. The distancing measures deployed by South Africa impose large economic costs and have negative implications for the factor distribution of income. Labor with low education levels are much more strongly affected than labor with secondary or tertiary education. As a result, households with low levels of educational attainment and high dependence on labor income would experience an enormous real income shock that would clearly jeopardize the food security of these households. However, in South Africa, total incomes for low income households are significantly insulated by government transfer payments. From public health, income distribution and food security perspectives, the remarkably rapid and severe shocks imposed because of Covid-19 illustrate the value of having in place transfer policies that support vulnerable households in the event of ‘black swan’ type shocks., Highlights • SAM multiplier analysis is used to assess the burdens on food insecure households imposed by strict lockdowns. • The distancing measures deployed by South Africa impose large reductions in wage income particularly for low-skilled workers. • Initial lockdown policies will jeopardize the food security of low-income households dependent on labor income. • The effects of the COVID-19 pandemic illustrate the value of transfer policies that support vulnerable households.

Mozambique is one of the most promising African countries for producing biofuels and the national biofuel policy of 2009 identifies measures to incentivize biofuel production. Demand for biofuels i...

Potential biofuel demand in South Africa is estimated to increase to 1550 million litres by 2025 due to mandatory blending rates. Land and water constraints, however, limit the ability for domestic...

The decade to 2015 saw rapid growth in trade between Southern African Development Community (SADC) countries. Much of this growth reflected South African exports to its neighbours of divers...

The Republic of South Africa faces the imperative of escaping economic stagnation. This article seeks to synthesise results from a series of research efforts, including but not limited to the articles presented in this special issue, and consider policy options for escaping economic stagnation. The focus is on South Africa and South African policies yielding relatively quick dividends in terms of growth and taking the rest of the world as given. Four broad implications are presented. These could form part of a concerted effort to escape from South Africa's long running economic malaise.

Aid and aid institutions constitute an important element of the global response to interlinked global developmental and environmental challenges. As such, these institutions are now being drawn into new arenas beyond the traditional focus on improving the livelihoods of poor people in low-income countries. Development aid, by itself, cannot “save the planet.” Nevertheless, development aid and development institutions do have the potential to become important catalytic actors in achieving developmental and global environmental objectives. This requires bold reforms and political action. Without appropriate restructuring of the international institutional architecture to confront the new development context combined with the necessary complementary policy frameworks, future aid, including aid for environmental objectives, risks substantially under-performing.

In trying to limit the spread of COVID-19, policymakers are confronting the difficult task of balancing the positive health effects of lockdowns against their economic costs — particularly the burdens imposed on low-income and food-insecure households. South African lockdown policies are relatively stringent, and the economic impacts are large. Figure 1 presents impacts on the income components of gross domestic product (GDP), based on an analysis using a social accounting matrix (SAM) model, a tool well-suited to assessing the impacts of shortterm shocks. The work is a collaboration between IFPRI, the National Treasury of South Africa, the South African Reserve Bank, and UNU-WIDER.

Little is known about the impacts of urbanization on women’s attitudes toward intimate partner violence (IPV). The scarcity of empirical studies on this relationship can be partly attributed to the lack of an objective measure of urbanization levels. In this study, we investigate the effects of urbanization on both women’s attitudes toward IPV using three continuous measures of urbanization: nightlight intensity, distance to urban areas, and total urban area within a 10-km radius. These measures are defined from satellite-based nighttime-light-intensity and multispectralsensor data. We find that despite a generally strong positive association between urbanization and progressive attitudes among women toward IPV, some stages of urbanization show a more significant association than others. Such nonlinear relationships are apparent in all estimations and across different measurements of urbanization. The heterogeneities in the effect of urbanization on women’s attitudes toward intimate partner violence further show that the effects of urbanization are sharply heterogeneous across wealth indicator terciles. While we find that urbanization is associated with an overall decrease in the acceptance of IPV, the effect is mostly concentrated in higher wealth terciles. For women in lower wealth terciles, urbanization is either insignificant or even associated with an increase in the acceptance of IPV.

Without changes in consumption, along with sharp reductions in food waste and postharvest losses, agricultural production must grow to meet future food demands. The variety of concepts and policies relating to yield increases fail to integrate an important constituent of production and human nutrition – biodiversity. We develop an analytical framework to unpack this biodiversity-production mutualism (BPM), which bridges the research fields of ecology and agroeconomics and makes the trade-off between food security and protection of biodiversity explicit. By applying the framework, the incorporation of agroecological principles in global food systems are quantifiable, informed assessments of green total factor productivity (TFP) are supported, and possible lock-ins of the global food system through overintensification and associated biodiversity loss can be avoided.

A propitiously timed household survey carried out in Mozambique over the period 2008/2009 permits us to study the relationship between shifts in food prices and child nutrition status in a low income setting. We focus on weight-for-height and weight-for-age in different survey quarters characterized by very different food price inflation rates. Using propensity score matching techniques, we find that these nutrition measures, which are sensitive in the short run, improve significantly in the fourth quarter of the survey, when the inflation rate for basic food products is low, compared to the first semester or three quarters, when food price inflation was generally high. The prevalence of underweight, in particular, falls by about 40 percent. We conclude that the best available evidence points to food penury, driven by the food and fuel price crisis combined with a short agricultural production year, as substantially increasing malnutrition amongst under-five children in Mozambique.

This special issue focuses on a collaborative effort between the National Treasury and the South African Revenue Service (SARS) to employ administrative record data from SARS for economic policy analysis. It contains six research articles plus a synthesis article designed to draw out potential policy implications and to place this research into a broader context. Exploitation of tax administrative record data has become global best practice. We conclude that this effort demonstrates strong prospects for developing a better understanding of the South African economy with positive implications for economic policy formulation.

The implications of urbanization on child nutritional outcomes are investigated using satellite-based nighttime light intensity data as a marker of urbanization with data from two rounds of the Nigeria Demographic and Health Survey. Nighttime light introduces a gradient of urbanization permitting investigation of the implications of urbanization on child nutritional outcomes along an urbanization continuum. Nightlight is found to significantly predict child nutritional outcomes even after controlling for observable covariates known to influence child nutrition. In all specifications, improvements in child nutrition outcomes onset with relatively low levels of light emissions and continue rapidly as nightlight intensity increases before largely leveling off. These nonlinear relationships highlight the value of nightlight as a population agglomeration indicator relative to traditional binary rural-urban indicators. Consistent with other recent work, patterns of urbanization influence welfare outcomes. At least for Nigeria, a pattern that extends the benefits of urban agglomeration to larger shares of the population would speed improvements to child nutritional outcomes.

The rights-based approach to development targets progress towards the realization of 30 articles set forth in the Universal Declaration of Human Rights. In current practice, progress is frequently measured using the multidimensional poverty index. While elegant and useful, the multidimensional poverty index is inconsistent with the Universal Declaration of Human Rights principles of indivisibility, inalienability, and equality. We argue that a first-order dominance (FOD) methodology maintains basic consistency with these principles. Specifically, FOD comparisons are independent of any applied weighting schemes and hence are free from assumptions regarding substitutability between included welfare indicators (indivisibility). FOD cannot be established when welfare in any indicator is deteriorating, no matter how great the advancement is in other indicators (inalienability). Finally, FOD requires that domination occurs throughout the population (equality), implying that welfare gains among better-off groups never offset welfare losses among worse-off groups. We discuss and compare the properties of the multidimensional poverty index and first-order dominance approach and apply both measures to 26 African countries using data near 2002 and 2012. Results across the two measures are broadly similar but not the same. For example, while the multidimensional poverty index suggests that all countries are advancing, FOD indicates that 14 countries experience broad-based progress, two countries show more moderate likelihoods of progress, and the remaining 10 countries neither improve nor deteriorate in terms of attainment of rights for the dimensions considered. We conclude that the multidimensional poverty index and first-order dominance approaches are useful complements that should be employed in tandem.

The present study develops a reliability assessment method of wind resource using optimum reservoir target power operations that maximizes the firm generation of integrated wind and hydropower. A combination of water resources model for a system of reservoirs that implements a demand–priority based linear programing algorithm and a single node power grid system model is implemented on hourly time step. This model was accompanied by a global genetic algorithm solver to determine optimum operation targets for each storage reservoir aiming at maximizing the 90th percentile power generation produced by the integration of wind and hydro over the entire simulation period. This model was applied on the reservoir storages and hydropower system in the Zambezi river basin to test if the storage reservoirs could be efficiently be used to offset wind power intermittence in South Africa subjected to the different physical and policy constraints. Based on the optimized target operation and hourly annual real data for the year 2010, the water resources system and power interconnection system were simulated together to assess the maximum firm generation of power as a result of the new wind and hydro combination target for storage hydropower plants. The result obtained indicates that high regulation of wind and hydro can be achieved as a result of combined operation and showed 45% increase in the level of wind penetration in South Africa’s power system over the reference scenario. The result also indicated a reduced level of coal power utilization and less cycling requirement. This will have a positive outcome in terms contributing to South Africa’s goal toward reducing greenhouse gas emission and the efforts to build green energy supply and resilience to the impacts of climate change.

We develop a sequential approach to link a bottom-up energy sector model to a detailed dynamic general equilibrium model of South Africa. The approach is designed to simultaneously address the shortcomings and maintain the attractive features of detailed energy sector and general equilibrium models. It also reflects common country-level energy planning processes. We illustrate the capabilities of this integrated bottom-up approach by analyzing the implications of (i) a carbon tax, (ii) liberalization of import supply restrictions in order to exploit regional hydropower potential, and (iii) a combined policy where both carbon taxes and import liberalization are pursued. For the combined scenario, our results suggest substantial emissions reductions relative to Baseline at essentially no cost to economic growth but about a one percent reduction in employment. We conclude that a regional energy strategy, anchored in hydropower, represents a potentially inexpensive approach to decarbonizing the South African economy. The strategy also has political economy attractions in that the combined approach reduces the burden of adjustment of politically sensitive sectors.

We explore a novel first-order dominance (FOD) approach to poverty mapping and compare its properties to small-area estimation. The FOD approach uses census data directly, is straightforward to implement, is multidimensional allowing for a broad conception of welfare and accounts rigorously for welfare distributions in both levels and trends. An application to Mozambique highlights the value of the approach, including its advantages in the monitoring and evaluation of public expenditures. We conclude that the FOD approach to poverty mapping constitutes a useful addition to the toolkit of policy analysts. © 2015 UNU-WIDER. Journal of International Development published by John Wiley & Sons, Ltd.

Within the last century, the global average temperature increased by about 1 °C and this rate of increase may accelerate over the course of the 21st century [1]. Although estimates of climate change are based on projections and probabilistic assessments, ample evidence exists that climate change impacts are likely to become more profound in this century, particularly if mitigation policies are absent or inadequate [1,2]. It has been argued that, relative to keeping the warming at 2 °C or lower, the global cost of continuing with “business as usual” may be 5 to 20 times higher [3,4]. [...]

We estimate the impact of Malawi Farm Input Subsidy Programme using an economywide approach. We find potentially substantial net benefits with indirect benefits accounting for about two-fifths of total benefits. Due to these indirect benefits, the cut-off

In recent years, academic studies have been converging towards the view that foreign aid promotes aggregate economic growth. We employ a simulation approach to: (i) validate the coherence of empirical aid-growth studies published since 2008; and (ii) calculate plausible ranges for the rate of return to aid. Our results highlight the long run nature of aid-financed investments and the importance of channels other than accumulation of physical capital. We find the return to aid lies in ranges commonly accepted for public investments and there is little to justify the view that aid has had a significant pernicious effect on productivity.

SummaryThis paper confirms recent evidence of a positive impact of aid on growth and widens the scope of evaluation to a range of outcomes including proximate sources of growth (e.g., physical and human capital), indicators of social welfare (e.g., poverty and infant mortality), and measures of economic transformation (e.g., share of agriculture and industry in value added). Focusing on long-run cumulative effects of aid in developing countries, and taking due account of potential endogeneity, a coherent and favorable pattern of results emerges. Aid has over the past 40years stimulated growth, promoted structural change, improved social indicators, and reduced poverty.