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Savings groups provide access to financial services to households who are underserved by formal financial institutions and microfinance lenders. Access to this model in rural Peru reduced vulnerability to idiosyncratic shocks and led to greater investments in housing quality and specialization in agricultural activities, especially in poorer villages. Savings groups reduced access to formal loans and increased reliance on microfinance loans, which goes against the graduation hypothesis. The negative effect on access to formal loans is driven by villages with higher poverty levels and lower pre-treatment access to formal credit.

In this paper, we estimate a stochastic production function for Bolivia, Ecuador, Colombia, and Peru to investigate whether road infrastructure affects farm technical inefficiency. We use agricultural censuses of Colombia and Bolivia in 2013 and 2014, respectively; national agricultural surveys in 2017 of both Ecuador and Peru; and data on the road network and travel time to the nearest town with 50,000 inhabitants or more. Our main findings are that irrigation increases the value of production and road network decreases farm technical inefficiency, that is, road density (travel time) increases (decreases) farm technical efficiency.

In this paper, we explore the link between energy and agricultural production in Bolivia, Peru, and Colombia. The economic literature and policy reports, discussed here, indicate that access to energy (electricity) has a positive effect on agricultural production. To test this hypothesis, we look at the agricultural census and national survey to estimate the effect of energy use on the value of production using the Propensity Score Matching (PSM) technique. We found that, in the three countries, access to energy increases the value of agricultural production.

This paper evaluates the effectiveness of easing credit constraints for rural producers in Mexico through loans provided by a national public development finance institution. In contrast to most of the existing literature, the study focuses on the effect of medium-sized loans over a two- to four-year time horizon. This paper looks at the effects of such loans on production and investment decisions, input use, and yields. Using a multiple treatment methodology, it explores the differential impacts of providing liquidity for working capital versus providing credit for investments in fixed assets. It finds that loans increased the likelihood that producers grow and sell certain key annual crops, in particular among recipients of working capital loans. It also finds significant effects on production value and sales (per hectare), with similar impacts for recipients of both types of loans, with gains in yields driven by changes in labor quality and more intensive use of key inputs. There is no evidence of significant effects on the purchase of large machinery, but there are impacts on the acquisition of cattle. Overall, the results reported in this paper suggest that lack of liquidity is at least as important as lack of funding for new investment in capital for rural producers in Mexico. Producers benefit from easing their credit constraints, regardless of the type of loan used for that purpose.

In this paper we estimate the average treatment effect from access to extension services and credit on agricultural production in selected Andean countries (Bolivia, Peru, and Colombia). More specifically, we want to identify the effect of accessibility, here represented as travel time to the nearest area with 1,500 or more inhabitants per square kilometer or at least 50,000 inhabitants, on the likelihood of accessing extension and credit. To estimate the treatment effect and identify the effect of accessibility on these variables, we use data from the Colombian and Bolivian Agricultural Censuses of 2013 and 2014, respectively; a national agricultural survey from 2017 for Peru; and geographic information on travel time. We find that the average treatment effect for extension is higher compared to that of credit for farms in Bolivia and Peru, and lower for Colombia. The average treatment effects of extension and credit for Peruvian farms are $2,387.45 and $3,583.42 respectively. The average treatment effect for extension and credit are $941.92 and $668.69, respectively, while in Colombia are $1,365.98 and $1,192.51, respectively. We also find that accessibility and the likelihood of accessing these services are nonlinearly related. Results indicate that higher likelihood is associated with lower travel time, especially in the analysis of credit.

This paper evaluates the impact of the introduction of savings groups on poverty, vulnerability, and financial inclusion outcomes in rural Peru. Using a cluster randomized control trial and relying on both survey and administrative records, we investigate the impact of savings groups after more than two years of exposure. We find t hat savings groups channel expensive investments such as housing improvements and reduce households' vulnerability to idiosyncratic shocks, particularly among households in poorer districts. The treatment also induces changes in households labor allocation choices: access to savings groups increases female labor market participation and, in poorer areas, it fosters greater specialization in agricultural activities. Access to savings groups also leads to a four-percentage point increase in access to credit among women, mainly driven by access to the groups loans. However, the introduction of savings groups has no impact on the likelihood of using formal financial services.On the contrary, it discourages access to loans from formal financial institutions and microfinance lenders among the unbanked.

This paper highlights trends and innovations likely to impact Latin America in the context of the coming 4th industrial revolution, and to assess their impact. This analysis is crucial for the region's future, but it is also essential to narrow our focus, as an analysis of all possible technological innovations is impossible.

The world population is expected to increase from approximately 2.5 billion in 1950 to almost 10 billion in 2050, exhibiting the highest population growth rates in history. Securing the supply of wood and timber from sustainable sources without competing for agricultural land and food production has already become a challenge in many parts of the world.South America has had the advantage of being a large continent with a relatively small population, of which a large share lives in urban areas. Historically, these conditions have permitted inefficient land-use systems such as extensive livestock grazing for beef production. However, in recent decades export-oriented industrial agriculture has become the main driver of South American land use patterns, increasing the pressure for more efficient and intensive production systems. Specialization and intensification in the land use sector have brought economic and productive benefits at a cost. They have caused the massive destruction of natural ecosystems while at the same time making national economies highly dependent on a reduced number of export products. Therefore opportunities for intensification on extensive grazing land and other inefficient land uses (often on marginal land) have to be considered. Particularly in times of pressing global environmental change and increasingly complex trade relationships, land use intensification has to take into account economic, environmental and social objectives and increase the resilience of the system as a whole.

This study examines potential policy instruments for agricultural climate change adaptation based on empirical analysis of a theoretical model for Brazil. Risk management approaches, such as agricultural insurance and research and development investments in technological change, particularly call for analysis. The results for a weather index effect on loss of profits and amount of insurance indicate that it is important to insure against droughts and against temperature extremes. In addition, extensive research and development investment is found to be necessary to mitigate the effects of climate change on almost all agricultural sectors, particularly soy, cattle, maize and milk production.

This paper proposes and estimates a default risk model for agricultural lenders that explicitly accounts for two risks that are endemic to agricultural activities: commodity price volatility and climate. The results indicate that both factors are relevant in explaining the occurrence of default in the portfolio of a rural bank. In addition, the paper illustrates how to integrate the default risk model into standard techniques of portfolio credit risk modeling. The portfolio credit risk model provides a quantitative tool to estimate the loss distribution and the economic capital for a rural bank. The estimated parameters of the default risk model, along with scenarios for the evolution of the risk factors, are used to construct stress tests on the portfolio of a rural bank. These stress tests indicate that climate factors have a larger effect on economic capital than commodity price volatility.