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331. Whither aid? Financing development in Mozambique

Author:
Sam Jones
Publication Date:
03-2009
Content Type:
Working Paper
Institution:
Danish Institute for International Studies
Abstract:
Careful consideration of the appropriate level and composition of aggregate public spending is vital in low income countries, especially in the presence of large volumes of foreign aid. Not only can expansion of the public sector weaken economic growth, but also provision of public services may be difficult to re­trench. These issues are relevant to Mozambique as the share of government in GDP already is comparatively high and strategic management of aggregate public spending historically has been weak. A new long-term macroeconomic model quantifies the implications of alternative aggregate spending profiles. It shows that small increases in minimum levels of government spending correspond to large increases in the duration to aid independence. Sharp reductions in aid availability would necessitate significant fiscal and economic adjustments, including cuts in real public spending per capita. For this reason, there is no room for complacency as regards the future of development finance to Mozambique.
Topic:
Development, Economics, Humanitarian Aid, International Political Economy, Poverty, and Third World
Political Geography:
Africa

332. Savings, Credit and Insurance: Household Demand for Formal Financial Services in Rural Ghana

Author:
Lena Giesbert, Susan Steiner, and Mirko Bendig
Publication Date:
01-2009
Content Type:
Working Paper
Institution:
German Institute of Global and Area Studies
Abstract:
This paper argues that the study of the demand for financial services in developing countries leaves out part of the story, if it looks at only one of the three elements of the so called finance trinity, i.e. savings products, loans, or insurances, as is largely done in the literature. In contrast to previous research, it is assumed that households' choice for any of these services is strongly interconnected. Therefore, the paper simultaneously estimates the determinants of household demand for savings, loans and insurances by applying a multivariate probit model on household survey data from rural Ghana. On the one hand, the estimation results confirm the common finding that poorer households are less likely to participate in the formal financial sector than better off households. On the other hand, there is empirical evidence that the usage of savings products, loans and insurances does not only depend on the socio-economic status of households, but also on various other factors, such as households' risk assessment and the past exposure to shocks. In addition, trust in the providing institution and its products appear to play a key role.
Topic:
Development, Economics, International Trade and Finance, Poverty, and Third World
Political Geography:
Africa

333. TCHAD : LA POUDRIERE DE L'EST

Publication Date:
04-2009
Content Type:
Working Paper
Institution:
International Crisis Group
Abstract:
L'Est du Tchad est une poudrière dont l'explosion pourrait déstabiliser l'ensemble du pays ainsi que les pays voisins et aggraver une situation humanitaire déjà désastreuse. Les conflits locaux fondés sur la raréfaction des ressources ont été exacerbés par des manipulations politiques nationales et régionales. La population a déjà énormément souffert des conflits internes tchadiens, de la crise du Darfour et de la guerre froide tchado-soudanaise. Les deux gouvernements, avec le soutien de leurs partenaires internationaux, devraient reprendre la mise en place de l'accord de Dakar, mais une conférence spécifiquement dédiée au conflit à l'Est du Tchad devrait également être organisée afin que les acteurs locaux et nationaux trouvent des solutions aux causes internes de la crise. Elle devrait être intégrée dans les structures existantes du processus de paix tchadien.
Topic:
Conflict Resolution, Development, Poverty, and War
Political Geography:
Africa

334. The Political Economy of Heterogeneous Development: Quantile Effects of Income and Education

Author:
Marcus Alexander, Matthew Harding, and Carlos Lamarche
Publication Date:
01-2009
Content Type:
Working Paper
Institution:
Weatherhead Center for International Affairs, Harvard University
Abstract:
Does development lead to the establishment of more democratic institutions? The key to the puzzle, we argue, is the previously unrecognized fact that based on quantitative regime scores, countries over the past 50 years have clustered into two separate, very distinct, yet equally-common stages of political development—authoritarian states with low levels of freedom on one side an d democracies with liberal institutions on the other side of a bimodal distribution of political regimes. We develop a new empirical strategy—exploiting exogenous world economic factors and introducing new panel data estimators—that allows for the first time to estimate the effects of development as well as unobserved country effects in driving democracy at these different stages of political development. We find that income and education have the least effect on democracy when authoritarian regimes are consolidated and that only country effects, possibly accounting for institutional legacies, can lead to political development. Ironically, it is in highly democratic and wealthiest of nations that income and education start to play a role; however greater wealth and better educated citizenry can both help and hurt democracy depending again on what the country's institutional legacies are. Far from accepting the notion that much of the developing world is cursed by unchanging and poor long-run institutions, policy-makers should take note that with democratization we also see country-specific factors that in turn condition the difference income and education make for democracy.
Topic:
Democratization, Development, Economics, Political Economy, and Third World
Political Geography:
Africa, United States, China, Asia, and Germany

335. Strategies for Growth and Poverty Reduction: Has Tanzania's Second PRSP Influenced Implementation?

Author:
Dennis Rweyemamu
Publication Date:
09-2009
Content Type:
Working Paper
Institution:
Danish Institute for International Studies
Abstract:
Tanzania's current growth and poverty reduction strategies are contained in its second PRSP. This document, and the processes leading to its formulation, has helped to mobilize donor funds. However, the content of the PRSP is largely irrelevant for implementation, and has contributed little to better inter-sectoral linkages and synergies both of which were its main purposes. The immediate reasons for this irrelevancy include a participatory planning process not aligned with the domestic political process and with no budget constraints which led to a shopping list of un-prioritized initiatives; an implementation machinery around the budget process which in practice does not ensure that resources are allocated in line with the document's priorities; and limited understanding and/ or acceptance across the spectrum of government institutions and political leadership that the PRSP is the overall strategic guiding document.
Topic:
Development, Economics, Poverty, and Foreign Aid
Political Geography:
Africa and Tanzania

336. Rebuilding Zimbabwe: Australia's role in supporting the transition

Author:
Joel Negin and Jolyon Ford
Publication Date:
10-2009
Content Type:
Policy Brief
Institution:
Lowy Institute for International Policy
Abstract:
Zimbabwe's long night is by no means over. Nearly a year after the violent and disputed March 2008 elections, and months after the September signing of a 'Global Political Agreement' with the ruling ZANU-PF party, the main faction of the Movement for Democratic Change (MDC) agreed in February to take part in a coalition government in which its leader, Morgan Tsvangirai, became Prime Minister. The state apparatus in Zimbabwe is currently shared uneasily by reformers and reactionaries with each of the MDC and ZANU-PF having half of the cabinet seats. Hardline ZANU-PF elements remain in government and control the security services, and a quiet but intense power struggle continues.
Topic:
Security, Agriculture, Development, Foreign Aid, and Food
Political Geography:
Africa, Australia, and Zimbabwe

337. What Happened to the Seasons? Changing seasonality may be one of the major impacts of climate change

Author:
Steve Jennings and John Magrath
Publication Date:
10-2009
Content Type:
Policy Brief
Institution:
Oxfam Publishing
Abstract:
The timing of rain, and intra-seasonal rainfall patterns are critical to smallholder farmers in developing countries. Seasonality influences farmers' decisions about when to cultivate and sow and harvest. It ultimately contributes to the success or failure of their crops. Worryingly, therefore, farmers are reporting that both the timing of rainy seasons and the pattern of rains within seasons are changing. These perceptions of change are striking in that they are geographically widespread and because the changes are described in remarkably consistent terms. In this paper, we relate the perceptions of farmers from several regions(East Asia, South Asia, Southern and East Africa, and Latin America) of how seasons are changing, and in some cases, how once distinct seasons appear to be disappearing altogether, and the impacts that these changes are having. We then go on to ask two critical questions. Firstly, do meteorological observations support farmers' perceptions of changing seasonality? Secondly, to what extent are these changes consistent with predictions from climate models? We conclude that changing seasonality may be one of the major impacts of climate change faced by smallholder farmers in developing countries over the next few decades. Indeed, this may already be the case. Yet it is relatively unexplored in the literature. We also suggest some of the key adaptation responses that might help farmers cope with these changes.
Topic:
Agriculture, Climate Change, Development, and Energy Policy
Political Geography:
Africa, East Asia, and Latin America

338. Institutional development or direct support to the poor

Author:
Neil Webster
Publication Date:
11-2009
Content Type:
Working Paper
Institution:
Danish Institute for International Studies
Abstract:
There are two fundamentally different understandings of how to bring about development. One argues that through the right policies it is possible to create an enabling environment for the development of people and societies. The other emphasises that development can only take place if those who are supposed to benefit from it, insist on it themselves. In the second understanding development cannot be created from above or from outside. So-called cash transfer programmes having spread from Latin America to Africa and Asia are based on this understanding as they transfer money to poor people on certain conditions. The question is to what extent these programmes contribute to development.
Topic:
Development, Poverty, and Foreign Aid
Political Geography:
Africa, Asia, and Latin America

339. Conflict-Business Dynamics in the Democratic Republic of Congo

Author:
Raymond Gilpin and Richard Downie
Publication Date:
11-2009
Content Type:
Working Paper
Institution:
United States Institute of Peace
Abstract:
Democratic Republic of Congo (DRC) has enormous economic potential thanks to its rich mineral deposits and vast tracts of arable land. Historically, these resources have been exploited by predatory leaders and a host of subregional actors. The time is now ripe for the DRC to put years of war and economic underdevelopment behind it. The business community has an important part to play in promoting sustainable peace in the DRC. Business communities in Bukavu and Lubumbashi have managed to remain profitable in the very trying years following the signing of the 1999 Lusaka peace accord by showing great resilience and versatility, primarily outside formal channels. Congolese businesses face serious obstacles, including poor infrastructure, high taxes, extortion, and market distortions. However, respondents expressed relatively little concern about insecurity and violence, suggesting that these costs have been internalized or that other obstacles impose much greater costs. DRC businesses neither want nor expect handouts. Respondents would prefer assistance in removing barriers to trade, improving infrastructure, and reducing corruption. Respondents are broadly optimistic about the future and their economic prospects, and have a strong sense of being stakeholders in shaping society. This bodes well for the future of the DRC, provided public policy can harness this energy and not impede it.
Topic:
Conflict Resolution, Development, Economics, and War
Political Geography:
Africa and Democratic Republic of the Congo

340. The Mozambican PRSP Initiative: Moorings, usage and future

Author:
Lars Buur and Obede Suarte Baloi
Publication Date:
12-2009
Content Type:
Working Paper
Institution:
Danish Institute for International Studies
Abstract:
This paper analyses the seemingly uncontroversial public life of the PRSP approach in Mozambique and suggests that it embodies much of the Frelimo government's thinking about development since independence, though obviously 'packaged' to fit international donor discourses as they continually change. The PRSP is therefore not an outright 'imposition' on the Frelimo government or necessarily a 'challenge' to its sovereignty, as it is often argued. In general we argue that the PRSP became over time a broad 'consensus document' because it came to potentially incorporate 'all' stakeholders needs and wishes. We argue that after the political turbulence of the 1980s and 1990s with privatisation and structural adjustments, the PRSP allowed for different elite groups to find common ground with regard to ideological and party-preserving concerns, as social and market-economic trade-offs could now be legitimately accommodated.
Topic:
Development, Economics, and Foreign Aid
Political Geography:
Africa