Fleur Wouterse

Summary: Motivation: Countries of Africa have, through the Maputo and Malabo declarations and the companion Comprehensive Africa Agriculture Development Programme (CAADP) committed to increased public investment in agriculture. If implemented, this should contribute substantially to realizing several development goals, including reduction of poverty and hunger and making rural populations more resilient to climate change.Purpose: How much would implementation of National Agriculture Investment Plans (NAIPs) formulated within CAADP help achieve the aims of the Sustainable Development Goals, Agenda 2063, and the Malabo Declaration—namely, to boost agricultural growth, eradicate hunger, and reduce poverty and inequality?Methods and approach: We use data from Côte d'Ivoire, Ethiopia, Malawi, Mozambique, Niger, and Rwanda compiled in a Social Accounting Matrix. We run Computable General Equilibrium models with microeconomic models for each country to simulate the potential effect of implementation of the NAIPs. Three different methods to finance increased spending on agriculture are simulated: one that reallocates public expenditure with no overall increase in spending; a second that finances extra spending by more taxes; and one that relies on external funding to increase total spending.Findings: Results show that agriculture‐led investment would significantly increase agricultural growth, raise farm productivity, reduce dependency on food imports, improve incomes of food producers, and cut poverty. In most countries, increased investment in agriculture does more to boost growth, create jobs, and cut poverty than investments in industry or services. Raising overall public spending to allow more agricultural investment is far more effective than shifting spending within a fixed budget.Policy implications: For the six countries modelled, an agriculture‐led investment strategy appears the best way to eradicate hunger and reduce poverty and inequality while building resilience of rural households.

We use new household and individual level WEAI data from the Tahoua region of Niger and estimate a variable coefficient Cobb-Douglas production function in which traditional inputs interact with two human capital variables – empowerment and formal education. Our estimation results reveal that human capital matters for productivity. So much so that it can be considered as technology-changing, significantly affecting a household’s production technology by enhancing returns to equipment. In fact, differentiating households by their status as dual or primary with only an adult female or male reveals that the productivity elasticity of empowerment is large for dual households in which women are the least empowered. Enhancing the empowerment of women in this group of households, by increasing their leadership skills or tenure security, would yield important productivity gains.

We use recent data from 253 smallholder producer organisations (SPOs) in Ethiopia, Malawi and Senegal, factor and regression analysis to define organisational health, understand its determinants and relate health to performance. We find that latent health evolves according to a life cycle and that start up incentives and design rules are important determinants of an organisation’s progression through this life cycle. Health, in turn, is found to explain SPO performance measured in terms of profits. Healthier and more profitable SPOs are those with an economic justification at establishment, those initially pursuing defensive objectives and those SPOs that have put in place a strategy for capital formation. More educated presidents contribute to the health of an SPO but it is also shown that when the president of the SPO is female, profits are lower while the organisation is not healthier.

We use new data on 500 Farmer‐Based Organizations (FBOs) in Ghana and regression analysis to reveal determinants of collective investments and the case of the Millennium Development Authority's (MiDA) agricultural program in Ghana to demonstrate that development programs offering hard incentives may be counterproductive in promoting collective action. We show that when a program sets criteria for participation and offers in‐cash and in‐kind support to selected FBOs, it may promote rent‐seeking and crowd out equity capital formation. This is so because FBOs may have formed for the sole purpose of benefitting from incentives offered by the program and thus lack an economic justification, which is an important condition for progression through the cooperative life cycle. Further, by setting stringent participation criteria, the program may end up selecting younger organizations while it is the more consolidated organizations that are able to connect to business development services (BDS) and engage in more offensive collective action.