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Agricultural Growth and Investment Options for Poverty Reduction in Malawi
Agriculture employs three-quarters of the population of Malawi. It makes up more than forty percent of the economy and sixty percent of all exports. Yet productivity in agriculture--measured as the amount of output for a given amount of inputs--is considerably lower than it could be, given Malawi's agricultural resources. Efforts to expand the economy and reduce poverty must involve agriculture. Where should the Government of Malawi invest?
Biofuels, Poverty, and Growth: A Computable General Equilibrium Analysis of Mozambique
This paper assesses the implications of large-scale investments in biofuels for growth and income distribution. We find that biofuels investment enhances growth and poverty reduction despite some displacement of food crops by biofuels. Overall, the biofuel investment trajectory analyzed increases Mozambique's annual economic growth by 0.6 percentage points and reduces the incidence of poverty by about 6 percentage points over a 12-year phase-in period. Benefits depend on production technology. An outgrower approach to producing biofuels is more pro-poor, due to the greater use of unskilled labor and accrual of land rents to smallholders, compared with the more capital-intensive plantation approach. Moreover, the benefits of outgrower schemes are enhanced if they result in technology spillovers to other crops. These results should not be taken as a green light for unrestrained biofuels development. Rather, they indicate that a carefully designed and managed biofuels policy holds the potential for substantial gains.
