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  • Author: Dean Karlan, Bram Thuysbaert, Christopher Udry, Lori Beaman
  • Publication Date: 09-2014
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: We partnered with a micro-lender in Mali to randomize credit offers at the village level. Then, in no-loan control villages, we gave cash grants to randomly selected households. These grants led to higher agricultural investments and profits, thus showing that liquidity constraints bind with respect to agricultural investment. In loan-villages, we gave grants to a random subset of farmers who (endogenously) did not borrow. These farmers have lower – in fact zero – marginal returns to the grants. Thus we find important heterogeneity in returns to investment and strong evidence that farmers with higher marginal returns to investment self-select into lending programs.
  • Topic: Agriculture, Economics
  • Political Geography: Africa
  • Author: Katrina Mullan
  • Publication Date: 10-2014
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: This paper assesses the scale of the potential co-benefits for residents of developing countries of protecting forest ecosystems in order to mitigate climate change. The objective is to improve understanding among development practitioners of the ways in which services provided by forest ecosystems can also make important contributions to achieving development objectives such as improvements to health and safety, and maintenance of food and energy security. This is achieved by reviewing empirical studies that estimate the value of specific ecosystem services derived from forests in order to evaluate and describe the current state of knowledge on how the wellbeing of local people is likely to be affected by the introduction of global mechanisms for avoided deforestation in developing countries. There are four main ways in which wellbeing can be affected: 1) forests provide soil protection and water regulation services, which in turn reduce waterborne diseases, maintain irrigation water supply, and mitigate risks of natural disaster; 2) forests provide habitat for birds, fish, mammals and insects that affect human health and income generation opportunities; 3) clearing forest through use of fire can lead to respiratory illness and property damage, particularly if the fires spread accidentally; and 4) tropical forests are particularly high in biodiversity, making them important locally as well as globally as a potential source of genetic material for new crop varieties and pharmaceuticals. Evidence on the size of these benefits suggests that while they are highly variable, households in or near forests and poor households benefit most from forest ecosystem services.
  • Topic: Climate Change, Energy Policy, Environment, Natural Resources, Water, Food
  • Author: Katrina Brandon
  • Publication Date: 10-2014
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: Tropical forests exert a more profound influence on weather patterns, freshwater, natural disasters, biodiversity, food, and human health–both in the countries where forests are found and in distant countries–than any other terrestrial biome. This report explains the variety of environmental services tropical forests provide and the science underlying how forests provide these services. Tropical deforestation and degradation have reduced the area covered by tropical forests from 12 percent to less than 5 percent of Earth's land area. Forest loss and degradation has reduced or halted the flows of a wide range of ecosystem goods and services, increasing the vulnerability of potentially billions of people to a variety of damaging impacts. Established and emerging science findings suggest that we have substantially underestimated the global importance of tropical forests and the impacts of their loss on human well-being.
  • Topic: Climate Change, Environment, Natural Disasters, Natural Resources
  • Author: Kevin Ummel
  • Publication Date: 10-2014
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: This paper describes the creation of a database providing estimated greenhouse gas (GHG) footprints for 6 million US households over the period 2008-2012. The database allows analysis of footprints for 52 types of consumption (e.g. electricity, gasoline, apparel, beef, air travel, etc.) within and across geographic regions as small as individual census tracts. Potential research applications with respect to carbon pricing and tax policy are discussed. Preliminary analysis reveals:
  • Topic: Energy Policy, Environment, Natural Resources
  • Political Geography: United States, America
  • Author: Amanda Glassman, Juan Ignacio Zoloa
  • Publication Date: 10-2014
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: As Latin American countries seek to expand the coverage and benefits provided by their health systems under a global drive for universal health coverage (UHC), decisions taken today–whether by government or individuals-will have an impact tomorrow on public spending requirements. To understand the implications of these decisions and define needed policy reforms, this paper calculates long-term projections for public spending on health in three countries, analyzing different scenarios related to population, risk factors, labor market participation, and technological growth. In addition, the paper simulates the effects of different policy options and their potential knock-on effects on health expenditure.
  • Topic: Health, Governance, Reform
  • Political Geography: Brazil, Latin America, Mexico, Chile
  • Author: Gabriel Demombynes, Justin Sandefur
  • Publication Date: 10-2014
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: The lack of reliable development statistics for many poor countries has led the U.N. to call for a “data revolution” (United Nations, 2013). One fairly narrow but widespread interpretation of this revolution is for international aid donors to fund a coordinated wave of household surveys across the developing world, tracking progress on a new round of post-2015 Sustainable Development Goals. We use data from the International Household Survey Network (IHSN) to show (i) the supply of household surveys has accelerated dramatically over the past 30 years and that (ii) demand for survey data appears to be higher in democracies and more aid-dependent countries. We also show that given existing international survey programs, the cost to international aid donors of filling remaining survey gaps is manageable--on the order of $300 million per year. We argue that any aid-financed expansion of household surveys should be complemented with (a) increased access to data through open data protocols, and (b) simultaneous support for the broader statistical system, including routine administrative data systems.
  • Topic: Development, Human Welfare, Infrastructure
  • Political Geography: Asia, United Nations
  • Author: Martin Persson, Sabine Henders, Thomas Kastner
  • Publication Date: 10-2014
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: This paper aims to improve our understanding of how and where global supply-chains link consumers of agricultural and forest commodities across the world to forest destruction in tropical countries. A better understanding of these linkages can help inform and support the design of demand-side interventions to reduce tropical deforestation. To that end, we map the link between deforestation for four commodities (beef, soybeans, palm oil, and wood products) in eight case countries (Argentina, Bolivia, Brazil, Paraguay, Democratic Republic of the Congo, Indonesia, Malaysia, and Papua New Guinea) to consumption, through international trade. Although few, the studied countries comprise a large share of the internationally traded volumes of the analyzed commodities: 83% of beef and 99% of soybean exports from Latin America, 97% of global palm oil exports, and roughly half of (official) tropical wood products trade. The analysis covers the period 2000-2009. We find that roughly a third of tropical deforestation and associated carbon emissions (3.9 Mha and 1.7 GtCO2) in 2009 can be attributed to our four case commodities in our eight case countries. On average a third of analyzed deforestation was embodied in agricultural exports, mainly to the EU and China. However, in all countries but Bolivia and Brazil, export markets are dominant drivers of forest clearing for our case commodities. If one excludes Brazilian beef on average 57% of deforestation attributed to our case commodities was embodied in exports. The share of emissions that was embodied in exported commodities increased between 2000 and 2009 for every country in our study except Bolivia and Malaysia.
  • Topic: Energy Policy, Environment, Natural Resources
  • Political Geography: China, Europe, Malaysia, Brazil, Argentina, Latin America, Bolivia
  • Author: Rosa C. Goodman, Martin Herold
  • Publication Date: 11-2014
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: Tropical forests have the highest carbon density and cover more land area than forests in any other biome. They also serve a vital role as a natural buffer to climate change ―capturing 2.2–2.7 Gt of carbon per year. Unfortunately, tropical forests, mangroves, and peatlands are also subjected to the highest levels of deforestation and account for nearly all net emissions from Forestry and Other Land Use (FOLU) (1.1–1.4 Gt C / year). Net emissions from FOLU accounted for only 11% of total anthropogenic greenhouse gas emissions or 14% of total carbon emissions in 2010, though these figures are somewhat misleading and do not reflect the full potential of tropical forests to mitigate climate change. First, net FOLU emissions have reduced only slightly while emissions from all other sectors have skyrocketed. Secondly, the FOLU net flux is made up of two larger fluxes —deforestation emissions (2.6–2.8 Gt C / year) minus sequestration from forest regrowth (1.2–1.7 Gt C / year). Additionally, intact tropical forests also appear to be capturing at least 1.0 Gt C/ year. Gross deforestation, therefore, accounts for over a quarter of all carbon emissions, and tropical forests have removed 22–26% of all anthropogenic carbon emissions in the 2000s. If deforestation were halted entirely, forests were allowed to regrow, and mature forests were left undisturbed, tropical forests alone could have captured 25–35% of all other anthropogenic carbon emissions. On the other hand, if climate change continues unabated, forests could turn from net sinks to net sources of carbon. Forestrelated activities are among the most economically feasible and cost-effective mitigation strategies, which are important for both short- and long-term mitigation strategies. Action is needed immediately to utilize these natural mitigation solutions, and we need coordinated and comprehensive forest-related policies for mitigation. An international mechanism such as REDD+ is essential to realize the great natural potential for tropical forests to stabilize the climate.
  • Topic: Climate Change, Energy Policy, Environment, Natural Resources, Reform
  • Political Geography: Africa, South Asia, Latin America
  • Author: Jesse Lueders, Cara Horowitz, Ann Carlson, Sean B. Hecht, Edward A. Parson
  • Publication Date: 11-2014
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: For the last several years, California has considered the idea of recognizing, within its greenhouse gas cap-and-trade program, offsets generated by foreign states and provinces through reduced tropical forest destruction and degradation and related conservation and sustainability efforts, known as REDD+. During their deliberations on the issue, state policymakers have heard arguments from stakeholders in favor of crediting REDD+ offsets, and those against. After years of planning and cooperative efforts undertaken with states in Brazil, Mexico, and elsewhere, California is still determining whether to embrace REDD+ offsets. The most salient and potentially persuasive arguments in favor stem from the opportunity to influence and reduce international forest-related emissions contributing to climate change, while simultaneously reducing the costs imposed by the state's climate change law. The state is still grappling, however, with serious questions about the effectiveness of REDD+ in addressing climate change, as well as the impacts of REDD+ on other social and environmental objectives. The suitability of the state's cap-and-trade program as a tool for reducing emissions outside the state, given the co-benefits that accrue to local communities from in-state reductions, remains another key area of debate. The outcome of this policy discussion will depend on interrelated questions of program design, future offset supply and demand, and the weight given to the importance of prioritizing in-state emissions reductions and co-benefits.
  • Topic: Climate Change, Energy Policy, Environment, Natural Resources
  • Political Geography: United States, Brazil, California, Mexico
  • Author: Dean Karlan, Pia Raffler, Greg Fischer, Margaret McConnell
  • Publication Date: 11-2014
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: In a field experiment in Uganda, we find that demand after a free distribution of three health products is lower than after a sale distribution. This contrasts with work on insecticide-treated bed nets, highlighting the importance of product characteristics in determining pricing policy. We put forward a model to illustrate the potential tension between two important factors, learning and anchoring, and then test this model with three products selected specifically for their variation in the scope for learning. We find the rank order of shifts in demand matches with the theoretical prediction, although the differences are not statistically significant.
  • Topic: Development, Health
  • Political Geography: Uganda, Africa
  • Author: Antonio G.M. La Viña, Alaya de Leon
  • Publication Date: 12-2014
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: This paper provides an analysis of the international political dynamics around the reduction of tropical deforestation and forest degradation as a climate mitigation strategy, emphasizing the necessity of an enabling environment and sustainable financing to support the scaling up of these efforts globally. After describing the evolution from the 1990s of international cooperation to combat tropical deforestation, the paper focuses principally on the United Nations Framework Convention on Climate Change (UNFCCC), and how it provided an impetus for a renewed effort on this issue. The paper describes the complex process through which the climate and tropical forest agenda got inserted into UNFCCC processes, from its marginal role in the Clean Development Mechanism (CDM) created by the Kyoto Protocol to the emergence of REDD+ (Reducing Emissions from Deforestation and Forest Degradation and the Role of Conservation, Sustainable Management of Forests and Enhancement of Forest Carbon Stocks) as the forum where decisions have been made on climate and tropical forests. The paper dissects the issues that have dominated the REDD+ negotiations, identifies and characterizes the actors and constituencies that have been influential in the process, analyzes lessons learned from the successes of this UNFCCC agenda, and suggests recommendations to move the REDD+ and overall tropical forests and climate agenda forward. The paper concludes with an anticipation of what to expect in the future, in the light especially of what could possibly be a new climate change agreement in 2015.
  • Topic: Climate Change, Energy Policy, Natural Resources
  • Political Geography: United Nations
  • Author: Erlend A. T. Hermansen, Sjur Kasa
  • Publication Date: 12-2014
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: Norway – a small northern country with only 5 million inhabitants – is at present a global leader in REDD+ financing. In this paper, we explain why and how this happened by telling the story about the emergence of Norway's International Climate and Forest Initiative (NICFI) in 2007 and its institutionalization in the following years. We emphasize how a set of Norwegian climate policy characteristics prepared the ground for NICFI. These characteristics were the relative absence of less expensive potential emission cuts domestically, a tradition of seeking cheaper emission reduction options abroad, and few fiscal constraints due to high petroleum revenues. When the domestic demand for a more proactive climate policy started to increase from 2006 onward, two Norwegian environmental NGOs, The Rainforest Foundation Norway and Friends of the Earth Norway, exploited the window of opportunity that emerged from the tension between high domestic abatement costs and increasing domestic climate policy demands by proposing a large-scale Norwegian rainforest effort. This proposal resonated well with the new emphasis on reduced deforestation as a promising climate policy measure internationally. Towards the end of 2007, these ENGOs managed to convince a broad majority in Parliament that large-scale financing of measures to reduce deforestation globally should become an important part of Norwegian climate policy. Financing NICFI through the growth in the steadily increasing development aid budget dampened opposition from more fiscally conservative actors and facilitated the rapid set-up of a flexible implementing organization directly linked to some of the most proactive politicians. Several agreements with key rainforest countries were rapidly established, and including ENGOs in policy formulation and implementation helped maintaining the momentum and legitimacy for NICFI as a more permanent solution to Norway's climate policy dilemmas. NICFI's robustness and high level of legitimacy are illustrated by the fact that the initiative has survived the recent 2013 change of government quite intact. However, we also suggest that the long-time survival of the initiative may be dependent on the future of the UNFCCC process as well as the destiny of the national projects.
  • Topic: Climate Change, Energy Policy, Environment, Natural Resources
  • Political Geography: Europe, Norway
  • Author: Dean Karlan, Greg Fischer, Margaret McConnell, Pia Raffler
  • Publication Date: 12-2014
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: In a field experiment in Uganda, we find that demand after a free distribution of three health products is lower than after a sale distribution. This contrasts with work on insecticide-treated bed nets, highlighting the importance of product characteristics in determining pricing policy. We put forward a model to illustrate the potential tension between two important factors, learning and anchoring, and then test this model with three products selected specifically for their variation in the scope for learning. We find the rank order of shifts in demand matches with the theoretical prediction, although the differences are not statistically significant.
  • Topic: Climate Change, Environment, Governance
  • Political Geography: Uganda, Europe, Germany
  • Author: Lant Pritchett, Yamini Aiyar
  • Publication Date: 12-2014
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: We combine newly created data on per student government expenditure on children in government elementary schools across India, data on per student expenditure by households on students attending private elementary schools, and the ASER measure of learning achievement of students in rural areas. The combination of these three sources allows us to compare both the “accounting cost” difference of public and private schools and also the “economic cost”—what it would take public schools, at their existing efficacy in producing learning, to achieve the learning results of the private sector. We estimate that the “accounting cost” per student in a government school in the median state in 2011/12 was Rs. 14,615 while the median child in private school cost Rs. 5,961. Hence in the typical Indian state, educating a student in government school costs more than twice as much than in private school, a gap of Rs. 7,906. Just these accounting cost gaps aggregated state by state suggests an annual excess of public over private cost of children enrolled in government schools of Rs. 50,000 crores (one crore=10 million) or .6 percent of GDP. But even that staggering estimate does not account for the observed learning differentials between public and private. We produce a measure of inefficiency that combines both the excess accounting cost and a money metric estimate of the cost of the inefficacy of lower learning achievement. This measure is the cost at which government schools would be predicted to reach the learning levels of the private sector. Combining the calculations of accounting cost differentials plus the cost of reaching the higher levels of learning observed in the private sector state by state (as both accounting cost differences and learning differences vary widely across states) implies that the excess cost of achieving the existing private learning levels at public sector costs is Rs. 232,000 crores (2.78% of GDP, or nearly US$50 billion). It might seem counterintuitive that the total loss to inefficiency is larger than the actual budget, but that is because the actual budget produces such low levels of learning at such high cost that when the loss from both higher expenditures and lower outputs are measured it exceeds expenditures.
  • Topic: Economics, Education, Privatization, Reform
  • Political Geography: India, Asia
  • Author: Jonah Busch, Scott J. Goetz, Matthew Hansen, Richard A. Houghton, Wayne Walker, Nadine Laporte
  • Publication Date: 12-2014
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: This paper presents an overview of the state of measurement and monitoring capabilities for forests in the context of REDD+ needs, with a focus on what is currently possible, where improvements are needed, and what capabilities will be advanced in the near-term with new technologies already under development. We summarize the role of remote sensing (both satellite and aircraft) for observational monitoring of forests, including measuring changes in their current and past extent for setting baselines, their carbon stock density for estimating emissions in areas that are deforested or degraded, and their regrowth dynamics following disturbance. We emphasize the synergistic role of integrating field inventory measurements with remote sensing for best practices in monitoring, reporting and verification. We also address the potential of remote sensing for enforcing safeguards on conservation of natural forests and biodiversity. We argue that capabilities exist now to meet operational needs for REDD+ measurement, reporting, and verification (MRV) and reference levels. For some other areas of importance for REDD+, such as safeguards for natural forests and biodiversity, monitoring capabilities are approaching operational in the near term. For all REDD+ needs, measurement capabilities will rapidly advance in the next few years as a result of new technology as well as advances in capacity building both within and outside of the tropical forest nations on which REDD+ is primarily focused.
  • Topic: Climate Change, Environment, Natural Resources
  • Author: Andy Sumner, Peter Edward
  • Publication Date: 09-2013
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: The interplay of between-and within-country inequality, the relative contribution of each to overall global inequality, and the implications this has for who benefits from recent global growth (and by how much), has become a significant avenue for economic research. However, drawing conclusions from the commonly used aggregate inequality indices such as the Gini and Theil makes it difficult to take a nuanced view of how global growth interacts with changing national and international inequality.
  • Topic: Cold War, Development, Economics, Globalization
  • Author: Kevin Ummel
  • Publication Date: 09-2013
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: South Africa and many other countries hope to aggressively expand wind and solar power (WSP) in coming decades. The challenge is to turn laudable aspirations into concrete plans that minimize costs, maximize benefits, and ensure reliability. Success hinges largely on the question of how and where to deploy intermittent WSP technologies. This study develops a 10-year database of expected hourly power generation for onshore wind, solar photovoltaic, and concentrating solar power technologies across South Africa. A simple power system model simulates the economic and environmental performance of different WSP spatial deployment strategies in 2040, while ensuring a minimum level of system reliability.
  • Topic: Climate Change, Economics, Energy Policy, Environment, Science and Technology
  • Political Geography: Africa, South Africa
  • Author: Lant Pritchett, Marla Spivack
  • Publication Date: 08-2013
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: How much larger are the consumption possibilities of an urban US household with per capita expenditures of 1,000 US dollars per month than a rural Indonesian household with per capita expenditures of 1,000,000 Indonesian Rupiah per month? Consumers in different markets face widely different consumption possibilities and prices and hence the conversion of incomes or expenditures to truly comparable units of purchasing power is extremely difficult. We propose a simple supplement to existing purchasing power adjusted currency conversions.
  • Topic: Development, Economics, Political Economy, Political Theory, Social Stratification, Socialism/Marxism
  • Political Geography: United States, Southeast Asia
  • Author: Charles Kenny, William Savedoff
  • Publication Date: 10-2013
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: A common objection to results-based programs is that they are somehow more vulnerable to corruption. This paper explains why results-based approaches to foreign aid may be less vulnerable to corruption than the traditional approaches which monitor and track the purchase and delivery of inputs and activities. The paper begins by classifying different corruption costs and specifically distinguishes the problem of diverted funds from the costs associated with failing to generate benefits. It then characterizes the key differences between traditional input-tracking programs and results-based approaches in terms of how they are supposed to work, the implicit risks that preoccupy designers, how they function in practice, and what this means both for the scale of corruption and the realization of benefits. It then considers the conditions under which one approach or another might be more appropriate. The paper concludes that input-tracking approaches are vulnerable to corruption because they have high failure costs and a weak track record for controlling diverted funds. By contrast, results-based approaches are less prone to failure costs and limit the capacity of dishonest agents to divert funds unless those agents first improve efficiency and outputs.
  • Topic: Corruption, Development, Foreign Aid, Governance
  • Author: Alex Cobham, Andy Sumner
  • Publication Date: 09-2013
  • Content Type: Working Paper
  • Institution: Center for Global Development
  • Abstract: There are normative or instrumental reasons why inequality may be said to matter (e.g. fairness and meritocracy). However, much global literature has taken an instrumentalist approach as to why high or rising inequality can hinder development. For example, Birdsall (2007) argues that income inequality in developing countries matters for at least three instrumental reasons: where markets are underdeveloped, inequality inhibits growth through economic mechanisms; where institutions of government are weak, inequality exacerbates the problem of creating and maintaining accountable government, increasing the probability of economic and social policies that inhibit growth and poverty reduction; and where social institutions are fragile, inequality further discourages the civic and social life that underpins the effective collective decision-making that is necessary to the functioning of healthy societies.
  • Topic: Economics, Poverty, Social Stratification, Labor Issues