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Essays in Development Economics: Evidence from East Africa

Book - Dissertation

This dissertation is divided into four chapters, each built around a different research paper that falls under the broad field of `development economics'. The analysis in all chapters is mostly empirical, relying on primary data collected in recent years from East Africa. Of course, theory plays a key role in directing the analysis. Chapters 1 and 2 study different aspects of female empowerment and household decisions in Tanzania. Chapters 3 and 4 study the use of technology within the dairy value chain in Ethiopia and Uganda.Chapters 1 and 2 focus on female empowerment. Women and gender equality are important for the advancement of developing countries. A recent report on the Sustainable Development Goals (SDGs) states that women spend three times more hours per day than men on unpaid labor (eg. child care and domestic work), which reinforces gender stereotypes . This unpaid labor also affects their time available for employment, the SDGs report also states that women represent less than 40 percent world employment. Female empowerment has been a central theme in development research for decades. Progress has been made but women still face discrimination in many countries, especially developing ones. To support female empowerment, development projects often provide women with economic resources, foster women's social capital, or use a combination of both. Chapters 1 and 2 study these two methods of supporting female empowerment.Chapter 1 focuses on the method that provides resources to support empowerment. These resources from a development project or social program also affect household welfare. Even further, the intra-household allocation of these resources is not only dependent on who receives the resources but whether the resources are disclosed to other household members. Using data from a choice experiment in rural Tanzania, in which both spouses participated (independently and in private), we find that women's allocations respond to disclosure while men's allocations do not. This disclosure effect is stronger among women with lower decision-making autonomy in their household but is weaker among women who have a better relationship with their husbands. These results provide new policy insights on who in a household to give resources and whether to do this privately. Chapter 2 relates to the second common method to support empowerment, generating women's social capital. We specifically focus on social connections. The underlying idea of women's empowerment groups is that these increase women's bargaining power. Using the same data set from Chapter 1, we test the effectiveness of social connections driving female empowerment through their bargaining power. There is little evidence that supports the assumed positive effect of women's networks on their decision-making autonomy in the household. We study if the number of friends a woman has in her village influences who makes decisions in her household. We find that women's networks do influence who makes decisions within their households more than the size of the husbands' social network. The number of friends a woman has increases her involvement in decisions about her health but not her mobility. Lastly, we find that the type of friend matters. Then the gender of the wife's friends and whether her friends are shared with her husband also affect who makes decisions. The results provide evidence in support of the bargaining mechanism but we also find an indication of other mechanisms such as the husband taking over decision-making or the spouses dividing the decision-making power by decision. Agriculture is another central topic in development economics. Agriculture accounts for 15\% of gross domestic product (GDP) in SSA \citep{wb2018}. The agriculture sector is transforming due to several reasons; for example, urbanization, shifts in diets, climate change, and technological advances, just to name a few. These changes have allowed certain agricultural sub-sectors to grow. Chapters 3 and 4 focus on the dairy sector in Ethiopia and Uganda. Due to increased demand and technological advances, the dairy sector in these countries has transformed in recent years. While the sector has grown in both countries, differences in world market participation and access to value chain technologies might have resulted in uneven experiences across countries. Chapter 3 focuses on its impact on prices in the value chain, using the example of Ethiopia and Uganda. We develop a conceptual framework and then validate the model using unique primary price data collected at several levels in the dairy value chains in both countries. We find that prices are overall significantly lower in Uganda than Ethiopia, reflecting their respective net exporting and importing status. Moreover, despite shorter value chains, we find much more significant effects of distances from the capital (the major end destination) on milk prices in Ethiopia than in Uganda. This is seemingly linked to the widespread presence of milk chilling centers in Uganda. While it has been shown that such technology is important for milk quality, we find here that they also have the added benefit to reducing the impact of farmer's remoteness on prices and therefore allow for more geographically extended value chains.Lastly, Chapter 4 studies how inclusive the transformation of the dairy sub-sector has been for smallholder farmers in each country. Most of the food in sub-Saharan Africa is produced by smallholder farmers and therefore they need to be included in the sector's transformation. This chapter once again focuses on Ethiopia and Uganda. We note significant changes in the dairy sector in these countries over the last decade, including with more adoption of cross-bred cows, and higher milk yields were seemingly driven by rapid changes in local demand (Ethiopia and Uganda) and export markets (Uganda). However, while small farmers are included in that transformation in Uganda, they were not in Ethiopia. This was seemingly driven by better and cheaper accessibility for cross-bred cows that small farmers can better bear in Uganda.
Publication year:2020