Did Rapid Smallholder-Led Agricultural Growth Fail to Reduce Rural Poverty? Making Sense of Malawi’s Poverty Puzzle

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. UNU-WIDER gratefully acknowledges the financial contributions to the research programme from the governments of Denmark, Finland, Sweden, and the United Kingdom. Terms of use: Documents inThe World Institute for Development Economics Research (WIDER) was established by the United Nations University (UNU) as its first research and training centre and started work in Helsinki, Finland in 1985. The Institute undertakes applied research and policy analysis on structural changes affecting the developing and transitional economies, provides a forum for the advocacy of policies leading to robust, equitable and environmentally sustainable growth, and promotes capacity strengthening and training in the field of economic and social policy-making. Work is carried out by staff researchers and visiting scholars in Helsinki and through networks of collaborating scholars and institutions around the world.UNU-WIDER, Katajanokanlaituri 6 B, 00160 Helsinki, Finland, wider.unu.eduThe views expressed in this publication are those of the author(s). Publication does not imply endorsement by the Institute or the United Nations University, nor by the programme/project sponsors, of any of the views expressed.Abstract: Disappointment was widespread when rapid economic growth since 2005, coupled with a smallholder-targeted fertilizer subsidy program, failed to significantly reduce poverty in Malawi. Official estimates for 2011 showed a 1.7 percentage point decline in national poverty between 2005 and 2011, while rural poverty increased marginally. In this study we estimate an alternative set of regional poverty lines using a cost of basic needs method that allows the consumption bundle to vary spatially and temporally while ensuring utility consistency. Our poverty figures suggest a substantial 7.3 percentage point decrease in national poverty over the analysis period, driven largely by a sharp reduction in rural poverty. These results are more consistent with the observed level of economic growth and improvements in several non-monetary dimensions of well-being. However, we find that extreme poverty did increase, suggesting that the most vulnerable people continue to be excluded from the benefits of economic policy and growth.

Dietary mineral supplies in Malawi: spatial and socioeconomic assessment

“…Household spending data in the IHS3 support the finding of prevalent dietary energy insufficiency in poor households. Pauw et al [54] reported that, as the wealth of poorest rural households increased, the share of income spent on food also increased. This appears contrary to Engel's law which states that the share of household budget spent on food is inversely related to household real income [55], a remarkably consistent observation across space and time [56].…”

Social Protection or Humanitarian Assistance: Contested Input Subsidies and Climate Adaptation in Malawi

“…However, several studies of the FISP provide convincing evidence of a positive impact on improved food security (Carr 2014). Pauw and Thurlow (2014) go as far as stating that there has been a dramatic decline in food insecurity in Malawi due to the FISP. Arndt et al (2014) estimate that each dollar spent on the FISP generates $1.62 in national welfare improvements.…”

“…Whilst it may be assumed that the poor and less vocal groups lost out in the local distribution of vouchers, it appears that even the two lowest quintiles are well represented among the receivers throughout this period. However, these data have been re-analysed by Pauw et al (2014), who found a larger decrease in poverty, as illustrated in Figure 6a. Their analysis is more consistent with the WMS model based on WMS estimates as illustrated in Figure 6b.…”

“…The main goal of social protection in the form of farm input subsidies has been to produce enough food in the country to avoid hunger. The political changes and the subsidised inputs have, according to several sources (Carr 2014;Arndt, Pauw and Thurlow 2014;Pauw, Beck and Mussa 2014;Government of Malawi 2016), contributed towards preventing hunger and the need for humanitarian assistance in the decade . According to the Government of Malawi (2016), the FISP was able to advance food security by improving agricultural productivity, but failed to develop the necessary resilience in relation to the 2015 flooding and the 2016 El Niño and drought.…”

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“…The IHSs show hardly any change in the average poverty level from 1997-98 to 2004-05 and 2010-11. However, these data have been re-analysed by Pauw et al (2014), who found a larger decrease in poverty, as illustrated in Figure 6a. Their analysis is more consistent with the WMS model based on WMS estimates as illustrated in Figure 6b.…”