Title: Social Services, Water Access, and Agricultural Productivity in Sub-Saharan Africa
Abstract: In sub-Saharan Africa, public resource
allocation in social service sectors can be particular important in
that low levels of development can make private services
inaccessible for much of the population. In addition, short-term
social services needs often compete with longer-term growth
enhancing investments for limited government funds. However, the
analysis and understanding of the agricultural productivity effects
from the provision of social services has been severely limited by
data constraints and the need to control for a variety of related
factors. Given the importance of agriculture for rural incomes, a
better understanding of the effects on agricultural productivity
from the provision of a variety of social services is important for
allocating spending that will not only support short-term needs but
also longer-term growth in rural areas. Despite the limited data
availability, previous analyses have been conducted regarding the
role of public expenditures on rural poverty. Often, this is
limited to one sector or overall rural incomes rather than
agricultural productivity. In addition, these analyses often assume
homogeneous production technology and do not account for climatic
variations driving production. Expanding on the work that has been
done previously, we analyze multiple expenditure sectors, allowing
heterogeneity in the underlying socio-economic and agro-climatic
environment. This research estimates the impact of public
expenditures on agricultural productivity across countries of
sub-Saharan Africa and then, specifically in the case of Tanzania.
Furthermore, given the limited funding available for the water
sector in Tanzania, it looks specifically at water constraints at
the household level and how this may constrain agricultural
productivity. In an effort to estimate the impacts of public
expenditures on agricultural productivity, the first part of the
analysis explores the existing data for sub-Saharan Africa, using a
cross-country regression framework. It exploits multiple analytical
options while including a newly-compiled dataset on annual
precipitation for agricultural land. While our conclusions are
substantially limited by the data constraints, this analysis
conducts an efficiency analysis for the group of sub-Saharan
African countries using health and educational outcomes as
indicators of social service availability. It also implements a
latent variable structural equation framework for a subset of
countries, allowing not only for country-specific heterogeneity but
also more direct estimation of the role of social service
expenditures covering multiple sectors. Overall, the results
provide evidence that public service expenditures (especially on
health and education) can influence input productivity and
efficiency in agriculture. Country-specific heterogeneity and
climate-related variables appear to be a significant consideration
for agricultural production in sub-Saharan Africa that should not
be ignored. In the remaining sections, we focus on Tanzania in
particular. We begin with an investigation of the impacts of
district-level health and education expenditures on marginal
productivities of agricultural inputs and overall production. The
results of our latent variable, covariance structural model confirm
the significance of government social expenditures in human capital
formation as measured through health and education indicators. The
results also show the effects of these health and educational
outcomes on agricultural productivity. We find that the marginal
productivities of inputs (labor in particular) respond
significantly and positively to health and education outcomes,
especially when health and education are considered jointly. The
impacts also seem to be a function of the type of health
constraint, with short-term health factors such as malaria and
diarrhea impacting productivity of seeds and fertilizer. In
contrast, longer-term health problems (i.e., chronic diseases)
appear to have greater impacts on labor quality and land
productivity. The results also suggest that there is a minimum
level of expenditures per capita needed to see an impact on
educational or health outcomes. The results confirm the importance
of considering intra-country heterogeneity as well as
climate-related constraints, as the results demonstrate that annual
precipitation has a significant impact on production for all
specifications. For the final part of the research, we focus on the
water sector in Tanzania, given that public spending in this sector
is very limited. For this analysis, we rely upon primary household
survey data collected in four regions of Tanzania to investigate
the impact of drinking water access on agricultural productivity at
the household level. As in many parts of sub-Saharan Africa, a lack
of sufficient and safe drinking water is a health constraint in
rural Tanzania. Although the water sector has been prioritized in
poverty-reduction efforts, water collection time has been
overlooked in many studies addressing productivity and incomes.
Using a production function approach, we estimate the impact of
drinking water collection times on agricultural labor availability,
labor productivity, and yields. The results show that additional
time required to access drinking water significantly reduces
household labor productivity and yields for households that have to
spend more than the median time (20 minutes) collecting water. In
these households, the time needed to collect water appears to serve
as a more significant constraint to labor productivity than the
quality of the water at the source. This effect remains consistent
even after controlling for heterogeneity among households, crop
diversity, and districts. The relative importance of other
productive inputs also changes with increased time needed for water
collection. Our results support further consideration of the time
required for water collection when planning rural development
initiatives. Overall, this research has highlighted the important
data limitations and the confounding constraints that can hinder
analysis of the impacts of public expenditures on agricultural
productivity. In order for governments to efficiently target
limited funds, a more comprehensive understanding of the direct and
indirect impacts of these expenditures on farm-level decisions and
constraints will be necessary. Further data sharing among agencies
and working across ministries is needed in order to o meet common
goals for long-term growth while addressing more immediate social
needs. The findings here suggest that social expenditures can also
positively impact agricultural productivity and these impacts
should be further explored in making funding decisions. In addition
to emphasizing the need for additional data, this research has
other important policy implications. It points to the importance of
providing sufficient levels of expenditures in order to influence
health and education outcomes and the importance of recognizing
context-specific needs given the heterogeneity between countries
even within a country. In addition, this research has provided
strong evidence of the importance of water-related constraints
(both precipitation and household access to water) that seem to
support not only consideration of these constraints but also
funding of measures that may reduce vulnerability.
Publication Year: 2012
Publication Date: 2012-11-19
Language: en
Type: dissertation
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