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The Impact of Economic Reforms in Rural Households in Ethiopia : A Study from 1989 to 1995

ADJUSTMENT PROCESS AGRICULTURE ARBITRAGE AUCTIONS AVERAGE GROWTH AVERAGE GROWTH RATE BARLEY BLACK MARKET BLACK MARKET PREMIUM BLACK MARKETS BORDER PRICE CAPITAL FORMATION COFFEE PRICES CONSUMER PRICE INDEX CONSUMERS CONSUMPTION GROWTH CPI DATA SETS DEFLATORS DEPENDENT VARIABLE DEVALUATION DEVELOPMENT PROJECTS DOMESTIC MARKETS ECONOMETRIC ANALYSIS ECONOMIC CHANGE ECONOMIC INCENTIVES ECONOMIC POLICY ECONOMIC REFORM ECONOMIC REFORMS ECONOMIC THEORY ECONOMICS EQUILIBRIUM EXCHANGE RATE EXPORT TAXES EXTERNAL SHOCKS FIXED PRICES FOOD POLICY RESEARCH FOREIGN EXCHANGE GDP GDP DEFLATOR GDP PER CAPITA GROSS DOMESTIC PRODUCT GROWTH RATE HIGH TAXES HUMAN CAPITAL INCOME INCOME DATA INCOME EFFECT INCOME EFFECTS INCOME GROWTH INDIVIDUAL FARMERS INFLATION INVESTMENT EXPENDITURES LAND REDISTRIBUTION LAND REFORM LOW INFLATION MACROECONOMIC PERFORMANCE MARKET LIBERALIZATION MARKET PRICES MARKET REFORMS MARKET VALUE MARKETING MIXED ECONOMY NATIONAL ACCOUNTS OVERVALUATION PERSISTENT POVERTY PLANNED ECONOMY POLICY CHANGES POLICY REFORMS POOR HOUSEHOLDS POSITIVE EFFECTS POVERTY ALLEVIATION POVERTY CHANGES POVERTY DYNAMICS POVERTY GAP POVERTY OUTCOMES POVERTY REDUCTION PRICE CHANGES PRICE CONTROLS PRICE FLUCTUATIONS PRICE INCREASES PRIVATE CONSUMPTION PRO-POOR PRODUCER PRICE INCREASES PRODUCER PRICES PRODUCERS PRODUCTION FUNCTIONS PRODUCTIVITY REAL EXCHANGE RATE REAL GDP REAL INCOME REAL INCOMES REFORM PROGRAM RELATIVE PRICES RURAL AREAS RURAL COMMUNITIES RURAL POVERTY SALES SCIENTIFIC RESEARCH SECTOR ACTIVITIES SIGNIFICANT IMPACT SPREAD STRUCTURAL ADJUSTMENT SURPLUS TAX REVENUE TAXATION TERMS OF TRADE TIME SERIES TRADE TAXES UNDERVALUATION URBAN AREAS WELFARE EFFECTS
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Washington, DC: World Bank
Africa | Ethiopia
2013-06-17T19:57:07Z | 2013-06-17T19:57:07Z | 2002-04

This study examines the poverty, and growth experience of six villages in rural Ethiopia, from 1989 to 1995. The time period was one of relative peace politically, which promoted considerable change in economic policies pertaining to the rural sector. As a result, local growth out-performed the average growth rate in gross domestic product. The focus of the study is the link between economic reforms, growth, and changes in poverty. The author poses the question: Can the observed reduction in poverty be explained by reform-induced higher returns to physical, and human capital, or simply by better weather? To find the answer, a profit function framework is employed to explain growth using prices, and endowments of land, labor, human capital, and location characteristics, with controls for shocks (for example, ill health and drought). The analysis finds that, on average, the poor has benefited more from the reforms than have the non-poor. But the experience of the poor is mixed, with some out-performing all other households, and others persisting in poverty. Although economic reforms do not deliver similar benefits to all the poor, there are high costs for withholding reforms. The study also highlights the effects of shocks on households, and the need for social protection measures, in a poverty reduction strategy.

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