Browsing by Subject "Governance challenges"

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    An analysis of institutional arrangements for providing animal health services : a theoretical framework and empirical evidence from Kenya and Uganda
    (2015) Ilukor, John; Birner, Regina
    Providing adequate animal health services to smallholder farmers in developing countries has remained a challenge, in spite of various reform efforts during the past decades, mainly because of governance challenges. Although good governance has been recognized as an important element in addressing emerging and re-emerging animal disease threats, animal health research has paid limited attention to the governance challenges inherent in the provision of animal health services. The existing frameworks for analyzing animal health services have mainly focused on market failures to decide what the public sector, private sector, and “third sector” (the community-based sector) should do with regard to providing animal health services. This thesis uses transaction cost economics to analyze institutional arrangements for providing animal health services since it captures both market failures and governance attributes. The objective of this thesis is threefold: (1) to develop a conceptual framework for analyzing animal health services using transaction cost theory of economic organization and to provide empirical evidence on its application using data collected on clinical veterinary services in Uganda and Kenya; (2) to identify governance challenges in the provision of animal health services and possible remedies to address them using a case study of Uganda; (3) to examine the quality of services provided by different service providers (paraprofessionals and veterinarians) and to gain insights into paraprofessional-veterinarian relations. This thesis is comprised of six chapters. The introductory chapter provides background information regarding the study areas in Uganda and Kenya, highlights the importance of strengthening and supporting the provision of veterinary services in developing countries, and presents the main research objectives and outline of the thesis. Chapter 2 presents a conceptual framework for analyzing institutional arrangements for providing veterinary services using Williamson’s discriminating alignment hypothesis and generates testable hypotheses regarding the cost effectiveness of various institutional arrangements. Using household survey data collected in Uganda and Kenya on clinical services, empirical tests of these hypotheses are presented. Chapter 3 examines the process of animal service delivery as well as identifies the main influential actors, important social relations, and main governance challenges encountered in the provision of clinical and preventive veterinary services in pastoral and intensive livestock productions systems in Uganda. Chapter 4 examines the determinants of referrals from veterinary paraprofessionals to professional veterinarians. The Chapter 5 examines whether veterinary paraprofessionals perform correct disease diagnosis and prescribe correct drugs for selected endemic diseases. The chapter also examines whether interaction between veterinary paraprofessionals and professional veterinarians would result in correct drug prescription and disease diagnosis. Chapter 6 concludes and offers policy recommendations and areas for further research. After presenting the importance of animal health services in developing countries, a framework for analyzing animal health services is developed in Chapter 2 based on Williamson’s discriminating alignment hypothesis. This framework combines both market failure and governance attributes to assess the cost-effectiveness of different institutional arrangements for animal health services. Some of these attributes include externality, transaction intensity, care intensity, measurability, and state and community capacity. Using this attributes, testable hypotheses regarding the appropriateness of institutional arrangements for providing animal health services are developed. Using data from Uganda and Kenya on clinical veterinary services, empirical tests of these hypotheses are performed to demonstrate the application of Williamson’s transaction cost theory to veterinary service delivery. The empirical results show that paraprofessionals are desirable because they offer needed care and attention to clients since they are located closer to livestock producers and thus have lower transaction costs and may be trusted more by farmers. Professional veterinarians, on the other hand, are preferred by farmers when cases require technical expertise (high measurability). The use of paraprofessional services is found to be positively associated with the availability of veterinarians, implying the existence of synergistic relationship between veterinarians and paraprofessionals. In other words, a referral system may be the most costs effective approach for building state and community capacity to provide veterinary services. After developing the framework for analyzing the provision of animal health services, Chapter 3 examines the process of providing animal health services using Uganda as a case study. A participatory mapping tool called Process Net-Map is used to identify relevant actors and assess their influence in the delivery of clinical and preventive veterinary services in both pastoral and intensive livestock production systems. The tool also helps elicit governance challenges in veterinary service delivery. The results reveal that important social relations in ensuring the provision of quality veterinary services and the timely reporting of animal disease in veterinary service delivery include: (1) cooperation between private veterinarians and paraprofessionals, as well as private veterinarians and government veterinarians in intensive production systems; and (2) cooperation between NGOs, government veterinarians, and community based animal health workers (CAHWs) in pastoral areas. The limited number of trained paraprofessionals and professional veterinarians, absenteeism by government veterinarians, insufficient and unpredictable budgets, weak legislation, exclusion of technical staff from the decision making process, and policy illogicality are identified as major governance problems in veterinary service delivery. Respondents also noted that the quality of veterinary services is very low because paraprofessionals without animal health training have dominated animal health markets in Uganda and the key to improve veterinary services is to build referral arrangements between paraprofessional and veterinarians. Although the literature on animal health service delivery recognizes that referrals between paraprofessionals and veterinarians are important in ensuring correct drug prescriptions and in improving disease surveillance, detection, and reporting, little is known about determinants of referrals between paraprofessionals and professional veterinarians. Chapter 4 analyzes data collected from paraprofessionals in Kenya and Uganda to identify factors influencing referrals from paraprofessionals to veterinarians using a probit regression model. The results show that the determinants of paraprofessional referrals to veterinarians include: paraprofessional’s mobile phone ownership, gender, attendance of short term trainings, annual assessments, and membership in paraprofessional associations. This chapter argues that policy makers should invest in legislation for paraprofessionals, supervision of paraprofessionals, the expansion of mobile phone ownership by paraprofessionals, the formation of paraprofessional associations, and short term training for paraprofessionals to build and strengthen referrals from paraprofessionals to veterinarians. The question of the quality of veterinary services provided by paraprofessionals has been contested in the animal health service delivery literature. Chapter 5 examines this question by using a role play experiment to analyze how the interaction of farmers and service providers influences the quality and demand for clinical services. The quality of clinical services is measured by scoring the accuracy of a service provider prescribing the appropriate drug for selected endemic animal diseases in each of the game’s four rounds. Statistical tests establish whether the quality of services provided by different types of paraprofessionals and veterinarians differ. Learning curves for service providers are constructed to examine whether the quality of services provided by paraprofessionals improves as they continue to interact with veterinarians. Belief updating curves are constructed for farmers to examine whether they change their beliefs about paraprofessionals after receiving information about the quality of they (farmers) receive from service providers. A probit regression model for binary panel data is estimated to determine the factors that influence farmers’ decisions to change service providers. The results show that the ability to identify the signs of different diseases and the accuracy of prescriptions by veterinarians is not significantly different from that of paraprofessionals trained in veterinary science. However, the ability of service providers who are not trained in veterinary medicine to perform these tasks is significantly lower than that of service providers trained in veterinary science. The continued interaction between paraprofessionals and veterinarians gradually leads to an improvement in the ability of paraprofessionals trained in general agriculture and social sciences to perform these tasks. This is not the case for paraprofessionals with no formal training or education. Farmers do not easily change their beliefs about paraprofessionals, even if they receive information on their lack of ability to diagnose diseases and prescribe drugs correctly. Belief updating depends not only on the outcome of the previous round, but also on the gender of the farmer and on the livestock production system. This paper argues that the slow pace in which farmers update their beliefs about paraprofessionals limits paraprofessionals’ willingness to learn and to consult with veterinarians. However, the use of “animal health cards” (records of diagnoses and treatments) could induce paraprofessionals to provide better quality services as well as enable farmers to measure the quality of services, thus improving the quality of veterinary services in the long run. The main policy recommendation generated from this thesis are the following: (1) There is a need for developing countries to invest and create an enabling environment that supports paraprofessionals and professional veterinarians’ relations to ensure timely reporting, treatment, and control of animal disease. This would help reduce wastes and efficiencies in animal production as well as human health risks. (2) The provision of veterinary extension services should focus not only on household heads, but on other household members as well, such as spouses/wives and herdsmen. This could contribute to improved reporting, treatment, and disease control, thus reducing the risks of animal loss and the spreading of diseases to other animals, livestock farms, and humans. (3) Stronger government engagement in the provision of veterinary services in pastoral or extensive livestock is required because the market has failed to attract private and trained paraprofessionals. Our findings indicate that the effort to close this gap by promoting community animal health workers with rather limited informal training has proven to be a rather problematic answer to this problem. This is especially true when these service providers are expected to fulfill a major role in providing curative services since this may lead to the inefficient use or potentially dangerous misuse of veterinary drugs. (4) Farmers need to be empowered to hold service providers accountable by developing and experimenting with tools, such as animal medical cards, that would enable them to measure the quality of services they receive and distinguish qualifications of different services providers. (5) Investment in veterinary education is needed to ensure that enough qualified veterinary staff (both diploma and degree holders) are available to offer veterinary services. This could be achieved by supporting and encouraging recognized universities or tertiary institutions to establish training centers in livestock producing areas and by offering scholarships targeting training community-based animal health workers or students from marginalized/pastoral livestock areas.
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    Comparison of institutional arrangements for inclusive dairy market development in India
    (2019) Ravichandran, Thanammal; Birner, Regina
    Future projections show that by 2025, the demand for dairy products in developing countries will increase by 25 percent due to population growth, urbanization and increased incomes. This increase in demand offers a unique opportunity for smallholder dairy farmers, who may achieve higher levels of income and well-being if they are able to increase their milk production. Currently, smallholder dairy producers in developing countries face severe constraints caused by low productivity, lack of market access and high transaction costs. Hence, investments in dairy production that aim to overcome these constraints can serve as a powerful tool for poverty reduction and rural development. Many donors have already invested in reducing poverty by stimulating growth of dairy sector, but the success of such development projects has been variable and largely dependent on local circumstances. India is a good example of the challenges faced by the promotion of dairy development. Remarkable growth in the dairy sector has been achieved by “Operation Flood”, a large-scale government-funded program to promote smallholder dairy production and market integration. However, growth in the dairy sector was not equally distributed among the different regions of India. Moreover, depending on the region, marginalized farmers, including female farmers, still face barriers to access technological innovations (e.g., breed improvement and better feeding practices) as well as access to institutions (e.g., credit and markets). Therefore, India presents a good case for a comparative study that aims to identify what types of institutional arrangements are most suitable to promote inclusive growth of the dairy sector, depending on local circumstances. Against this background, it is the main objective of this thesis to analyze institutional arrangements for inclusive dairy sector development and to explore the factors that influence or hinder inclusive growth, using India as a case study country. The focus is placed on institutional arrangements that have the potential to address governance challenges and gender inequality in dairy development. Data for this thesis was collected in three Indian states that differ with regard to the overall governance conditions: Telangana, which enjoys favorable governance conditions, Bihar, which can be classified as intermediate, and Uttarakhand, a state with rather unfavorable governance conditions. The thesis is composed of five chapters. Following an introductory chapter, Chapter 2 explores the governance challenges that different institutional arrangements of dairy marketing pose for inclusive growth. Chapter 3 focuses on the barriers faced by women to participate in institutional arrangements for dairy marketing and to access and control the income derived from dairy production. Chapter 4 presents a case study of the MilkIT project, an internationally funded project that used the institutional arrangement of the “Innovation Platform” to promote dairy development. Chapter 5 discusses the overall findings of the thesis in a comparative perspective and identifies the success factors, which influence inclusive growth of the dairy sector. The final chapter also presents policy recommendations for inclusive dairy development. The institutional arrangements for dairy marketing that were examined in Bihar and Telangana include different types of dairy cooperatives (with mixed membership and women-only membership), a private dairy company and informal marketing arrangements. A qualitative research approach using Grounded Theory was applied to identify the factors that influence participation of women and marginalized groups in different institutional arrangements. The researcher stayed for two weeks in each of the selected villages and collected data using participant observation as well as other research tools: semi-structured interviews, focus group discussions and the application of Net-Map, a participatory mapping technique. In Uttarakhand, data from a baseline household survey and focus group discussions conducted for the MilkIT project were compared with a post-intervention household survey to assess the impact of Innovation Platforms on institutional and technological innovations. Furthermore, the documentation of meetings held in the context of the Innovation Platforms was analyzed. The findings of the study underline that gender inequality and governance challenges are major constraints to achieving inclusive growth, which require context-specific interventions. In Telangana, dairy cooperatives that have only women as members proved to be an appropriate institutional arrangement for inclusive dairy development. These women-only cooperatives performed better than cooperatives with mixed membership. The study showed that women and lower caste producers were often not able to participate in cooperatives with mixed membership, and those who participated had limited access to leadership roles and training opportunities. The results for Bihar were rather different, which underlines the need for a context-specific approach. Women-only cooperatives allowed females and low-caste members to participate, but all leadership roles were occupied by men who dominated the management of those cooperatives. As in Telangana, the mixed dairy cooperative in Bihar were not fully inclusive, but those women and low caste members who were able to join benefitted relatively more from access to inputs and training as was the case in Telangana. Exclusion of women and marginalized groups was particularly evident in the case of a private dairy company in Telangana, which mainly focused on marketing of milk and did not engage in services for productivity enhancement. Informal dairy market arrangements were found to be easily accessible for women and marginalized groups, but they did not facilitate access to inputs and services either. The Innovation Platform approach was found to be effective in facilitating market access and promoting technical innovations. By design and in practice, women were given a chance to participate in this approach not only by attending meetings but also by participating in decision-making. The study demonstrates that both the institutional set-up and the prevailing governance processes are key aspects of institutional arrangements for inclusive dairy development. Success factors include decentralized governance structures; low state interference; participation of women not only at the village level, but also higher levels of the cooperative arrangement (union or federation level); democratic practices, especially transparency, in the election of leaders; and involvement of all types of members in decision making. Effectiveness and inclusiveness in the provision of economic services also mattered, most notably with regard to input supply and support services to all members. The type of institutional arrangements required to realize these success factors may differ across regions, as the comparison of Telangana and Bihar shows. Overall, the study suggests that performing a context-specific social and gender analysis is essential for the design of formal institutional arrangements for dairy markets, a finding that likely applies to all agricultural markets. The study clearly shows that creating organizations with women-only membership is not a sufficient condition to promote inclusive agricultural development. What matters is women’s participation in leadership position of agricultural marketing organizations (which may require quotas), capacity building, networking through self-help groups and extension services that are accessible to women. The study also shows that innovative institutional arrangements, such as Innovation Platforms, also have a promising potential to foster inclusive agricultural development.
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    Performance and governance challenges of a government-funded microcredit program for the handloom weavers in Bangladesh
    (2019) Parvin, Mst. Tania; Birner, Regina
    Microfinance is an important policy tool for poverty reduction and employment generation in developing countries. The first microfinance institution was developed in Bangladesh in the 1970s. Since its inception, many studies have been conducted on different aspects of microfinance, such as outreach, impact and sustainability. However, these studies have mostly been limited to the performance of microcredit programs operated by non-government organizations (NGOs). Therefore, it is justified to shift the focus from NGOs to microcredit programs operated by the public sector. To fill this knowledge gap, a case study of Bangladesh Handloom Board (BHB)’s microcredit scheme has been conducted, which represents a publicly sponsored credit program targeting handloom weavers. Using a mixed methods approach, this thesis has analyzed three dimensions of the selected credit program: impact assessment, repayment performance, and governance challenges. These three topics are covered by three different papers in the thesis. The first two papers apply quantitative techniques whereas the third one adopts a qualitative approach for assessing the institutional viability. The objective of the first paper is to estimate the impact of BHB’s microcredit scheme on the handloom weaver’s investment behavior in Bangladesh. From a policy perspective, this analysis is relevant for two reasons. First, it fills the gaps in the impact assessment studies of credit which have largely neglected the government-run microcredit programs. Second, the article provides insights for the promotion and continuation of this public credit program. Using an Instrumental Variable (IV) Two-stage Least Squares (2SLS) regression model, the study findings reveal that the government credit program alone is not sufficient to increase the investment in the handloom sector of Bangladesh. The credit received from sources other than BHB was thought to be more relevant with regard to this goal. However, this result also implies that access to multiple sources of credit put borrowers into a debt trap, which makes them economically worse off after repaying loans with interest. As a result, productive investment does not take place through the credit program. This finding, however, does not imply that the credit program should be stopped. It is concluded that the credit amount available under this program for technology adoption in the handloom sector should be increased. Moreover, providing credit for power looms will facilitate a structural change from using handlooms to power looms, which may provide a more sustainable means of future livelihood for current handloom weavers. The second paper analyses the credit repayment of the BHB’s microcredit scheme. Considering that the repayment rate (which is regarded as one of the success factors of the credit program) was only 65% as of June 2015, this study identifies factors that contribute to such low repayment rate, which makes government-sponsored microcredit programs financially unsustainable. This analysis is important to guide the public credit institutions to design a better lending policy by focusing on the factors that require special attention while lending to the eligible borrowers. Using a Probit model, this study reveals that socioeconomic and community-level factors associated with the borrowers played an essential role in determining timely loan repayment. Some of these factors were beyond the control of the credit institution. In conclusion, this study suggests strengthening the loan monitoring system by opening up more branches so that the timely delivery of financial as well as non-financial services to borrowers can be assured. The third paper examines the governance challenges faced by the BHB. The analysis is based on the findings of the previous two papers. As the findings from both papers highlight the challenges of BHB, it is important to understand why such challenges occur when implementing a government-sponsored credit program and from where they exactly originate. This analysis also has implications for policy revision and reformulation of BHB, which should be guided by a better understanding of the organization-specific problems that a government-funded microcredit program is facing. These challenges are assessed by using a qualitative research method called Process Net-map. The use of this method helps to understand how the credit program is implemented in practice, which may deviate from the prescribed implementation plan. Moreover, this study analyzes the challenges that arise from the perspectives of both the supply-side and the demand-side stakeholders of BHB. The major finding of the first paper is supported by the outcome of this paper as it reveals that shortage of funds was the main obstacle for implementing BHB’s microcredit scheme, which failed to meet the clients’ financial needs. Besides this problem, the shortage of adequate staff was responsible for weak field administration, which is amplified by the lack of incentives to motivate them. Political influence and corruption in the system were also identified as central challenges. From the beneficiary-side, high opportunity cost to get loans, lack of non-financial services, inadequacy of funds, and difficulty in group formation were also major problems. A lack of transparency in information flow between groups was also noted as a problem. This paper concludes that a poorly designed program which fails to address the organization-specific challenges of government-run microcredit program will not improve the livelihood of the intended beneficiaries. Hence, the study recognizes the credit program’s need for a better legal and regulatory framework to address the governance challenges that are identified. The focus should be placed on flexible, demand-driven, bottom-up and participatory initiatives. Overall, the study concludes that government-run microcredit programs, affected by problems from large bureaucracies, face specific challenges, which tend to be larger than those faced by NGO-run microcredit programs. One possible solution may be an enhanced collaborative system that involves both public and private credit institutions as it may encourage cross-sector learning.
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    Prices, governance challenges and contracts in scaling of biofortification
    (2023) Richard, Alioma; Zeller, Manfred
    Micronutrient deficiency remains a global health challenge, especially in developing countries, despite government and development partners programs, numerous policies, and interventions to decrease its prevalence. Micronutrient deficiency adversely affects pregnancy, child growth, disease susceptibility, and cognitive development. Populations suffer from deficiencies due to low intake of micronutrients such as iron, zinc, vitamin A and iodine in their diets. Therefore, many interventions and policies have aimed at increasing the intake of micronutrients by the target populations. Some of these interventions include fortification, that is to increase the micronutrient content of foods or condiments, biofortification which entails breeding staple crops with higher content of bioavailable micronutrients, supplementation, and dietary diversity. These interventions face numerous challenges to scale to larger populations mainly because of behavioural attributes, prices, and governance challenges. The importance of prices stretches from academia to policymakers because of its substantial impact on the consumption behaviour of poor households affecting micronutrient intake. Existing literature on prices concentrated on the cost of micronutrient-dense foods compared to starchy staple foods and the price change for different food items. The second challenge in the scaling of interventions is governance challenges. Governance challenges exist in formal and informal institutions affecting the value chain for biofortified seeds or foods. These challenges jeopardize positive development outcomes and may as well pose significant obstacles to scaling the use of biofortified seed and food. Lastly, there has been a growing focus on the involvement of aggregators, processors, and retailers in the development of food value chains in low-income countries, yet the role of supply contracts is unknown. The objectives of this thesis are threefold: 1) to estimate the long-term trends in prices and volatility of micronutrient-dense food as opposed to starchy staple food and derive hypotheses for factors that might have contributed to the observed divergence in the past long-term growth of prices of micronutrient-dense versus starchy food 2) to identify the governance challenges facing farmers, seed multipliers, aggregators, processors, and retailers as one of the scaling pathways and empirically test one pathway to address the governance challenge in Uganda and 3) to determine the distribution and performance of aggregators, retailers, and processors in Nigerias vitamin A food value chain. This cumulative thesis has three papers. The first paper seeks to answer as main question: “Do prices of micronutrient-dense food commodities grow faster than prices of starchy staple food items”. The second paper poses the following as its main question: “What are the governance challenges in scaling biofortified crops”. The third paper addresses the question of which factors determine the distribution and performance of aggregators, processors, and retailers in the development of value chains for staple food crops. In the first paper, we used the autoregressive and panel autoregressive distributed lag models to analyze the trends in relative prices and the effects of income growth. The data set was price data for micronutrient and calorie-dense foods from FAO STAT-GIEWS, IMF, and the World Bank. The results showed that micronutrient-dense food prices in real terms grew on average by 0.03% per month more than starchy staple food prices, with the expectation of a 12% growth gap in the next 30 years. The volatility of micronutrient-dense food items exceeds starchy staple foods in most domestic markets. Also, the prices of micronutrient-dense foods were more volatile in international markets than in most developing countries. Income growth in developing countries is hypothesized to be one of the factors that contributed to the faster growth in demand for and, therefore, prices of micronutrient-dense food commodities. Other factors, such as the growth in the production of staple foods may have caused price trends to persist. After having presented evidence that prices of micronutrient-dense foods have grown faster in the past 30 years, and if this trend continues, interventions for scaling biofortification, among others, will gain importance for eradicating hidden hunger. In the second paper, we provide insights into the governance challenges of biofortification in Uganda. This paper aims to identify the governance challenges facing farmers, seed multipliers, aggregators, processors, and retailers as one of the scaling pathways and empirically test one pathway to address the governance challenge. This pathway was information provision through training. We used a Process Net-Map to elicit information from respondents regarding processes, actors, and challenges in the food value chain of biofortified crops. The Process Net-Map involves the identification of actors, their roles, their influence on the scaling of biofortification and challenges in the processes. The field lab experiment was used to collect data on the effect of information provision on the identification of iron beans. We analysed the data from field lab experiments through a correlated random effects model. The results demonstrate that vine multipliers face challenges in the supply of vines, and households face a trade-off between allocating land for orange-fleshed potatoes and other varieties. In addition, the value chain actors adulterate iron beans while consumers are unwilling to pay a premium for orange-fleshed sweet potato roots and iron bean grains. These challenges may result from information asymmetry, merit goods, collective action, and free riding. Though information provision can improve the identification of iron beans, its effect was insignificant as from the field lab experiments. Increasing access to biofortified seed through subsidies would increase the production of biofortified crops that would saturate the markets. Creating awareness of the importance of nutritious products would enable consumers to pay for biofortified seeds and food. The third paper provides evidence on factors determining the distribution and performance of aggregators, retailers, and processors in Nigerias vitamin A food value chain. We used data collected by HarvestPlus to assess the outcome indicators, including throughput, sales, prices, variable costs and contracts for vitamin A cassava and maize. We used the spatial distributed lag model to determine factors that affect the distribution of aggregators, retailers and processors and the correlated random effects model to assess the role of contracts on their performance. We find that infrastructural and supply variables do not influence the location of aggregators, retailers, and processors. Out of the demand variables (population density, ownership of livestock and literacy rates, price of Garri-cassava flour), only the price of Garri and livestock ownership influenced the location of aggregators, retailers, and processors. Contracts seem to reduce the cost per kilogram for aggregators while insufficiently affecting the costs of retailers and processors. Contracts are also associated with improving the profits of retailers and aggregators. The main policy recommendations emanating from the findings of this thesis are: 1) governments need to adopt policies that enhance nutrition-sensitive interventions such as supplementation, fortification, dietary diversity, and biofortification 2) employ subsidies to increase the production of biofortified crops while creating awareness on the importance of nutritious products in the scaling of biofortified crops and 3) create enabling environments so that aggregators, retailers and processors can engage in contracts with farmers.