January 11, 2008

Professor David Stifel Investigates Root Causes of Poverty in Madagascar

He will present research funded by the World Bank at international conference in June

David Stifel, assistant professor of economics and business, spent the 2006-07 school year researching the root causes of poverty in Madagascar. He worked with the World Bank Country Office to develop a multi-year labor markets research program in consultation with the government of Madagascar and other donors. His research was funded by the United Nations’ Children’s Fund (UNICEF) and the World Bank.

Stifel will present his research at a national workshop he is organizing in Antananarivo, Madagascar, in June 2008. This project is an extension of poverty research he has worked on in Madagascar and Kenya for a number of years.

“Labor markets are the focus [in Madagascar] because poor people derive most of their income from their own largely unskilled labor – the one asset that they possess in abundance,” Stifel explains.

His duties at the World Bank Country Office consisted mostly of working with Malagasy colleagues at the national statistical office to analyze data from initial poverty research. Most of Stifel’s research is associated with empirical analyses of poverty, which examines the root causes of poverty. Such causes, for example, may include inadequate sources of household incomes, like poor agricultural productivity and meager non-farm labor earnings.

“The functioning of the labor market has important implications for economic efficiency, growth, and poverty reduction,” says Stifel. “On the one hand, well functioning labor markets can facilitate growth through efficient allocation of resources, and allow the poor to share in opportunities created by economic growth. On the other hand, poorly functioning labor markets can inhibit both. Thus, the unifying goal of my current research is to understand how labor markets and labor earnings can facilitate poverty reduction and growth in Madagascar.”

In addition to analyzing data from other researchers, he also conducted some of the initial research required for developing this research program. This research generated several academic papers that will appear in scholarly journals and also be utilized by Malagasy policy makers.

Felix Forster ’09 (Rostock, Germany), who is pursuing a B.S. in mathematics and an A.B. in economics and business, co-authored one of these papers with Stifel. The paper investigates the horizontal inequalities – inequalities across groups based on characteristics such as ethnicity, educational attainment, land holdings, etc. – in rural Madagascar. Forster will present a preliminary version of the paper in late March at Skillman Library through the library’s student seminar series before Stifel presents a final version at Oxford University in April.

Stifel also worked this past year with Neil Rankin of the University of Witwatersrand in Johannesburg, South Africa, to secure funding for a $600,000 multi-country project on labor markets research from the Canadian International Development Research Centre (IDRC). The project involves research in Madagascar, Ghana, South Africa, and Tanzania. Stifel is serving as the lead researcher for the Madagascar component studying the rural non-farm economy and formal sector labor demand.

Stifel says this project has served as a spring board for his current research program. The program is a study of contract farming in collaboration with his colleague, Marc Bellemare, assistant professor of public policy and economics at Duke University.

“While previous research has shown that contracts between (a) grocery stores & food processing firms and (b) small-scale farmers is beneficial to poor farmers, little is known about the prevalence of these contracts and why some farmers adopt the contracts while others do not,” Stifel explains. “Marc and I are currently in the planning stage, and will conduct a survey of farmers and firms that contract with farmers early this year to address these questions. The larger policy question is related to what types of contracts can lead to the greatest coverage while maintaining the benefits to poor farmers.”

  • David Stifel Assists Policy Makers in Madagascar and Kenya
  • Economics and Business
  • Exceptional Faculty

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