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Library Finance and Hunger : Empirical Evidence of the Agricultural Productivity Channel

Finance and Hunger : Empirical Evidence of the Agricultural Productivity Channel

Finance and Hunger : Empirical Evidence of the Agricultural Productivity Channel

Resource information

Date of publication
juni 2012
Resource Language
ISBN / Resource ID
oai:openknowledge.worldbank.org:10986/8832

Using cross-country and panel regressions, the authors show that financial sector development significantly reduces undernourishment (hunger), largely through gaining farmers and others access to productivity-enhancing equipment, translating into beneficial income and general effects. They show specifically that a deeper financial sector leads to higher agricultural productivity, including higher cereal yields, through increased fertilizer and tractor use. Higher productivity in turn leads to lower undernourishment. The results are robust to various specifications and econometric tests and imply that a 1 percentage point increase in private credit to GDP reduces undernourishment by 0.22-2.45 percentage points, or about one-quarter the impact of GDP per capita.

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Authors and Publishers

Author(s), editor(s), contributor(s)

Claessens, Stijn
Feijen, Erik

Publisher(s)
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