VoxDev Development Economics

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Hear about the cutting edge of development economics from research to practice. 

  1. Why civil service reform fails (and what actually works)

    14 HR AGO

    Why civil service reform fails (and what actually works)

    Every civil service reform plan opens with the same list of complaints: poor performance, low motivation, weak accountability. Across six African countries and three decades, governments launched 131 separate reform efforts; not one fully achieved what it set out to do. Martin Williams spent more than a decade working alongside Ghana's civil service before writing a book called Reform as Process that analyses the lessons from his experience, and the rest of the 131 reforms. For example, 34 programmes across six countries tried to link civil service pay to performance; none delivered. One lesson is that formal rules and accountability systems cannot govern what matters in a civil service: innovation, adaptation, co-ordination, the willingness to act on the spirit of a rule rather than its letter. Meaningful reforms often require no money at all. They require changing expectations from inside, starting small and building credibility, decentralising the leadership of change, and treating new formal rules as a last resort rather than a first step. The book behind this episode: Williams, Martin J. 2026. Reform as Process: Implementing Change in Public Bureaucracies. New York: Columbia University Press. Open-access PDF available at uplopen.com. To cite this episode: Phillips, Tim, and Martin J. Williams. 2026. "Why civil service reform fails (and what actually works)." VoxDev Talks (podcast).Assign this as extra listening. The citation above is formatted and ready for a reading list or VLE.About the guestMartin J. Williams is Associate Professor of Organizational Studies and Associate Professor (by courtesy) of Political Science and Public Policy at the University of Michigan, and Associate Faculty at the Blavatnik School of Government, University of Oxford. His research spans the politics and management of policy implementation, public service delivery, and bureaucratic reform, with a sustained focus on sub-Saharan Africa. He previously worked as an economist in Ghana's Ministry of Trade and Industry as an Overseas Development Institute Fellow, and as a Senior Researcher at the Economic Policy Research Institute in Cape Town. Reform as Process has been shortlisted for the Douglass North Award for best book in institutional and organizational economics. Research cited in this episodeNon-verifiable tasks. In organizational economics, a verifiable action is one where a third party (an auditor, a judge, an administrative tribunal) can determine objectively whether it was performed correctly. Non-verifiable tasks are those where no such determination can be made; they include innovation, adaptation, co-ordination across teams, and acting on the spirit of a rule rather than its letter. Williams draws on this framework, which originates in contract theory, to explain why formal accountability systems consistently fall short: they can only govern verifiable outputs, leaving the full range of non-verifiable tasks unaddressed and, in many cases, actively crowded out. Performance-linked incentive systems. Williams's dataset covers 34 separate reform efforts across Ghana, Kenya, Nigeria, Senegal, South Africa, and Zambia that attempted to tie civil service pay or progression to measured performance. Not one delivered sustained differentiated incentives on an ongoing basis; only two achieved even partial delivery of rewards, and none delivered sanctions based on measured performance. Williams argues this is not isolated implementation failure but reflects a structural incompatibility between formalised performance metrics and the non-verifiable nature of much civil service work. Managers respond rationally: they set soft targets, award uniform scores, and the process becomes a tick-box exercise. Projectization of reform. Williams uses this term to describe the dominant approach: treating change as a time-bound, discrete intervention with its own budget, acronym, and implementing team, conceived separately from the organisation's core work. This approach systematically distorts reform goals towards formally measurable outputs (new policies, new laws) rather than sustained behavioural change, undermines credibility by signalling a predetermined end date, and reinforces the perception among civil servants that reform is a temporary performance before things return to normal. Continuous improvement. Williams draws an analogy with physical fitness: achieving a target and then stopping does not sustain the gain. High-performing organisations, in the public and private sectors alike, treat improvement as an ongoing process embedded in daily work, not a periodic project handed to a specialist unit. Starting small is not an absence of ambition; it is how credibility is built and larger changes become possible. Williams argues civil service reform should be reconceived on these terms, with performance improvement treated as the job of everyone in the organisation. Decentralised reform leadership. The dominant model of reform leadership, Williams argues, is a visionary leader driving a top-down plan. This model is counterproductive. It personalises reform in ways that guarantee reversal when the leader moves on, and it cannot reach the day-to-day interactions among the thousands of individuals and hundreds of teams that determine how a civil service actually works. A more effective model is catalysing rather than forcing: creating conditions in which teams can identify and solve their own problems, escalate issues, co-ordinate with each other, and act on ideas for improvement without fear of being ignored or penalised. More VoxDev Talks episodesHow government analytics can improve public sector implementation, in which Daniel Rogger and Christian Schuster discuss their efforts to use the data that already exists in governments to better understand how they function.

    37 min
  2. The World Bank's East Asian Miracle

    20 MAY

    The World Bank's East Asian Miracle

    In 1993, the World Bank published a report on a remarkable development story. East Asia's post-war growth — Japan, South Korea, Taiwan, Hong Kong and their neighbours — had lifted millions out of poverty in a generation. The report documented the influence of export subsidies, state-directed credit, land reform, and government-business dialogue. But the bank, constrained by the Washington Consensus of the time, underplayed the industrial policies that were at the heart of this miracle. Nancy Birdsall was head of the department that produced the report. In this week's VoxDev Talk, she looks back, talking to Tim Phillips about whether this stance affected policy in other developing countries. Birdsall tells Tim Phillips how the report came to exist at all — financed by the Japanese government as a deliberate strategy to expose the bank's economists to a success story their prevailing framework couldn't explain.  With industrial policy back at the centre of economic debate, Birdsall's new article in the Journal of Economic Perspectives asks whether the bank missed its moment to embed those lessons into its operational work.  The research behind this episode: Birdsall, Nancy. 2025. "The World Bank's East Asian Miracle: Too Much a Product of Its Time?" Journal of Economic Perspectives 39(4): 127–48. A free download is available at the Center for Global Development. To cite this episode: Phillips, Tim, and Nancy Birdsall. 2026. "The World Bank's East Asian Miracle." VoxDev Talk (podcast). [Episode URL].Assign this as extra listening. The citation above is formatted and ready for a reading list or VLE.About Nancy BirdsallNancy Birdsall is president emerita of the Center for Global Development, which she co-founded in 2001. She was previously executive vice president of the Inter-American Development Bank and, before that, director of the Policy Research Department at the World Bank, where she oversaw the department responsible for the East Asian Miracle report. Her research spans development finance, inequality, economic growth and the role of multilateral institutions in the global economy. Research cited in this episodeThe East Asian Miracle (World Bank, 1993). A 400-page study of the economic performance of eight high-performing Asian economies — Japan, South Korea, Taiwan, Hong Kong, Singapore, Indonesia, Malaysia and Thailand — covering the period 1965 to 1990. Commissioned with Japanese government funding, the report documented both market fundamentals and a range of active state policies; its handling of industrial policy was carefully hedged to remain within the bounds of what the bank's dominant Washington Consensus framework could accept. The full report is available from the World Bank Open Knowledge Repository.The Washington Consensus. A term coined by economist John Williamson in 1989 to describe the package of macroeconomic and structural reforms — fiscal discipline, trade liberalisation, privatisation, deregulation and market-determined prices — that the IMF, World Bank and US Treasury broadly promoted as the framework for development in the late 1980s and 1990s. The consensus was dominant inside the bank during the period the East Asian Miracle report was written; countries following activist state policies did not fit its categories easily. MITI (Japan's Ministry of International Trade and Industry). The Japanese government body responsible for coordinating industrial and trade policy during Japan's post-war growth period, including the direction of credit, protection of infant industries and promotion of heavy manufacturing exports. MITI was widely known inside the bank, but its role in Japan's development was not systematically studied or incorporated into the bank's policy advice until the East Asian Miracle report. It was abolished and reorganised as the Ministry of Economy, Trade and Industry (METI) in 2001. Performance-based credit subsidies. A mechanism used across several East Asian economies in which exporters could access subsidised credit conditional on demonstrating actual export orders. The conditionality — credit only if you are already performing — was central to why the policy worked: it rewarded productive firms and withdrew support from those that failed to deliver. The East Asian Miracle report described this approach in detail without classifying it as industrial policy. Japan's postal savings system. A government-run savings scheme that channelled household deposits through post offices into state-directed investment, providing below-market returns to savers while funding subsidised credit to targeted sectors. Birdsall notes it as a mechanism worth studying for developing countries seeking to finance industrial support without relying on private capital markets. Indonesia and the airplane sector. The Indonesian government under Suharto sought to develop a domestic aerospace industry, with state subsidies to Industri Pesawat Terbang Nusantara (IPTN). The World Bank's East Asia regional department, which managed the bank's lending relationship with Indonesia, was concerned that the East Asian Miracle report might be read as endorsing this approach. Their pressure to limit the report's treatment of industrial policy is the episode's opening anecdote — and the source of what is possibly the best line in the show. IDB report on public-private dialogue in Latin America. Birdsall references work by the Inter-American Development Bank on the conditions under which structured dialogue between government bureaucrats and private-sector firms can support industrial policy; she notes that access at the highest levels of government — including the president — appears to be a factor in whether such dialogues produce results.  More VoxDev Talks on this topicIndustrial policy for economic development, Dani Rodrik on the evidence for active state roles in directing investment and exports, and the institutional prerequisites for making them work. The future of the World Bank: Why knowledge is power, Penny Goldberg on the bank's role as a producer and broker of development knowledge, and how that function has evolved since the Washington Consensus era. Related reading on VoxDevModern industrial policy: The Asian miracles' blueprint, a VoxDev Talk examining how the principles behind East Asian industrial success — performance conditionality, export orientation, technology learning — can be translated into policy frameworks for today's developing economies. Where are we in the economics of industrial policies?, what three decades of research have established about when and why industrial policy works, and what conditions determine whether government intervention helps or hinders. Implementing industrial policy effectively: Lessons from shipbuilding in China, how policy design and performance conditionality determine whether sector-level support produces lasting productivity gains — the same question at the heart of the East Asian Miracle debate.

    27 min
  3. Ed Glaeser on the perfect city and the demons of density

    15 MAY

    Ed Glaeser on the perfect city and the demons of density

    This is an episode from VoxDev's new podcast series, Ideas in Development. This series has a separate podcast feed, where you can find every episode of Oliver Hanney and Kurtis Lockhart's conversations on cities. YouTube: https://www.youtube.com/watch?v=sjXmiaMPabQ Apple Podcasts: https://podcasts.apple.com/us/podcast/the-perfect-city/id1866874059?i=1000767322240 Spotify: https://open.spotify.com/episode/3MfSc3AWT6lT5jG9kvXW4B?si=371569bc3d374d72 Audioboom: https://audioboom.com/posts/8902311-the-perfect-city Substack: https://ideasindevelopment.substack.com/p/the-perfect-city   What does a perfect city look like in a low- or middle-income country – and how do you get there? In the closing episode of the Ideas in Development cities series, Ed Glaeser joins Kurtis Lockhart and Oliver Hanney for a wide-ranging conversation on what makes cities work. He sets out the three foundations every city needs (safety, mobility, education), why infrastructure without the right incentives and institutions fails, what 19th-century New York's cholera outbreaks teach Lusaka about water, why “bus good, train bad” still holds, and what the medieval European city has to offer sub-Saharan Africa's fastest-growing urban regions. We also discuss the political art of being a great mayor, why "capacity eats policy as a light afternoon snack", and his three priorities for African cities over the next decade.

    37 min
  4. Roshaneh Zafar on 30 years of microfinance and mindset change in Pakistan

    13 MAY

    Roshaneh Zafar on 30 years of microfinance and mindset change in Pakistan

    Wherever Roshaneh Zafar went in Pakistan in the early 1990s, documenting World Bank social development projects, women told her the same thing: the water and sanitation are fine, but what about economic opportunity? Zafar tells Tim Phillips how that question led her to train with Muhammad Yunus and the Grameen Bank, and then back to Pakistan to found Kashf Foundation in 1996 — the country's first specialised microfinance institution for women. Thirty years on, Kashf serves more than one million clients, has covered six million lives through micro-health insurance, and has financed over 3,000 low-cost private schools. Zafar describes a model that long ago outgrew its Grameen origins: customised for Pakistan's diversity, run on a partnership rather than a hierarchical footing, and now embracing climate risk, ultra-poor programmes and AI-assisted credit decisions. The episode also confronts the question: Does microfinance actually empower women? Research has questioned whether it makes a difference. Zafar has ten years of longitudinal data that tells a different story, and a view on why the two bodies of evidence are not as contradictory as they appear. Research and references discussed in this episode: Banerjee, Abhijit, Esther Duflo, Rachel Glennerster, and Cynthia Kinnan. 2015. "The Miracle of Microfinance? Evidence from a Randomized Evaluation." American Economic Journal: Applied Economics 7(1): 22–53. Rana, Annum Ather. 2025. Evidence on the Impact of Microfinance Program on Poverty Reduction and Income Security. Kashf Foundation Focus Note Series, April  To cite this episode: Phillips, Tim, and Roshaneh Zafar. 2026. "Roshaneh Zafar on 30 years of microfinance and mindset change in Pakistan." VoxDev Talk (podcast). Assign this as extra listening. The citation above is formatted and ready for a reading list or VLE.About Roshaneh ZafarRoshaneh Zafar is the founder and managing director of Kashf Foundation, Pakistan's first specialised microfinance institution. A development economist by training, she worked at the World Bank before leaving to found Kashf in 1996 after training under Muhammad Yunus at Grameen Bank in Bangladesh. Her work spans microfinance, micro-insurance, women's economic empowerment, low-cost private education and behaviour change communication.  Research and context cited in this episodeGrameen Bank and the Grameen model. Founded by Muhammad Yunus in Bangladesh in 1983, Grameen Bank pioneered group-based lending to poor women without requiring collateral, on the premise that social accountability within borrower groups could substitute for asset security. Yunus received the Nobel Peace Prize in 2006. Kashf was established as a Grameen replicator but diverged significantly in its approach: hiring women loan officers from the outset, replacing the group hierarchy with a peer partnership model (using the Urdu term baji, meaning sister, for both client and staff), and adapting products for Pakistan's religious, linguistic and cultural diversity. The 2008 microfinance delinquency crisis in Pakistan. Over-indebtedness, predatory lending practices and the absence of a credit information bureau led to a sector-wide delinquency crisis in Pakistan in 2008. Following the crisis, regulators, lenders and the Pakistan Microfinance Network introduced enhanced consumer protection standards and a credit bureau to prevent multiple borrowing. Kashf now limits lending to clients with no more than two active loans from any provider. Banerjee et al. (2015) randomised controlled trial. The paper, a randomised evaluation of a microcredit expansion in Hyderabad, India by Spandana Sphoorty, found no statistically significant effect on women's empowerment, health, education or consumption over an 18-to-24-month follow-up period. It became the most-cited challenge to microfinance's development impact. Zafar's counter-argument turns on time horizon: empowerment, she argues, is a decade-scale process that short-panel RCTs cannot capture. A University of Minnesota longitudinal analysis of ten years of Kashf client data found a statistically significant positive correlation between the number of loans taken and business income, and between savings behaviour and subsequent business investment. Behaviour change communication: theater and television. Kashf has used street theater for thirty years to communicate on topics including child marriage, girls' education, reproductive health and insurance take-up. After Zafar attended a conference session on the impact of telenovelas on gender norms in Brazil and Mexico, the foundation moved into television drama production, covering topics including child sexual abuse, human trafficking and cybercrime. A child sexual abuse drama prompted a legal notice from PEMRA (the Pakistan Electronic Media Regulatory Authority), which was successfully contested. The dramas are produced with a media and creative team to ensure sensitive handling of difficult subjects. The gender bond and gender sukuk. In 2005, Zafar rang the opening bell at the New York Stock Exchange. The experience prompted a long-term ambition to connect micro women entrepreneurs to capital markets. Kashf subsequently issued a gender bond listed on the Pakistan Stock Exchange, followed by a gender sukuk (Sharia-compliant bond) listed on the Luxembourg Stock Exchange — the first such instrument linking Pakistani microfinance to international Islamic capital markets. Low-cost private schools. Research by Kashf found that clients, once they had access to income, were moving their children from public to low-cost private schools; teacher absenteeism in private schools was far lower. Further research showed 70% of these schools were run by women. Kashf began financing them; it now supports over 3,000 such schools, with a requirement that girls constitute at least 50% of enrolment. More VoxDev Talks on this topicBreaking down access constraints faced by women: Experimental evidence from Pakistan, a VoxDev Talk on how removing specific barriers to vocational training take-up shifts economic participation among women in Pakistan — the supply-side complement to Kashf's demand-side model. How safe transport could unlock women's labour force participation in Pakistan, a VoxDev Talk on how mobility constraints suppress women's economic activity in urban Pakistan, and how subsidised women-only transport services can shift that. Related reading on VoxDevWhat have we learned about microfinance?, a VoxDev article reviewing the evidence base on microfinance impact, including the conditions under which credit does and does not produce lasting change in household welfare. Women's microcredit groups empower women politically, a VoxDev article on evidence that participation in group lending schemes produces political voice and civic engagement even when economic empowerment effects are limited. Empowering women through digital financial services, a VoxDev article on how mobile money and digital accounts give women a private, named financial identity — and what that does to their control over household resources.

    30 min
  5. Leonard Wantchekon on youth and governance in African cities

    8 MAY

    Leonard Wantchekon on youth and governance in African cities

    This is an episode from VoxDev's new podcast series, Ideas in Development. This series has a separate podcast feed, where you can find every episode of Oliver Hanney and Kurtis Lockhart's conversations on cities.  YouTube: https://www.youtube.com/watch?v=kOPG6UmOHGUApple Podcasts: https://podcasts.apple.com/us/podcast/cities-of-opportunity-not-powder-kegs/id1866874059?i=1000766172534Spotify: https://open.spotify.com/episode/6BoYX7rfpjn86KndCxsnyd?si=53213815c1fd4408Audioboom: https://audioboom.com/posts/8899287-cities-of-opportunity-not-powder-kegsSubstack: https://ideasindevelopment.substack.com/p/cities-of-opportunity-not-powderVoxDev: https://voxdev.org/topic/institutions-political-economy/leonard-wantchekon-youth-governance-and-africas-urban-future  Are African cities a powder keg of restless youth – or the most promising place to build prosperity, peaceful politics and shared civic life? Leonard Wantchekon joins Ideas in Development to argue that African cities should be seen as a youth opportunity, not a youth problem. We discuss recent unrest in Kenya and Tanzania, his work showing that clientelism is overwhelmingly a rural phenomenon, and that deliberation and decentralisation are the institutional minimums African cities should be reaching for. Leonard then lays out what deliberation, decentralisation and a renewed urban culture could do for the next generation of African city dwellers.

    55 min
  6. How killing sparrows contributed to the Great Chinese Famine

    6 MAY

    How killing sparrows contributed to the Great Chinese Famine

    Between 1959 and 1961, between thirty and forty million people starved to death in China. The Great Famine had many causes, and one of them was a campaign to eradicate sparrows. Shaoda Wang of the University of Chicago tells Tim Phillips about Mao Zedong's 1958 Four Pests Campaign, which led to the mass killing of sparrows, set off a chain of consequences that scientists had warned about, but political pressure had silenced. Sparrows eat crops, but they also eat the locusts and other insects that destroy the crops. Remove the sparrows and the pests go unchecked. Wang and his co-authors estimate the eradication cut national grain yields by 8-9%, accounting for roughly a fifth of the total agricultural decline during the famine. The research behind this episode: Frank, Eyal G., Qinyun Wang, Shaoda Wang, Xuebin Wang, and Yang You. 2024. "Campaigning for Extinction: Eradication of Sparrows and the Great Famine in China." NBER Working Paper 34087. To cite this episode: Phillips, Tim, and Shaoda Wang. 2025. "How killing sparrows contributed to the Great Chinese Famine.” VoxDev Talk (podcast). Assign this as extra listening. The citation above is formatted and ready for a reading list or VLE.About Shaoda WangShaoda Wang is an assistant professor at the Harris School of Public Policy, University of Chicago. His research spans environmental economics, political economy and development, with a focus on how state capacity and political incentives shape environmental and health outcomes in China and other developing countries. Research cited in this episodeThe Four Pests Campaign (1958). Launched as part of Mao Zedong's Great Leap Forward, the campaign targeted rats, flies, mosquitoes and sparrows. Sparrows were included on the grounds that they ate grain and reduced agricultural yields. Several prominent Chinese scientists warned at the time that removing sparrows would destabilise the food chain by eliminating a key predator of crop pests, particularly locusts. Their advice was ignored. The campaign resulted in the killing of an estimated two billion sparrows. County gazetteers as a data source. Official harvest data reported by local governments to the central government during the Great Leap Forward was heavily inflated; local officials faced strong political incentives to overstate output, and those exaggerated figures contributed to the famine by masking food shortages from central planners. Wang and his co-authors instead use county gazetteers: records compiled by local elites through a bottom-up process with no link to the political reward structures that distorted official reporting. Comparison between the two sources reveals the scale of over-reporting in the official data. Sparrow habitat suitability index. Rather than relying on reported sparrow kill counts, which were distorted by local officials seeking to demonstrate compliance with campaign targets, the paper constructs an index of how suitable each county's climate and ecological conditions are for sparrow habitation. Counties with high sparrow suitability were more exposed to the shock of eradication; comparing their crop yield and mortality trajectories against low-suitability counties before and after the campaign provides the causal identification strategy. The two groups followed similar trajectories before the campaign; divergence afterwards is attributed to the eradication. State food procurement as a famine amplifier. The Great Famine was not simply a production shortfall. The central government continued to export food during the famine years because inflated harvest reports gave it no signal of the actual crisis. State procurement quotas extracted grain from rural communities at a time when households were already facing starvation; the political system that caused the sparrow eradication was also the mechanism that amplified its consequences. More VoxDev Talks on this topicThe economics of ecosystems: How nature and economies interact. Eyal Frank of the University of Chicago — a co-author of the sparrows paper — on how to measure the economic value of biodiversity. His research on bats and white-nose syndrome, and on desert locusts, shows what happens when natural pest control collapses; the sparrows episode is the historical counterpart. Related reading on VoxDevThe political economy of policy learning: Evidence from China, a VoxDev article on how misaligned incentives across China's political hierarchy distort policy experimentation and produce systematically exaggerated signals — the same dynamic that inflated both the sparrow kill counts and the harvest figures during the Great Leap Forward. Autocratic rule and social capital: Evidence from Imperial China, a VoxDev article on the long-run effects of political persecution under autocratic rule in China, and how the suppression of dissent shapes economic and social behaviour across generations. The economics of conservation in low- and middle-income countries, a VoxDev article surveying the evidence on maintaining natural ecosystems, the role of governance, and the costs of losing species whose economic value is not yet understood.

    16 min
  7. Chris Blattman on how organised crime takes over cities

    1 MAY

    Chris Blattman on how organised crime takes over cities

    This is an episode from VoxDev's new podcast series, Ideas in Development. This series has a separate podcast feed, where you can find every episode of Oliver Hanney and Kurtis Lockhart's conversations on cities. YouTube: https://www.youtube.com/watch?v=JKF3aJ96L2o Apple Podcasts: https://podcasts.apple.com/us/podcast/how-crime-takes-over-cities/id1866874059?i=1000763970538 Spotify: https://open.spotify.com/episode/1YGI5Q0LDKRCSK8MHBHfEh?si=5EiiP-vbRnOYxoACBDbE0Q Audioboom: https://audioboom.com/posts/8895828-how-crime-takes-over-cities Substack: https://ideasindevelopment.substack.com/p/how-crime-captures-a-city VoxDev: https://voxdev.org/topic/institutions-political-economy/chris-blattman-how-crime-takes-over-cities  How does organised crime take over a city – and can mayors act before it does? Chris Blattman, economist and political scientist at the University of Chicago, joins the Ideas in Development cities series to explain how street gangs evolve into powerful criminal confederations, why cities like Medellín can have low homicide rates and still be almost completely captured, and what the "terrible trade-off" between violence, criminal power and political corruption means for policymakers. We then discuss the perils faced by fast-growing African cities, where the conditions for organised crime to take root are quietly assembling. Check out the Africa Urban Lab: https://www.aul.city/

    50 min
  8. Boosting farmers' profits

    29 APR

    Boosting farmers' profits

    Decades of agricultural development policy have chased yield. Bigger harvests, better seeds, more fertiliser. But how can we make farming more profitable?  Craig McIntosh of UC San Diego is academic lead on a J-PAL Policy Insight covering twenty-three randomised evaluations of credit and grants for farmers in low- and middle-income countries. He tell Tim Phillips that although yields and revenues often rise, profit rarely responds in the same way. When farmers are already running their farms close to the margin, costs rise at the same rate as income, and the household bank balance does not move much. What can we bundle with credit to change that situation? The research behind this episode: Abdul Latif Jameel Poverty Action Lab (J-PAL). 2026. "Can relaxing credit constraints boost farmers' profits?” J-PAL Policy Insights. Last modified February 2026. Academic leads: Craig McIntosh and Tavneet Suri; insight authors: Leonie Rauls and Rebecca Toole. To cite this episode: Phillips, Tim, and Craig McIntosh. 2026. “Boosting farmers' profits?" VoxDev Talks (podcast). Assign this as extra listening. The citation above is formatted and ready for a reading list or VLE.About the guestCraig McIntosh is Professor of Economics at the School of Global Policy and Strategy, UC San Diego. His research spans development finance, agricultural credit, cash transfer design and the evaluation of large-scale anti-poverty interventions.  Research cited in this episodeMicrocredit take-up among farmers. Across four randomised evaluations of traditional microcredit aimed at farmers, in Morocco, Ethiopia, Bangladesh and Malawi, take-up sat between 13 and 33 percent. Standard microcredit repayment begins a week or two after disbursement, which is incompatible with a crop cycle that pays out cash once or twice a year. Group liability also breaks down in agriculture, where shocks like drought or floods hit borrowers together rather than one at a time. Tailoring credit to the agricultural cycle. Restructured loans push take-up much higher. Nakano and Magezi in Tanzania allowed rice farmers to defer 80 percent of repayment until harvest; 39 percent borrowed and over 92 percent repaid. William Jack and co-authors in Kenya offered dairy farmers asset-collateralised loans for a water tank; take-up reached 44 percent against 2.4 percent for a typical joint-liability product. Lambon-Quayefio, Manjeer and Udry in Ghana offered digital credit with a three-month grace period; 59 percent of farmers took it up. Sell low, buy high. Burke and co-authors in Kenya showed that smallholders routinely sell at the post-harvest price trough and buy back grain at hungry-season prices 20 to 40 percent higher. Harvest-time loans that allowed farmers to delay sales had take-up of 64 percent and produced returns around 29 percent for borrowers. Treated villages also saw flatter price trajectories, generating spillover benefits for non-borrowers. Lean-season credit. Fink, Jack and Masiye in Zambia found that lean-season loans let farmers stop hiring out their labour and instead work their own land. Output rose by 9 percent. Loan repayments were comparable to the gain, leaving farmers roughly even on profits. Selection into credit markets. Beaman, Karlan, Thuysbaert and Udry in Mali first offered loans, then offered grants to those who had refused. Returns to capital among would-be borrowers were on the order of 130 percent. Returns among those who had refused the loan were close to zero. Credit appears to self-target toward farmers who can use it productively, which is regressive in welfare terms and also exactly what a capital-scarce economy needs credit markets to do. Input subsidy programmes (ISPs). Jayne and co-authors reviewed eighty studies of fertiliser subsidies across sub-Saharan Africa. Yields rise while subsidies are in place; profitability is mixed; targeting is frequently politically distorted, often skewed toward better-connected or wealthier farmers. The standout randomised exception is Carter, Laajaj and Yang in Mozambique, where two-thirds of recipients had never used fertiliser before; the programme produced sustained gains and a high benefit-cost ratio. By contrast, Gignoux and co-authors in Haiti found a fertiliser-voucher subsidy crowded out farmers' own input spending and lowered yields once the subsidy ended. Cash transfers and diversification. In six studies measuring both farm and non-farm outcomes, three found households doubled down on agriculture and three saw movement into non-farm enterprises. The Zambian Child Grant evaluation by Handa and co-authors saw women invest in seeds, fertiliser and livestock and start non-farm businesses, with household income roughly doubling. Bundled input programmes. Four randomised evaluations bundled credit or a grant with information, training or market access. All four lifted revenues; three of the four lifted incomes or profits. Harou and co-authors in Tanzania showed that fertiliser vouchers alone and soil testing alone did nothing; only the combination raised yields and revenues. Ashraf, Gine and Karlan's Kenya study on French-bean and baby-corn export found credit increased programme participation from 27 to 41 percent, even where it did not further raise income among participants.

    30 min
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