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Managing Extreme Events I Famine

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This week, managing extreme events or (form earlier lecture) large, covariant ... Natural or man-made: weather is only one source of crop failure and food shortages ... – PowerPoint PPT presentation

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Title: Managing Extreme Events I Famine


1
Managing Extreme Events IFamine
  • November 5, 2007

2
Announcements
  • One paragraph abstract of policy brief due on
    Friday (Nov. 9th)
  • Should include
  • Brief description of very specific problem in a
    specific country
  • Who is your audience? (USAID, World Bank, etc.)
  • Brief description of causes
  • Brief explanation of your policy recommendation
  • Financial Crises reading and lecture cancelled

3
Readings for Today
  • Sen, Chapter 7
  • Smith, Overcoming Humanitarian Dilemmas in the
    DPRK

4
Overview
  • Famines (as a category of crisis)
  • Conventional view vs. political view
  • North Korea

5
Risk, Again
  • This week, managing extreme events or (form
    earlier lecture) large, covariant risks (see next
    slide)
  • Question what role can and does the
    international community play in responding to
    such crises and mitigating the risk associated
    with them
  • Natural disasters flood, drought, earthquakes,
    fires
  • Famines and food shortages
  • Civil wars
  • Financial crises

6
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7
Famine I
  • Traditional view weather drought, flood,
    freezesgtcrop failuresgtfood
    shortagesgtmalnutrition and starvationgtdeath
  • Revisionist views the complexity and variety of
    famines

8
Famine II
  • Natural or man-made weather is only one source
    of crop failure and food shortages
  • policy choices with respect to agriculture,
    particularly in Communist systems (Ukraine,
    China, North Korea) but also in market economies
    (Ethiopia 1972-74)
  • war, civil war or domestic conflict leads to crop
    or distribution failures or difficulty in
    humanitarian assistance (the new famines)
  • Once shortages are apparent, domestic politics
    forecloses international appeals or aid (North
    Korea)

9
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13
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14
Famines III
  • Decline in aggregate food availability is neither
    a necessary nor sufficient condition for famines
    to occur (Sen Sen and Dreze)
  • Mortality is high, but rarely exceeds 2-3 percent
    of population, suggesting distribution issues are
    key
  • Famines can occur if rising food prices prevent
    poor from being able to purchase food
  • Not just cultivators and landless labor, but
    artisans and traders affected by generalized
    recession in rural economy
  • Pastoralists and fisherman see deteriorating
    terms of trade as grain prices skyrocket

15
Famines IV
  • Sens focus on entitlements the bundle of
    commodities--and ultimately rights--that
    individuals can command, including
  • Through production
  • Labor (working for food sharecropping)
  • Through purchases in the market (exchange)
  • Through legal rights or guarantees of transfers,
    or anti-famine compacts

16
Famines V
  • Re-analysis of 6 famines as entitlement failures,
    particularly exchange failures speculation and
    hoarding lead to spiraling prices and bubbles
  • And dont occur in democracies primarily for
    informational and political reasons (although
    Niger raises questions)
  • A case for humanitarian intervention (parallel to
    genocides)?

17
Famines IV
  • Sources of mortality (excess deaths)
  • The vulnerable--children and elderly--and the
    need to reach them
  • An evolution in thinking from starvation as
    cause
  • to hunger-related diseases--diarrhoea,
    gasto-enteritis, dystentary--and infection
  • to epidemics death not from susceptibility but
    exposure
  • Refugees and refugee camps contribute to
  • Deaths from cholera, malaria, measles, typhus
    (the Central African refugees)

18
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19
North Korea Background
  • Partition
  • Northern part of the peninsula more
    industrialized, the South the breadbasket.
  • Devastated by 1950-53 war, armistice in 1954.
  • Centrally planned economy organized along Soviet
    lines
  • Agriculture collectivized, brought under state
    control.
  • Food security sought through self-sufficiency
    (juche) at the national, provincial, and even
    county level.
  • Agricultural production system highly
    input-intensive dependent on energy, fertilizer

20
Origins of the Crisis
  • The changed geo-strategic context
  • Soviet aid cut-off, mid-1980s.
  • Massive trade shock 1990
  • Juche strategy and limited exports means
    declining access to commercial financing for
    imports
  • Industrial economy collapses, deprives
    agriculture of industrial inputs
  • Yields and output fall
  • To maintain output levels, increasingly marginal
    land is brought into production hillsides
    denuded, soil erosion, river silting
  • The 1995 floods provide cover to appeal for aid

21
Aggregate Grain Supply
  • The debate over famine food availability or
    distribution?
  • Economic decline from mid-1980s.
  • Deprived of inputs, agricultural yields fall
  • The misunderstood role of weather.

22
Aggregate food balances
  • Demand controversies
  • Normal, human, minimum human needs
  • Actual v. counterfactual supply
  • Was the famine avoidable, and if so by when?
  • The failure of the external sector

23
Crowding out aid as balance of payments support
Total Imports and Commercial Food Imports
Imports and Aid
24
Microeconomic analysis of the famine the
entitlement failure
  • Lets eat two meals a day
  • Constrained monitoring, incentives to divert, and
    the development of markets.

25
Food availability or entitlement failures?
  • Historically food distributed through the Public
    Distribution System, a rationing system
  • The system breaks down
  • the state vs. the cultivators incentives to
    hoard, divert effort into private plots
  • Central government engages in triage cant--or
    wont--distribute shortfalls
  • As social compact breaks down, households resort
    to coping behavior (internal migration, foraging)
  • Food increasingly allocated through markets
  • Estimated excess deaths 600,000-1,000,000 (3-5
    percent of population).

26
Foreign Donors and the DPRK Government
  • Myth of the natural disasters
  •   Relations fundamentally adversarial
  •   The humanitarian principles and the concerns
    of the NGOs and donors
  • The nuclear crisis and the political use of food
    aid
  • The US
  • Japan
  • South Korea

27
Conclusions and Things to Think About
  • How are famines similar to or different from
    other types of humanitarian crises, and what does
    that mean for the international response?

28
What is to be done?
  • Aid is politically precarious.
  • Agriculture-centric strategy probably
    insufficient
  • WFP seeking 100 million in 2006-7
  • but donor fatigue has set in.
  • Industrial revival is key the fallacy of
    self-sufficiency
  • Domestic and foreign incentives to muddle through
    imply continuation of food crisis
  • But new agreement may provide the basis for
    resumption of external assistance
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