Environmental impact of genetically modified cotton in South Africa

This paper presents the results of a large-scale study designed to monitor the impact arising from the introduction of insect-resistant Bt cotton in the Makhathini Flats, Republic of South Africa. Bt cotton provides a degree of resistance to cotton bollworm complex (Lepidoptera). Data were collected on the use of insecticides (type and quantity) as well as the farm-level economics of production from over 2200 farmers in three growing seasons (1998/1999, 1999/2000 and 2000/2001). and the results are discussed within the context of environmental impact brought about by insecticide. Over the three seasons of the study it was clear that Bt cotton provided benefits in terms of higher yield and gross margin relative to farmers growing conventional (non-Bt) cotton, and the benefits were particularly apparent for the smallest producers. Bt growers also used significantly less insecticide than growers of non-Bt cotton. Once quantities of insecticide applied to Bt and non-Bt cotton were converted into a Biocide Index and an Environmental Impact Quotient (EIQ) in order to allow for differences in terms of toxicity and persistence in the environment, it was apparent that the growing of Bt had a less negative impact on the environment. While this points to beneficial impacts on agricultural sustainability there are wider concerns regarding the vulnerability of resource-poor farmers in an area with limited (as yet) marketing options for their product and options for livelihood diversification both within and outside agriculture. Cotton producers in Makhathini are vulnerable as they rely on just One company for inputs (including, credit) and for their market. While Bt cotton provides benefits it does not in itself address some of the structural limitations that farmers face. (c) 2006 Elsevier B.V. All rights reserved.

Output risk aspects of genetically modified crop technology in South Africa

Technology involving genetic modification of crops has the potential to make a contribution to rural poverty reduction in many developing countries. Thus far, insecticide-producing 'Bt' varieties of cotton have been the main GM crops under cultivation in developing nations. Several studies have evaluated the farm-level performance of Bt varieties in comparison to conventional ones by estimating production technology, and have mostly found Bt technology to be very successful in raising output and/or reducing insecticide input. However, the production risk properties of this technology have not been studied, although they are likely to be important to risk-averse smallholders. This study investigates the output risk aspects of Bt technology using a three-year farm-level dataset on smallholder cotton production in Makhathini flats, Kwa-Zulu Natal, South Africa. Stochastic dominance and stochastic production function estimation methods are used to examine the risk properties of the two technologies. Results indicate that Bt technology increases output risk by being most effective when crop growth conditions are good, but being less effective when conditions are less favourable. However, in spite of its risk increasing effect, the mean output performance of Bt cotton is good enough to make it preferable to conventional technology even for risk-averse smallholders.

Simulating the impact of regulation changes on the market for prostitution services

The paper draws on recent research on the economics of prostitution focussing on the role of stigma in shaping the interaction between demand and supply and the resulting sub-markets in which this activity is typically organised. Here we extend the framework to consider the role of reputation and stigma in determining policy decisions regarding the regulation of prostitution and show how sub-optimal outcomes (from the point of view of the welfare of sex workers) may prevail.

Poisoning the mind: Arsenic contamination of drinking water wells and children's educational achievement in rural Bangladesh

Bangladesh has experienced the largest mass poisoning of a population in history owing to contamination of groundwater with naturally occurring inorganic arsenic. Prolonged drinking of such water risks development of diseases and therefore has implications for children's cognitive and psychological development. This study examines the effect of arsenic contamination of tubewells, the primary source of drinking water at home, on the learning outcome of school-going children in rural Bangladesh using recent nationally representative data on secondary school children. We unambiguously find a negative and statistically significant correlation between mathematics scores and arsenic-contaminated drinking tubewells at home, net of the child's socio-economic status, parental background and school specific unobserved correlates of learning. Similar correlations are found for an alternative measure of student achievement and subjective well-being (i.e. self-reported measure of life satisfaction), of the student. We conclude by discussing the policy implication of our findings in the context of the current debate over the adverse effect of arsenic poisoning on children.

The economic theory of international supply chains: a systems view

This paper offers an integrated analysis of out-sourcing, off-shoring and foreign direct investment within a systems view of international business. This view takes the supply chain rather than the firm as the basic unit of analysis. It argues that competition in the global economy selects supply chains that maximise the joint profit of all the firms in the chain. The systems view is compared with the firm-centred view commonly used in strategy literature. The paper shows that a firm’s strategy must be embedded within an efficient supply chain strategy, and that this strategy must be negotiated with, rather than imposed upon, other firms. The paper analyses the conditions under which various supply chain strategies - and by implication various firm-level strategies - are efficient. Only by adopting a systems view of supply chains is it possible to determine which firm-level strategies will succeed in a volatile global economy.

Two-way communication costs and the boundaries of the firm

Casson and Wadeson (International Journal of the Economics of Business, 1998, 5, pp. 5-27) have modelled the dialogue, or conversation, which customers have with their suppliers in order to convey their requirements, while taking production implications into account. They showed that this has important implications for the positioning of the boundaries of the firm. Unfortunately, their model has the restriction that communication is only costly in the direction of customer to supplier. This paper extends their model by introducing two-way communication costs. It shows that the level of communication cost in the direction of supplier to customer is a key additional factor in determining the nature of the dialogue that takes place. It also shows that this has important additional implications for the positioning of the boundaries of the firm. Custom computer software development is used as an example of an application of the theory.

Communication costs and the boundaries of the firm

Much has been written about where the boundaries of the firm are drawn, but little about what occurs at the boundaries themselves. When a firm subcontracts, does it inform its suppliers fully of what it requires, or is it willing to accept what they have available? In practice firms often engage in a dialogue, or conversation, with their suppliers, in which at first they set out their general requirements, and only when the supplier reports back on how these can be met are their more specific requirements set out. This paper models such conversations as a rational response to communication costs. The model is used to examine the impact of new information technology, such as CAD/CAM, on the conduct of subcontracting. It can also be used to examine its impact on the marketing activities of firms. The technique of analysis, which is based on the economic theory of teams, has more general applications too. It can be used to model all the forms of dialogue involved in the processes of coordination both within and between firms.

Information strategies and the theory of the Firm

Information costs play a key role in determining the relative efficiency of alternative organisational structures. The choice of locations at which information is stored in a firm is an important determinant of its information costs. A specific example of information use is modelled in order to explore what factors determine whether information should be stored centrally or locally and if it should be replicated at different sites. This provides insights into why firms are structured hierarchically, with some decisions and tasks being performed centrally and others at different levels of decentralisation. The effects of new information technologies are also discussed. These can radically alter the patterns and levels of information costs within a firm and so can cause substantial changes in organisational structure.

Pippi Longstocking, juvenile delinquent? Hachette, self-censorship and the moral reconstruction of postwar France

This paper looks at the blockages to the publication of children’s literature caused by the intellectual climate of the postwar era, through a case study of the editorial policy of Hachette, the largest publisher for children at this time. This period witnessed heightened tensions surrounding the social and humanitarian responsibilities of literature. Writers were blamed for having created a culture of defeatism, and collaborationist authors were punished harshly in the purges. In the case of children’s literature, the discourse on responsibility was made more urgent by the assumption that children were easily influenced by their reading material, and by the centrality of the young to the discourse on the moral reconstruction of France. As the politician and education reformer Gustave Monod put it: “penser l’avenir, c’est penser le sort des enfants et de la jeunesse.” These concerns led to the expansion of associations and publications dedicated to protecting children and promoting “good” reading matter for them, and, famously, to the 1949 law regulating publications for children, which banned the depiction of crime, debauchery and violence that might demoralise young readers. Using the testimonials of former employees, along with readers’ reports and editorial correspondence preserved in the Hachette archives, this paper will examine how individual editorial decisions and self-censorship strategies were shaped by the 1949 law with its attendant discourse of moral panic on children’s reading, and how national concerns for future citizens were balanced with commercial imperatives.