The Winner of the 13th Asia Pacific Research Prize (Iue Prize):
Dr. Takeshi Aida

- Summary -

This dissertation investigates the nexus among irrigation, community, and poverty by analyzing the data from southern Sri Lanka based on modern experimental and econometric approaches.

Chapter 1 discusses the academic and policy contribution of this dissertation.

Chapter 2 investigates the effect of social capital between irrigation canal upstream and downstream farmers on their water allocation problem. Though community-based irrigation management is considered to achieve efficient resource extraction, its effectiveness is unclear when there is heterogeneity among resource users. Using a combination of unique natural and artefactual field experiment data and general household survey data, this study finds that farmers with higher social capital, especially trust toward their downstream farmers, optimize their water demand, showing consideration for their downstream farmers. Additionally, this study finds supportive evidence for the hypothesis that scarcity of resources enhances social capital.

Chapter 3 analyzes the impact of irrigation access on poverty reduction. Since agriculture is the primary sector in most developing countries and most of the poor depend on agriculture for their livelihood, agricultural growth is key to alleviating poverty. By combining a livelihoods approach in sociology with a micro-econometric approach, we show that irrigation access has a positive effect on income through livelihood choices. We also show through qualitative approaches that factors not linked to irrigation infrastructure may contribute to changes in livelihood portfolios. In addition, we highlight factors that result in certain households being unable to move out of poverty despite access to the improved irrigation infrastructure.

Chapter 4 analyzes the effectiveness of risk sharing in spatial and social networks. Since income fluctuations are inevitable in agriculture, informal consumption smoothing within a community (i.e., risk sharing) is an important issue to mitigate transient poverty. Employing spatial panel econometric models, this study extends the empirical tests of full risk sharing hypothesis to incorporate spatial and social network effects and quantifies the diffusion of income shocks in each network. The estimation results show that consumption smoothing in spatial network performs better than in social network in the sense that income shocks defuse better among neighboring households.