Improving productivity in developing countries

Project overview

Project lead: Orazio Attanasio, Institute for Fiscal Studies

Start date: 12 March 2012

End date: 21 August 2015

Research Council project page

There is much evidence to show that productivity in developing countries can be extremely low, particularly for agricultural activities. Often, policymakers, practitioners and researchers have identified simple innovations and investment opportunities that would greatly improve productivity and offer a substantial rate of return but yet do not get adopted.

This research aimed to identify imperfections and frictions that prevent the adoption of profitable technology and innovations or, more generally, that may impede investment opportunities with a potentially high rate of return. To achieve this, the research used data collected to evaluate a number of interventions in developing countries in order to estimate models of individual behaviour and investment choices. Four different projects covered parts of Africa, India, and Pakistan.

The use of different methods, ranging from impact evaluation to the estimation of economic (structural) models of behaviour allowed for an understanding of the mechanisms at play, and also for the extrapolation of what is learnt in a given context to a variety of different situations. This research is crucial for the design of policies aimed at improving productivity.


Follow-on Grant

Following on from Attanasio’s DEGRP research, a further follow-on project grant has been awarded by the ESRC until June 2021. To fill a knowledge gap on the take-up of microfinance loans in India, his research will ask: Does information provision foster or hinder the effectiveness of microcredit for human capital investments?

Understanding the role of information, and how it interacts with the provision of social credit impact investments, will help programmes create better awareness campaigns to influence uptake and deliver the desired outcomes of initiatives. Focusing on microcredit loan uptake for sanitation investments in rural areas in Maharashtra, the project will build knowledge for future policy and communications messages with a view to help households out of poverty and enhance their productivity.