Person:
Damania, Richard
Author Name Variants
Fields of Specialization
Development Economics, Environmental Economics, Natural Resource Economics, Agricultural Economics, Water Economics, Game Theory
Degrees
Externally Hosted Work
Contact Information
Last updated
November 29, 2023
Biography
Richard Damania is the Chief Economist of the Sustainable Development Practice Group. He has held several positions in the World Bank including as Senior Economic Advisor in the Water Practice, Lead Economist in the Africa Region’s Sustainable Development Department, in the South Asia and Latin America and Caribbean Regions of the World Bank. His work has spanned across multiple sectors and has helped the World Bank become an acknowledged thought-leader on matters relating to environment, water and the economy. Prior to joining the World Bank he held positions in academia and has published extensively with over 100 papers in scientific journals.
Publication Search Results
1 - 10 of 11
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Publication
The Nitrogen Legacy: The Long-Term Effects of Water Pollution on Human Capital
(World Bank, Washington, DC, 2019-12-10)The fallout of nitrogen pollution is considered one of the largest global externalities facing the world, impacting air, water soil and human health. This paper presents new evidence that nitrogen pollution in water is an important determinant of variations in human capital. Data from the Demographic and Health Survey dataset across India, Vietnam, and 33 African countries are combined to analyze the causal links between pollution exposure experienced during the very earliest stages of life and later-life health. Results show that pollution exposure experienced in the critical years of development from the period of birth up until year three – is associated with decreased height as an adult, a well-known indicator of overall health and productivity, and is robust to several statistical checks. Because adult height is related to education, labor productivity, and income, this also implies a loss of earning potential. Results are consistent and show that early-life exposure to nitrogen pollution in water can lower height-for-age scores during childhood in Vietnam and during infancy in Africa. These findings add to the evidence on the enduring consequences of water pollution and identify a critical area for policy intervention. -
Publication
Infrastructure in Conflict-Prone and Fragile Environments: Evidence from the Democratic Republic of Congo
(World Bank, Washington, DC, 2015-05)In conflict-prone situations, access to markets is necessary to restore economic growth and generate the preconditions for peace and reconstruction. Hence, the rehabilitation of damaged transport infrastructure has emerged as an overarching investment priority among donors and governments. This paper brings together two distinct strands of literature on the effects of conflict on welfare and on the economic impact of transport infrastructure. The theoretical model explores how transport infrastructure affects conflict incidence and welfare when selection into rebel groups is endogenous. The implications of the model are tested with data from the Democratic Republic of Congo. The analysis addresses the problems of the endogeneity of transport costs and conflict using a novel set of instrumental variables. For transport costs, a new instrument is developed, the natural-historical path, which measures the most efficient travel route to a market, taking into account topography, land cover, and historical caravan routes. Recognizing the imprecision in measuring the geographic impacts of conflict, the analysis develops a spatial kernel density function to proxy for the incidence of conflict. To account for its endogeneity, it is instrumented with ethnic fractionalization and distance to the eastern border. A variety of indicators of well-being are used: a wealth index, a poverty index, and local gross domestic product. The results suggest that, in most situations, reducing transport costs has the expected beneficial impacts on all the measures of welfare. However, when there is intense conflict, improvements in infrastructure may not have the anticipated benefits. The results suggest the need for more nuanced strategies that take into account varying circumstances and consider actions that jointly target governance with construction activities. -
Publication
Ecosystems : Burden or Bounty?
(World Bank, Washington, DC, 2014-05)This paper presents a somewhat novel approach to explore the economic contribution of ecosystems. It develops linked models to capture connections between resource stocks and flows and the resulting microeconomic and macroeconomic impacts. A bioeconomic model is developed that is imbedded into a computable general equilibrium (CGE) model. Incorporating imperfect regulation, the bioeconomic model characterizes optimal policies, while the CGE model explores the economy-wide consequences of possible changes to the ecosystem. The model is parameterized and calibrated to the case of the Serengeti ecosystem which is perhaps the most intensively researched biome with a relative abundance of data. This ecosystem is also undergoing rapid change from a host of factors related to developments within and around the protected area system. The analysis identifies the contribution of the ecosystem to the economy and finds that changes in tourism and bushmeat hunting have surprisingly diffuse economy-wide impacts, that are especially large in the rural sector. To guard against overstatement, ecosystem impacts are under-stated relative to other effects. The results suggest that linkages to the natural resource sector (backward and forward multipliers) are important and neglecting these may lead to biased estimates. -
Publication
Transport Infrastructure and Welfare: An Application to Nigeria
(World Bank, Washington, DC, 2015-05)Transport infrastructure is deemed to be central to development and consumes a large fraction of the development assistance envelope. Yet there is debate about the economic impact of road projects. This paper proposes an approach to assess the differential development impacts of alternative road construction and prioritize various proposals, using Nigeria as a case study. Recognizing that there is no perfect measure of economic well-being, a variety of outcome metrics are used, including crop revenue, livestock revenue, non-agricultural income, the probability of being multi-dimensionally poor, and local gross domestic product for Nigeria. Although the measure of transport is the most accurate possible, it is still endogenous because of the nonrandom placement of road infrastructure. This endogeneity is addressed using a seemingly novel instrumental variable termed the natural path: the time it would take to walk along the most logical route connecting two points without taking into account other, bias-causing economic benefits. Further, the analysis considers the potential endogeneity from nonrandom placement of households and markets through carefully chosen control variables. It finds that reducing transportation costs in Nigeria will increase crop revenue, non-agricultural income, the wealth index, and local gross domestic product. Livestock sales increase as well, although this finding is less robust. The probability of being multi-dimensionally poor will decrease. The results also cast light on income diversification and structural changes that may arise. These findings are robust to relaxing the exclusion restriction. The paper also demonstrates how to prioritize alternative road programs by comparing the expected development impacts of alternative New Partnership for Africas Development projects. -
Publication
Road Improvement and Deforestation in the Congo Basin Countries
(World Bank, Washington, DC, 2015-05)Road construction has often been viewed as the precursor to deforestation, especially in tropical forests. Traditional responses to such threats have been reactive, with attempts to mitigate impacts through physical measures, or the establishment of protected areas. These approaches often have not been entirely successful, especially in areas where economic potential is significant. This paper seeks to mitigate such conflicts by proposing a proactive approach to development planning and environmental policy. It develops a high-resolution spatial model of road improvement impacts that includes ecological risks and the economics of forest clearing. The approach is implemented by estimating the potential impact of road upgrading on forest clearing and biodiversity in eight Congo Basin countries. The paper demonstrates how the detailed analysis can identify areas of high ecological priority as well as areas at high risk of forest loss. The paper contributes to several aspects of the literature. First, it provides the most recent and reliable estimates of the drivers of deforestation in the Congo Basin, with the latest high-resolution satellite data on forest cover changes. Second, it presents novel estimates of biodiversity threats by creating an index that combines and synthesizes several measures of biodiversity loss and impacts. It then develops an empirical framework for estimating the ecological impacts of road improvement. Finally, the paper illustrates how the empirical framework can be used to preempt impacts and avoid potential ecological damage. -
Publication
Agricultural Technology Choice and Transport
(World Bank, Washington, DC, 2015-05)This paper addresses an old and recurring theme in development economics: the slow adoption of new technologies by farmers in many developing countries. The paper explores a somewhat novel link to explain this puzzle -- the link between market access and the incentives to adopt a new technology when there are non-convexities. The paper develops a theoretical model to guide the empirical analysis, which uses spatially disaggregated agricultural production data from Spatial Production Allocation Model and Living Standards Measurement Study survey data for Nigeria. The model is used to estimate the impact of transport costs on crop production, the adoption of modern technologies, and the differential impact on returns of modern versus traditional farmers. To overcome the limitation of data availability on travel costs for much of Africa, road survey data are combined with geographic information road network data to generate the most thorough and accurate road network available. With these data and the Highway Development Management Model, minimum travel costs from each location to the market are computed. Consistent with the theory, analysis finds that transportation costs are critical in determining technology choices, with a greater responsiveness among farmers who adopt modern technologies, and at times a perverse (negative) response to lower transport costs among those who employ more traditional techniques. In sum, the paper presents compelling evidence that the constraints to the adoption of modern technologies and access to markets are interconnected, and so should be targeted jointly. -
Publication
When Good Conservation Becomes Good Economics: Kenya’s Vanishing Herds
(World Bank, Washington, DC, 2019-10-07)It is no exaggeration to state that Kenya’s wildlife has done much to shape the image and development fortunes of the country. Today tourism is among Kenya’s top sources of foreign exchange, dominates the service sector, and contributes significantly to employment, especially in rural areas where economic opportunities are limited. The typical international tourist arrives on a package tour that may include a safari, a visit to the beach, or both. It is safari tourism, however, that generates the most employment and economic activity across the country. But the wildlife that has lured travelers to Kenya by the planeload is in dramatic decline. In the past three decades, the country has lost more than half of its wildlife. Wild herds that once roamed freely across the borders of Kenya and Tanzania have shrunk dramatically in numbers and vanished completely from much of the North. Perhaps most troubling is that recent monitoring of wildlife populations suggests that long-term declines of many of the charismatic species that attract tourists like lions, elephants, giraffes, impalas, and others are occurring at the same rates within the country’s national parks as outside of these protected areas. This report identifies with greater precision the drivers of land conversion from natural habitats to other uses, and examines the extent to which land conversion leads to the extirpation of wildlife and the loss of tourism incomes. -
Publication
Evaluating Transport Infrastructure Projects in Low Data Environments: An Application to Nigeria
(Taylor and Francis, 2018)Transport infrastructure consumes a large fraction of the development assistance envelope. Yet procedures for evaluating transport infrastructure projects are typically ad hoc. This paper proposes an approach to assess the differential impacts of alternative investment proposals in data constrained environments where conducting reliable impact analyses is difficult. We first demonstrate a technique for estimating the cost of transporting products to markets. We then estimate the impact of improving the road network on economic activity. Finally, we perform simulations to demonstrate a methodology for prioritizing alternative investments. The analysis demonstrates a pragmatic, though rigorous, approach for assessing transport infrastructure benefits. -
Publication
The Nitrogen Legacy: The Long-Term Effects of Water Pollution on Human Capital
(World Bank, Washington, DC, 2020-02)The fallout of nitrogen pollution is considered one of the largest global externalities facing the world, impacting air, water, soil, and human health. This paper combines data from the Demographic and Health Survey data set across India, Vietnam, and 33 African countries to analyze the causal links between pollution exposure experienced during the very earliest stages of life and later-life health. The results show that pollution exposure experienced in the critical years of development—from birth until age three—is associated with decreased height as an adult, a well-known indicator of overall health and productivity, and is robust to several statistical checks. Because adult height is related to education, labor productivity, and income, this also implies a loss of earning potential. The analysis begins within an assessment in India, where the data are more available, and is then extended to geographic settings including Vietnam and 33 countries in Africa. The results are consistent and show that early-life exposure to nitrogen pollution in water can lower height-for-age scores during childhood in Vietnam and during infancy in Africa. These findings add to the evidence on the enduring consequences of water pollution and identify a critical area for policy intervention. -
Publication
Economic Boom or Ecologic Doom?: Using Spatial Analysis to Reconcile Road Development with Forest Conservation
(Washington, DC: World Bank, 2016-05-20)The natural endowment of the Democrat Republic of Congo, in the form of land, minerals, and forests, is unparalleled. The right mix of policies has the potential to unleash incentives that could transform the economy. However, transport infrastructure in the DRC is amongst the sparsest and most dilapidated in the world, and this lack of infrastructure is likely a significant constraint to growth. This work considerably advances the information that is available to infrastructure planners, and provides methodologies that could be used to make more informed decisions to identify trade-offs between economic growth and environmental endangerment. The approach draws from the state-of the art across a variety of disciplines – spatial (GIS) analysis, spatial econometrics, economic theory, and conservation biology – to create an approach that can guide the location and level of investments by estimating benefits and environmental costs at a highly disaggregated spatial scale. The analysis proceeds in four related phases that combine economic assessments with geospatial analysis. First transport costs are estimated using GIS techniques. A variety of econometric procedures are then used to determine the economic effects of changing transport costs. Second, highly disaggregated spatial data is used to estimate the effects of roads on forest cover, and the resulting biodiversity that would be at risk from local deforestation. Next the two spatial estimates are combined to simulate the effects of different policies. Finally this provides a series of maps that identify regions where there are large trade-offs between economic and ecological goals. Overall the results suggests that the siting of infrastructure needs to consider impacts at the very outset of the planning process. This report presents both new data and new techniques that can be used to identify areas of opportunity, risk, and potential for REDD+ financing. Such upstream planning has been rendered both feasible and cost effective with the availability of geo-referenced information on forest cover and economic data. This report provides the data and easily comprehensible maps for such an exercise.