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This paper analyzes the effectiveness of agriculture-led versus non-agriculture-led development strategies under climate-induced economic uncertainty. Utilizing Malawi as a case study, we introduce the application of Stochastic Dominance (SD) analysis, a tool from decision analysis theory, and compare the two strategies in the context of weather/climate-associated economic uncertainty. Our findings suggest that an agriculture-led development strategy consistently surpasses its non-agriculture-led antagonist in poverty and undernourishment outcomes across almost all possible weather/climate scenarios. This underscores that, despite increasing exposure of the entire economy to weather/climate uncertainty, agriculture-led development remains the optimal strategy for Malawi to reduce poverty and undernourishment. The study also endorses the broader use of SD analysis in policy planning studies, promoting its potential to integrate risk and uncertainty into policymaking.

This paper suggests using portfolio management methods in policy planning models as a practical tool for determining optimal policy under model parameter uncertainty. We suggest that in addition to calculating the standard policy return estimates, policy options should also be analyzed from the risk perspective by using metrics that inform the effect of parameter uncertainty on policy impact variation. We demonstrate the approach in a Computable General Equilibrium model that analyzes pro-poor agricultural value chains in Senegal under world market uncertainty. We show that prioritizing the rice sector is the most effective policy in terms of expected policy return, but this policy is also associated with the highest risk, leading to an increase in poverty under unfavorable yet realistic scenarios. Much like diversified portfolios in finance, mixed policies that assume the rice sector's promotion combined with other sectors such as milk, vegetables, oilseeds, or fishery, can offer risk reduction at the cost of reduced expected policy return.

Evidence-based planning for post-conflict reconstruction is often constrained by missing data and the shortcomings of conventional analytical methods. To overcome these constraints, we use economy-wide modeling methods to model the impact of war and reconstruction possibilities for the economy of Yemen. We first calibrate the model to pre-conflict data (2014) and validate it by replicating the most recent available dynamic needs assessments for Yemen that were elaborated by the World Bank. We then report model scenario results for unobserved development indicators, such as estimates for sector-level growth, employment, and poverty. For the post-conflict period, we use the assumptions of a recent dynamic needs assessment and assume gradual reconstruction of the war-induced damages by the target year 2024. Then we focus on uncertain institutional factors and investigate their importance for the country’s socio-economic development. Finally, we assess the potential structural characteristics of Yemen’s economy in the year 2024 and analyze potential risks and trade-offs associated with government’s institutional performance and the implications these have for the pace of post-conflict reconstruction.

With increasing evidence that rural households in Sub-Saharan Africa (SSA) opt for deagrarianization as an adaptation strategy to climate change, it is becoming important to understand the role of Global Climate Change (GCC) in ongoing structural transformation processes in these countries. We use Senegal as a case study country and analyze how various GCC scenarios affect the country's economic sectors, households' welfare, and structural transformation patterns. Our simulation results suggest that GCC can increase the country's deagrarianization pace, with industrial and service sectors in the capital Dakar being the most important destinations of the former agricultural labor force. Although unplanned urbanization smoothes the overall negative impact of GCC and decreases spatial income disparities, uncontrolled deagrarianization is also associated with negative externalities. Previous growth-focused studies suggest that services partaking in Senegal's deagrarianization can hamper its long-term growth prospects, and our results suggest that productivity increase of services can redirect part of the former agricultural labor force towards industrial sectors.

In order to address long-standing economic challenges, in 2016 the Government of Egypt (GOE) put in place a major economic reform program to restore macroeconomic stability and to promote inclusive growth. As a result, there are early signs that the economy is rebounding and Egypt's economic outlook is becoming more favorable. However, it is less clear how the ongoing reform program is affecting households, especially the poor. To shed light on this question, this paper uses an economy-wide model to estimate the distributional impacts of the energy subsidy cuts in 2014, 2016, and 2017, the currency devaluation at the end of 2016, and the expected complete phasing out of energy subsidies over the coming years.