The main objective of this paper is to provide estimates of the cost of moving out of subsistence for Madagascar's farmers. The analysis is based on a simple asset-return model of occupational choice. Estimates suggest that the entry (sunk) cost associated with moving out of subsistence can be...

The increase in investment abroad during the past two decades may help explain the simultaneous worldwide rush toward free trade. The entry of foreign capital may change the political game, increasing openness to international trade no matter what form the foreign capital takes (whether entering...