Rural poverty and agricultural performance in India

This paper examines time series evidence on rural poverty over the past two decades. The time series shows that the incidence of poverty fluctuates in response to variations in real agricultural output per head, but there is no significant time trend. There is a statistically significant inverse relationship between rural poverty and agricultural performance for India as a whole, suggesting that agricultural growth by itself tends to reduce the incidence of poverty. The analysis for individual states presents a somewhat different picture. The inverse relationship between output per head and rural poverty is observed in several states but there is also evidence that there are processes at work which tend to increase the incidence of poverty, independently of variations in agricultural output per head.     

Alleviating rural poverty through agricultural growth

The article examines the role of agricultural GDP growth in alleviating rural poverty in LDCs. Cross‐sectional regression analysis indicates that GDP growth by itself takes a very long time to reduce poverty significantly. It suggests that decreases in land concentration could have a more immediate impact on reducing rural poverty; the budgetary and other costs of implementing such changes are not, however, considered. The preferred approach is a combination of equitable growth and redistributive measures.     

Farm productivity and rural poverty in India

Armed with new data, we return to an old question from the pages of this journal: to what extent do India's rural poor share in agricultural growth? Combining data from 24 household sample surveys spanning 35 years with other sources, we estimate a model of the joint determination of consumption‐poverty measures, agricultural wages, and food prices. We find that higher farm productivity brought both absolute and relative gains to poor rural households. A large share of the gains was via wages and prices, though these effects took time. The benefits to the poor were not confined to those near the poverty line.     

Price policy,poverty, and power within rural West African households

This paper explores the impact of agricultural price policy on poverty in West Africa, a region in which prices are an important tool for raising rural household incomes. A game-theoretic, collective model of household income generation and resource allocation is developed that incorporates three features typical of West African rural households: preference heterogeneity among women and men, individual resource control, and power-mediated bargaining over resource control in the face of changes in households' economic environments. To explore price effects, the model is used to simulate the income impacts of large increases in cotton prices accompanying fast-paced agricultural liberalisation in Burkina Faso in the 1980s. The paper shows that where resources are controlled individually by household members, rather than pooled, Pareto efficiency in income generation does not hold. The impact of agricultural price policy on poverty is mediated by bargaining over resource control within households. Both the relative bargaining power of women and men and the degree of preference heterogeneity between them play fundamental roles in the outcome of such bargaining. The results point to a lower ability of households to take advantage of price incentives and thereby raise their incomes than a unitary household model, in which preferences do not differ and resources are pooled, predicts. They suggest that the effectiveness of price policy in reducing poverty in the region would be enhanced by taking into account the incentive structure within households as well as individual household members' ability to bargain over the benefit and cost streams flowing from price changes.     

DISCUSSION - Agricultural Policy Reform and Rural Livelihoods in Central Mexico

This contribution examines the impact of profound changes to agricultural policy implemented since 1988 on the livelihoods of Mexico's rural population. Detailed studies in four villages show that rural incomes are very unevenly distributed within communities leaving half of households in poverty. During the last decade key factors affecting village economies have been international and national, rather than specific changes to farm policy. Most changes have been to the detriment of the communities studied, but peasant households have adapted and survived, at a price. If the worst fears about the consequences of economic liberalisation have not been realised, neither have the hopes. Depressed markets for basic goods and services have limited the growth of the rural economy. Private investment and provision of services have not been stimulated.     

Cash Transfers Enable Households to Cope with Agricultural Production and Price Shocks: Evidence from Zambia

Climate change is projected to dramatically disrupt rainfall patterns and agricultural yields in sub-Saharan Africa. These shocks to food production can mire farming households in poverty traps. This study investigates whether unconditional cash transfers can help households cope with agricultural production and price shocks. We find that cash empowers poor, rural households facing these negative shocks to employ coping strategies typically used by the non-poor and enables them to substantially increase their food consumption and overall food security. Extending relatively small cash payments unconditionally to the rural poor is a powerful policy option for fostering climate-resilient development.     

Agricultural wages in Bangladesh: What do the figures really show?

Using new data and a different model, Palmer‐Jones [1993] has questioned the conclusions of Boyce and Ravallion [1991] concerning the evolution over time of agricultural wages in Bangladesh. I argue that Palmer‐Jones's model is unconvincing and that the main conclusions of Boyce and Ravallion are far more robust than he suggests. Wages respond sluggishly to rice prices. Bangladesh's (limited) agricultural growth has not raised the real wage rate, which was on a downward trend for most of the 1960s and 1970s. The mid‐1980s saw higher real wages, though this cannot yet be deemed a reversal of the previous trend.     

Public Participation and Environmental Impact Assessment in Mainland China and Taiwan: Political Foundations of Environmental Management

This article explores the role of agro-ecological factors associated with agricultural growth and poverty outcomes in India. Using a new operationalisation of agro-ecological factors and incorporating within-State variations in poverty and other variables we show that agricultural growth and poverty reduction appear to depend on underlying agro-ecological conditions which are favourable to the spread of irrigation and hence agricultural development, which in turn in associated with poverty reduction. Promotion of agriculture in less favoured areas in unlikely to have similar effects on agriculture in less favoured areas is unlikely to have similar effects on agricultural growth even if the effects of agricultural growth on poverty remain similar, unless conditions for irrigation are favourable or rainfall is sufficiently abundant and reliable. This suggests that considerable caution may be needed in drawing policy conclusions from empirical analysis by state alone, and without regard to their underlying factor endowments.     

Analysing agricultural investment from the realities of small-scale food providers: grounding the debates

Abstract

Over the past decade, agricultural investment has been presented as a catchall solution to a converging set of global crises, often with poor rural communities as the proclaimed beneficiaries. Yet the promises of such investment, such as poverty alleviation and improved food access, are routinely at odds with realities on the ground. This article offers frameworks for analysis of agricultural investment that are grounded in the realities of small-scale food providers, drawing from two studies. The first study employs a right to food framework to identify the main channels through which food for consumption is procured by small-scale food providers and the factors impacting these channels. It draws on empirical data from within the Southern Agricultural Growth Corridor of Tanzania (SAGCOT), an investment model promised to lift rural communities out of poverty, which reflects a regional trend. Based on the shortcomings of the large-scale investments examined, the second study employs a food sovereignty framework to explore alternative forms of investment envisioned and/or already being put into practice by small-scale food providers in the SAGCOT area and elsewhere in Tanzania. While two different frameworks formed the basis of two different studies, both the studies and their frameworks are interrelated. The final section of this article makes the case for why both the right to food and food sovereignty are essential lenses for understanding agricultural investment vis-à-vis small-scale food providers and the ways in which they can serve as complementary tools for effective analysis.     

Distributional Effects of Maize Price Increases in Malawi

Abstract

In the wake of highly volatile world prices of staple commodities, we examine the impacts of increases in maize prices on various categories of households in Malawi. Using household-level data, changes in household income are calculated taking into account the net maize production status of the household and food price elasticities estimated from a censored demand system. While maize price increases have unequivocal deleterious effects on the incomes of urban households, rural households experience differential impacts. Net producing households in rural areas benefit from price increases with households above the poverty line obtaining proportionally higher incomes.     

Enhancing food access in Africa: The Botswana experience

A combination of drought and misguided economic policies have resulted in decreased food security and frequent famines in many African countries in recent years. Botswana is a rare exception that has survived its worst drought without a single death from hunger. It has adopted a National Food Strategy that has both long term and short term policy dimensions. The long term goal is to increase food security through improved agricultural production and diversified rural economy. In the short term, the goal is to provide food security to the most vulnerable segment of its population. The two components of the food access program are human supplementary feeding and cash for work. The article examines Botswana’s experience in enhancing food security, based on an exploratory case study of the public employment program (cash for work) in the South East District of the Republic of Botswana. Sisay Asefa is associate professor of economics at Western Michigan State University. His current research is in country development studies, African (economic) studies, and rural/agricultural development studies. He is the author of “The Role of the Government of Botswana in Increasing Rural and Urban Access to Food” inSouthern Africa: Food Security Policy Options, edited by M. Rukuni and R. H. Bernesten, 1989 and editor ofWorld Food and Agriculture: Economic Issues and Problems (W. E. Upjohn Institute, 1988).     

Safety in small numbers: Local strategies for survival and growth in Romania and the Kyrgyz Republic

Using a comparative study of farm households from poor rural communities in Kyrgyzstan and north-east Romania this paper explores the intricacies of a variety of forms of cooperation in agriculture. The findings highlight the safety net, labour specialisation, asset-pooling and service delivery functions of different groups that enable rural livelihoods to, at times, cope and at times improve in situations of imperfect information, sluggish labour and land markets, and constrained capital markets. The research presented here indicates that small to medium forms of cooperation provide the rural poor with predictable livelihood strategies under conditions of uncertainty. Specifically, cooperative action, in the form of groups, substitutes for imperfect markets. Despite the push for decollectivisation and privatisation across transition countries there remains a place for encouraging group initiatives, at least for the medium term, on the grounds of both poverty alleviation and agricultural growth.     

Food Price Volatility and Vulnerability in the Global South: considering the global economic context

Abstract

Most official analyses of the recent food price crisis have focused on the market fundamentals of supply and demand for food as key explanatory factors. As a result, most of the policy recommendations emanating from the major international institutions include measures to boost supply and temper demand. In this paper I argue that international macroeconomic factors played a key role in fostering both price volatility and vulnerability, and as such they need to be recognised. With respect to the recent price volatility, the weak US dollar and speculation on agricultural commodities futures markets greatly influenced agricultural prices. With respect to price vulnerability, global economic forces played an important role in dampening production incentives in the world's poorest countries over the past 30 years, leading to a situation of food import dependence. Policy responses to the food crisis must consider the role of these broader international macroeconomic forces—both in the immediate context and their longer term impact.     

Poverty and productivity in female-headed households in Zimbabwe

A household survey conducted in rural Zimbabwe in 2001 is used to compare the position of de facto and de jure female-headed households to those with a male head. These households are characterised by different forms of poverty that impinge on their ability to improve agricultural productivity. However, once inputs are accounted for, it is only for growing cotton that female-headed households' productivity is lower than that found for male-headed households. General poverty alleviation policies will benefit the female-headed household but specific interventions via extension services and access to marketing consortia are also indicated.     

Fertility and the household's economic status: A natural experiment using Indian micro data

We model fertility as endogenous to the family's economic status because poor households choose to have large families in the absence of adequate social insurance. Because of a strong son preference in India, having two girls first can proxy an exogenous increase in fertility, and is therefore a good instrument for fertility in determining poverty of rural households. The 1993–1994 Indian Quinquennial Survey data shows that even though poverty rates are comparable, 74 per cent of two-girl families have a third child compared to 63 per cent of other families. Fertility significantly positively affects poverty when treated as exogenous, but vanishes once endogenised. These results are robust to omitting states with skewed sex ratios and to proxying economic status by expenditures.     

The Poverty of Statistics and the Statistics of Poverty

This paper offers a critique of the picture of world growth and world inequality generally disseminated by international agencies. The positive view commonly presented depends on the widespread consensus that economic performance should be measured using ‘Purchasing Power Parity’ (PPP) statistics, instead of market exchange rates. Although originally conceived narrowly as a basis for comparing living standards, PPP indicators are now indiscriminately promoted as an unexceptionable standard for comparing and aggregating national income statistics. This article highlights the flaws in the PPP approach by accepting the claims made on their behalf at face value. It shows that, even on the basis of these claims, the wrong conclusions have been drawn. By comparing PPP and market exchange rate measures of inequality it shows that what really took place, at the end of the last century, was a systematic reduction in the prices of consumption goods in the Third World. PPP statistics have concealed this underlying and unsustainable trend, allowing it to be packaged as a stable reduction in poverty. Neither genuine growth, nor lasting poverty reduction was achieved over this period. The fall in the price of consumer goods masked a systematic failure to overcome the central problem of development—the high price of capital goods, which PPP statistics understate, and of intermediate goods, which they completely omit.     

Rural income and poverty in a time of radical change in Malawi

Malawi is one of the poorest countries in Africa. There is widespread, though not universal, agreement about the shape of poverty in the country and the policy challenge this sets. Agriculture continues to be the most obvious means to stimulate broad-based rural growth and to provide levels of food security and income needed for the majority rural population. A longitudinal study over a decade during which radical policy and political changes occurred provides the data and basis for discussing the appropriate policy directions for reducing poverty.     

Does Size Matter? Reassessing the Relationship between Aquaculture and Poverty in Bangladesh

Aquaculture has long been promoted by development institutions in Bangladesh on the understanding that it can alleviate poverty. Most of this attention has focused on forms of the activity commonly referred to as ‘small-scale’. This article draws on concepts from the literature on agricultural growth and elaborates a typology of aquaculture based on relations of production which suggests that, in Bangladesh, quasi-capitalist forms of aquaculture may possess greater potential to reduce poverty and enhance food security than the quasi-peasant modes of production generally assumed to do so. The implications of this conclusion are explored.     

Poverty,resource distribution and security: The impact of new agricultural technology in rural Bangladesh

Recent studies have examined the relationship between agrarian change and rural poverty in LDCs concentrating on either exchange or non‐exchange income. Neither approach employed independently is, however, adequate. Bangladeshi evidence is presented of growing concentration of control of land, of components of new agricultural technology and of ancillary resources. Increasing incidence of landlessness and near landlessness has resulted in greater dependence on wage employment for subsistence by the rural poor. It is argued that the non‐exchange component of income is important in slack periods and assumes even greater significance in abnormal years when both real wage and employment fall sharply. With rapid population growth, depletion of natural resources and greater penetration of technological and market forces, the cushioning effect of access to natural resources, in adverse circumstances, on the rural poor has become more limited and their income security has been undermined.     

From peasant community to production co‐operative: An analysis of recent government policy in Peru

Discussions concerning rural development in Peru since the military coup of 1968 have focused mainly on the large‐scale land reform programme under which the coastal estates and many of the livestock and agricultural haciendas in the highlands have been expropriated [Petras and Rimensnyder, 1970, Quijano, 1971, and Hobsbawm, 1971]. This has tended to deflect interest from other important aspects of rural development policy. It would be wrong to assume that, prior to the latest reforms, the Peruvian scene consisted almost entirely of latifundia agriculture, for a substantial proportion of the productive agricultural land in both the highlands and coastal valleys was, and remains, in the control of smallholder farmers, or is held under communal ownership by peasant communities. In an attempt to incorporate these non‐hacienda zones into the plan for national development [Plan del Peru: 1971–1975], the government is encouraging the expansion of smallholder commercial production, the establishment of new, or the improvement of existing, marketing and servicing co‐operatives, and is promoting a re‐organisation of peasant communities with the long‐term objective of transforming them into modern production or multipurpose co‐operatives. This paper outlines recent legislation aimed at reforming these peasant communities and examines the social consequences of the new policy, particularly as it affects smallholder regions. We address ourselves mainly to two problems: Firstly, we wish to assess the effectiveness of the policy in transferring the benefits of community resources to the poorer strata of the rural population, a central aim of the reforms; and secondly, we want to isolate the factors which inhibit the emergence of viable modes of co‐operative organisation and which limit the role that community institutions can play in promoting local development. It is necessary in a paper of this length to confine ourselves mainly to an analysis of the situation in one district of the Mantaro Valley of Central Peru—that of Matahuasi—for which we have detailed data; although many of our conclusions, we believe, raise problems of general significance for interpreting the types of development strategies and priorities favoured by the present government.