Coordination Risk and Cost Impacts on Economic Development in Poor Rural Areas |
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| Authors: | Andrew Dorward Jonathan Kydd Colin Poulton Dirk Bezemer |
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| Institution: | 1. Centre for Development, Environment and Policy , School of Oriental and African Studies , Ashford , UK Andrew.Dorward@soas.ac.uk;3. University of London , UK;4. Centre for Development, Environment and Policy , School of Oriental and African Studies , Ashford , UK;5. Faculty of Economics &6. Business , University of Groningen , The Netherlands |
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| Abstract: | This paper addresses issues relevant to a critical problem in economic development: how to get rapid pro-poor economic growth in poor rural areas in Africa and South Asia where most of the world's dollar a day poor live. It examines constraints to the development of coordinated exchange systems in poor rural areas, focusing on the core problem of thin markets and low density of economic activity in these areas. Transaction cost and risk analysis is integrated into a conventional neoclassical production economics framework to describe the existence of low level equilibrium traps in transactions and supply chains and to generate important insights for development policy. |
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