When do Agricultural Exports Help the Rural Poor? A Political-economy Approach

Many economists have argued that agricultural exports should be one of the best ways to reduce rural poverty in developing countries, through the creation of productive employment in the rural areas. Non-economists have tended to be sceptical, often seeing such exports as competitive with food crops and thus potentially threatening to an adequate supply of food. The historical record includes many cases in which the prospect of profitable agricultural exports prompted the rich/powerful to appropriate land formerly occupied by lower income agricultural workers, often squatters or people with traditional land rights. That record, as currently understood, leaves it unclear whether such exports have more frequently brought benefits to the rural poor or hurt them. An adequate model of the poverty effects of agricultural exports must thus take account of how control of land (and labour as well) may be shifted among groups without compensation as it becomes more valuable. Two major issues/questions are of current interest. First, have the unjust mechanisms whereby the rich wrested valuable resources from the poor in the past become less common? Second, is there evidence that the sort of labour-intensive agricultural exports most likely to benefit the poor are growing fast enough to suggest an important poverty effect at present and in the future? More in-depth research is needed to clarify both points. For the present, it appears unlikely that agricultural exports will be a major source of poverty reduction for the rural poor in the Third World taken as a whole.