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Biased Technological Change in Agriculture: The Hayami-Ruttan Hypothesis Revisited

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  • Rainer Klump
  • César Miralles Cabrera
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    Abstract

    This paper presents a consistent explanation for biases in the direction of technical change in agriculture. The emergence of such biases had been pointed out by Hayami and Ruttan (1970) based on a study of long time series of agricultural inputs and technologies in Japan and in the US from 1880 to 1980. Land scarcity in Japan seems to have favored land-saving technologies like new crop varieties and the use of, while land abundance in the US made technological change more labour-saving due to the use of tractors and machinery. A theoretical explanation for the relationship between factor-biases in technological change and relative factor proportions can be given in the framework of the model of directed technical change developed by Acemoglu (1998, 2000, 2001). In this model the elasticity of substitution between factors of production is a key determinant of the direction of the technological bias. In our paper Acemoglu’s model of direct technical change is adapted to the analysis of agricultural production. The implications of the model are tested with data from 93 countries between 1961 and 2002. Based on this test we can confirm the Hayami-Ruttan hypothesis in its original form on a global level. When we test across regions, levels of income and levels of land inequality we find that those countries have developed in the most successful way, where the direction of technological bias in agriculture has been the least biased by market imperfections.

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    Bibliographic Info

    Paper provided by DEGIT, Dynamics, Economic Growth, and International Trade in its series DEGIT Conference Papers with number c013_016.

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    Length: 32 pages
    Date of creation: Nov 2008
    Date of revision:
    Handle: RePEc:deg:conpap:c013_016

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    1. Kydd, Jonathan & Dorward, Andrew & Morrison, Jamie & Cadisch, Georg, 2002. "Agricultural Development And Pro Poor Economic Growth In Sub Saharan Africa: Potential And Policy," ADU Working Papers 10920, Imperial College at Wye, Department of Agricultural Sciences.
    2. Daron Acemoglu, 2001. "Directed Technical Change," NBER Working Papers 8287, National Bureau of Economic Research, Inc.
    3. Binswanger, Hans P, 1974. "The Measurement of Technical Change Biases with Many Factors of Production," American Economic Review, American Economic Association, vol. 64(6), pages 964-76, December.
    4. de Janvry, Alain, 1973. "A Socioeconomic Model of Induced Innovations for Argentine Agricultural Development," The Quarterly Journal of Economics, MIT Press, vol. 87(3), pages 410-435, August.
    5. Kym Anderson, 2006. "Reducing Distortions to Agricultural Incentives: Progress, Pitfalls, and Prospects," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(5), pages 1135-1146.
    6. Daron Acemoglu, 2000. "Labor- and Capital- Augmenting Technical Change," NBER Working Papers 7544, National Bureau of Economic Research, Inc.
    7. Vernon W. Ruttan, 2002. "Productivity Growth in World Agriculture: Sources and Constraints," Journal of Economic Perspectives, American Economic Association, vol. 16(4), pages 161-184, Fall.
    8. Thirtle, Colin G. & Lin, Lin & Piesse, Jenifer, 2003. "The Impact Of Research Led Agricultural Productivity Growth On Poverty Reduction In Africa, Asia And Latin America," 2003 Annual Meeting, August 16-22, 2003, Durban, South Africa 25834, International Association of Agricultural Economists.
    9. Kawagoe, Toshihiko & Hayami, Yujiro & Ruttan, Vernon W., 1985. "The intercountry agricultural production function and productivity differences among countries," Journal of Development Economics, Elsevier, vol. 19(1-2), pages 113-132.
    10. Ravallion, Martin & Datt, Gaurav, 1999. "When is growth pro-poor? Evidence from the diverse experiences of India's states," Policy Research Working Paper Series 2263, The World Bank.
    11. Nordhaus, William D, 1973. "Some Skeptical Thoughts on the Theory of Induced Innovation," The Quarterly Journal of Economics, MIT Press, vol. 87(2), pages 208-19, May.
    12. Dorward, Andrew & Kydd, Jonathan & Morrison, Jamie & Urey, Ian, 2002. "A Policy Agenda For Pro Poor Agricultural Growth," ADU Working Papers 10923, Imperial College at Wye, Department of Agricultural Sciences.
    13. Kawagoe, Toshihiko & Otsuka, Keijiro & Hayami, Yujiro, 1986. "Induced Bias of Technical Change in Agriculture: The United States and Japan, 1880-1980," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages 523-44, June.
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