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Scenarios and Options for Productivity Growth in Philippine Agriculture: An Application of the Agricultural Multimarket Model for Policy Evaluation (AMPLE)

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  • Briones, Roehlano M.

Abstract

Sustaining and accelerating agricultural growth remains a development imperative in view of persistent rural poverty and emerging threats to food security. While growth can be achieved by expansion of agricultural area and input intensification, growth through improvement in productivity is a promising option. However, productivity growth appears to be a relatively low priority for policy. Rather, the agricultural strategy is oriented toward domestic protection to achieve self-sufficiency and to support production by generous subsidies. In contrast, an alternative strategy may be one that is competition-oriented and productivity-based, i.e., one that favors integration with the international economy through trade, as well as making domestic investments targeted at productivity growth. Scenarios for Philippine agriculture under these policy options are evaluated using a new supply and demand model (Agricultural Multimarket Model for Policy Evaluation or AMPLE). Model simulations suggest that: rapid productivity growth, even when combined with trade liberalization, is generally favorable for farmers and consumers based on improved outlook on production, exports, and food consumption. In contrast, trade liberalization alone has a contractionary effect on agriculture; and production support is a costly instrument for promoting agricultural growth. The model experiments suggest that a back-to-basics strategy for agriculture, incorporating various productivity-based instruments such as investments in R&D, extension, rural infrastructure, protection of the resource base of agriculture, and even human capital formation and institutional reforms, are key to long-term agricultural growth.

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Bibliographic Info

Paper provided by Philippine Institute for Development Studies in its series Discussion Papers with number DP 2010-05.

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Length: 48
Date of creation: 2010
Date of revision:
Handle: RePEc:phd:dpaper:dp_2010-05

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Keywords: Philippines; agriculture; productivity growth; scenario analysis; supply and demand; technological change;

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References

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  1. Teruel, Romeo G. & Kuroda, Yoshimi, 2005. "Public infrastructure and productivity growth in Philippine agriculture, 1974-2000," Journal of Asian Economics, Elsevier, vol. 16(3), pages 555-576, June.
  2. Butzer, Rita & Larson, Donald F. & Mundlak, Yair, 2002. "Determinants Of Agricultural Growth In Thailand, Indonesia And The Philippines," Discussion Papers 14979, Hebrew University of Jerusalem, Department of Agricultural Economics and Management.
  3. Lau, Lawrence J. & Yotopoulos, Pan A., 1989. "The meta-production function approach to technological change in world agriculture," Journal of Development Economics, Elsevier, vol. 31(2), pages 241-269, October.
  4. Cororaton, Caesar B. & Caparas, Maria Teresa, 1999. "Total Factor Productivity: Estimates for Philippine Economy," Discussion Papers DP 1999-06, Philippine Institute for Development Studies.
  5. repec:phd:pjdevt:jpd_1986_vol._xiii_nos._1&2-b is not listed on IDEAS
  6. David, Cristina C. & Balisacan, Arsenio M., 1995. "Philippine Rice Supply Demand: Prospects and Policy Implications," Discussion Papers DP 1995-28, Philippine Institute for Development Studies.
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Cited by:
  1. Briones, Roehlano M., 2013. "Market Structure and Distribution of Benefits from Agricultural Exports: the Case of the Philippine Mango Industry," Discussion Papers DP 2013-16, Philippine Institute for Development Studies.
  2. Danilo C. ISRAEL & Roehlano M. BRIONES, 2013. "Impacts of Natural Disasters on Agriculture, Food Security, and Natural Resources and Environment in the Philippines," Working Papers DP-2013-15, Economic Research Institute for ASEAN and East Asia (ERIA).

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