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Is agriculture the engine of growth?

Author Info

  • Richard Tiffin
  • Xavier Irz

Abstract

We seek to address formally the question raised by Gardner (2003) in his Elmhirst lecture as to the direction of causality between agricultural value added per worker and Gross Domestic Product (GDP) per capita. Using the Granger causality test in the panel data analyzed by Gardner for 85 countries, we find overwhelming evidence that supports the conclusion that agricultural value added is the causal variable in developing countries, while the direction of causality in developed countries is unclear. We also examine further the use of the Granger causality test in integrated data and provide evidence that the performance of the test can be increased in small samples through the use of the bootstrap. Copyright 2006 International Association of Agricultural Economists.

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File URL: http://www.blackwell-synergy.com/doi/abs/10.1111/j.1574-0862.2006.00141.x
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Article provided by International Association of Agricultural Economists in its journal Agricultural Economics.

Volume (Year): 35 (2006)
Issue (Month): 1 (07)
Pages: 79-89

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Handle: RePEc:bla:agecon:v:35:y:2006:i:1:p:79-89
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  1. Pineres, Sheila Amin Gutierrez de, 1999. "Externalities in the agricultural export sector and economic growth: a developing country perspective," Agricultural Economics of Agricultural Economists, International Association of Agricultural Economists, vol. 21(3), December.
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  7. de Pineres, Sheila Amin Gutierrez, 1999. "Externalities in the agricultural export sector and economic growth: a developing country perspective," Agricultural Economics, Blackwell, vol. 21(3), pages 257-267, December.
  8. Mosconi, Rocco & Giannini, Carlo, 1992. "Non-causality in Cointegrated Systems: Representation Estimation and Testing," Oxford Bulletin of Economics and Statistics, Department of Economics, University of Oxford, vol. 54(3), pages 399-417, August.
  9. Tomas Kögel & Alexia Prskawetz, 2000. "Agricultural productivity growth and escape from the Malthusian trap," MPIDR Working Papers WP-2000-002, Max Planck Institute for Demographic Research, Rostock, Germany.
  10. Steger, Thomas M., 2000. "Economic growth with subsistence consumption," Journal of Development Economics, Elsevier, vol. 62(2), pages 343-361, August.
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  12. Echevarria, Cristina, 1997. "Changes in Sectoral Composition Associated with Economic Growth," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 38(2), pages 431-52, May.
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  16. Irz, Xavier T. & Roe, Terry L., 2000. "Can the world feed itself? Some insights from growth theory," Agrekon, Agricultural Economics Association of South Africa (AEASA), vol. 39(4), December.
  17. Kevin M. Murphy & Andrei Shleifer & Robert Vishny, 1989. "Income Distribution, Market Size, and Industrialization," The Quarterly Journal of Economics, Oxford University Press, vol. 104(3), pages 537-564.
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