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Can Cities or Towns Drive African Development? Economywide Analysis for Ethiopia and Uganda

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  • Dorosh, Paul
  • Thurlow, James

Abstract

Rapid urbanization is an important characteristic of African development and yet the structural transformation debate focuses on agriculture’s relative merits without also considering the benefits from urban agglomeration. As a result, African governments are often provided conflicting recommendations on the importance of rural agriculture or urban industry. We develop dynamic economywide models for Ethiopia and Uganda that capture both traditional aspects of the debate (growth linkages and foreign trade) and benefits from urbanization (internal migration and agglomeration effects). Simulations suggest that urban agglomeration is an important source of long-term growth and structural transformation, but that investing in cities does not greatly reduce national poverty over the short-term. In this regard, agricultural growth is more effective, albeit with slower national growth. Given these trade-offs, we conclude that, while urbanization’s benefits argue against an “agro-fundamentalist” approach to African development, the short-term imperative of reducing poverty necessitates further agricultural investment.

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  • Dorosh, Paul & Thurlow, James, 2014. "Can Cities or Towns Drive African Development? Economywide Analysis for Ethiopia and Uganda," World Development, Elsevier, vol. 63(C), pages 113-123.
  • Handle: RePEc:eee:wdevel:v:63:y:2014:i:c:p:113-123
    DOI: 10.1016/j.worlddev.2013.10.014
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    Cited by:

    1. Vandercasteelen, Joachim & Beyene, Seneshaw Tamru & Minten, Bart & Swinnen, Johan, 2018. "Cities and agricultural transformation in Africa: Evidence from Ethiopia," World Development, Elsevier, vol. 105(C), pages 383-399.
    2. repec:eee:wdevel:v:96:y:2017:i:c:p:198-215 is not listed on IDEAS
    3. Christiaensen,Luc & Kanbur,Ravi & Christiaensen,Luc & Kanbur,Ravi, 2016. "Secondary towns and poverty reduction : refocusing the urbanization agenda," Policy Research Working Paper Series 7895, The World Bank.
    4. Joachim Vandercasteelen & Seneshaw Tamru & Bart Minten & Johan Swinnen, 2017. "Secondary towns, agricultural prices, and intensification: Evidence from Ethiopia," LICOS Discussion Papers 39317, LICOS - Centre for Institutions and Economic Performance, KU Leuven.
    5. Christiaensen, Luc & Todo, Yasuyuki, 2014. "Poverty Reduction During the Rural–Urban Transformation – The Role of the Missing Middle," World Development, Elsevier, vol. 63(C), pages 43-58.
    6. Larson,Donald F. & Muraoka,Rie & Otsuka,Keijiro, 2016. "On the central role of small farms in African rural development strategies," Policy Research Working Paper Series 7710, The World Bank.
    7. Wim Naudé, 2016. "Entrepreneurship and the Reallocation of African Farmers," Agrekon, Taylor & Francis Journals, vol. 55(1-2), pages 1-33, June.
    8. Christopher Adam & David Bevan & Douglas Gollin, 2016. "Rural-Urban Linkages, Public Investment and Transport Costs: The Case of Tanzania," CSAE Working Paper Series 2016-01, Centre for the Study of African Economies, University of Oxford.
    9. repec:oup:jafrec:v:27:y:2018:i:1:p:127-148. is not listed on IDEAS
    10. Luc Christiaensen & Joachim Weerdt & Yasuyuki Todo, 2013. "Urbanization and poverty reduction: the role of rural diversification and secondary towns," Agricultural Economics, International Association of Agricultural Economists, vol. 44(4-5), pages 435-447, July.
    11. repec:eee:wdevel:v:106:y:2018:i:c:p:393-406 is not listed on IDEAS
    12. Ingelaere,Bert Lodewijk M & Christiaensen,Luc & De Weerdt,Joachim & Kanbur,Ravi & Ingelaere,Bert Lodewijk M & Christiaensen,Luc & De Weerdt,Joachim & Kanbur,Ravi, 2017. "Why secondary towns can be important for poverty reduction -- a migrant's perspective," Policy Research Working Paper Series 8193, The World Bank.
    13. Hirvonen, Kalle & Lilleør, Helene Bie, 2015. "Going Back Home: Internal Return Migration in Rural Tanzania," World Development, Elsevier, vol. 70(C), pages 186-202.
    14. repec:eee:wdevel:v:105:y:2018:i:c:p:273-282 is not listed on IDEAS

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