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Agglomeration, Growth and Regional Equity: An Analysis of Agriculture- versus Urban-led Development in Uganda

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  • Paul Dorosh
  • James Thurlow

Abstract

Traditional development models focus on the sector rather than location of growth. Advocates of agriculture-led strategies emphasise agriculture's strong growth linkages and potential to raise rural incomes. The new economic geography literature, however, provides theoretical support for urban industry-led development, which generates positive agglomeration effects of concentrating populations and economic activity. This debate is important for Sub-Saharan Africa, where agriculture dominates but where rapid urbanisation is occurring. We use an empirically calibrated economywide model with migration and agglomeration to estimate impacts of three investment strategies for Uganda—a fast growing country with wide rural–urban and regional disparities. First, our results indicate that a transport corridor connecting poorer northern regions to the rapidly growing south provides marginal benefits to northern households since northern producers are constrained by low productivity. Secondly, investing in southern urban centres to harness agglomeration effects accelerates national growth, but has little effect on other regions' welfare because of weak growth linkages and small migration effects. Finally, raising agricultural productivity, while less effective at stimulating national growth, generates broad-based welfare improvements. Thus, even after accounting for migration and agglomeration gains from urban-led development, improving agricultural productivity remains crucial for significantly reducing poverty and promoting regional equity in Uganda. Copyright 2012 , Oxford University Press.

Suggested Citation

  • Paul Dorosh & James Thurlow, 2012. "Agglomeration, Growth and Regional Equity: An Analysis of Agriculture- versus Urban-led Development in Uganda," Journal of African Economies, Centre for the Study of African Economies (CSAE), vol. 21(1), pages 94-123, January.
  • Handle: RePEc:oup:jafrec:v:21:y:2012:i:1:p:94-123
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    File URL: http://hdl.handle.net/10.1093/jae/ejr033
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    Cited by:

    1. Karl Pauw & James Thurlow, 2015. "Prioritizing Rural Investments in Africa: A Hybrid Evaluation Approach Applied to Uganda," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 27(3), pages 407-424, July.
    2. Stefan Dercon & Douglas Gollin, 2014. "Agriculture in African Development: A Review of Theories and Strategies," CSAE Working Paper Series 2014-22, Centre for the Study of African Economies, University of Oxford.
    3. Karl Pauw & James Thurlow, 2015. "Prioritizing Rural Investments in Africa: A Hybrid Evaluation Approach Applied to Uganda," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 27(3), pages 407-424, July.
    4. Dorosh, Paul & Thurlow, James & Kebede, Frehiwot Worku & Ferede, Tadele & Taffesse, Alemayehu Seyoum, 2018. "Structural change and poverty reduction in Ethiopia: Economy-wide analysis of the evolving role of agriculture," ESSP working papers 123, International Food Policy Research Institute (IFPRI).
    5. repec:unu:wpaper:wp2012-50 is not listed on IDEAS
    6. Hong, Jingke & Gu, Jianping & Liang, Xin & Liu, Guiwen & Shen, Geoffrey Qiping & Tang, Miaohan, 2019. "Spatiotemporal investigation of energy network patterns of agglomeration economies in China: Province-level evidence," Energy, Elsevier, vol. 187(C).

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