IDEAS home Printed from https://ideas.repec.org/a/pal/eurjdr/v31y2019i5d10.1057_s41287-019-00207-5.html
   My bibliography  Save this article

Targeting Agricultural Investments and Input Subsidies in Low-Income Lagging Regions of India

Author

Listed:
  • Seema Bathla

    (Jawaharlal Nehru University)

  • Pramod K. Joshi

    (International Food Policy Research Institute (IFPRI))

  • Anjani Kumar

    (International Food Policy Research Institute (IFPRI))

Abstract

Poverty in India has been declining consistently over the years, yet it is home to 172 million poor people. Most of India’s poor are concentrated in rural areas and are dependent on agriculture. This poses a serious challenge to the exploration of potential pathways that could effectively eradicate poverty and accomplish the United Nations Sustainable Development Goals. We estimate the effects of various types of investment in rural areas in accelerating agricultural productivity and reducing rural poverty, and find differential impacts of investments and subsidies across low-, middle-, and high-income states. Private investment in minor irrigation, public investments in agricultural research and development, and subsidies on irrigation and electricity have the highest marginal returns in low-income states. Further, the payoffs from additional spending in promoting agricultural income are also higher in low-income states, suggesting targeting these locations with strategic investments and subsidies to improve agricultural productivity and reduce poverty.

Suggested Citation

  • Seema Bathla & Pramod K. Joshi & Anjani Kumar, 2019. "Targeting Agricultural Investments and Input Subsidies in Low-Income Lagging Regions of India," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 31(5), pages 1197-1226, December.
    • Handle: RePEc:pal:eurjdr:v:31:y:2019:i:5:d:10.1057_s41287-019-00207-5
    DOI: 10.1057/s41287-019-00207-5
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1057/s41287-019-00207-5
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1057/s41287-019-00207-5?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Datt,Gaurav & Ravallion,Martin & Murgai,Rinku, 2016. "Growth, urbanization, and poverty reduction in India," Policy Research Working Paper Series 7568, The World Bank.
    2. Shenggen Fan & Xiaobo Zhang, 2008. "Public Expenditure, Growth and Poverty Reduction in Rural Uganda," African Development Review, African Development Bank, vol. 20(3), pages 466-496.
    3. Ravallion, Martin & Datt, Gaurav, 1995. "Growth and poverty in rural India," Policy Research Working Paper Series 1405, The World Bank.
    4. Shenggen Fan & Ashok Gulati & Sukhadeo Thorat, 2008. "Investment, subsidies, and pro‐poor growth in rural India," Agricultural Economics, International Association of Agricultural Economists, vol. 39(2), pages 163-170, September.
    5. Joshua D. Angrist & Jörn-Steffen Pischke, 2010. "The Credibility Revolution in Empirical Economics: How Better Research Design Is Taking the Con out of Econometrics," Journal of Economic Perspectives, American Economic Association, vol. 24(2), pages 3-30, Spring.
    6. Unknown, 2014. "Inter-Conference Symposium of International Association of Agricultural Economists (IAAE) on Re-visiting Agriculture Policies in the Light of Globalisation Experience: The Indian Context: A Brief Repo," Indian Journal of Agricultural Economics, Indian Society of Agricultural Economics, vol. 69(4), pages 1-3.
    7. Fan, Shenggen (ed.), 2008. "Public expenditures, growth, and poverty: Lessons from developing countries," IFPRI books, International Food Policy Research Institute (IFPRI), number 978-0-8018-8859-5.
    8. Gulati, Ashok & Narayanan, Sudha, 2003. "The Subsidy Syndrome in Indian Agriculture," OUP Catalogue, Oxford University Press, number 9780195662061.
    9. Panagariya, Arvind & Chakraborty, Pinaki & Rao, M. Govinda, 2014. "State Level Reforms, Growth, and Development in Indian States," OUP Catalogue, Oxford University Press, number 9780199367863.
    10. Fan, Shenggen & Kanbur, Ravi & Zhang, Xiaobo, 2008. "Regional Inequality In China: An Overview," Working Papers 51157, Cornell University, Department of Applied Economics and Management.
    11. Ravallion, Martin & Chen, Shaohua, 2007. "China's (uneven) progress against poverty," Journal of Development Economics, Elsevier, vol. 82(1), pages 1-42, January.
    12. World Bank, 2014. "Republic of India : Accelerating Agricultural Productivity Growth," World Bank Publications - Reports 18736, The World Bank Group.
    13. Barro, Robert J, 1990. "Government Spending in a Simple Model of Endogenous Growth," Journal of Political Economy, University of Chicago Press, vol. 98(5), pages 103-126, October.
    14. Fan, Shenngen & Hazell, Peter & Haque, T., 2000. "Targeting public investments by agro-ecological zone to achieve growth and poverty alleviation goals in rural India," Food Policy, Elsevier, vol. 25(4), pages 411-428, August.
    15. Lipton, Michael & Ravallion, Martin, 1995. "Poverty and policy," Handbook of Development Economics, in: Hollis Chenery & T.N. Srinivasan (ed.), Handbook of Development Economics, edition 1, volume 3, chapter 41, pages 2551-2657, Elsevier.
    16. Joshi, P.K. & Birthal, Pratap Singh & Minot, Nicholas, 2006. "Sources of agricultural growth in India: role of diversification towards high-value crops," MTID discussion papers 98, International Food Policy Research Institute (IFPRI).
    17. Mogues, Tewodaj & Yu, Bingxin & Fan, Shenggen & McBride, Linden, 2012. "The impacts of public investment in and for agriculture: synthesis of the existing evidence," ESA Working Papers 288994, Food and Agriculture Organization of the United Nations, Agricultural Development Economics Division (ESA).
    18. Zhang, Xiaobo & Fan, Shenggen, 2004. "Public investment and regional inequality in rural China," Agricultural Economics, Blackwell, vol. 30(2), pages 89-100, March.
    19. Fan, Shenggen, 2008. "Public expenditures, growth, and poverty in developing countries: Lessons from developing countries," Issue briefs 51, International Food Policy Research Institute (IFPRI).
    20. Chirwa, Ephraim & Dorward, Andrew, 2013. "Agricultural Input Subsidies: The Recent Malawi Experience," OUP Catalogue, Oxford University Press, number 9780199683529.
    21. Pratap S. Birthal & Harvinder Singh & Shiv Kumar, 2011. "Agriculture, economic growth and regional disparities in India," Journal of International Development, John Wiley & Sons, Ltd., vol. 23(1), pages 119-131, January.
    22. Kumar, Anjani & Kumar, Praduman & Sharma, Alakh N., 2011. "Rural Poverty and Agricultural Growth in India: Implications for the Twelfth Five Year Plan," Indian Journal of Agricultural Economics, Indian Society of Agricultural Economics, vol. 66(3), pages 1-10.
    23. Tewodaj Mogues & Shenggen Fan & Samuel Benin, 2015. "Public Investments in and for Agriculture," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 27(3), pages 337-352, July.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Peng Cao & Xiao Ouyang & Jun Xu, 2022. "How Do Ecosystem Services Affect Poverty Reduction Efficiency? A Panel Data Analysis of State Poverty Counties in China," IJERPH, MDPI, vol. 19(3), pages 1-17, February.
    2. Bannor, Frank & Dikgang, Johane & Kutela Gelo, Dambala, 2021. "Interdependence between research and development, climate variability and agricultural production: evidence from sub-Saharan Africa," MPRA Paper 105697, University Library of Munich, Germany.
    3. Akber, Nusrat & Paltasingh, Kirtti Ranjan & Mishra, Ashok K., 2022. "How can public policy encourage private investments in Indian agriculture? Input subsidies vs. public investment," Food Policy, Elsevier, vol. 107(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Bathla, S. & Kumar, A. & Joshi, P.K., 2018. "Regional income inequalities and public investments in rural India," Agricultural Economics Research Review, Agricultural Economics Research Association (India), vol. 31(1).
    2. Bathla, Seema & Yu, Bingxin & Thorat, Sukhadeo & Joshi, Pramod K., 2015. "Accelerating Agricultural Growth and Poverty Alleviation through Public Expenditure: The Experience of India," 2015 Conference, August 9-14, 2015, Milan, Italy 211202, International Association of Agricultural Economists.
    3. Kumar, Anjani & Kumar, Anjani & Elumalai, K. & Saroj, Sunil, 2021. "Irrigation Governance, Private Investment, and Agricultural Productivity in India," 2021 Conference, August 17-31, 2021, Virtual 315083, International Association of Agricultural Economists.
    4. Renkow, Mitch, 2010. "Impacts of IFPRI's "priorities for pro-poor public investment" global research program:," Impact assessments 31, International Food Policy Research Institute (IFPRI).
    5. Benin, Samuel, 2015. "Returns to agricultural public spending in Africa south of the Sahara:," IFPRI discussion papers 1491, International Food Policy Research Institute (IFPRI).
    6. Shenggen Fan, 2020. "Reflections of Food Policy Evolution over the Last Three Decades," Applied Economic Perspectives and Policy, John Wiley & Sons, vol. 42(3), pages 380-394, September.
    7. Díaz-Bonilla, Eugenio, 2014. "On food security stocks, peace clauses, and permanent solutions after Bali:," IFPRI discussion papers 1388, International Food Policy Research Institute (IFPRI).
    8. Apata Temidayo Gabriel, 2019. "Public spending mechanisms and gross domestic product (GDP) growth in the agricultural sector (1970–2016): Lessons for Nigeria from agricultural policy progressions in China," Bulletin of Geography. Socio-economic Series, Sciendo, vol. 44(44), pages 57-72, June.
    9. Anson, Richard & Mogues, Tewodaj, 2016. "A systematic review of cross-country data initiatives on agricultural public expenditures in developing countries:," IFPRI discussion papers 1541, International Food Policy Research Institute (IFPRI).
    10. Mogues, Tewodaj & Billings, Lucy, 2015. "The making of public investments: Champions, coordination, and characteristics of nutrition interventions:," IFPRI discussion papers 1479, International Food Policy Research Institute (IFPRI).
    11. Klasen, Stephan & Reimers, Malte, 2017. "Looking at Pro-Poor Growth from an Agricultural Perspective," World Development, Elsevier, vol. 90(C), pages 147-168.
    12. Kamenya, Madalitso A. & Hendriks, Sheryl L. & Gandidzanwa, Colleta & Ulimwengu, John & Odjo, Sunday, 2022. "Public agriculture investment and food security in ECOWAS," Food Policy, Elsevier, vol. 113(C).
    13. Waeyenberge, Elisa Van. & Bargawi, Hannah., 2011. "Macroeconomic policy for "full and productive employment and decent work for all" : Uganda country study," ILO Working Papers 994658733402676, International Labour Organization.
    14. Adjin, Kougblenou Christophe & Pereira Fontes, Francisco & Sánchez, Marco V., 2022. "A tool to support the spatial prioritization of commodity-specific investments – An application to Uganda," ESA Working Papers 330796, Food and Agriculture Organization of the United Nations, Agricultural Development Economics Division (ESA).
    15. Omo Aregbeyen & Bashir Kolawole, 2015. "Oil Revenue, Public Spending and Economic Growth Relationships in Nigeria," Journal of Sustainable Development, Canadian Center of Science and Education, vol. 8(3), pages 113-113, April.
    16. Apata, Temidayo, 2021. "Effect of public spending on agricultural productivity in Nigeria (1981-2018)," Revista Galega de Economía, University of Santiago de Compostela. Faculty of Economics and Business., vol. 30(2), pages 1-21.
    17. Emerta Aragie & Jean Balié, 2021. "Public spending on agricultural productivity and rural commercialization: A comparison of impacts using an economy‐wide approach," Development Policy Review, Overseas Development Institute, vol. 39(S1), pages 21-41, August.
    18. Mavrotas, George & Mogues, Tewodaj & Oyeyemi, Motunrayo & Smart, Jenny & Xiong, Zhe, 2018. "Agricultural public expenditures, sector performance, and welfare in Nigeria: A state-level analysis," NSSP working papers 60, International Food Policy Research Institute (IFPRI).
    19. 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.
    20. Benin, Samuel, 2016. "Returns to agricultural public spending in Ghana: Cocoa versus noncocoa subsector:," IFPRI discussion papers 1503, International Food Policy Research Institute (IFPRI).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:pal:eurjdr:v:31:y:2019:i:5:d:10.1057_s41287-019-00207-5. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.palgrave-journals.com/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.