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Structural Transformation 2.0: The Rocky Road Ahead…

In: African Farmers, Value Chains and Agricultural Development

Author

Listed:
  • Alan de Brauw

    (International Food Policy Research Institute)

  • Erwin Bulte

    (Wageningen University and Research)

Abstract

Most countries that have undergone economic structural transformation (Structural Transformation 1.0) have done so first using low wage, export-oriented labor-intensive manufacturing as a driving force to absorb labor, first because there was no competition (the West) and then because productivity-adjusted wages were much lower than other places (East Asia). We first argue this structural transformation is unlikely in Africa, because labor productivity is lower and in general is less densely populated, limiting conditions for labor specialization. Instead we argue for a structural transformation based in part on agricultural processing (Structural Transformation 2.0). We suggest four paths by which Structural Transformation 2.0 could be catalyzed: Bundling interventions to alleviate multiple agricultural constraints; some farm consolidation; infrastructure investments, including but not exclusively roads; and by increasing demand and improving regional trade.

Suggested Citation

  • Alan de Brauw & Erwin Bulte, 2021. "Structural Transformation 2.0: The Rocky Road Ahead…," Palgrave Studies in Agricultural Economics and Food Policy, in: African Farmers, Value Chains and Agricultural Development, chapter 0, pages 189-212, Palgrave Macmillan.
    • Handle: RePEc:pal:psachp:978-3-030-88693-6_9
    DOI: 10.1007/978-3-030-88693-6_9
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