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Profits and Politics: Coordinating Technology Adoption in Agriculture

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  • Rohini Pande

    () (Economic Growth Center, Yale University)

Abstract

This paper examines the political economy of coordination in a simple two-sector model in which individuals' choice of agricultural technology affects industrialization. We demonstrate the existence of multiple equilibria; the economy is either characterized by the use of a traditional agricultural technology and a low level of industrialization or the use of a mechanized technology and a high level of industrialization. Relative to the traditional technology, the mechanized technology increases output but leaves some population groups worse off. We show that the distributional implications of choosing the mechanized technology restrict the possibility of Pareto-improving coordination by an elected policy-maker, even when we allow for income redistribution.

Suggested Citation

  • Rohini Pande, 2005. "Profits and Politics: Coordinating Technology Adoption in Agriculture," Working Papers 922, Economic Growth Center, Yale University.
  • Handle: RePEc:egc:wpaper:922
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    File URL: http://www.econ.yale.edu/growth_pdf/cdp922.pdf
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    References listed on IDEAS

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    9. Dixit, Avinash & Londregan, John, 1995. "Redistributive Politics and Economic Efficiency," American Political Science Review, Cambridge University Press, vol. 89(04), pages 856-866, December.
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    Cited by:

    1. Santiago Urbiztondo & Marcela Cristini & Cynthia Moskovits & Sebastián Saiegh, 2009. "The Political Economy of Productivity in Argentina: Interpretation and Illustration," IDB Publications (Working Papers) 1119, Inter-American Development Bank.

    More about this item

    Keywords

    Industrialization; Choice of Technology; Government Policy;

    JEL classification:

    • O14 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Industrialization; Manufacturing and Service Industries; Choice of Technology
    • H10 - Public Economics - - Structure and Scope of Government - - - General

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