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Does Agricultural Growth Reduce Inequality and Poverty in Developing Countries?

Author

Listed:
  • Katsushi S. Imai

    (Economics, School of Social Sciences, University of Manchester, UK and Research Institute for Economics and Business Administration, Kobe University)

  • Raghav GAIHA

    (Faculty of Management Studies, University of Delhi, India and Harvard School of Public Health, Harvard University Boston, USA)

  • Wenya Cheng

    (School of Social Sciences, University of Manchester, UK)

Abstract

Drawing upon cross-country panel data for developing countries, the present study examines the role of agricultural growth in reducing inequality and poverty by modelling the dynamic linkage between agricultural and non-agricultural sectors. For this purpose, we have compared the role of agricultural growth and that of non-agricultural growth and have found that agricultural growth is more important in reducing poverty, while the negative effect of agricultural growth on inequality is found in a few models where specific definitions of inequality are adopted. The role of agricultural growth in reducing inequality is, however, undermined by ethnic fractionalisation which tends to make inequality more persistent. Our analysis generally reinforces the case for revival of agriculture in the post-2015 discourse, contrary to the much emphasised roles of rural-urban migration and urbanisation as main drivers of growth and elimination of extreme poverty.

Suggested Citation

  • Katsushi S. Imai & Raghav GAIHA & Wenya Cheng, 2015. "Does Agricultural Growth Reduce Inequality and Poverty in Developing Countries?," Discussion Paper Series DP2015-23, Research Institute for Economics & Business Administration, Kobe University, revised Apr 2016.
    • Handle: RePEc:kob:dpaper:dp2015-23
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    File URL: https://www.rieb.kobe-u.ac.jp/academic/ra/dp/English/DP2015-23.pdf
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    References listed on IDEAS

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    Cited by:

    1. Dhahri, Sabrine & Omri, Anis, 2020. "Foreign capital towards SDGs 1 & 2—Ending Poverty and hunger: The role of agricultural production," Structural Change and Economic Dynamics, Elsevier, vol. 53(C), pages 208-221.
    2. Katsushi S. Imai & Bilal Malaeb, 2016. "Asia's Rural-urban Disparity in the Context of Growing Inequality," Discussion Paper Series DP2016-29, Research Institute for Economics & Business Administration, Kobe University.
    3. Katsushi S. Imai & Raghav Gaiha & Fabrizio Bresciani, 2016. "Dynamics of Rural Transformation and Poverty and Inequality in Asia and the Pacific," Discussion Paper Series DP2016-30, Research Institute for Economics & Business Administration, Kobe University, revised Feb 2019.
    4. Lucas Chancel & Denis Cogneau & Amory Gethin & Alix Myczkowski, 2019. "How large are African inequalities? Towards Distributional National Accounts in Africa, 1990 - 2017," World Inequality Lab Working Papers hal-02876986, HAL.
    5. Chancel, Lucas & Cogneau, Denis & Gethin, Amory & Myczkowski, Alix & Robilliard, Anne-Sophie, 2023. "Income inequality in Africa, 1990–2019: Measurement, patterns, determinants," World Development, Elsevier, vol. 163(C).
    6. Lucas Chancel & Denis Cogneau & Amory Gethin & Alix Myczkowski, 2019. "How large are African inequalities? Towards Distributional National Accounts in Africa, 1990 - 2017," World Inequality Lab Working Papers hal-02876986, HAL.
    7. Baumert, Sophia & Fisher, Janet & Ryan, Casey & Woollen, Emily & Vollmer, Frank & Artur, Luis & Zorrilla-Miras, Pedro & Mahamane, Mansour, 2019. "Forgone opportunities of large-scale agricultural investment: A comparison of three models of soya production in Central Mozambique," World Development Perspectives, Elsevier, vol. 16(C).

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    More about this item

    Keywords

    Inequality; Poverty; Growth; Agriculture; Non-agriculture; MDG; SDG;
    All these keywords.

    JEL classification:

    • C20 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - General
    • I15 - Health, Education, and Welfare - - Health - - - Health and Economic Development
    • I39 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Other
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

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