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Poverty Reduction during the Rural-Urban Transformation: Rural Development is Still More Important than Urbanisation

Author

Listed:
  • Katsushi S. IMAI

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

  • Raghav Gaiha

    (Global Development Institute, University of Manchester, U.K. and Harvard School of Public Health, Harvard University Boston, USA)

  • Alessandra Garbero

    (Research and Impact Assessment Division (RIA), Strategy and Knowledge Department, International Fund for Agricultural Development (IFAD), Italy)

Abstract

Based on cross-country panel datasets, we find that (i) an increase in population share in agriculture is associated with poverty reduction once the longer- term poverty change or the dynamic is taken into account; (ii) rural non-agricultural sector also is poverty reducing in some cases; and (iii) increased population in the mega cities has no role in poverty reduction. In fact, the growth of population in mega cities is “poverty-increasing” in a few cases. Given that a rapid population growth or rural-urban migration is likely to increase poverty, more emphasis should be placed on policies that enhance support for rural agricultural and non-agricultural sectors. If our analysis has any validity, doubts are raised about recent research emphasising the role of secondary towns or urbanisation as the main driver of extreme poverty reduction.

Suggested Citation

  • Katsushi S. IMAI & Raghav Gaiha & Alessandra Garbero, 2016. "Poverty Reduction during the Rural-Urban Transformation: Rural Development is Still More Important than Urbanisation," Discussion Paper Series DP2016-25, Research Institute for Economics & Business Administration, Kobe University, revised Oct 2017.
    • Handle: RePEc:kob:dpaper:dp2016-25
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    References listed on IDEAS

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    More about this item

    Keywords

    Inequality; Poverty; Growth; Agriculture; Non-agriculture;
    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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