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Internal Migration and the Spatial Reorganization of Agriculture

Author

Listed:
  • Raahil Madhok
  • Frederik Noack
  • Ahmed Mushfiq Mobarak
  • Olivier Deschenes

Abstract

This paper studies how agricultural production responds to the loss of agricultural labor during the process of urbanization and structural transformation. Using household microdata from India and exogenous variation in migration opportunities induced by urban income shocks, we show that agricultural households do not systematically replace lost labor with increased capital. Instead, they cultivate less land and lower their use of agricultural technology, reducing crop production. Resulting changes in land and crop prices induce non-migrant households to expand agricultural investments and production. In aggregate, market adaptation mitigates over three-fourths of the direct agricultural losses from urbanization. Spatial reorganization moves food production from land near urban areas toward more remote areas with lower emigration.

Suggested Citation

  • Raahil Madhok & Frederik Noack & Ahmed Mushfiq Mobarak & Olivier Deschenes, 2025. "Internal Migration and the Spatial Reorganization of Agriculture," NBER Working Papers 33854, National Bureau of Economic Research, Inc.
    • Handle: RePEc:nbr:nberwo:33854
    Note: DEV EEE
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    More about this item

    JEL classification:

    • J43 - Labor and Demographic Economics - - Particular Labor Markets - - - Agricultural Labor Markets
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • Q15 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Land Ownership and Tenure; Land Reform; Land Use; Irrigation; Agriculture and Environment
    • R11 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Regional Economic Activity: Growth, Development, Environmental Issues, and Changes

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