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Agriculture and the rest of the economy: macroconnections and policy restraints

  • Chichilnisky, Graciela
  • Taylor, Lance

The first two sections of the paper are devoted to a combination of Kuznets and structuralist stories, where we ask how the agricultural/nonagricultural terms of trade and income distribution must adjust to permit both savings and investment and commodity market balance to be assured. It will be shown that inflationary processes can easily be kicked off by terms of trade movements in the short run. In the next two sections we follow Chichilnisky in working out a longer run, Lewis-style model in which economic dualism plus an elastic labor supply can lead to severe problems with realization of the marketed surplus and agricultural exports abroad. A brief final section summarizes the major implications of the models for policy choice.

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File URL: https://mpra.ub.uni-muenchen.de/8022/1/MPRA_paper_8022.pdf
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Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 8022.

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Date of creation: 1980
Date of revision:
Handle: RePEc:pra:mprapa:8022
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  1. Chichilnisky, Graciela, 1981. "Terms of trade and domestic distribution : Export-led growth with abundant labour," Journal of Development Economics, Elsevier, vol. 8(2), pages 163-192, April.
  2. Cardoso, Eliana A., 1981. "Food supply and inflation," Journal of Development Economics, Elsevier, vol. 8(3), pages 269-284, June.
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