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Ecuador's rural nonfarm sector as a route out of poverty

Author

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  • Lanjouw, Peter

Abstract

The author analyzes a recent household survey for Ecuador to assess the role of the nonagricultural rural sector in reducing poverty. That sector accounts for roughly 40 percent of rural incomes in Ecuador, three-fourths of which comes from nonagricultural enterprises as opposed to wage labor. The sector provides employment to nearly 40 percent of men and 50 percent of economically active women. The nonagricultural rural sector represents a potentially important route out of poverty: Poverty declines as the share of income from nonagricultural sources arises. Nonagricultural employment and earnings are positively associated with higher education levels and better access to infrastructure services. Although women are more likely than men to be employed in this sector, their earnings for given education levels and other household characteristics are significantly lower. All other things equal, the greatest fall in poverty could be expected from expanding employment opportunities in transport, commerce-related activities, and such services as administration and the hotel and restaurant trade.

Suggested Citation

  • Lanjouw, Peter, 1998. "Ecuador's rural nonfarm sector as a route out of poverty," Policy Research Working Paper Series 1904, The World Bank.
  • Handle: RePEc:wbk:wbrwps:1904
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    References listed on IDEAS

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    1. Haggblade, Steven & Liedholm, Carl & Mead, Donald C., 1986. "The Effect of Policy and Policy Reforms on Non-Agricultural Enterprises and Employment in Developing Countries: A Review of Past Experiences," Food Security International Development Working Papers 54744, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    2. Atkinson, A B, 1987. "On the Measurement of Poverty," Econometrica, Econometric Society, vol. 55(4), pages 749-764, July.
    3. Lanjouw, Jean O. & Lanjouw, Peter, 1995. "Rural nonfarm employment : a survey," Policy Research Working Paper Series 1463, The World Bank.
    4. Lanjouw, Jean Olson & Lanjouw, Peter, 1997. "Poverty comparisons with non-compatible data: theory and illustrations," Policy Research Working Paper Series 1709, The World Bank.
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    Citations

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    Cited by:

    1. Canagarajah, S. & Newman, C. & Bhattamishra, R., 2001. "Non-farm income, gender, and inequality: evidence from rural Ghana and Uganda," Food Policy, Elsevier, vol. 26(4), pages 405-420, August.
    2. Cuong, Nguyen Viet & Tung, Phung Duc & Westbrook, Daniel, 2015. "Do the poorest ethnic minorities benefit from a large-scale poverty reduction program? Evidence from Vietnam," The Quarterly Review of Economics and Finance, Elsevier, vol. 56(C), pages 3-14.
    3. Newman, Constance & Canagarajah, Sudharshan, 2000. "Gender, poverty, and nonfarm employment in Ghana and Uganda," Policy Research Working Paper Series 2367, The World Bank.

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