Agriculture and the macroeconomy
Based on an economy-wide perspective, this paper begins with a discussion of the bias against exports and agriculture that characterized the economic literature and the development strategies in many developing countries after World War II. This is followed by an analysis of how the macroeconomic environment affects agricultural structural price incentives. Specifically, the paper discusses how early policies concerning industrial protection, exchange rates, and interest rates and other fiscal policies can strongly influence the economic incentives for agriculture compared with other sectors, identifying the most relevant literature and alternative approaches used on this issue. It then proceeds to examine how the real exchange rate can be affected by exogenous shocks, such as the foreign terms of trade, with emphases on the Dutch Disease phenomenon and agriculture. The paper next examines the influence of interest rates on incentives in agriculture, arguing that, surprisingly, this has been a neglected area in the literature. The paper explores the effects on agriculture of structural adjustment programs implemented since the early 1980s in developing countries. The final section surveys the literature on agriculture and the macro-economy in industrial countries, focusing on the impact of the exchange rate on export competitiveness in the United States, the cost of agricultural protection for the overall economy in Europe and Japan, and the increased importance of fluctuations in money markets for the farm sector and the additional instability they generate
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- Dorosh, Paul & Valdés, Alberto, 1990. "Effects of exchange rate and trade policies on agriculture in Pakistan:," Research reports 84, International Food Policy Research Institute (IFPRI).
- Bela Balassa, 1965.
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- Krueger, Anne O & Schiff, Maurice & Valdes, Alberto, 1988. "Agricultural Incentives in Developing Countries: Measuring the Effect of Sectoral and Economywide Policies," World Bank Economic Review, World Bank Group, vol. 2(3), pages 255-271, September.
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- Martin, Will & Warr, Peter G, 1993. "Explaining the Relative Decline of Agriculture: A Supply-Side Analysis for Indonesia," World Bank Economic Review, World Bank Group, vol. 7(3), pages 381-401, September.
- Amin, A.A., 1996. "The Effects of Exchange Rate Policy on Cameroon's Agricultural Competitiveness," Papers 42, African Economic Research Consortium.
- A. Valdés, 1994. "Agricultural Reforms In Chile And New Zealand: A Review," Journal of Agricultural Economics, Wiley Blackwell, vol. 45(2), pages 189-201.
- Panagariya, Arvind & Schiff, Maurice, 1991. "Taxes versus quotas : the case of cocoa exports," Policy Research Working Paper Series 756, The World Bank.
- Kyle, Steven, 1992. "Pitfalls in the measurement of real exchange rate effects on agriculture," World Development, Elsevier, vol. 20(7), pages 1009-1019, July.
- Mundlak, Yair, 1997. "The Dynamics of Agriculture," 1997 Conference, August 10-16, 1997, Sacramento, California 197028, International Association of Agricultural Economists.
- G. Edward Schuh, 1974. "The Exchange Rate and U. S. Agriculture," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 56(1), pages 1-13.
- Ghura, Dhaneshwar & Grennes, Thomas J., 1993. "The real exchange rate and macroeconomic performance in Sub-Saharan Africa," Journal of Development Economics, Elsevier, vol. 42(1), pages 155-174, October.
- Jagdish N. Bhagwati, 1978. "Anatomy and Consequences of Exchange Control Regimes," NBER Books, National Bureau of Economic Research, Inc, number bhag78-1, Enero-Jun. Full references (including those not matched with items on IDEAS)
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