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Spatial specialization and farm-nonfarm linkages

  • Deichmann, Uwe
  • Shilpi, Forhad
  • Vakis, Renos

Using individual level employment data from Bangladesh, this paper presents empirical evidence on the relative importance of farm and urban linkages for rural nonfarm employment. The econometric results indicate that high return wage work and self-employment in nonfarm activities cluster around major urban centers. The negative effects of isolation on high return wage work and on self-employment are magnified in locations with higher agricultural potential. The low return nonfarm activities respond primarily to local demand displaying no significant spatial variation. The empirical results highlight the need for improved connectivity of regions with higher agricultural potential to urban centers for nonfarm development in Bangladesh.

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Paper provided by The World Bank in its series Policy Research Working Paper Series with number 4611.

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Date of creation: 01 Apr 2008
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Handle: RePEc:wbk:wbrwps:4611
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  1. Haggblade, Steven & Hazell, Peter B. & Brown, James, 1988. "Farm-nonfarm linkages in rural sub-Saharan Africa," Policy Research Working Paper Series 6, The World Bank.
  2. Jacoby, Hanan C, 2000. "Access to Markets and the Benefits of Rural Roads," Economic Journal, Royal Economic Society, vol. 110(465), pages 713-37, July.
  3. Marcel Fafchamps & Forhad Shilpi, 2003. "Cities and Specialization: Evidence from South Asia," Economics Series Working Papers 139, University of Oxford, Department of Economics.
  4. Foster, Andrew D & Rosenzweig, Mark R, 2004. "Agricultural Productivity Growth, Rural Economic Diversity, and Economic Reforms: India, 1970-2000," Economic Development and Cultural Change, University of Chicago Press, vol. 52(3), pages 509-42, April.
  5. Haggblade, Steven & Hazell, P. B. R. & Reardon, Thomas, 2002. "Strategies for stimulating poverty-alleviating growth in the rural nonfarm economy in developing countries:," EPTD discussion papers 92, International Food Policy Research Institute (IFPRI).
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