The Role of Agriculture in Poverty Reduction
Edited by Fabrizio Bresciani and Alberto Valdés
Chapter 2: Agricultural Growth and Poverty Reduction
Ramón López 2.1 INTRODUCTION This chapter does two things. First, it provides an overview of the mechanisms through which agricultural growth reduces poverty and it examines the key conditions aﬀecting the intensity of the impact of agricultural growth on poverty. Second, it reviews other conceptual analyses for methodological guidance that can be used in empirical analyses. If the focus of this chapter were purely on the ‘poverty externalities’ of agriculture, it could be argued that the discussion should be restricted to how agricultural growth impacts the poor outside the agricultural sector. This would be justiﬁed by the fact that agricultural value added already includes the increased income of poor farmers and poor farm workers. However, for the sake of comprehensiveness, we shall also consider the impact of agricultural growth on the poor who depend directly on agriculture.1 This has the added beneﬁt of allowing us to compare agriculture with other sectors in terms of the distribution of the sectoral value added and answers the question: is agricultural income better distributed than income generated in other sectors? In the context of this study, we cannot comprehensively and exhaustively cover the enormous variety of structural conditions and policies that aﬀect the poverty impact of agricultural growth. Rather, we focus on selected issues that we believe are important for future empirical studies. Although market and government policy failures are often key factors behind the persistence of poverty in most countries, in this analysis we consider market failures...
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