Agricultural Transformation & Rural Development.
Contents <ul><li>Facts. </li></ul><ul><li>Rural Development. </li></ul><ul><li>Kinds Of Agriculture. </li></ul><ul><li>Agr...
Rural Development <ul><li>More than half of the world population lives in rural areas. </li></ul><ul><li>Living conditions...
Rural Development <ul><li>Any such policy requires at least 3 basic complementary elements: </li></ul><ul><ul><li>Increase...
Facts on Agriculture <ul><li>Agriculture employs at least 60% of the labour force in </li></ul><ul><li>Asia and Africa, bu...
<ul><li>China has shown the largest growth of per capita food production in the last two decades. </li></ul><ul><li>Africa...
Two Kinds of World Agriculture. <ul><li>Highly Efficient </li></ul><ul><li>Developed countries </li></ul><ul><li>High outp...
Agrarian system in Latin America   <ul><li>There are two types. </li></ul><ul><li>Latifundios </li></ul><ul><li>Minifundio...
Minifundios. <ul><li>Minifundios:  These are small farms that can only provide for a single worker. </li></ul><ul><li>Mini...
Agrarian system in Asia. <ul><li>Asia suffers from land scarcity: a large number of </li></ul><ul><li>peasants are crowded...
<ul><li>Sharecropping occurs in about 85% of the land in Asia. </li></ul><ul><li>The transition from subsistence to commer...
The Economics of Agricultural Development. <ul><li>Three stages of agricultural development: </li></ul><ul><li>(1)   Subsi...
Characteristics of Subsistence farming. <ul><li>1. Most output produced for family consumption. </li></ul><ul><li>2. Land ...
Transition to mixed and diversified farming. <ul><li>A successful transition from subsistence to diversified farming depen...
Transition to specialized, modern commercial farming. <ul><li>This type of farming usually emerges when other sectors of t...
Policies for agricultural development. <ul><li>Policy # 1:  </li></ul><ul><li>Encourage technology and innovation in farms...
Policies. <ul><li>Policy # 3: </li></ul><ul><li>Implementation of  land reform coupled with </li></ul><ul><li>access to cr...
The End  Any Question.
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Agricultural Transformation and Rural Development

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Agricultural Transformation and Rural Development

  1. 1. Agricultural Transformation & Rural Development.
  2. 2. Contents <ul><li>Facts. </li></ul><ul><li>Rural Development. </li></ul><ul><li>Kinds Of Agriculture. </li></ul><ul><li>Agrarian System in Latin America . </li></ul><ul><li>Agrarian System in Asia. </li></ul><ul><li>Stages of Agricultural Development . </li></ul><ul><li>Recommandations/ Policies. </li></ul>
  3. 3. Rural Development <ul><li>More than half of the world population lives in rural areas. </li></ul><ul><li>Living conditions: Precarious & subsistent. </li></ul><ul><li>Wide spread poverty, growing inequality, unemployment & rapid population growth. </li></ul><ul><li>Any development strategy to be meaningful must focus on rural development. </li></ul>
  4. 4. Rural Development <ul><li>Any such policy requires at least 3 basic complementary elements: </li></ul><ul><ul><li>Increase productivity of small farmers </li></ul></ul><ul><ul><li>Increase domestic demand through employment-oriented urban development </li></ul></ul><ul><ul><li>Diversify, non-agricultural, labor intensive rural development strategy </li></ul></ul><ul><li>Without such integrated rural development any industrial growth will only give rise to inequality, poverty and unemployment </li></ul>
  5. 5. Facts on Agriculture <ul><li>Agriculture employs at least 60% of the labour force in </li></ul><ul><li>Asia and Africa, but it only accounts for no more than </li></ul><ul><li>30% of GDP. </li></ul><ul><li>Between 1950 and 1970, per capita food and </li></ul><ul><li>agricultural production grew less than 1% per year in </li></ul><ul><li>the developing world. </li></ul><ul><li>The green revolution has helped increase agricultural </li></ul><ul><li>productivity in developing countries. </li></ul>
  6. 6. <ul><li>China has shown the largest growth of per capita food production in the last two decades. </li></ul><ul><li>Africa has shown a significant decline in agricultural productivity in the last two decades. </li></ul><ul><li>Major reason for poor agricultural performance in developing countries - neglect of agriculture coupled with a bias toward urban industrial economy. </li></ul><ul><li>Solution integrated rural development </li></ul>
  7. 7. Two Kinds of World Agriculture. <ul><li>Highly Efficient </li></ul><ul><li>Developed countries </li></ul><ul><li>High output per worker </li></ul><ul><li>Small number of Farmers can feed entire nation. </li></ul><ul><li>Technological and </li></ul><ul><li>biological improvements. </li></ul><ul><li>Inefficient </li></ul><ul><li>Developing countries. </li></ul><ul><li>Low productivity. </li></ul><ul><li>Agricultural output can </li></ul><ul><li>barely sustain farm </li></ul><ul><li>population. </li></ul><ul><li>Technological Stagnation. </li></ul>
  8. 8. Agrarian system in Latin America <ul><li>There are two types. </li></ul><ul><li>Latifundios </li></ul><ul><li>Minifundios. </li></ul><ul><li>Latifundios : latifundios are very large landholdings that employ from 12 to even thousands of workers. </li></ul><ul><li>Latifundios are inefficient : they do not exploit the economies of scale of large production, but rather they underutilize the land. </li></ul><ul><li>Reasons why latifundios are inefficient: (1) large </li></ul><ul><li>landholdings are a symbol of power rather than a </li></ul><ul><li>productive asset; (2) monitoring costs are higher for large landholdings. </li></ul>
  9. 9. Minifundios. <ul><li>Minifundios: These are small farms that can only provide for a single worker. </li></ul><ul><li>Minifundios comprise up to 90% of the farms, but only occupy up to 17% of total agricultural land. </li></ul>
  10. 10. Agrarian system in Asia. <ul><li>Asia suffers from land scarcity: a large number of </li></ul><ul><li>peasants are crowded in too little land </li></ul><ul><li>Traditional agrarian structure is the village: the </li></ul><ul><li>community owns the land, and peasant families can </li></ul><ul><li>use it to provide goods and services to the whole tribe </li></ul><ul><li>European colonization changed the system by </li></ul><ul><li>encouraging private property ownership. This created: </li></ul><ul><li>(1) landlords: who own the land, but usually live in </li></ul><ul><li>the city. </li></ul><ul><li>(2) sharecroppers and tenant farmers: who actually work the land. </li></ul>
  11. 11. <ul><li>Sharecropping occurs in about 85% of the land in Asia. </li></ul><ul><li>The transition from subsistence to commercial </li></ul><ul><li>production gave rise to the money-lender: he </li></ul><ul><li>provides cash to the farmer to cover for seeds, </li></ul><ul><li>fertilizers and food while the crop is harvested. </li></ul><ul><li>Land plays the role of collateral. </li></ul><ul><li>The money-lender phenomenon has led to many peasants losing their land, being forced to become tenants paying high rents, and being trapped in poverty. </li></ul>
  12. 12. The Economics of Agricultural Development. <ul><li>Three stages of agricultural development: </li></ul><ul><li>(1) Subsistence : low-productivity, subsistence level, </li></ul><ul><li>peasant farm. </li></ul><ul><li>(2) Diversified: mixed family agriculture, part for consumption, part for sales. </li></ul><ul><li>(3) Specialized: high-productivity modern farm </li></ul><ul><li>with specialized agriculture geared to commercial markets. </li></ul>
  13. 13. Characteristics of Subsistence farming. <ul><li>1. Most output produced for family consumption. </li></ul><ul><li>2. Land and labour are the main factors of production, while capital investment is minimal. </li></ul><ul><li>3. It is threatened by the failure of rains, and the potential appropriation of the land by the money lender. </li></ul><ul><li>4. Labour is underemployed most of the year, but highly occupied for planting and harvesting. </li></ul><ul><li>5. Farmers are often resistant to technological innovation due in part to the limited access to credit, insurance and information: there is a lot of uncertainty and risk involved in subsistence farming. </li></ul>
  14. 14. Transition to mixed and diversified farming. <ul><li>A successful transition from subsistence to diversified farming depends on the availability of credit, fertilizers, crop information and marketing facilities. </li></ul><ul><li>Farmers need to feel secure that his family will benefit from the change in order to guarantee successful transition. </li></ul>
  15. 15. Transition to specialized, modern commercial farming. <ul><li>This type of farming usually emerges when other sectors of the economy, such as the industrial sector, have already developed. </li></ul><ul><li>It usually involves capital intensive and labour saving techniques of production. </li></ul>
  16. 16. Policies for agricultural development. <ul><li>Policy # 1: </li></ul><ul><li>Encourage technology and innovation in farms, not in the form of labour-saving machinery (since developing countries are abundant in labour), but rather in the form of hybrid seeds, irrigation and fertilizers. </li></ul><ul><li>Policy # 2: </li></ul><ul><li>Better design of government policies to guarantee equitable access of all farmers to credit and technological innovations. Often the benefits of these policies are only enjoyed by large-scale farmers. </li></ul>
  17. 17. Policies. <ul><li>Policy # 3: </li></ul><ul><li>Implementation of land reform coupled with </li></ul><ul><li>access to credit in order to provide rural families with ownership of productive assets (land) and break the vice circle of highly unequal distribution of rural income. </li></ul><ul><li>Policy # 4: </li></ul><ul><li>A fully fledge integrated rural development, which includes: </li></ul><ul><li>(1) not only increasing agricultural productivity, but also encouraging nonfarm activities in the rural areas; </li></ul><ul><li>(2) Access to health, education and housing in rural areas. </li></ul>
  18. 18. The End Any Question.
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