Agricultural transformation and rural development chapter6

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Agricultural transformation and rural development chapter6

  1. 1. 320RK 1Agricultural Transformation and RuralDevelopment“It is in the agricultural sector that thebattle for long-term economicdevelopment will be won or lost.”Gunnar Myrdal
  2. 2. 320RK 2Agricultural Transformation andRural Development: Outline Integrated rural development Growth and stagnation of the agricultural sectorsince 1950 Characteristics of agrarian systems in LatinAmerica, Asia, and Africa Economics of peasant subsistence agriculture andtransition to commercial farming Land reform and land markets Role of women in agriculture Case Study
  3. 3. 320RK 3Agricultural Transformation andRural Development: Introduction The heavy emphasis in the past on rapidindustrialization may have been misplaced Agricultural development is now seen as animportant part of any development strategy Although agriculture employs the majority ofthe LDC labor force, it accounts for a muchlower share of total output Trends in per capita food and agriculturalproduction, 1950 -1994
  4. 4. 320RK 4Agricultural Transformation andRural Development How can agricultural output and productivity percapita be substantially increased that will benefit thesmall farmer and support the urban population? What is the process by which traditional farms aretransformed into commercial farms? Why do traditional farmers resist change? Are price incentives sufficient to increase output? How can rural development be achieved?
  5. 5. 320RK 5Agricultural stagnation and Growth Since1950: Output and employment, 1995Region % of L force inAgricultureAgriculturaloutput as a %of GDPSouth Asia 64 30East Asia 70 18Latin America 25 10Africa 68 20
  6. 6. 320RK 6
  7. 7. 320RK 7
  8. 8. 320RK 8
  9. 9. 320RK 9Distribution of Farms and FarmlandAvg.Operationalfarm sizehectares% offarmlandabove 50hectares% of tenantedarea infarmlandAsia:BangladeshIndiaPhilippines1.62.33.6Na3.713.920.98.532.8Latin America:BrazilCosta RicaPeru59.738.116.984.679.779.110.29.013.6
  10. 10. 320RK 10
  11. 11. 320RK 11Structure of Agrarian Systems Two kinds of world agriculture: Efficient agriculture- high labour and landproductivity Inefficient agriculture- diminishing returnsto labour
  12. 12. 320RK 12Agricultural in Latin America, Asia,and Africa Peasant agriculture in Latin America, Asia, andAfrica Latin AmericaThe Latifundio-Minifundio patternResource underutilization AsiaFragmentation and subdivision of peasant land inAsia AfricaExtensive cultivation patternsShifting cultivation
  13. 13. 320RK 13
  14. 14. 320RK 14Latifundio-Minifundio pattern Latifundios- employment of 12 or more Minifundios- employment of 2 or less Family farms- employment of 4-12 workers Inefficient operation of latifundios Inequality in land distribution
  15. 15. 320RK 15Fragmentation and subdivision High population density and small patches of land Equal distribution of land Traditional pattern of land ownership arose from 3forces:1. Colonial rule2. Power of money lender3. Rapid population growth
  16. 16. 320RK 16Subsistence Agriculture andExtensive cultivation Importance of subsistence agriculture in thevillage community Practice of shifting cultivation Right to common property such as land andwater Historical forces restricting growth of output: Traditional farming practices Intensive and shifting cultivation Scarce labour supply during peak season
  17. 17. 320RK 17Economics of agriculturaldevelopment Three broad stages in the evolution of agriculturalproduction:Primitive stage- subsistence peasant farmMixed family agriculture- consumption+saleModern farm- specialized and commercial farming
  18. 18. 320RK 18Economics of agriculturaldevelopment: Transition processSubsistencefarmingDiversified ormixed farmingSpecialized,moderncommercialfarming
  19. 19. 320RK 19Subsistence farming: Risk aversionand uncertainty Small farmer attitudes toward risk: Exploding the mythof irrational producers
  20. 20. 320RK 20Subsistence farming: Risk aversionand uncertainty
  21. 21. 320RK 21Crop yield of different farmingtechniques
  22. 22. 320RK 22Incentives under share cropping
  23. 23. 320RK 23Sharecropping and interlocking factormarkets Sharecropping occurs when a peasant farmer uses thelandowner’s farmland in exchange for a share of foodoutput which the peasant farmer grows. Is share cropping inefficient? Marshall’s observations Cheung’s findings Shaban’s study Hayam’s findings Recent approach to share cropping in the event ofinterlocking factor markets
  24. 24. 320RK 24Sharecropping and interlocking factormarkets Interlocking factor markets occur when different inputsare provided by the same suppliers and these suppliersexercise monopolistic or oligopolistic control overresources. Case study of Sharecropping and Constraints onAgrarian Reform: India athttp://wps.aw.com/aw_todarosmit_econdevelp_8/0,6111,284582-,00.h
  25. 25. 320RK 25Land Reform: Is it inevitable fortenant’s welfare Land reform means the redistribution of property or landrights for the benefit of the landless, tenants, and farmlaborers. Agrarian reform embraces improvements in both land tenureand agricultural organization. Types of land reform intervention:Land tenure reformExternal inducements or market based incentivesExternal controlsConfirmation of title
  26. 26. 320RK 26Land Reform: Is it inevitable fortenant’s welfare Land reform means the redistribution of property or landrights for the benefit of the landless, tenants, and farmlaborers. Agrarian reform embraces improvements in both land tenureand agricultural organization. Types of land reform intervention:Land tenure reformExternal inducements or market based incentivesExternal controlsConfirmation of title
  27. 27. 320RK 27Land Reform: Inevitable for Tenant’sWelfarePoints for discussion: What is the case for equitable land distribution? Are big farms more efficient? Design of a land reform Should land reform be a permanent, one-shotreform?(revolutionary)Should landlords be compensated? (evolutionary) Alternatives to traditional land reform Market assisted land reform Tenancy reform
  28. 28. 320RK 28Land reforms Additional material:Land Reforms: Prospects and Strategies byAbhijit V. Banerjee, Massachusetts Institute of Technology athttp://lnweb18.worldbank.org/ESSD/essdext.nsf/24DocByUnid/86356E62C8AYou may like to use the points for discussion to go through the paper orrely on your class notes.
  29. 29. 320RK 29Toward a strategy of agricultural and ruraldevelopment Improving small-scale agricultureTechnology and innovationInstitutional and pricing policiesSupportive social institutions Conditions for rural developmentLand reformSupportive policiesIntegrated development objectivesRole of women in agriculture (case study applies tosupportive policies and integrated RD as well)Microfinance - Hope for the Poor: The Grameen Bank ofBangladesh at Microfinance athttp://wps.aw.com/wps/media/objects/277/284582/todarocasestudies.pdf

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