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A World Without Agriculture: The Structural Transformation by C. Peter Timmer

By C. Peter Timmer

The progressively diminishing function of agriculture on this planet economy_a principally unperceived, poorly understood, yet profound change_is as transformational for developmental fiscal notion as gravity has been for physics. C. Peter Timmer argues that policymakers who forget about this primary shift possibility mismanaging their fiscal improvement regulations, with critical outcomes. The 'structural transformation' of constructing economies has 4 major positive aspects: a falling proportion of agriculture in fiscal output and employment; a emerging proportion of city financial task in and sleek companies; the migration of rural staff to city settings; and a demographic transition in beginning and dying premiums that usually ends up in a spurt in inhabitants progress sooner than a brand new equilibrium is reached. even if all constructing economies event those transitions, dealing with the ensuing political results has been an important problem for policymakers over the last half-century. attempting to cease the structural transformation easily doesn't paintings. Bolstering the capability of the terrible to learn from switch, in spite of the fact that, does. Investments in human assets, for example_especially in schooling and health_are the main promising techniques to easing the transitions of a constructing countryOs structural transformation. Such thoughts require major public-sector assets and coverage help to reinforce rural productiveness and rely on political tactics which are delicate to the pressures generated via the structural transformation. constructing effective coverage mechanisms to lead constructing economies in the course of the structural transformation will be a concern of global governments within the twenty-first century. This monograph, a global with no Agriculture, used to be the 2007 Henry Wendt Lecture, brought on the American company Institute in Washington, D.C. on October 30, 2007. The Wendt Lecture is introduced each year through a pupil who has made significant contributions to our knowing of the trendy phenomenon of globalization and its outcomes for social welfare, executive coverage, and the growth of liberal political associations.

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First, the patterns from the early developers seem remarkably similar to those for the full sample of countries from 1965 to 2000. 22 Second, the tendency for the gap-share variable to widen in the early stages of development does not seem to be a feature just of latedeveloping countries. To the contrary, the pattern seems equally strong in the early developers. The turning point is in the range of $1,000, depending on exact specifications, and all of the sample countries reached the turning point early in their development.

Reverse causation seems to be the only plausible explanation for such an impact, with widening sectoral income distribution actually causing domestic agricultural policy to respond with greater price incentives. The broader role of agriculture revealed in these patterns extends well beyond agricultural price policy, and it clearly is powerful enough to influence the basic patterns of the structural transformation. It is important, then, to understand what role agriculture actually plays on the way to its virtual disappearance as a share of the economy.

Such a strategy is the first step in breaking the cycle of poverty. 37 Countries with rapidly increasing food production have much better records of poverty alleviation, perhaps because of changes in the local economics of access to food— changes that are not captured by aggregate statistics on incomes and prices. The most recent confirmation of this relationship is in the 2004 study by Majid, mentioned above. 38 Whatever the mechanisms, intensive campaigns to raise domestic food production—through rural investments and rapid technological change—can be expected to have positive spillover effects on nutrient intake among the poor.

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