The Effect of Agricultural Technology on the Speed of Development

We examine heterogeneity in the elasticity of agricultural output with respect to labor. Employing panel data from 128 countries over a forty-year period we find distinct heterogeneity in the elasticity of agricultural output with respect to labor. This elasticity is lowest in countries with temperate and/or cold climate regions, and higher in countries including tropical or highland regions. This agricultural parameter determines the speed of structural change following changes in agricultural productivity or population. Calibration shows shifts in labor allocations and welfare will be 2–3 times larger in temperate regions than in tropical or highland regions.

[1]  Y. Hayami,et al.  Agricultural Development: An International Perspective. , 1972 .

[2]  Dietrich Vollrath.  The agricultural basis of comparative development , 2011 .

[3]  Catriona Dutreuilh,et al.  Introduction , 2019 .

[4]  M. Pesaran,et al.  Estimating Long-Run Relationships From Dynamic Heterogeneous Panels , 1995 .

[5]  D. Andrews,et al.  Cross-Section Regression with Common Shocks , 2003 .

[6]  K. Wiebe,et al.  RESOURCE QUALITY AND AGRICULTURAL PRODUCTIVITY: A MULTI-COUNTRY COMPARISON , 2000 .

[7]  F. Teal,et al.  Structural Change and Cross-Country Growth Empirics , 2013 .

[8]  E. D. Kellogg.  Mellor, John W. Agriculture on the Road to Industrialization. Baltimore MD: The Johns Hopkins University Press, 1995, 358 pp., price unavailable , 1996 .

[9]  M. Timmer,et al.  A Cross-country Database For Sectoral Employment And Productivity in Asia and Latin America, 1950-2005 , 2007 .

[10]  Vernon W. Ruttan,et al.  Agricultural productivity differences among countries. , 1970 .

[11]  Michael J. Sposi.  Evolving Comparative Advantage, Sectoral Linkages, and Structural Change , 2015, Journal of Monetary Economics.

[12]  Gerdien W. Meijerink,et al.  The role of agriculture in economic development , 2007 .

[13]  L. Gutierrez,et al.  International R&D Spillovers . . . , 2022 .

[14]  D. Yang,et al.  Agriculture and aggregate productivity: A quantitative cross-country analysis , 2008 .

[15]  M. Pesaran.  A Simple Panel Unit Root Test in the Presence of Cross Section Dependence , 2003 .

[16]  M. Hashem Pesaran,et al.  Testing Weak Cross-Sectional Dependence in Large Panels , 2012, SSRN Electronic Journal.

[17]  V. Mueller,et al.  The Role of Rural–Urban Migration in the Structural Transformation of Sub-Saharan Africa , 2014 .

[18]  Kei-Mu Yi,et al.  Structural Change in an Open Economy , 2013 .

[19]  Yair Mundlak,et al.  Heterogeneous Technology and Panel Data: The Case of the Agricultural Production Function , 2008 .

[20]  M. Pesaran,et al.  Weak and Strong Cross-Section Dependence and Estimation of Large Panels , 2009, SSRN Electronic Journal.

[21]  M. Pesaran.  Estimation and Inference in Large Heterogeneous Panels with a Multifactor Error Structure , 2004, SSRN Electronic Journal.

[22]  Theodore W. Schultz,et al.  The Economic Organization of Agriculture , 1953 .

[23]  P. Collier,et al.  African Agriculture in 50Years: Smallholders in a Rapidly Changing World? , 2014 .

[24]  Johannes Roseboom,et al.  International Productivity Patterns: Accounting for Input Quality, Infrastructure, and Research , 1997 .

[25]  J. Thurlow,et al.  Can Cities or Towns Drive African Development? Economy-wide Analysis for Ethiopia and Uganda , 2014 .

[26]  Kiminori Matsuyama,et al.  Structural Change in an Interdependent World: A Global View of Manufacturing Decline , 2009 .

[27]  Dani Rodrik,et al.  Globalization, Structural Change, and Productivity Growth, with an Update on Africa , 2014 .

[28]  B. Rudolf,et al.  World Map of the Köppen-Geiger climate classification updated , 2006 .

[29]  Mary Tiffen,et al.  Transition in Sub-Saharan Africa: Agriculture, Urbanization and Income Growth , 2003 .

[30]  J. Bai,et al.  Panel Data Models With Interactive Fixed Effects , 2009 .

[31]  Diego Restuccia,et al.  The Role of the Structural Transformation in Aggregate Productivity , 2010 .

[32]  C. Helmers,et al.  Do Spillovers Matter When Estimating Private Returns to R&D? , 2011, Review of Economics and Statistics.

[33]  J. Mellor.  Agriculture on the Road to industrialization , 2004 .

[34]  Bruce F. Johnston,et al.  Agriculture and Structural Transformation : Economic Strategies in Late-Developing Countries , 1975 .

[35]  Stephen L. Parente,et al.  The Food Problem and the Evolution of International Income Levels , 2004 .

[36]  Richard Rogerson,et al.  Growth and Structural Transformation , 2013 .

[37]  D. Gollin.  Agricultural Productivity and Economic Growth , 2010 .

[38]  Devashish Mitra,et al.  Productivity Growth and Convergence in Agriculture versus Manufacturing* , 1999, Economic Development and Cultural Change.

[39]  Francisco Alvarez-Cuadrado,et al.  Structural Change Out of Agriculture: Labor Push Versus Labor Pull , 2011, SSRN Electronic Journal.

[40]  L. Hamilton.  How Robust is Robust Regression , 1992 .

[41]  Kiminori Matsuyama,et al.  Agricultural Productivity, Comparative Advantage and Economic Growth , 1991 .

[42]  J. Thurlow,et al.  The role of agriculture in African development. , 2010 .

[43]  Ron Smith,et al.  Unobserved Heterogeneity in Panel Time Series Models , 2004, Comput. Stat. Data Anal..

[44]  F. Teal,et al.  No Mangoes in the Tundra: Spatial Heterogeneity in Agricultural Productivity Analysis , 2013 .

[45]  Y. Mundlak.  Agriculture and Economic Growth: Theory and Measurement , 2000 .