Agricultural Dualism Research Articles

Rural–urban migrants’ remittance and agricultural pollution in the presence of agricultural dualism

Rural–urban migrants’ remittance and agricultural pollution in the presence of agricultural dualism

Is human‐capital investment necessary to modernization? The effect of rural polytechnic training in dual agriculture

AbstractIn this paper we analyze the link between human‐capital investment and agricultural modernization in a dualistic agricultural economy. We assume that human‐capital investment in the context of agricultural dualism is distinct from that of simple traditional agriculture in that it gives top priority to developing the skills needed for production in the modern agricultural sector. Our aim is to investigate the likely consequences of investments and subsidies that provide polytechnic training to employees in the modern agricultural sector. To this end, we develop a three‐sector general equilibrium model with which one can evaluate the effect of rural polytechnic training. Our research indicates that sector investments and government subsidies raise the output of the traditional agricultural sector but conditionally raise the output of the modern agricultural sector. Moreover, sector investments and government subsidies each have greater effects on the development of the traditional sector than they would on that of the modern sector. These, nevertheless, are not conducive to the agricultural modernization.

International factor mobility and environment in a dual agricultural economy

The purpose of this study is to investigate the influences that international factor movements have on the environment in developing country under agricultural dualism. By using a general equilibrium model that incorporates a modern agricultural sector in different stages, we analyse the effects of international factor movements on the environment. At the beginning of the modern agricultural sector, international labour movement has no influence on the environment; if the modern agricultural capital share in the economy increases to a certain level, international capital inflow improves the environment in the developing countries whereas international capital outflow harms the environment, otherwise, international capital inflow harms the environment whereas international capital outflow improves the environment. However, after the popularization of modern agriculture, international labour movement and international capital movement affect the environment in the same direction: factor inflow harms the environment, whereas outflow improves the environment. Thus, it is possible for the international factor movement be compatible with the environmental protection in a developing country.

Unemployment, Wage Inequality and International Factor Movement in the Presence of Agricultural Dualism

AbstractThis paper investigates how the international factor movements affect the unemployment and skilled–unskilled wage inequality with the existence of a modern agricultural sector. Our research has the new feature that we not only consider that the rural labor migrates to the urban sector but also to the modern agricultural sector. The main conclusions are that the unskilled labor outflow certainly decreases the wage inequality and unemployment rate and the influences that skilled labor movement and capital inflow have on wage inequality and unemployment rate are dependent on the factor intensity between the urban and modern agricultural sectors.

Liberalisation and Jobless Growth in Developing Economy

This paper explains why a developing country may experience a jobless growth in the organised sectors during liberalised regime within the framework of a three-sector mobile capital version of Harris-Todaro type general equilibrium model describing rural-urban migration with agricultural dualism and a non-traded intermediate input. Main findings support the fact that as a consequence of different trade reform policies, organised sectors have experienced increased competition from foreign markets which has forced them to lax labour laws, with the freedom to switch towards more capital-intensive techniques of production, resulting retrenchment of relatively less productive workers and ending up with a jobless growth under the liberalised regime. These results are particularly interesting for their contradiction to the predictions of the standard Harris-Todaro model.

Agricultural subsidy policies fail to deal with child labour under agricultural dualism: What could be the alternative policies?

We provide a theoretical explanation why agricultural subsidy policies are likely to fail to ensure simultaneous eradication of the incidence of child labour and improvement in the well-being of the poor working families in terms of a three-sector general equilibrium model with child labour and agricultural dualism. We identify both demand and supply side effects of any policy intervention on child labour. We also suggest two alternative policies, a scheme of direct cash transfer to poor people and economic growth through foreign direct investment (FDI), both of which would be effective in achieving these twin objectives of a welfare government.

Revisiting the Apparent Paradox: Foreign Capital Inflow, Welfare Amelioration and ‘Jobless Growth’ with Agricultural Dualism and Non-traded Intermediate Input

In order to answer the pertinent question why developing countries are showing penchant for foreign capital over the last two decades in spite of its detrimental effects as revealed from the conventional two-sector mobile capital version of Harris–Todaro (HT) model in the presence of protectionist policy; this paper, in terms of a three-sector HT type general equilibrium model with agricultural dualism where advanced agricultural sector produces a non-traded intermediate input using capital apart from labour and land for the agro-based industry in the urban sector, tries to show that foreign capital inflow may not only improve social welfare, but also lower the magnitude of urban unemployment of labour or may lead to the phenomenon of ‘jobless growth’.

FDI, Unemployment, and Welfare in the Presence of Agricultural Dualism: A Three-Sector General Equilibrium Model

The present paper uses a three-sector general equilibrium framework to examine the effect of Foreign Direct Investment (FDI) on unemployment and welfare in laboursurplus economies in the post-globalisation era. We show that the expansion of landhungry export-oriented agricultural sector through FDI accentuates the problem of urban unemployment in the presence of sticky urban wage and agricultural dualism. We also note that multiple cross-effects and factor specificity play an important role in determining change in output composition and welfare in the wake of the inflow of foreign capital. JEL classification: F16, F21 Keywords: Agricultural Dualism, FDI, Unemployment, Welfare

Agricultural Dualism, Incidence of Child Labour and Subsidy Policies

This paper purports to examine the validity of the common belief that in a developing economy the backward agricultural sector should be subsidized as poorer group of the working population are employed in this sector that send their children out to work out of sheer poverty. A three-sector general equilibrium framework with agricultural dualism and child labour has been employed for the purpose of analysis. It finds that a price subsidy policy to backward agricultural sector is likely to aggravate the child labour incidence while a credit subsidy to advanced agriculture may be effective in reducing the gravity of the problem in the economy. The paper, therefore, questions the desirability of assisting backward agriculture for eradicating child labour in the society.

Fair Wage Hypothesis, Foreign Capital Inflow and Skilled-Unskilled Wage Inequality in the Presence of Agricultural Dualism

The paper develops a four-sector general equilibrium model where the fair wage hypothesis is valid and there is agricultural dualism for analyzing the consequence of an inflow of foreign capital on the skilled-unskilled wage inequality and the unemployment of skilled labour in a developing economy. The unskilled workers are fully employed but there is imperfection in the market for unskilled labour. On the contrary, the skilled wage is set by the firms by minimizing the unit cost of skilled labour and their efficiency depends on the relative income distribution and the unemployment rate. The analysis finds that an inflow of foreign capital worsens the relative wage inequality but lowers the unemployment of skilled labour. It provides an alternative theoretical foundation to the empirical finding that inflows of foreign capital might have produced unfavourable effect on the wage inequality in the developing countries during the liberalized regime by increasing the relative demand for skilled labour.

Labour Market Reform, Welfare and Urban Unemployment in a Small Open Economy

The paper examines the aptness of labour market reform in a developing country using a three-sector Harris-Todaro model with agricultural dualism and a non-traded final commodity. The paper, contrary to the common belief, finds that liberalization in the labour market may be desirable from the view points of both social welfare and unemployment problem. This theoretical framework may be useful in explaining as to why labour market reform should be regarded as an integral component of the package of liberalized economic policies in the countries in transition.

Foreign capital, welfare and urban unemployment in the presence of agricultural dualism

In a two sector mobile capital Harris–Todaro model, such as [Corden, W.M., Findlay, R., 1975. Urban unemployment, intersectoral capital mobility, and development policy in a dual economy. Economica 42, 59–78], an inflow of foreign capital in the presence of protectionist policy is welfare deteriorating as well as unemployment accentuating. But, the developing countries have chosen liberalized investment and trade policies as their development strategies and have been able to attract a considerable amount of foreign capital during the last two decades. A relevant question is why these countries are yearning for foreign capital given its detrimental effects as predicted by the conventional theoretical literature on trade and development. This paper makes an attempt to address the above issue in terms of a three sector Harris–Todaro model with agricultural dualism and a non-traded final commodity. In the given setup, an inflow of foreign capital is likely to improve welfare and does not necessarily worsen the problem of unemployment. The paper may also be useful to explain as to why many of the developing economies have experienced ‘jobless growth’ in the liberalized regime.

Foreign Capital, Welfare and Urban Unemployment in the Presence of Agricultural Dualism

In a two sector mobile capital Harris-Todaro model, such as Corden and Findlay (1975), an inflow of foreign capital in the presence of protectionist policy is welfare deteriorating as well as unemployment accentuating. But, the developing countries have chosen liberalized investment and trade policies as their development strategies and have been able to attract a considerable amount of foreign capital during the last two decades. A relevant question is why these countries are yearning for foreign capital given its detrimental effects as predicted by the conventional theoretical literature on trade and development. This paper makes an attempt to address the above issue in terms of a three sector Harris-Todaro model with agricultural dualism and a non-traded final commodity. In the given setup, an inflow of foreign capital is likely to improve welfare and does not necessarily worsen the problem of unemployment. The paper may also be useful to explain as to why many of the developing economies have experienced 'jobless growth' in the liberalized regime.

Food marketing and pricing policy in Eastern and Southern Africa: A survey

This article surveys the empirical record of grain marketing and pricing policy in Eastern and Southern Africa over 1930–1995. The paper addresses five key issues with major implications for food policy throughout Africa: (a) why the anticipated supply response to market liberalization has not yet occurred; (b) why the common assumption of state taxation of farmers to support a cheap food policy does not apply in most of the countries in the region; (c) why the temporary successes of the state-led approach to stimulating smallholder grain production were unsustainable; (d) why the elimination of government food subsidies associated with market reform has not adversely affected consumers; and (e) why the fiscal cost of the marketing systems at least initially worsened rather than improved after the reforms were implemented in most countries. The key future challenges for marketing policy are how to develop coordinated and financially sustainable input, finance and commodity marketing systems for raising productivity growth in smallholder agriculture while overcoming inherited agricultural dualism, and how to mitigate the effects of food price instability in a cost-effective manner.