Poverty reduction during the rural–urban transformation: Rural development is still more important than urbanisation

Based on cross-country panel datasets, we find that (i) an increase in population share in agriculture is associated with poverty reduction once the longer-term poverty change or the dynamic is taken into account; (ii) rural non-agricultural sector also is poverty reducing in some cases; and (iii) i...

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Bibliographic Details
Published in:Journal of policy modeling 2017-11, Vol.39 (6), p.963-982
Main Authors: Imai, Katsushi S., Gaiha, Raghav, Garbero, Alessandra
Format: Article
Language:English
Subjects:
Agriculture
Growth
Inequality
Non-agriculture
Poverty
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Summary:Based on cross-country panel datasets, we find that (i) an increase in population share in agriculture is associated with poverty reduction once the longer-term poverty change or the dynamic is taken into account; (ii) rural non-agricultural sector also is poverty reducing in some cases; and (iii) increased population in the mega cities has no role in poverty reduction. In fact, the growth of population in mega cities is “poverty-increasing” in a few cases. Given that a rapid population growth or rural–urban migration is likely to increase poverty, more emphasis should be placed on policies that enhance support for rural agricultural and non-agricultural sectors. If our analysis has any validity, doubts are raised about recent research emphasising the role of secondary towns or urbanisation as the main driver of extreme poverty reduction.
ISSN:0161-8938
1873-8060
DOI:10.1016/j.jpolmod.2017.10.002