Agrifood Economics

Patterns of rural development: a cross-country comparison using microeconomic data

ESA Working Paper 08-06
Year: 2008
Author(s): Paul Winters, Timothy Essam, Benjamin Davis, Alberto Zezza, Calogero Carletto, Kostas Stamoulis
This article proposes a general pattern of rural development in which rises in per capita income are associated with a decline in the importance of agricultural production and a rise in the importance of non-agricultural income sources. Following the approach to examining Engel’s Law, we use data from 15 developing countries and a merged data set to test whether such a pattern emerges. The analysis shows a strong, positive relationship between rising per capita income and the share of income earned from rural non-agricultural activities and a negative relationship between per capita income and agricultural production.
Publication type: Working paper
JEL codes: O12, O13, O57, Q12