Agricultural Productivity Growth and Poverty Alleviation

TLDR

Agricultural growth is widely regarded as a key driver of poverty reduction through job creation, rural linkages, and lower food costs, though its impact varies by context. The article aims to theoretically justify and empirically test the hypothesis that higher agricultural yield per unit area reduces poverty. Using cross‑country regression, the study estimates the relationship between yield per unit area and poverty indicators. The analysis confirms a strong negative association between yield and poverty, indicating that agricultural growth is among the most effective development interventions.

Abstract

How important is agricultural growth to poverty reduction? This article first sets out the theoretical reasons for expecting agricultural growth to reduce poverty. Several plausible and strong arguments apply ‐ including the creation of jobs on the land, linkages from farming to the rest of the rural economy, and a decline in the real cost of food for the whole economy ‐ but the degree of impact is in all cases qualified by particular circumstances. Hence, the article deploys a cross‐country estimation of the links between agricultural yield per unit area and measures of poverty. This produces strong confirmation of the hypothesised linkages. It is unlikely that there are many other development interventions capable of reducing the numbers in poverty so effectively.