The contribution of agriculture to economic growth

About this book

The paper analyzes the contribution of agriculture to economic growth. By employing cross-section data for the developing and developed countries during 1960-1970 and 1970-1979, it is found that in the context of Mr. Chenery-Syrquin's model intercountry variation in agricultural growth explains a significant portion of intercountry variation in the industrial (non-agricultural) growth. Further, in the context of an aggregate production function agricultural growth is found to contribute significantly to productivity increases and thus to overall economic growth. For the developing countries sample of the 1970-79 period, the results show that a one percent increase in agricultural growth leads to approximately four-tenths of a percentage point increase in productivity. It is also found that export growth contributes positively to productivity growth while the inflation rate contributes negatively.