IDEAS home Printed from https://ideas.repec.org/a/bla/deveco/v52y2014i1p26-51.html
   My bibliography  Save this article

Changing Sources of Household Income, Poverty, and Sectoral Inequality in Sri Lanka, 1990–2006

Author

Listed:
  • Nandika S. Kumanayake
  • Jonna P. Estudillo
  • Keijiro Otsuka

Abstract

type="main"> Comparing dynamic changes in household income and poverty among urban, rural, and estate sectors in Sri Lanka from 1990 to 2006, this study finds that a shift of household income away from farm to nonfarm sources is accompanied by a significant improvement in household income and reduction in poverty, particularly in the rural sector. Major contributing factors are the rise in returns to labor, in general, and educated labor, in particular, due to the development of the nonfarm labor market. Persistently low income among estate households can be explained primarily by the limited availability of nonfarm employment opportunities and the low education levels of working members.

Suggested Citation

  • Nandika S. Kumanayake & Jonna P. Estudillo & Keijiro Otsuka, 2014. "Changing Sources of Household Income, Poverty, and Sectoral Inequality in Sri Lanka, 1990–2006," The Developing Economies, Institute of Developing Economies, vol. 52(1), pages 26-51, March.
    • Handle: RePEc:bla:deveco:v:52:y:2014:i:1:p:26-51
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1111/deve.12033
    Download Restriction: Access to full text is restricted to subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Kanbur, Ravi & Venables, Anthony J. (ed.), 2005. "Spatial Inequality and Development," OUP Catalogue, Oxford University Press, number 9780199278633.
    2. Foster, James & Greer, Joel & Thorbecke, Erik, 1984. "A Class of Decomposable Poverty Measures," Econometrica, Econometric Society, vol. 52(3), pages 761-766, May.
    3. Benjamin Davis & Paul Winters & Thomas Reardon & Kostas Stamoulis, 2009. "Rural nonfarm employment and farming: household‐level linkages," Agricultural Economics, International Association of Agricultural Economists, vol. 40(2), pages 119-123, March.
    4. Oaxaca, Ronald, 1973. "Male-Female Wage Differentials in Urban Labor Markets," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 14(3), pages 693-709, October.
    5. Foster, Andrew D & Rosenzweig, Mark R, 2004. "Agricultural Productivity Growth, Rural Economic Diversity, and Economic Reforms: India, 1970-2000," Economic Development and Cultural Change, University of Chicago Press, vol. 52(3), pages 509-542, April.
    6. Haggblade, Steven & Hazell, Peter & Reardon, Thomas, 2010. "The Rural Non-farm Economy: Prospects for Growth and Poverty Reduction," World Development, Elsevier, vol. 38(10), pages 1429-1441, October.
    7. Stefan Dercon, 2009. "Rural Poverty: Old Challenges in New Contexts," The World Bank Research Observer, World Bank, vol. 24(1), pages 1-28, April.
    8. Barrett, C. B. & Reardon, T. & Webb, P., 2001. "Nonfarm income diversification and household livelihood strategies in rural Africa: concepts, dynamics, and policy implications," Food Policy, Elsevier, vol. 26(4), pages 315-331, August.
    9. Jayasuriya, S. K. & Shand, R. T., 1986. "Technical change and labor absorption in Asian agriculture: Some emerging trends," World Development, Elsevier, vol. 14(3), pages 415-428, March.
    10. World Bank, 2007. "Sri Lanka - Poverty Assessment : Engendering Growth with Equity, Opportunities and Challenges," World Bank Publications - Reports 8050, The World Bank Group.
    11. Kanbur, Ravi & Venables, Anthony J., 2005. "SPATIAL INEQUALITY AND DEVELOPMENT Overview of UNU-WIDER Project," Working Papers 127127, Cornell University, Department of Applied Economics and Management.
    12. Alan S. Blinder, 1973. "Wage Discrimination: Reduced Form and Structural Estimates," Journal of Human Resources, University of Wisconsin Press, vol. 8(4), pages 436-455.
    13. Keijiro Otsuka, 2006. "Why Can't We Transform Traditional Agriculture in Sub-Saharan Africa? ," Review of Agricultural Economics, Agricultural and Applied Economics Association, vol. 28(3), pages 332-337.
    14. Jonna P. Estudillo & Yasuyuki Sawada & Keijiro Otsuka, 2008. "Poverty and Income Dynamics in Philippine Villages, 1985–2004," Review of Development Economics, Wiley Blackwell, vol. 12(4), pages 877-890, November.
    15. Otsuka, Keijiro & Cordova, Violeta G. & David, Cristina C., 1990. "Modern rice technology and regional wage differentials in the Philippines," Agricultural Economics, Blackwell, vol. 4(3-4), pages 297-314, December.
    16. Reardon, Thomas & Berdegue, Julio & Escobar, German, 2001. "Rural Nonfarm Employment and Incomes in Latin America: Overview and Policy Implications," World Development, Elsevier, vol. 29(3), pages 395-409, March.
    17. Reimers, Cordelia W, 1983. "Labor Market Discrimination against Hispanic and Black Men," The Review of Economics and Statistics, MIT Press, vol. 65(4), pages 570-579, November.
    18. Jonna P. ESTUDILLO & Keijiro OTSUKA, 2006. "Lessons From Three Decades Of Green Revolution In The Philippines," The Developing Economies, Institute of Developing Economies, vol. 44(2), pages 123-148, June.
    19. Charity Gay Ramos & Jonna Estudillo & Yasuyuki Sawada & Keijiro Otsuka, 2012. "Transformation of the Rural Economy in the Philippines, 1988--2006," Journal of Development Studies, Taylor & Francis Journals, vol. 48(11), pages 1629-1648, November.
    20. Haggblade, Steven & Hazell, Peter B. R. & Reardon, Thomas Anthony (ed.), 2007. "Transforming the rural nonfarm economy: Opportunities and threats in the developing world," IFPRI books, International Food Policy Research Institute (IFPRI), number 978-0-8018-8664-5.
    21. Minten, Bart & Barrett, Christopher B., 2008. "Agricultural Technology, Productivity, and Poverty in Madagascar," World Development, Elsevier, vol. 36(5), pages 797-822, May.
    22. Yujiro Hayami, 1996. "The Peasant in Economic Modernization," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 78(5), pages 1157-1167.
    23. Lanjouw, Jean O. & Lanjouw, Peter, 2001. "The rural non-farm sector: issues and evidence from developing countries," Agricultural Economics, Blackwell, vol. 26(1), pages 1-23, October.
    24. Ravi Kanbur & Tony Venables, 2005. "Introduction: Spatial inequality and development," Journal of Economic Geography, Oxford University Press, vol. 5(1), pages 1-2, January.
    25. Hossain, Mahabub, 1988. "Nature and impact of the Green Revolution in Bangladesh:," Research reports 67, International Food Policy Research Institute (IFPRI).
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Mohamed Esham & Brent Jacobs & Hewage Sunith Rohitha Rosairo & Balde Boubacar Siddighi, 2018. "Climate change and food security: a Sri Lankan perspective," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 20(3), pages 1017-1036, June.
    2. Dennis Wichelns, 2015. "Achieving Water and Food Security in 2050: Outlook, Policies, and Investments," Agriculture, MDPI, vol. 5(2), pages 1-33, April.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Indunil De Silva, 2013. "Endowments Versus Returns: Counterfactual Quantile Decomposition Of Urban–Rural Inequality In Sri Lanka," Review of Urban & Regional Development Studies, Wiley Blackwell, vol. 25(1), pages 47-60, March.
    2. Almeida, Alexandre N. & Bravo-Ureta, Boris E., 2019. "Agricultural productivity, shadow wages and off-farm labor decisions in Nicaragua," Economic Systems, Elsevier, vol. 43(1), pages 99-110.
    3. Marwan Benali & Bernhard Brümmer & Victor Afari‐Sefa, 2018. "Smallholder participation in vegetable exports and age‐disaggregated labor allocation in Northern Tanzania," Agricultural Economics, International Association of Agricultural Economists, vol. 49(5), pages 549-562, September.
    4. Bezu, Sosina & Barrett, Christopher B. & Holden, Stein T., 2012. "Does the Nonfarm Economy Offer Pathways for Upward Mobility? Evidence from a Panel Data Study in Ethiopia," World Development, Elsevier, vol. 40(8), pages 1634-1646.
    5. Musa Hasen Ahmed & Kumilachew Alamerie Melesse, 2018. "Impact of off-farm activities on technical efficiency: evidence from maize producers of eastern Ethiopia," Agricultural and Food Economics, Springer;Italian Society of Agricultural Economics (SIDEA), vol. 6(1), pages 1-15, December.
    6. Jan Fałkowski & Maciej Jakubowski & Paweł Strawiński, 2014. "Returns from income strategies in rural Poland," The Economics of Transition, The European Bank for Reconstruction and Development, vol. 22(1), pages 139-178, January.
    7. Zeeshan & Geetilaxmi Mohapatra & Arun Kumar Giri, 2022. "How Farm Household Spends Their Non-farm Incomes in Rural India? Evidence from Longitudinal Data," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(4), pages 1967-1996, August.
    8. Sunderlin, William D. & Dewi, Sonya & Puntodewo, Atie & Müller, Daniel & Angelsen, Arild & Epprecht, Michael, 2008. "Why forests are important for global poverty alleviation: A spatial explanation," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 13(2).
    9. World Bank, 2004. "Sri Lanka - Reshaping Economic Geography : Connecting People to Prosperity," World Bank Publications - Books, The World Bank Group, number 21549.
    10. Adugna Lemi, "undated". "The Dynamics of Income Diversification in Ethiopia: Evidence from Panel data," Working Papers 3, University of Massachusetts Boston, Economics Department.
    11. Bezu, Sosina & Holden, Stein, 2014. "Are Rural Youth in Ethiopia Abandoning Agriculture?," World Development, Elsevier, vol. 64(C), pages 259-272.
    12. Binswanger-Mkhize, Hans P. & Johnson, Timothy & Samboko, Paul Chimuka & You, Liangzhi, 2016. "The impact of urban growth on agricultural and rural non-farm growth in Kenya," 2016 Fifth International Conference, September 23-26, 2016, Addis Ababa, Ethiopia 249274, African Association of Agricultural Economists (AAAE).
    13. Joshua D Merfeld, 2020. "Moving Up or Just Surviving? Nonfarm Self‐Employment in India," American Journal of Agricultural Economics, John Wiley & Sons, vol. 102(1), pages 32-53, January.
    14. Bezu, Sosina & Barrett, Christopher B., 2010. "Activity Choice in Rural Non-farm Employment (RNFE): Survival versus accumulative strategy," MPRA Paper 55034, University Library of Munich, Germany.
    15. Nagler,Paula & Naude, Wim & Nagler,Paula & Naude, Wim, 2014. "Non-farm enterprises in rural Africa : new empirical evidence," Policy Research Working Paper Series 7066, The World Bank.
    16. Koloma, Yaya, 2012. "DETERMINANTS de la pauvreté et genre des bénéficiaires de microfinance au Mali [DETERMINANTS of poverty by gender of beneficiaries of microfinance in Mali]," MPRA Paper 40644, University Library of Munich, Germany.
    17. Barbier, Edward B., 2012. "Natural capital, ecological scarcity and rural poverty," Policy Research Working Paper Series 6232, The World Bank.
    18. Kazi Iqbal & Md Nahid Ferdous Pabon & Md Wahid Ferdous Ibon, 2023. "Examining rural income and employment in Bangladesh: A case of structural changes in the rural nonfarm sector in a developing country," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 67(3), pages 364-387, July.
    19. Mamoudou Ba & Amar Anwar & Mazhar Mughal, 2021. "Non‐farm employment and poverty reduction in Mauritania," Journal of International Development, John Wiley & Sons, Ltd., vol. 33(3), pages 490-514, April.
    20. Ayenew, Habtamu Yesigat & Sauer, Johannes & Abate-Kassa, Getachew, 2016. "Rural Non-Farm Sector, Agricultural Self-Employment And Wage Employment In Agricultural Households: The Implications For Income And Risk In Rural Ethiopia," 56th Annual Conference, Bonn, Germany, September 28-30, 2016 244809, German Association of Agricultural Economists (GEWISOLA).

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:deveco:v:52:y:2014:i:1:p:26-51. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: https://edirc.repec.org/data/idegvjp.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.