IDEAS home Printed from https://ideas.repec.org/a/bla/rdevec/v7y2003i1p138-151.html
   My bibliography  Save this article

Interactions between Agriculture and Industry: Theoretical Analysis of the Consequences of Discriminating Agriculture in Sub–Saharan Africa

Author

Listed:
  • Jørn Rattsø
  • Ragnar Torvik

Abstract

Many countries in sub–Saharan Africa discriminated against agriculture to promote industry after independence. The domestic terms of trade were turned against agriculture by the price fixing of monopoly marketing boards. This policy was assumed to reduce labor costs of industry and was combined with overvaluation of the currency, protectionism, and priority rationing of imported inputs to industry. The region got the worst of both worlds—stagnation in both agriculture and industry. What went wrong? In a dual model designed to represent characteristics of the region, discrimination of agriculture is shown to contract industry through trade linkages. Export–oriented agriculture has been held back, and import–dependent industries have suffered because of the foreign exchange constraint. In a dynamic extension assuming learning–by–doing in industry and catching–up in agriculture, it is shown that discrimination against agriculture may reduce the growth rate of the economy and the technological advantage of industry.

Suggested Citation

  • Jørn Rattsø & Ragnar Torvik, 2003. "Interactions between Agriculture and Industry: Theoretical Analysis of the Consequences of Discriminating Agriculture in Sub–Saharan Africa," Review of Development Economics, Wiley Blackwell, vol. 7(1), pages 138-151, February.
    • Handle: RePEc:bla:rdevec:v:7:y:2003:i:1:p:138-151
    DOI: 10.1111/1467-9361.00181
    as

    Download full text from publisher

    File URL: https://doi.org/10.1111/1467-9361.00181
    Download Restriction: no
    File URL: https://libkey.io/10.1111/1467-9361.00181?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

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


    Cited by:

    1. de Souza, Joao Paulo A., 2015. "Evidence of growth complementarity between agriculture and industry in developing countries," Structural Change and Economic Dynamics, Elsevier, vol. 34(C), pages 1-18.
    2. Baba, S.H. & Wani, M.H. & Zargar, B.A. & Malik, H.A., 2014. "Imperatives for Sustenance of Agricultural Economy in the Mountains: A Prototype from Jammu & Kashmir," Agricultural Economics Research Review, Agricultural Economics Research Association (India), vol. 27(2).
    3. Yifu Lin, Justin & Li, Zhiyun, 2008. "Endogenous Institution Formation under a Catching-up Strategy in Developing Countries1," Policy Research Working Paper Series 4794, The World Bank.
    4. Jørn Rattsø & Hildegunn Ekroll Stokke, 2003. "Learning and Foreign Technology Spillover in Thailand: Empirical Evidence on Productivity Dynamics," Nordic Journal of Political Economy, Nordic Journal of Political Economy, vol. 29, pages 47-66.
    5. Benjamin N. Dennis & Talan B. Işcan, 2007. "Agricultural Distortions, Structural Change, and Economics Growth: A Cross-Country Analysis," Working Papers daleconwp2007-03, Dalhousie University, Department of Economics.
    6. Jonaki Sengupta & Ranjanendra Narayan Nag & Bhaskar Goswami, 2017. "Commodity Price Fluctuations and Unemployment in a Dependent Economy," Contemporary Economics, University of Economics and Human Sciences in Warsaw., vol. 11(3), September.

    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:rdevec:v:7:y:2003:i:1:p:138-151. 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.

    We have no bibliographic references for this item. You can help adding them by using 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: http://www.blackwellpublishing.com/journal.asp?ref=1363-6669 .

    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.