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Modern rice technology and regional wage differentials in the Philippines

Author

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  • Otsuka, Keijiro
  • Cordova, Violeta G.
  • David, Cristina C.

Abstract

Fear has been widely expressed that the modern rice varieties have created large disparities in regional income distribution, as the productivity gap between favorable and unfavorable rice‐production environments widened due to differential technology adoption throughout South and Southeast Asia over the last two decades. Technology affects the income of farm population directly through its effects on productivity and factor use, and indirectly through its effect on factor prices. In particular, the ultimate distributional impact of modern varieties will critically depend on the interregional labor‐market adjustments through migration in response to regional wage differentials created by the differential technology adoption, since labor is the main resource of the majority of the rural population. We studied favorable and unfavorable rice‐growing villages in the Philippines, and found that adoption of modern varieties during the 1970s was positively related to population growth rate. Contrary to popular belief, no association was observed between wage rates and adoption of modern varieties as of 1986. These findings support the hypothesis that the differential adoption of modern rice varieties induced interregional labor migration toward equalization of wage income across different production environments.
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Suggested Citation

  • 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.
    • Handle: RePEc:eee:agecon:v:4:y:1990:i:3-4:p:297-314
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    Cited by:

    1. 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.
    2. Byerlee, Derek R., 1993. "Technology Adaptation and Adoption: The Experience of Seed-Fertiliser Technology and Beyond," Review of Marketing and Agricultural Economics, Australian Agricultural and Resource Economics Society, vol. 61(02-2), pages 1-16, August.
    3. Thanos Fragkandreas, 2022. "Three Decades of Research on Innovation and Inequality: Causal Scenarios, Explanatory Factors, and Suggestions," Working Papers 60, Birkbeck Centre for Innovation Management Research, revised Feb 2022.
    4. Balisacan, Arsenio M., 1991. "Linkages, Poverty and Income Distribution," Working Papers WP 1991-15, Philippine Institute for Development Studies.
    5. James A. Roumasset, 1996. "Food Security & Stochastic Aspects of Poverty," Working Papers 199607, University of Hawaii at Manoa, Department of Economics.
    6. Anderson, Jock & Roumasset, James, 1996. "FOOD Insecurity and Stochastic Aspects of Poverty," MPRA Paper 13323, University Library of Munich, Germany.

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