Intersectoral linkages in Asian agriculture

The objectives of this paper are to provide a comprehensive survey of linkages (emerging from the net increase in income in the agricultural sector) to other sectors of the economy. Production, consumption, employment, saving‐investment and foreign trade linkages are discussed and their measurement and various concepts based on input‐output methodology are outlined. The advances on social accounting matrix analysis and partial input‐output models, in which income distribution is explicitly built‐in, are also considered. The methodology of computable general‐equilibrium models is used to conduct policy analysis in many developing countries. It is suggested that policy simulation before and after policy changes can be performed adequately with the help of computable general‐equilibrium models. It is, however, asserted that in developing agriculture, land reform, new technology and credit institutions can promote agricultural growth faster than employment growth leading to increases in productivity growth. This will presumably generate incomes and consumption growth intersectorally and also reduce inequality in the distribution of income if the government policies are correctly implemented.