Question

Explain following statement / reason : Agriculture has been vitalized for poverty alleviation.​

Answer 1

Answer:

The analysis found that the agricultural GDP per worker elasticity of poverty reduction is 0.85 against the 0.08 non-agricultural GDP per worker elasticity of poverty reduction. However, it is suggested that the impact of agriculture on poverty reduction cannot be judged by focusing on this sector alone.

Answer 2

Answer:

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Explanation:

There is a lot of evidence that agriculture can contribute to poverty reduction beyond a direct effect on farmer's incomes. Agricultural development can stimulate economic development outside of the agricultural sector, and lead to higher job and growth creation. Increased productivity of agriculture raises farm incomes, increases food supply, reduces food prices, and provides greater employment opportunities in both rural and urban areas. Higher incomes can increase the consumer demand for goods and services produced by sectors other than agriculture. Such linkages (or the 'multiplier effect') between growth in the agricultural sector and the wider economy has enabled developing countries to diversify to other sectors where growth is higher and wages are better.

Diversification outside of agriculture is important to a country's development. This is particularly true in rural areas where about 70% of the world's poorest people live (IFAD 2011a). Haggblade et al (2002) estimate that across developing countries, as many as a quarter of the rural population is employed full time outside of agriculture, which constitutes 35-40% of rural incomes. This is not only a pattern amongst the wealthier rural population - the poorest 20% of the population earn an average of 30% of their incomes from non-farm sources (DFID 2005).