Table Of Content

2008 world development report Agriculture for Development 2008 world development report Agriculture for Development 2008 world development report Agriculture for Development THE WORLD BANK Washington, DC © 2007 The International Bank for Reconstruction and Development / The World Bank 1818 H Street NW Washington DC 20433 Telephone: 202-473-1000 Internet: www.worldbank.org E-mail: [email protected] All rights reserved 1 2 3 4 5 10 09 08 07 This volume is a product of the staff of the International Bank for Reconstruction and Devel- opment / The World Bank. The fi ndings, interpretations, and conclusions expressed in this volume do not necessarily refl ect the views of the Executive Directors of The World Bank or the governments they represent. The World Bank does not guarantee the accuracy of the data included in this work. 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All other queries on rights and licenses, including subsidiary rights, should be addressed to the Offi ce of the Publisher, The World Bank, 1818 H Street NW, Washington, DC 20433, USA; fax: 202-522-2422; e-mail: [email protected]. Cover design by Chris Lester of Rock Creek Strategic Marketing and Bill Pragluski of Critical Stages. Typesetting by Precision Graphics. Printed in the United States by Quebecor World. Cover photos by World Bank staff members, clockwise from top left: milk thermometer, Lillian Foo; wheat threshing, Alexander Rowland; Holstein cow, Lillian Foo; supermarket beans, Lillian Foo; Andean woman and baby at market, Curt Carnemark/World Bank Photo Library; cotton plant, Arne Hoel. Softcover Hardcover ISBN-13: 978-0-8213-6807-7 ISBN-13: 978-0-8213-6808-4 ISSN: 0163-5085 ISSN: 0163-5085 eISBN-13: 978-0-8213-6809-1 DOI: 10.1596/978-0-8213-7235-7 DOI: 10.1596/978-0-8213-7233-3 Contents Foreword xiii Acknowledgments xv Abbreviations and Data Notes xvii Overview 1 What can agriculture do for development? 2 What are effective instruments in using agriculture for development? 8 How can agriculture-for-development agendas best be implemented? 18 Part I What can agriculture do for development? 26 1 Growth and poverty reduction in agriculture’s three worlds 26 The structural transformation 27 The three worlds of agriculture for development 29 Agriculture’s development potential shortchanged 38 The political economy of agricultural policy 42 A new role for agriculture in development 44 focus A: Declining rural poverty has been a key factor in aggregate poverty reduction 45 2 Agriculture’s performance, diversity, and uncertainties 50 Productivity growth in developing countries drove agriculture’s global success 50 Growth across regions and countries has been uneven 53 Differences in performance refl ect different underlying conditions 54 Opportunities for a new agriculture through diversifi cation 58 Future perspectives: confronting challenges and rising uncertainties 61 Conclusion—a continuing production challenge 68 focus B: Biofuels: the promise and the risks 70 v vi CONTENTS 3 Rural households and their pathways out of poverty 72 Three complementary pathways out of rural poverty: farming, labor, and migration 73 The variation in rural households’ income strategies 74 Rural occupations and income sources 77 Household behavior when markets and governments fail: rational, despite appearances 82 Rural household asset positions: often low and unequal 84 Pervasive risks and costly responses 89 Smallholder challenges to compete 90 Conclusions 92 focus C: What are the links between agricultural production and food security? 94 Part II What are effective instruments for using agriculture for development? 96 4 Reforming trade, price, and subsidy policies 96 Agricultural protection and subsidies in developed countries 96 Agricultural taxation in developing countries 98 Simulated gains from trade liberalization 103 Scope for achieving potential gains 110 Transitional support 112 Public investment for long-term development 114 Conclusions 116 5 Bringing agriculture to the market 118 Food staples: improving commodity trading and risk management 118 Traditional bulk export commodities: maintaining international competitiveness 122 Higher-value urban markets: linking producers to modern supply chains 124 Higher-value exports: meeting product standards 128 Conclusion 133 focus D: Agribusiness for development 135 6 Supporting smallholder competitiveness through institutional innovations 138 Land policies for secure rights and reallocating resources 138 Financial services for smallholders 143 Insurance to manage risk 147 Contents vii Developing effi cient input markets 150 Producer organizations in a context of value chains and globalization 153 Institutional innovations—still a work in progress 157 7 Innovating through science and technology 158 Genetic improvement has been enormously successful, but not everywhere 159 Management and systems technologies need to complement genetic improvement 163 Investing more in R&D 165 Institutional arrangements to increase the effi ciency and effectiveness of R&D systems 169 Using available technology better: extension and ICT innovations 172 Moving forward 176 focus E: Capturing the benefi ts of genetically modifi ed organisms for the poor 177 8 Making agricultural systems more environmentally sustainable 180 Drivers of resource degradation 181 Improving agricultural water management 182 Greening the green revolution 188 Managing intensive livestock systems 189 Reversing degradation in less-favored areas 190 Payment for environmental services 197 Conclusions 199 focus F: Adaptation to and mitigation of climate change in agriculture 200 9 Moving beyond the farm 202 Rural employment: a daunting challenge 202 Agricultural wage employment 205 Rising rural nonfarm employment 209 Wages and earnings in the rural labor market 212 Labor supply: migration and the urban economy 214 Schooling, training, and transition to the labor market 216 Providing safety nets to reduce vulnerability 219 A fi nal word on rural labor markets and migration: the need for policy attention 221 focus G: Education and skills for rural development 222 focus H: The two-way links between agriculture and health 224 viii CONTENTS Part III How can agriculture-for-development agendas best be implemented? 226 10 Emerging national agendas for agriculture’s three worlds 226 New opportunities and challenges 226 The proposed approach 227 Agriculture-based countries—accelerating growth, poverty reduction, and food security 229 Transforming countries—reducing rural-urban income gaps and rural poverty 234 Urbanized countries—linking smallholders to the new food markets and providing good jobs 238 Political, administrative, and fi nancial feasibility 242 Recognizing the policy dilemmas 243 11 Strengthening governance, from local to global 245 Changing roles: the state, the private sector, and civil society 246 Agricultural policy processes 248 Governance reforms for better policy implementation 251 Decentralization and local governance 254 Community-driven development 256 Aid effectiveness for agricultural programs 257 Progress on the global agenda 258 Moving forward on better governance for agriculture 265 Bibliographical note 266 Endnotes 269 References 285 Selected indicators 321 Selected agricultural and rural indicators 322 Selected world development indicators 333 Index 355