Agriculture And Its Stimulus To Rural Development In Developing Countries

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Dr. C. SIVAKKOLUNDU , P. SHEEBA & M. ADHILAKSHMI

Abstract

Agriculture plays an important part in rural development, especially due to land use, in countries where the sector is of less economic significance. The main potential contributions of farming to rural development are in terms of supporting employment, ancillary businesses, and environmental services. The Developing countries are moving from being largely rural and agrarian to becoming urban and industrial. We study the processes by which this takes place, including the way mutually beneficial links can be forged between town and country, and how the rural non-farm economy can be stimulated to provide local jobs for some of those who leave farming for better paid jobs. Reducing poverty and producing more food that helps reduce the real cost of food are half the battle in beating hunger and malnutrition. The introduction of agricultural employment as a lagged, contemporaneous and leading variable both controls for spurious correlation and allows for the identification of the different kinds of relationship between changes in agriculture and in other sectors. The effect of the lagged variable is interpreted as the effect of agricultural development on non-agricultural development, and the effect of the leading variable after appropriate transformation is interpreted as the effect of changes in the non-agricultural sector on agricultural development.


                    The current or contemporaneous effect is more difficult to interpret because it incorporates all of the identified effects and additionally the spurious relation between agricultural and non-agricultural developments within a region, i.e. those relations that are due to unobserved regional influences, which affect both developments simultaneously.

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