Publication:
Beyond Dualism: Agricultural Productivity, Small Towns, and Structural Change in Bangladesh

Loading...
Thumbnail Image
Files in English
English PDF (943.45 KB)
275 downloads
English Text (105.08 KB)
10 downloads
Date
2017-06
ISSN
Published
2017-06
Abstract
This paper uses a framework that goes beyond rural-urban dualism and highlights the role of small town economy in understanding structural change in a developing country. It provides a theoretical and empirical analysis of the role of agricultural productivity in structural transformation in the labor market. The empirical work is based on a general equilibrium model that formalizes the demand and labor market linkages: the small-town draws labor away from the rural areas to produce goods and services whose demand may depend largely on rural income. The theory clarifies the role played by the income elasticity of demand and the wage elasticity with respect to productivity increase in agriculture. For productivity growth to lead to a demand effect, the wage elasticity has to be lower than a threshold. When the demand for goods and services produced in small towns comes mainly from the adjacent rural areas, the demand effect can outweigh the negative wage effect, and lead to higher employment in the town-goods sector. Using rainfall as an instrument, the empirical analysis finds a significant positive effect of agricultural productivity on rice yield and agricultural wages. Productivity shock increases wages more in the rural sample compared with the small town economy sample, but structural change in employment is more pronounced in the small-town economy. In the rural sample, it increases employment only in small-scale manufacturing and services. In contrast, a positive productivity shock has large and positive impacts on employment in construction and transport, education, health and other services, and manufacturing employment in larger scale enterprises located in small towns and cities. Agricultural productivity growth induces structural transformation within the services sector in small towns, with employment in skilled services growing at a faster pace than that of low skilled services.
Link to Data Set
Citation
Emran, M. Shahe; Shilpi, Forhad. 2017. Beyond Dualism: Agricultural Productivity, Small Towns, and Structural Change in Bangladesh. Policy Research Working Paper;No. 8087. © World Bank, Washington, DC. http://hdl.handle.net/10986/27287 License: CC BY 3.0 IGO.
Report Series
Report Series
Other publications in this report series
  • Publication
    Are Short-Term Gains in Learning Outcomes Possible? Evidence from the Malawi Education Sector Improvement Project
    (Washington, DC: World Bank, 2024-07-17) Asim, Salman; Gera, Ravinder Casley
    This paper presents evidence of the impact of a five-year package of interconnected interventions intended to improve learning environments in eight disadvantaged districts in Malawi. The intervention, which was implemented over five years, provided additional finance to schools to support the hiring of additional teachers and construction of learning shelters to improve class sizes in lower primary, along with constructing classrooms and providing results-based finance to reward improvements in staffing. The interventions were targeted to eight districts with longstanding disadvantages in staffing, learning environments, and learning outcomes, particularly for girls. Employing administrative data and data from a nationally representative independent sample of public primary schools, the analysis finds that these investments closed the gap in learning outcomes between the targeted districts and the rest of Malawi. There is also suggestive evidence that the program reduced learning gaps between girls and boys. The findings suggest that even in a low-income environment with significant constraints, targeted efforts to reduce class sizes can close district-level gaps in learning.
  • Publication
    The Fertility Impacts of Development Programs
    (Washington, DC: World Bank, 2024-07-17) Donald, Aletheia; Goldstein, Markuz; Koroknay-Palicz, Tricia; Sage, Mathilde
    This paper examines how women’s fertility responds to increases in their earnings and household wealth, using six experiments conducted in Sub-Saharan Africa. Contrary to predictions that an increase in female earnings raises the opportunity cost of childbearing and that this will lower fertility, the findings show that an increase in the profits of female business-owners in Ethiopia and Togo results in them having more children. The findings also show a positive fertility response to increases in the value of household assets induced by land formalization programs in Benin and Ghana. These results are driven by women who are in most need of sons for support in old age or in the event of widowhood. The findings suggest that women’s lack of long-term economic security is an important driver of fertility in Sub-Saharan Africa.
  • Publication
    When Does Decision-Making Reflect Agency? Evidence from the Rural Philippines
    (Washington, DC: World Bank, 2024-07-17) Arugay, Aries; Donald, Aletheia; Jarvis, Forest; Johnson, Hillary C.; Valenciano, Aletheia
    Decision-making is often used as a proxy for agency—the ability to set goals and act on them—although there are several theoretical critiques of this approach. Using unique data from the rural Philippines, this paper empirically tests the extent to which different aspects of decision-making are correlated with the Relative Autonomy Index, a measure of agency that has been validated for use in lower-income countries. Being a decision-maker (as asked in common survey questions) is only weakly related to the Relative Autonomy Index for women, and not at all for men. Having input into decisions and, to a greater extent, the ability to make personal decisions if desired are strongly associated with the RAI for both genders. The quantitative and qualitative data indicate that these concepts better capture the ability to make choices in line with one’s personal goals, while being a decision-maker instead reflects being responsible for the outcome or managing the execution of a task, often in the face of limited options. The findings caution against focusing on being a decision-maker as a sole indicator of agency and have practical implications for both conceptualizing and measuring agency.
  • Publication
    Financial Development and Fragility
    (Washington, DC: World Bank, 2024-07-17) João, Igor Custodio; Calice, Pietro; Lucas, Andre; Schaumburg, Julia
    This paper explores the potential correlations between financial development and state fragility, using a sample of 137 countries observed over the period from 1998–2019. The countries are grouped into clusters that capture the different joint states of financial development and fragility. The paper introduces a new switching methodology to further allow for a qualification of the evolution of countries in terms. of fragility scores with and without controlling for other variables. Irrespective of the precise methodology and state fragility measure as used in this paper, the findings indicate a negative correlation between financial development and state fragility, after controlling for several forms of observed and unobserved heterogeneity.
  • Publication
    Does Effective School Leadership Improve Student Progression and Test Scores? Evidence from a Field Experiment in Malawi
    (Washington, DC: World Bank, 2024-07-17) Asim, Salman; Gera, Ravinder Casley; Harris, Donna; Dercon, Stefan
    Evidence from high-income countries suggests that the quality of school leadership has measurable impacts on teacher behaviors and student learning achievement. However, there is a lack of rigorous evidence in low-income contexts, particularly in Sub-Saharan Africa. This study tests the impact on student progression and test scores of a two-year, multi-phase intervention to strengthen leadership skills for head teachers, deputy head teachers, and sub-district education officials. The intervention consists of two phases of classroom training along with follow-up visits, implemented over two years. It focuses on skills related to making more efficient use of resources; motivating and incentivizing teachers to improve performance; and curating a culture in which students and teachers are all motivated to strengthen learning. A randomized controlled trial was conducted in 1,198 schools in all districts of Malawi, providing evidence of the impact of the intervention at scale. The findings show that the intervention improved student test scores by 0.1 standard deviations, equivalent to around eight weeks of additional learning, as well as improving progression rates. The outcomes were achieved primarily as a result of improvements in the provision of remedial classes.
Journal
Journal Volume
Journal Issue
Associated URLs
Associated content
Citations