Fighting Poverty Through Agriculture
John McArthur on how increasing rural productivity is an effective way to reduce extreme poverty.
The public chorus to eliminate extreme poverty by 2030 now includes U.S. President Barack Obama, World Bank President Jim Yong Kim, and Bono. The backdrop is extremely promising since the developing world has already cut the share of people living in absolute poverty – that is, on less than the equivalent of $1.25 a day – by half since 1990. At a consistent rate of progress, the other half could well cross the line in another 20 years too.
But, as my colleague Laurence Chandy and his co-authors recently pointed out, the distance to crossing the absolute-poverty line varies tremendously by region. Most of China has already crossed the $1.25 threshold, and India has a huge share of its population poised to make the leap next. Sub-Saharan Africa has the farthest to go, despite recent progress, since a large proportion of its population still lives so far below $1.25 per day, often at half that level of income.
Most of Africa’s poorest people live on small farms in rural areas, so those places will likely form the final frontier of the global quest to end extreme poverty. Although fast-growing cities have gained attention for their role in fighting poverty, including in the World Bank’s latest Global Monitoring Report, it is increases in rural productivity, especially agriculture, that are typically a fundamental driver of the urbanization process.
There are grounds for optimism. Growing academic evidence highlights agriculture’s unique role in helping to reduce extreme poverty. For example, an important 2011 paper by economists Luc Christiaensen, Lionel Demery, and Jesper Kuhl shows that agriculture is roughly three times more effective at reducing extreme poverty than non-agricultural sectors.
There has also been a global renaissance of attention on the need for an African Green Revolution, driven by both public and private investments in a manner that respects local community structures. The World Economic Forum’s Grow Africa initiative, which convened last week in Cape Town, offers a potential high-impact platform, bringing together investors and governments to launch practical joint strategies at scale.
Complementary investments in transport infrastructure, irrigation, farmer credit and input support systems (e.g. for fertilizer and seeds) were essential to Asia’s 20th century green revolutions, which laid the foundation for that region’s subsequent economic breakthroughs. The same basic approach, updated for today’s social and environmental realities, can help to ensure that Africa’s long-term economic success is equally, if not more, robust.
The sooner the process starts, the faster the world gets to the finish line on extreme poverty.