Is agriculture the key to development?

http://www.owen.org/blog/3903?pfstyle=wp January 8, 2011

Today is World Food Day. That means there are plenty of articles and statements today by the agricultural lobby
calling for more investment in food production and agriculture. People who work in agricultural research call for
– surprise surprise – more investment in agricultural research. EU and US farmers who grow more food than
they can sell demand that aid budgets are used to ship their surplus as food aid (even though, according to MSF, it
is “nutritionally substandard”). A lot of words will be written about the need for more food production to tackle
hunger.

On this World Food Day, I urge you to take a little time to read instead Amartya Sen’s classic book, Poverty and
Famines : An Essay on Entitlement and Deprivation, written 30 years ago and for which he was awarded the
Nobel Prize in economics. Rarely has a book got to the nub of an issue so clearly in its first two sentences:

Starvation is the characteristic of some people not having enough food to eat. It is not the
characteristic of there being not enough food to eat.

This is a fundamental insight. People are hungry not because not enough food is produced but because they are
too poor to buy it. In Sen’s language, the poor do not have enough entitlements to enable them to eat. Sen
argued that, in most circumstances, instead of giving food to the poor we should give them cash to enable them to
buy the food they needed. This would both give people access to food, and strengthen local markets and improve
the livelihoods of local food producers.

Official Nobel Prize portrait of Amartya Sen

In a subsequent book, Sen argued that famine is a political issue more than a
problem of food production. ‘It is not surprising that no famine has ever taken
place in the history of the world in a functioning democracy,’ he wrote in
Development as Freedom.

Yet we still talk about hunger as if it were, at heart, a problem of food production.
(For example, see these remarks yesterday by the Director General of the UN
Food and Agriculture Organisation, calling for a 70% increase in food production).
When we understand that hunger is a problem of poverty, the policy options look
quite different.

But how do we tackle poverty?

Three quarters of the world’s poor live in rural areas, and most depend on
agriculture for their livelihoods.

The agricultural lobby sees a way to restate their case. Perhaps they can accept that hunger is a problem of
poverty, not food production. But the fact that the majority of the world’s poor work in agriculture means, they
say, that the best way to improve the incomes of the poor, and so reduce hunger, is to increase agricultural
productivity. More adventurously they claim that more effective agriculture can drive the whole process of
development, by increasing farm incomes, leading to rising savings and investment and so kick-starting
industrialisation.

This is a plausible story, but it is not as persuasive as the alternative interpretation of the high correlation
between poverty and agriculture: the fact that most poor people work in agriculture suggests that the best way to
escape poverty is to get out of agriculture.

When people leave farms and get jobs in manufacturing their incomes are both higher and more secure. Demand
for food in the cities grows; the number of people working in agriculture falls; food prices rise; and the remaining
farmers get higher incomes. Rising incomes enable farmers to invest more in irrigation, fertilizer, machinery and
seeds. Agricultural productivity rises, not as a consequence of direct efforts to improve agriculture but as the
indirect consequence of industrialisation. On this view, industrialisation will drive improvements in agriculture,
rather than the other way round.

If this second view is right, if you want to tackle hunger, reduce poverty, and improve food production you should
focus your investment on more rapid industrialisation and job creation, not better farming.

I am not against investing in agriculture. Better access to existing technologies, and the development of some new
technologies, could make a big difference to the lives of farmers in developing countries. But I am against
promoting the romantic idea of happy peasant farmers. Farming in developing countries is an unremitting,
unrewarding life and it is likely to stay that way for many generations until industrialisation pushes up farm
incomes. And we should not accept uncritically the claim that agricultural productivity is an especially important
driver of poverty reduction and industrialisation.

So on World Food Day let us remember Sen’s insight that hunger is not a problem of food production but of
poverty. The fact that most poor people work in agriculture suggests that a good way to escape poverty is to get
out of agriculture. So the best way to reduce hunger and help people out of poverty may be to focus not on
improving agriculture, but rather on helping people who want to leave agriculture into more rewarding work.

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