The Role of Crop Type in Cross-Country Income Differences

Markus Eberhardt and Dietrich Vollrath

No 11248, CEPR Discussion Papers from Centre for Economic Policy Research

Abstract: Labor productivity and labor share in the agricultural sector are key determinants of living standards across countries. We show that differences in agricultural technology -- the coefficients on factor inputs in the production function -- account for a substantial portion of cross-country differences in agricultural labor productivity, agricultural labor share, and per capita income. In a panel of 100 countries we document differences in technology estimates associated with major crops, and then illustrate the quantitative implications for development. Counterfactually eliminating crop-type technology heterogeneity reduces variance in log income per capita by 25%, and raises the median by 60%.

Keywords: Agricultural development; Crop type; Structural change; Technology heterogeneity (search for similar items in EconPapers)
JEL-codes: C23 F63 O11 O47 Q16 (search for similar items in EconPapers)
Date: 2016-04
New Economics Papers: this item is included in nep-agr, nep-eff and nep-gro
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Citations: View citations in EconPapers (7)

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