Ethan Ligon|Élisabeth Sadoulet
Estimating the Relative Benefits of Agricultural Growth on the Distribution of Expenditures
University of California, Berkeley|University of California, Berkeley
sectoral composition aggregate economic growth affect poverty ask whether agricultural growth developing countries increases expenditures poorer households growth sectors reduced form analyses tackled question using either countrylevel time series data regional panel data one country crosssectional country data paper unusual using panel data many countries improve much existing literature devising instrumental variables strategy correct endogeneity sectoral gdp growth involving averaging sectoral income growth rates neighboring countries principal finding instrumental variable estimator estimated elasticities associated growth agricultural income significantly greater nonagricultural income extreme top bottom deciles middle range income distribution effect given gdp growth due agriculture 34 times larger due nonagricultural activities established average growth gdp originating agriculture beneficial poorer deciles finally explore whether pattern holds across different groupings countries second important finding heterogeneity across groupings particularly find poorest people poorest countries agricultural income growth beneficial