Beyond Agriculture? The Promise of the Rural Economy for Growth and Poverty Reduction

Community/Rural/Urban Development, Food Security and Poverty, International Development,

Determinants of Farm Revenue in Pakistan

Will small farm viability decline with the reduction of average farm size in Pakistan? This paper addresses the determinants of rural household and farm-related income. Using the 2001 PIDE Household Survey, the approach developed captures the potential interactions between farm returns and household, farm, and factor market characteristics (schooling, family size, land tenure and operational size, access to water, credit, and capital). Econometric results show: (a) returns to additional schooling and the revenue elasticity of operated acres increase with farm size; (b) medium and large farm renters would be willing to pay more than observed rents, implying an incentive to increase farm size at the prevailing rental values; (c) owner-operated farms, landowners who also leases in, and fixed rental tenants earn higher revenues than sharecropping tenants. The difference, however, between landowner/fix-renter income and sharecropper income varies with family and farm size, as well as water use. While these results favour farm size increase, the results also show that off-farm and non-farm income sources are relatively more important for small farmers, contributing to their viability.Pakistan, Land Markets, Rural Factor Markets, Revenue Function

Determinants of Farm Revenue in Pakistan

Will small farm viability decline with the reduction of average farm size in Pakistan? This paper addresses the determinants of rural household and farm-related income. Using the 2001 PIDE Household Survey, the approach developed captures the potential interactions between farm returns and household, farm, and factor market characteristics (schooling, family size, land tenure and operational size, access to water, credit, and capital). Econometric results show: (a) returns to additional schooling and the revenue elasticity of operated acres increase with farm size; (b) medium and large farm renters would be willing to pay more than observed rents, implying an incentive to increase farm size at the prevailing rental values; (c) owneroperated farms, landowners who also leases in, and fixed rental tenants earn higher revenues than sharecropping tenants. The difference, however, between landowner/fix-renter income and sharecropper income varies with family and farm size, as well as water use. While these results favour farm size increase, the results also show that off-farm and non-farm income sources are relatively more important for small farmers, contributing to their viability. JEL classification: D13, Q12, Q15 Keywords: Pakistan, Land Markets, Rural Factor Markets, Revenue Functio

SUSTAINABILITY WITH UNBALANCED GROWTH: THE ROLE OF STRUCTURAL CHANGE

Environmental Economics and Policy, International Development,

Renewable Resources as a Factor of Production in International Trade

This work provides an extensive review of the literature on trade and environmental issues that has been growing since the early 1990s. The gaps in this literature are identified and generalizations are provided from results that are scattered. Next, we contribute to this literature by studying a Ricardian model of trade, in which one of the sectors uses a renewable resource as a factor of production. The contribution lies in the study of trade and welfare through the full horizon of the welfare maximization problem, not relying in equilibrium analysis. This study is divided into small country case and a 2 country - 2 factor model. In the first case, we show how trade prevents extinction, and if the assumption of full open access environmental externality is relaxed the welfare expected results change substantially. In the 2 x 2 model we show that equilibrium is actually not possible invalidating many such analyses existing in the literature. This lack of equilibrium may lead the country that is free from environmental externalities to actually lose with trade vis-à-vis autarky

TRADE AND THE ENVIRONMENT: AN ECONOMIC LITERATURE SURVEY

This document attempts to organize and summarize the major developments of the trade and environment literature observed during the last ten years. Both the major theoretical and empirical contributions are presented and discussed. This includes an overview of the different methods economists have used to describe the environmental externalities, and decompose their welfare effects in open economies. Additionally, guided by the literature we review the policy implications in the presence of two distortions: price (tariff) and environmental, when policymakers are benevolent or are more lenient for certain political groups. Finally, a brief review to the critique of traditional economic research is presented.Environmental Economics and Policy, International Relations/Trade,

TRADE AND THE ENVIRONMENT: AN ECONOMIC LITERATURE SURVEY

This document attempts to organize and summarize the major developments of the trade and environment literature observed during the last ten years. Both the major theoretical and empirical contributions are presented and discussed. This includes an overview of the different methods economists have used to describe the environmental externalities, and decompose their welfare effects in open economies. Additionally, guided by the literature we review the policy implications in the presence of two distortions: price (tariff) and environmental, when policymakers are benevolent or are more lenient for certain political groups. Finally, a brief review to the critique of traditional economic research is presented