CGD in the News

Field v Factory (Economist)

September 24, 2008

The Economist cites CGD non-resident fellow Peter Timmer on India's agricultural transformation.

From the article:

"'The only way out for agriculture is industry,' Chairman Mao once said. If India is to prosper in the coming decades it must undergo what economists call a 'structural transformation': agriculture's share of employment and output must fall; industry’s share must rise. Farms cannot thrive unless factories thrive, and vice versa. The factories need the farms to feed their workers cheaply. The farms, in turn, need factories to draw underemployed field-hands off the land, transforming them from surplus labourers into consumers.

Almost every country that has prospered has gone through this process, and in every country it inspired political tension. According to Peter Timmer of the Centre for Global Development in Washington, D.C., “successful agricultural transformation has been painful to every society that did it."

Read the article