Reevaluating Agricultural Productivity Gaps with Longitudinal Microdata.

ABSTRACT: Recent research has pointed to large gaps in labor productivity between the agricultural and non-agricultural sectors in low-income countries, as well as between workers in rural and urban areas. Most estimates are based on national accounts or repeated cross-sections of microsurvey data, and as a result typically struggle to account for individual selection between sectors. This paper uses long-run individual-level panel data from two low-income countries (Indonesia and Kenya) to explore these gaps. Accounting for individual fixed effects leads to much smaller estimated productivity gains from moving into the non-agricultural sector (or urban areas), reducing estimated gaps by roughly 67%-92%. Furthermore, gaps do not emerge up to 5 years after a move between sectors. We evaluate whether

SUBMITTER: Hamory J 

PROVIDER: S-EPMC10639112 | biostudies-literature | 2021 Jun

REPOSITORIES: biostudies-literature