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© 1991 International Bank for Reconstruction and Development / The World Bank

research-article

TECHNOLOGICAL CHANGE AND COMMERCIALIZATION IN AGRICULTURE: The Effect on the Poor

Hans P. Binswanger and Joachim von Braun

Do the economic gains brought by technological innovation and commercialization in agriculture work their way through to the poor? The prevailing optimistic view is that they do. But this view is not universal: some hold that these forces for change can interact with, or even induce, institutional and market failure, with adverse consequences for the poor.

Adherents of the pessimistic view point to real-world instances in which the poor have failed to reap the benefits, or even have lost, from the technological change or commercialization. Where these effects have occurred we find that they are mostly attributable to inelastic demand or adverse institutional features; often, when technology or commercialization has been blamed for the decline in income of the poor, other—not necessarily connected—policies have in fact been responsible for the damage.

This article contends that the optimistic view is, by and large, correct: normally, technology and commercialization stimulate agricultural growth, improve employment opportunities, and expand food supply—all central to the alleviation of poverty. The evidence does not offer much encouragement to an extension of this view—that through "social engineering" the benefits from technology and commercialization can easily be targeted toward the poor; the limited opportunities for such targeting should of course be seized.


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