Macro data show what appear to be large gaps in sectoral productivity, with agriculture a particularly unproductive sector in many developing countries. In an accounting sense, an important part of the income gap between rich and poor countries seems to arise from the fact that in poor countries, large fractions of the labour force work in agriculture - a sector where labour productivity is extremely low. Recent research in this area has tried to assess whether these sectoral productivity differences are real or simply the result of mismeasurement.
Theme 3 will support research in different macro and micro literatures, including:
- Research focused on the impact of distortions in land markets and other markets for agricultural inputs. In many sub-Saharan African economies, for instance, land rights are complex and institutional arrangements inhibit both sales and rental of agricultural land.
- Research on the macroeconomic impact of agricultural technology and on the economic barriers to take-up of improved technologies.
- Research focused on sectoral productivity in relation to industry and services. Previous research has raised concerns about advanced and middle-income economies concentrating in low productivity growth service sectors, but an emerging literature has begun to challenge the notion that service sector productivity growth lags behind industrial productivity growth, and that service jobs are in general inferior.
Theme 3 is led by Julieta Caunedo (Assistant Professor of Economics at Cornell University) and Kevin Donovan (Assistant Professor of Economics at the Yale School of Management).