Academic journal article World Review of Political Economy

A Critique of Inclusive Growth: Problems of Modernization of Agriculture

Academic journal article World Review of Political Economy

A Critique of Inclusive Growth: Problems of Modernization of Agriculture

Article excerpt

1. introduction

Agriculture is a vital development tool for achieving the Millennium Development Goal that calls for halving by 2015 the share of people suffering from extreme poverty and hunger. That is the overall message of this year's World Development Report (WDR), the 30th in the series. Three out of every four poor people in developing countries live in rural areas, and most of them depend directly or indirectly on agriculture for their livelihoods. This Report provides guidance to governments and the international community on designing and implementing agriculture-for-development agendas that can make a difference in the lives of hundreds of millions of rural poor. (World Bank 2008, xiii)

The target of this note is to address the issue of "inclusive growth" from a critical standpoint. It is argued in the orthodox literature that the ongoing course of globalization can be a harbinger of a growth process which is inclusive in nature. thus, globalization not only induces growth of national income and brings in prosperity in the lagging least developed countries (ldcs), but also ensures an overall uplift of the standard of living of the vast majority of the poor who live in these countries. However, we, on the contrary, argue that this very project of "globalization and inclusive growth" is mired with contradictions. Our objective in this article is to bring out such incongruities by investigating a major policy prescription that is supposed to ensure broad-based growth by linking the local economies, in particular, agriculture with the global market.

The orthodox school argues that the significant progress in the spheres of trade, finance, industry, and other services in the ldcs is due to the fact that these sectors of the developing world have achieved considerable extent of global connectivity. this integration with the global market is thought to bring in substantial gains also for the population engaged with these so-called modern sectors. contrarily, it is contemplated that, by and large, the agricultural sectors of the ldcs remain outside this globalizing world, and hence, due to this lack of global connectivity, the third-world agriculture lags behind. Furthermore, as the vast majority of the people of the developing world have to live on this sector, they are unable to come out of the poverty trap. consequently, a program of "inclusive growth" cannot neglect the issue of inclusion of the third-world agriculture into the globalizing modern market-economy. this global integration is supposed to be the solution of the dual problems of lagging agriculture and also impoverishment of the vast majority of the third-world population. In fact, this integration of the third-world agriculture is considered to be the new panacea for inclusive growth.

In this context, the Wdr 2008 (World Bank 2008) has been introduced with the title "Agriculture for development." Its fundamental proposition is that, agriculture of the ldcs should be so designed that it could engender growth, and more importantly, this growth could be broad-based in nature. the World Bank President observes that "[t]oday, rapidly expanding domestic and global markets; institutional innovations in markets, finance, and collective action; and revolutions in biotechnology and information technology all offer exciting opportunities to use agriculture to promote development" (World Bank 2008, xiii). thus, the inherent logic of this Wdr 2008 is to attach agriculture with the globalization process which could ensure access to all these opportunities. It is proposed that, with the incorporation of the third-world agriculture within the global economy, not only new growth opportunities are created, but also the benefits of this growth percolate to the rural poor; and thus, an inclusive growth process is ensured.

However, we critically analyze this claim of the Wdr 2008 by interrogating a very crucial policy prescription proposed by this report. …

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