Cited by 391Economic Growth and ProductivityAgricultural Economics and PracticesAgricultural economics and policies

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Fertilizing growth: Agricultural inputs and their effects in economic development

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McArthur, John W., McCord, Gordon C.·2017·Journal of Development Economics

Abstract

This paper estimates the role of agronomic inputs in cereal yield improvements and the consequences for countries' processes of structural change. The results suggest a clear role for fertilizer, modern seeds and water in boosting yields. We then test for respective empirical links between agricultural yields and economic growth, labor share in agriculture and non-agricultural value added per worker. The identification strategy includes a novel instrumental variable that exploits the unique economic geography of fertilizer production and transport costs to countries' agricultural heartlands. We estimate that a half ton increase in staple yields generates a 14 to 19 percent higher GDP per capita and a 4.6 to 5.6 percentage point lower labor share in agriculture five years later. The results suggest a strong role for agricultural productivity as a driver of structural change.

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Crossref · 10.1016/j.jdeveco.2017.02.007

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Figures

Fig. 1 Cereal yields across developing regions, 1961–2001.
Fig. 1 Cereal yields across developing regions, 1961–2001.CC BY · PubMed Central
Fig. 2 Fertilizer use in developing regions, 1961–2001.
Fig. 2 Fertilizer use in developing regions, 1961–2001.CC BY · PubMed Central
Fig. 3 Cereal yields and fertilizer use, selected countries, 1961–2001.
Fig. 3 Cereal yields and fertilizer use, selected countries, 1961–2001.CC BY · PubMed Central
Fig. 4 Fertilizer price index (Real US$ terms, 2005=100).
Fig. 4 Fertilizer price index (Real US$ terms, 2005=100).CC BY · PubMed Central
Fig. 5 Cost-adjusted distance to major fertilizer production site.
Fig. 5 Cost-adjusted distance to major fertilizer production site.CC BY · PubMed Central
Fig. 6 Fertilizer prices in 1999 and distance to fertilizer production site.
Fig. 6 Fertilizer prices in 1999 and distance to fertilizer production site.CC BY · PubMed Central
Fig. 7 Fertilizer use in 1985 and distance to fertilizer production site.
Fig. 7 Fertilizer use in 1985 and distance to fertilizer production site.CC BY · PubMed Central
Fig. 8 Yields and relative rates of assistance to agriculture.
Fig. 8 Yields and relative rates of assistance to agriculture.CC BY · PubMed Central
Fig. 9 Coefficients on different lags of instrumented cereal yield in a specification following Table 4 Columns III–IV.
Fig. 9 Coefficients on different lags of instrumented cereal yield in a specification following Table 4 Columns III–IV.CC BY · PubMed Central
Fig. 10 Coefficient on different lags of instrumented cereal yield in a specification following Table 6 Columns VII–VIII.
Fig. 10 Coefficient on different lags of instrumented cereal yield in a specification following Table 6 Columns VII–VIII.CC BY · PubMed Central
Fig. 11 Coefficients on different lags of instrumented cereal yield in a specification following Table 7 Columns VI–VII.
Fig. 11 Coefficients on different lags of instrumented cereal yield in a specification following Table 7 Columns VI–VII.CC BY · PubMed Central

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Metadata

Authors
McArthur, J. W., & McCord, G. C.
Affiliations
  • Brookings Institution (US)
  • University of California San Diego (US)
Corresponding author
McCord, Gordon C.
Venue
Journal of Development Economics
Publisher
Elsevier BV
Published
2017-07
Volume
127
Pages
133-152
ISSN
0304-3878 (ISSN-L)
OpenAlex
W3124982061
Cited by
391
References
85
Citations by year
2026: 37 · 2025: 47 · 2024: 61 · 2023: 52 · 2022: 47 · 2021: 45 · 2020: 58 · 2019: 18 · 2018: 14 · 2017: 9
FWCI
48.73
Type
journal article
Language
en
Open access
Locations
  • Journal of Development Economics (publishedVersion, cc-by)
  • SSRN Electronic Journal (acceptedVersion)
  • Europe PMC (PubMed Central) (publishedVersion, cc-by)
  • PubMed Central (publishedVersion, cc-by)
  • PubMed (publishedVersion)
  • eScholarship (California Digital Library) (submittedVersion)
  • RePEc: Research Papers in Economics (submittedVersion)
Funders
Bill & Melinda Gates Foundation (OPP44755 and OPP1083277)
Topics
  • Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Economic Growth and Productivity
  • Life Sciences › Agricultural and Biological Sciences › General Agricultural and Biological Sciences › Agricultural Economics and Practices
  • Social Sciences › Economics, Econometrics and Finance › Economics and Econometrics › Agricultural economics and policies
Keywords
agricultural inputs, fertilizers, irrigation, cereal yield, agricultural productivity, economic growth, structural change, instrumental variables, GDP per capita

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CoChat. (2026). Citation check: Fertilizing growth: Agricultural inputs and their effects in economic development. https://app.cochat.ai/papers/10.1016/j.jdeveco.2017.02.007
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McArthur, J. W., & McCord, G. C. (2017). Fertilizing growth: Agricultural inputs and their effects in economic development. Journal of Development Economics. https://doi.org/10.1016/j.jdeveco.2017.02.007