World Poverty and the Role of Agricultural Technology: Direct and Indirect Effects

Abstract

Agricultural technology can help reduce poverty through direct and indirect effects. Direct effects are gains for the adopters while indirect effects are gains derived from adoption by others leading to lower food prices, employment creation, and growth linkage effects. Conceptualising and measuring these effects is highly complex, yet is needed for each region if technology is to be used as an effective instrument for poverty reduction. We propose a methodology for doing this in the context of computable general equilibrium modelling and apply it to archetype models for Africa, Asia, and Latin America. Results show that the dominant effect of technology on poverty is through direct effects in Africa, indirect agricultural employment effects in Asia, and linkage effects through the rest of the economy in Latin America. In each case, increasing the poverty reduction effect through the targeting of technology across crops and through complementary rural development programmes is also explored.