Pathways Out of Poverty During an Economic Crisis : An Empirical Assessment of Rural Indonesia

Most poor people in developing countries still live in rural areas and are primarily engaged in low productivity farming activities. Thus pathways out of poverty are likely to be strongly connected to productivity increases in the rural economy, whether they are realized in farming, in rural nonfarm enterprises, or by way of rural-urban migration. The authors use cross-sectional data from the Central Statistical Board for 1993 and 2002, as well as a panel data set from the Indonesia Family Life Survey for 1993 and 2000, to show which pathways out of poverty were most successful over this period. The findings suggest that increased engagement of farmers in rural nonfarm enterprises is an important route out of rural poverty, but that most of the rural agricultural poor that exit poverty still do so while remaining rural and agricultural. So changes in agricultural prices, wages, and productivity still play a critical role in moving people out of poverty.

Bibliographic Details

Main Authors:	McCulloch, Neil, Weisbrod, Julian, Timmer, C. Peter
Language:	English
Published:	World Bank, Washington, DC 2007-03
Subjects:	AGRICULTURAL ACTIVITIES, AGRICULTURAL DEVELOPMENT, AGRICULTURAL EMPLOYMENT, AGRICULTURAL GROWTH, AGRICULTURAL OUTPUT, AGRICULTURAL PRICES, AGRICULTURAL PRODUCTIVITY, AGRICULTURAL PRODUCTIVITY GROWTH, AGRICULTURAL SECTOR, AGRICULTURAL SECTORS, AGRICULTURAL TECHNOLOGIES, AGRICULTURAL WORKERS, AVERAGE INCOMES, COMMERCIAL FARMERS, COMMERCIAL FARMS, CONSUMER PRICE INDEX, CONSUMERS, CONTRACEPTIVE USE, DATA SETS, DEBT, DEMOGRAPHIC CHANGES, DESCRIPTIVE STATISTICS, DEVELOPING COUNTRIES, DEVELOPMENT ECONOMICS, DIVERSIFICATION, ECONOMIC ACTIVITY, ECONOMIC DEVELOPMENT, ECONOMIC GROWTH, EMPIRICAL EVIDENCE, EMPIRICAL LITERATURE, EMPIRICAL RESULTS, EMPIRICAL WORK, EMPLOYMENT IN AGRICULTURE, EMPLOYMENT OPPORTUNITIES, EXPORTS, FACTOR ENDOWMENTS, FAMILY MEMBERS, FARM ACTIVITIES, FARM EMPLOYMENT, FARM OUTPUT, FARM PRODUCTIVITY, FARM SECTOR, FARM WORK, FARM WORKERS, FARMER, FARMERS, FARMING ACTIVITIES, FERTILITY, FOOD PRICES, FOOD SHARE, GLOBAL DEVELOPMENT, GREEN REVOLUTION, HEADCOUNT POVERTY, HEALTH CARE, HEALTH INSURANCE, HIGH GROWTH, HOUSEHOLD HEAD, HOUSEHOLD INCOME, HOUSEHOLD LEVEL, HOUSEHOLD POVERTY, HOUSEHOLD SIZE, HOUSEHOLD SURVEY, HUMAN CAPITAL, ILLNESS, IMPACT ON POVERTY, IMPACT ON POVERTY REDUCTION, IMPROVING GROWTH, INCOME, INCOME DATA, INCOME GROWTH, INDIVIDUAL INCOMES, INEQUALITY, INSURANCE, INVESTMENT CLIMATE, LABOR FORCE, LABOR MARKET, LONG-RUN IMPACT, MEAN INCOME, MILLENNIUM DEVELOPMENT GOALS, MODERNIZATION, MULTIPLIERS, NON-FARM OUTPUT, NUMBER OF CHILDREN, NUMBER OF WORKERS, OLD AGE, OPEN ECONOMIES, OPPORTUNITY COSTS, OUTPUT GROWTH, PER CAPITA EXPENDITURE, POLICY RESEARCH, POLICY RESEARCH WORKING PAPER, POLITICAL TURMOIL, POOR, POOR ECONOMIC GROWTH, POOR PEOPLE, POORER REGIONS, POPULATION DENSITY, POPULATION GROWTH, POVERTY ALLEVIATION, POVERTY CHANGES, POVERTY DYNAMICS, POVERTY GAP, POVERTY INDEX, POVERTY LINE, POVERTY LINES, POVERTY REDUCTION, POVERTY STATUS, PRO-POOR, PRO-POOR GROWTH, PRODUCTIVITY INCREASES, PROGRESS, PURCHASING POWER, RAPID GROWTH, REAL INCOME, REAL INCOMES, REDUCING POVERTY, REDUCTION IN POVERTY, REDUCTION OF POVERTY, RELATIVE IMPORTANCE, RURAL, RURAL AREAS, RURAL DEVELOPMENT, RURAL ECONOMIC GROWTH, RURAL ECONOMY, RURAL EMPLOYMENT, RURAL FARM, RURAL FARMERS, RURAL INCOME, RURAL INVESTMENT, RURAL POOR, RURAL POVERTY, RURAL REGIONS, RURAL VILLAGES, RURAL WORKERS, SCHOOLING, SERVICE PROVISION, SEX, SHARP REDUCTION, SKILLED WORKERS, SOCIAL SERVICES, SPOUSE, SQUARED POVERTY GAP, STRUCTURAL TRANSFORMATION, SUBSISTENCE, SUBSISTENCE FARMERS, TOTAL POVERTY, URBAN AREAS, URBAN MIGRATION, URBAN POOR, URBAN WORKERS, URBANIZATION, VILLAGE LEVEL, WAGES, WORKFORCE,
Online Access:	http://documents.worldbank.org/curated/en/2007/03/7471884/pathways-out-poverty-during-economic-crisis-empirical-assessment-rural-indonesia https://hdl.handle.net/10986/7217
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