AGRICULTURAL

ECONOMICS

Agricultural Economics 35 (2006) 79–89

Is agriculture the engine of growth?

Richard Tiffin∗ , Xavier Irz
Department of Agricultural and Food Economics, University of Reading, Earley Gate, P.O. Box 237, Reading, RG6 6AR, Reading, UK
Received 3 February 2004; received in revised form 12 January 2005; accepted 3 June 2005

Abstract
We seek to address formally the question raised by Gardner (2003) in his Elmhirst lecture as to the direction of causality between agricultural
value added per worker and Gross Domestic Product (GDP) per capita. Using the Granger causality test in the panel data analyzed by Gardner for 85
countries, we find overwhelming evidence that supports the conclusion that agricultural value added is the causal variable in developing countries,
while the direction of causality in developed countries is unclear. We also examine further the use of the Granger causality test in integrated data
and provide evidence that the performance of the test can be increased in small samples through the use of the bootstrap.

JEL classification: C22, C23, O41

Keywords: Agriculture and growth; Granger causality; Unit roots in panel data; Bootstrap

1. Introduction Section 2 reviews the literature on the relationship between

In his Elmhirst lecture, Gardner (2003) considers the sources
and constraints on agricultural growth. As part of the paper he
investigates the relationship between the growth in agricultural
value added per worker and GDP per capita for 52 develop-
ing countries. He provides evidence of a positive relationship
between these growth rates and poses the question: “What is
the direction of causality?” There is a substantial literature that
provides conflicting evidence in answering the question. For
example some suggest that the export of surplus resources from
agriculture leads to agriculture driving economic growth. Oth-
ers suggest that increases in the nonagricultural wage lead to
relocation and increases in agricultural productivity thereby
implying that causality runs from general economic growth to
agriculture. Gardner (2003) provides limited information con-
cerning the methods used to answer this question, however, it is
concluded that an “investigation of lags . . . does not show agri-
culture as leading.” In this article our aim is to further investigate
the question posed by Gardner using the data he analyzed. Our
analysis employs the Granger causality test and as such com-
plements recent work by Gemmell et al. (2000) by applying a
similar approach to a panel of countries.
∗ Corresponding author. Tel.: +44 118 378 89651; fax: +44 118 975 64671.
E-mail address: j.r.tiffin@reading.ac.uk (R. Tiffin).
agricultural and economic growth. The testing procedures we
employ are discussed in general in Section 3 while the specific
details of the procedure we employ are given in Section 4.
Section 5 presents the results and Section 6 concludes.
2. Insights from the literature
Most early development strategies, advocated by Rosenstein-
Rodan, Nurkse, and Hirshman among others, emphasized in-
dustrial development as the main source of economic growth
and were biased against the agricultural sector (Schiff and
Valdez, 1998). However, the poor growth performance of many
newly independent countries, particularly in the 1970s, chal-
lenged this view, and the need for agricultural growth became
part of the conventional wisdom with the Berg report (World
Bank, 1982a) and the 1982 World Development Report (World
Bank, 1982b). This new orthodoxy considers that agricultural
growth is causally prior to industrial development, based on
conceptual arguments and some empirical evidence that we
now review.
Following the classical analyses of Kuznets (1964), Johnston
and Mellor (1961), and Schultz (1964), several contributions of
agriculture to overall economic growth and development are
usually acknowledged. There is, of course, the direct contribu-
tion that an increase in agricultural value added makes to Gross
Domestic Product (GDP), which, once expressed in growth rate,

c 2006 International Association of Agricultural Economists
80 R. Tiffin, X. Irz / Agricultural Economics 35 (2006) 79–89
is proportional to the sector’s share of the economy; however,
this accounting relationship does not imply causality as the
two variables (agriculture value added and GDP) then evolve
simultaneously.
The generation of a surplus, i.e., resources that can be ex-
ported from agriculture to the rest of the economy to support
the process of development, seems much more important to ex-
plain a potential causality from agricultural to general economic
growth. First, it is necessary for the agricultural sector to pro-
duce food for the workers engaged in other areas of economic
activity and, even if this argument weakens in the context of
an open economy, it remains valid as many agricultural goods
retain a degree of nontradability. It follows that agricultural
growth can form a pre-condition for the release of labor from
agriculture to the rest of the economy. In addition to this direct
transfer of resources away from agriculture, output growth in
agriculture is also likely to result in a decrease in the price of
food, which is a wage good, and hence induces economic growth
through two mechanisms. A relatively low price of food allows
industrialists to pay low wages, which boosts the profitability
and competitiveness of the industrial sector, and might result
in increased savings and investments (as in Lewis’s celebrated
dual-economy model, [Lewis, 1954]), as well as the creation of
nonagricultural jobs. Furthermore, a decline in the price of food
effectively increases the real income of net-purchasers of food
and the resulting disposable income can help stimulate demand
for nonagricultural products.
In a similar vein, agriculture can supply the capital necessary
to finance industrial development or the provision of public
goods by the state. This remains important because, in spite of
the recent liberalization of capital markets, it is well established
that for a large majority of countries, investment relies primar-
ily on domestic savings (Ventura, 1997). Although this transfer
of resources can rely on voluntary savings by the agricultural
population, given the right set of incentives (Griffin, 1979),
many governments have historically accelerated the process by
taxing agriculture directly or indirectly. Hence, early industri-
alization in Japan in the last decades of the nineteenth century
was largely financed by a land tax, representing over 80% of
fiscal revenues at the time (Ghatak and Ingersent, 1984), and in
many developing countries, agriculture still makes a substan-
tial net contribution to government revenue (Schiff and Valdez,
1992). Similarly, scarcity of foreign exchange in low-income
countries may restrict the purchase of capital goods and other
imports essential to investment. Here again, growth in output of
tradable farm commodities can make a contribution by either
substituting food imports or increasing exports. Finally, agricul-
ture is a source of raw materials for several industrial subsectors
that can therefore potentially benefit from agricultural growth.
This argument appears most important for countries at early
stages of development, because the textile, food processing,
and other agriculturally based industries require little technol-
ogy and physical capital but are relatively labor intensive, and
hence “fit” the resource endowment of these countries particu-
larly well.
In addition to the above direct effects, increased production
in agriculture has an impact on other sectors through a series
of linkages. These include production links, both “upstream”
from the farm in demand for inputs and services for agriculture
and “downstream” from the farm in the demand for processing,
storage, and transport of produce. There are also consumption
links as farmers and farm laborers spend their increased incomes
on goods and services that are provided by the nonagricultural
sector. While conceptually simple, these growth linkages are
difficult to measure but most empirical studies have estimated
large multipliers, explained primarily by the strength of the
consumption linkages (Thirtle et al., 2003). Furthermore, these
ideas have been developed to support the design of so-called
agriculture-led industrialization strategies that stress the impor-
tance of agriculture in creating a market for industrial products
(Adelman, 1995).
From the previous discussion, the potential for agriculture to
cause general economic growth seems compelling, particularly
in the context of developing countries. It is necessary, however,
to recognize that several arguments presented in the literature
suggest that the causality might run in the opposite direction,
i.e., from nonagricultural to agricultural growth. The main the-
sis relates to the work initiated by Gardner and Mundlak, who
emphasize adjustments in the labor market as the engine of
growth in agricultural value added per worker and agricultural
income. Simply stated, an increase in the nonagricultural wage
rate results in a reallocation of labor from agriculture to non-
agriculture, which in turn increases labor productivity and
value-added per worker in the agricultural sector. According
to this view, there exists a fundamental surplus of labor in
agriculture and raising living standards in that sector can only
be achieved by growth in the nonfarm economy to which farm
workers have access (Gardner, 2000). Empirical support for this
idea originates both from developed and developing countries.
Hence, Gardner (2000) establishes from a historical analysis of
U.S. agricultural development that income growth in the non-
farm sector is more fundamentally important in increasing farm
income than any specifically agricultural variable. Estudillo and
Otsuka (1999) find that growth in the nonfarm economy is the
key driver of growth in agricultural wage rates in the Philip-
pines. Mundlak et al. (2004), in a comparison of agricultural
development in Indonesia, the Philippines, and Thailand, con-
clude in favor of the presence of a clear oversupply of labor
in agriculture that is only reinforced by recent technological
change in the sector. Finally, Butzer and Larson (2002) con-
clude from a study of inter-sectoral migrations in Venezuela
that “as labor migrates from agriculture to nonagriculture, labor
productivity in agriculture increases, reducing the inter-sectoral
difference.” Another reason why agriculture might benefit from
nonfarm growth is that agricultural growth depends largely on
the provision of “modern” inputs and technology from the in-
dustrial sector (Hwa, 1988). As a consequence, growth gen-
erating technological change in the manufacturing sector can
spill-over to agriculture and hence cause growth in that sector
(Gemmell et al., 2000).
 R. Tiffin, X. Irz / Agricultural Economics 35 (2006) 79–89
We are therefore left with two opposing views of the role of
agriculture in the process of economic growth. Traditionally,
agricultural economists consider that growth in the farm sector
provides the food, raw materials, labor, capital, and foreign
exchange necessary to finance subsequent growth in the rest
of the economy, while simultaneously generating an additional
demand for industrial goods and services. Lately, arguments
have been presented that support the reverse causality, with
growth in per capita GDP generating an increase in value-added
per worker in agriculture via migration of farm workers to the
other sectors of the economy.
Recently, the question has been addressed by developing
dynamic general equilibrium (DGE) models where different
sectors, including agriculture, interact in the process of growth.
The appeal of this approach arises from its internal consis-
tency in piecing together the ideas outlined above, but this often
comes at the cost of making a number of simplifying assump-
tions. Some important themes emerge from this line of work,
in particular with respect to the importance that agricultural
productivity plays in triggering the process of industrialization
and development or in influencing the long-term rate of eco-
nomic growth. Hence, Murphy et al. (1989) demonstrate that
an increase in agricultural productivity is necessary for the ini-
tiation and continuation of the growth process. The result is
explained primarily by the assumption of increasing returns to
scale in the industrial sector, due to high fixed costs, which
implies that the size of the market for industrial goods deter-
mines whether the sector can operate profitably. In this context,
the demand generated by agriculture for industrial products is
crucial in making the industrial sector, which ultimately drives
the growth process, viable. Along similar lines, a new strand
of the growth literature concerns itself with the escape from a
“Malthusian trap,” i.e., a regime of growth where any increase
in productivity is negated by population growth, hence prevent-
ing any real increase in living standards. For instance, Kogel
and Prskawetz (2001) establish in a model with endogenous fer-
tility and technological progress, that an exogenous increase in
the rate of agricultural productivity growth is all that is needed
to explain the stylized facts of the UK industrial revolution. In a
similar vein, Gollin et al. (2002) calibrate a two-sector growth
model to demonstrate that a one time increase in agricultural
productivity can have dramatic consequences for the speed of a
country’s development, and therefore identify agricultural pro-
ductivity as a key determinant of underdevelopment. Irz and
Roe (2000) reiterate the finding that a minimum rate of produc-
tivity growth in agriculture is necessary to counter population
growth and avoid the Malthusian trap and, more importantly,
that the demographic and technological characteristics of sev-
eral sub-Saharan countries are broadly consistent with such a
poverty trap. It follows that an agricultural revolution is nec-
essary in that part of the world to trigger sustained economic
growth. Escape from the Malthusian trap is also analyzed by
Hansen and Prescott (2002), Lucas (1998), and Gallor and Weill
(1999). Altogether, these studies tend to confirm the consensus
among development economists that agricultural productivity
81
is essential, at early stages of development, either to overcome
the Malthusian forces of diminishing returns to a growing labor
force operating on a fixed resource base, or to provide an outlet
for industrial products.
DGE models have also been used to explain how the es-
sential nature of food consumption can explain the growth dy-
namics of low-income countries. Steger (2000) establishes that
the transitional dynamics of the neoclassical growth model are
dramatically modified when subsistence consumption is intro-
duced, with early stages of development characterized by low
savings, little investment, and, as a result, slow growth. It fol-
lows that the ability of the agricultural sector to produce beyond
the subsistence needs of its population has dynamic effects as
it increases the aggregate saving rate. Steger (2000) formalizes
this idea in a two-sector model of exogenous growth where the
importance of Engel’s law is recognized. Finally, Steger (2000)
takes a slightly different avenue to reach the identical conclu-
sion that the structural change of an economy (i.e., the change in
its sectoral composition induced in part by productivity growth
in agriculture) is crucial in raising its saving rate.
A last group of DGE studies emphasizes externalities as
the key to understanding the contribution of agriculture to the
growth process. An original model by Wichman (1995) inves-
tigates the dynamic implications of an empirically plausible
positive relationship between nutrition and labor productivity.
In this framework, agricultural growth increases food consump-
tion, improves nutrition, and, ultimately, raises labor productiv-
ity in all sectors. When the externality is dynamic, meaning that
better nutrition not only raises labor productivity instantly but
also improves learning, the importance of agricultural produc-
tivity growth in the development process is amplified. Piñeres
(1999) extends the human capital models of endogenous growth
to a multisector setting to investigate the ability of the farm sec-
tor to generate long-term growth. The empirical application to
Columbia concludes that growth in the nontraditional agricul-
tural export sector is superior to manufacturing growth in rais-
ing the long-term rate of economic growth. Finally, Matsuyama
(1992) demonstrates in a two-sector endogenous growth model
how the benefits from a one-time productivity gain in agricul-
ture depends on the trade regime of the country. In a closed
economy framework, an increase in agricultural productivity
leads to a reallocation of labor away from agriculture because
of Engel’s law; since the postulated engine of growth is learning-
by-doing in manufacturing, this reallocation induces a rise in the
rate of economic growth. On the contrary, in an open-economy
framework, increased agricultural productivity reinforces the
country’s comparative advantage in agriculture, induces labor
to reallocate away from manufacturing where the learning ef-
fect takes place and therefore reduces the long-term rate of
growth.
Altogether, the DGE literature reinforces the idea that, for
low-income countries, agricultural growth plays a central role
in launching the development process and stresses the impor-
tance of productivity growth in the sector. We also note that
we are not aware of any DGE study establishing that general
82 R. Tiffin, X. Irz / Agricultural Economics 35 (2006) 79–89
economic growth causes agricultural growth. Furthermore,
though insightful, this literature sheds little light on the direc-
tion of the causality between agricultural and general economic
growth in countries with relatively high living standards.
Finally, the inter-relationship of sectors in the process of
development has also been analyzed econometrically for cross-
sections of countries or for particular countries in a time-series
framework. Taking the former approach, Stern regresses the (av-
erage) rate of economic growth on the rate of agricultural growth
for a sample of developing countries to find a significant and
positive relationship for the period 1965–1980 but not for the
period 1980–1990 (Stern, 1996). Echevarria (1997) establishes
that in a sample of 62 countries, there is evidence of a positive
relationship between average rate of growth and agriculture’s
share of GDP over the 1970–1987 period. Though suggestive
of interactions among sectors in the process of growth, these
studies ignore the developments in time-series econometrics of
the last two decades.
Several country studies take a more rigorous stance in tack-
ling the same question. Most relevant to our endeavor is
Gemmell et al. (2000) who investigate the importance of inter-
sectoral linkages for agricultural growth in Malaysia. They first
extend the growth model of Feder (1982) to derive an estimable
equation that relates agricultural value-added to only manufac-
turing value-added in the two-sector version of the model, or
to manufacturing value-added and services value-added in the
three-sector version. This model is important in that it justifies
the estimable equation detailed in the next section. The problem
of endogeneity of the variables is circumvented by the adoption
of a VAR approach to the estimation of the model, which also
allows for an analysis of Granger causality among the model’s
variables. The empirical results demonstrate that expansion of
manufacturing output causes negative agricultural growth in
the short run, as sectors compete for a fixed endowment of
resources, but positive agricultural growth in the long run, sug-
gesting that manufacturing growth spills-over to the farm sector.
By contrast, expansion of the agricultural sector does not affect
the other sectors of the economy. The findings are interpreted
as indicating that manufacturing growth stimulates demand for
agricultural commodities and provides the agricultural sector
with new inputs and technology, but contradicts the conven-
tional wisdom of the agricultural economics literature. On the
contrary, Kanwar (2000) takes a similar econometric approach
to demonstrate that in India, while the agricultural sector affects
the process of income generation in the manufacturing sector,
the reverse is not true. Here, the author justifies the finding
by relying on the standard arguments that agricultural growth
relaxes the wage goods, raw material, and foreign exchange
constraints and provides a potentially large market for man-
ufactured products. Although not analyzing causality, Martin
and Warr (1992) and Martin and Warr (1993) establish in an
error-correction framework that an essential source of growth in
agricultural income in Indonesia and Thailand is economy-wide
capital accumulation, which pulls out surplus labor from rural
areas. Finally, Koo and Jinding (1992) estimate a simple partial
adjustment model showing that in China, agricultural growth
causes growth of the industrial sector, but the industrial sector
does not contribute to the growth of the agricultural sector. This
reflects the “squeeze” that the Chinese state exerted on agricul-
ture from 1950 to 1980 by imposing artificially low agricultural
prices among other policies. Altogether, these studies fail to
identify a unique causal relationship between agricultural and
economic growth; we also note that, to the best of our knowl-
edge, the literature does not present any rigorous cross-country
analysis of this relationship. This is a gap that we aim to fill.
3. Tests for integration, cointegration, and noncausality
When a time series has a unit root in its autoregressive repre-
sentation it is subject to a stochastic trend and is consequently
nonstationary. Such a series is said to be integrated. When the
stochastic trend is common to multiple time series a linear
combination of the series exists, which is not integrated and
the series are said to be cointegrated. Procedures for testing for
integration 1 and for cointegration 2 have been widely applied. It
is recognized, however, that these procedures often have limited
power to reject a false null hypothesis. A growing literature now
exists presenting the case for the use of panel data to increase
the power of tests for integration and cointegration.
Maddalla and Wu (1999) present a comparison of the Levin
et al. (2002) and Im et al. (1997) procedures for testing for unit
roots in panel data. They also introduce an alternative based on
a procedure for testing a joint hypothesis using the combined
significance levels from the tests of the constituent hypotheses.
Maddalla and Wu (1999) note that the Im et al. (1997) test
can be viewed in such a light where the joint hypothesis to be
tested is that all the series in the panel are subject to a unit root.
The procedure requires the significance levels (πi ) from tests of
the null hypothesis that there is a unit root in each of the series
in the panel. It is noted that, because the significance level (π i )
of a test is a uniform random variable on the interval 0 − 1,
−2 ln π i has a χ 2 distribution with 2 degrees of freedom distri-
bution and hence


N
λ = −2 ln πi , (1)
i=1
has a χ 2 distribution with 2N degrees of freedom where N is
the number of cross-sectional units in the panel.
The procedures proposed by Pedroni (1999) for testing
for cointegration in a panel are based on the cointegrating
regression
yit = αi + βi xit + uit i = 1, . . . , N, (2)
where {yit | t = 1, . . . , Ti } and {xit | t = 1, . . . , Ti } are integrated
time series, T i is the number of observations in the time series
of the ith cross-sectional unit, α it represents the deterministic
1 For example, the augmented Dickey–Fuller and the Philips Z α and Z t tests.
2 For example the Engle and Granger and Johansen procedures.
 R. Tiffin, X. Irz / Agricultural Economics 35 (2006) 79–89 83

component and may include a constant, trend, seasonal dummy The distribution of the test statistic in (8) in the presence
variables, etc., β i is a parameter, and u it is the disturbance term. of integration and cointegration is considered by Sims et al.
Note that β i and α i are permitted to vary between time series. (1990), Toda and Phillips (1993), and Lutkepohl and Reimers
Two of the tests developed by Pedroni (1999) are essentially (1992). In general, the distribution of the test statistic depends
analogues of the Levin et al. (2002) and Im et al. (1997) tests on the properties of the system. Toda and Yamamoto (1995)
applied to test for a unit root in the u it series. Other tests are in show, however, that when the true model is a VAR(p) and the
a similar vein but are based on the variance ratio and Phillips following VAR(p + d) is estimated:
and Perron tests instead of the Dickey–Fuller test.
The Granger causality test is based on the following VAR zt = ψxt +
x̃t + ut , (10)
model:
where d is the maximum order of integration in the variables of


p the model and x̃t = (zt−p−d , . . . , zt−p−1−k ) , the distribution of
zt = µ + Ai zt−i + ut , (3) the Wald statistic based only on the ψ coefficients as defined
i=1 in (8) has an asymptotic χ 2 (p) distribution regardless of the
= ψxt + ut , (4) properties of the cointegrating vectors.
From the perspective of applied research, it is perhaps more
where z t = (v t , yt ) , µ t = (µ 1 , µ 2 ) , u t = (vvt , uyt ) , A i is the important to consider the small sample properties of the test
2 × 2 dimensional matrix of parameters a i.j k (j , k = 1, 2), ψ = statistic. In this vein, Zapata and Rambaldi (1997) conduct a
(µ, A 1 , . . . , A p ) and x t = (1, zt−1 , . . . , zt−p ) . The restrictions Monte Carlo exercise comparing the small sample performance
necessary for agricultural value added (v t ) to be noncausal of of a standard Wald test, the Wald test modified in accordance
GDP (y t ) are that a i.21 = 0, i = 1, . . . , p. 3 These can be ex- with the suggestion of Toda and Yamamoto (1995), and the like-
pressed in the conventional way lihood ratio proposed by Mosconi and Gianini (1992). Broadly
speaking, their results show that all three tests have an empirical
r vec(ψ  ) = 0, (5) size which is close to the nominal size in sample sizes in excess
of a hundred. The power of the three tests is good at all sample
with sizes except for the case of the modified Wald statistic which
is shown to have low power in samples with 25 observations.
r = s1 ⊗ s, (6)
Given the size of the sample used here, this is significant.
and Recent interest in the use of the bootstrap as a method of im-
      proving the small sample performance of tests in a cointegrating
0 0 1 framework stems from the work of Li and Maddala (1997). In
s1 = , s= , s3 = , (7) particular, they consider ways in which dependencies between
1 Ip ⊗ s3 0
the observed variables in the model may be preserved in the
where 0 is a row vector of zeros conformable with the remainder bootstrap sample. These may arise in the type of model under
of s. Because of the presence of stochastic regressors in a VAR, consideration here for two reasons: (1) due to contemporane-
tests of the hypotheses are asymptotic, with the Wald statistic: ous correlation between the elements of the panel and (2) due to
serial correlation within the elements arising, for example due
    
ˆ u r −1 (r vec(ψ̂  )),
λ = (r vec(ψ̂ )) r (XX )−1 ⊗  (8) to misspecification of the number of lags in the Dickey–Fuller
equation. Li and Maddala (1997) also argue that the residuals
being most common, where X = (x1 , . . . , xT ), ψ̂ and 
ˆ u are used in generating the bootstrap sample should be generated
estimates of the parameter vector and covariance matrix of u, using the parameter values assumed under the null hypothesis.
respectively (see Lutkepol, 1993, pp. 64–68). In devising the methods we use here we follow Li and Maddala
The VAR model in (3) can also be rewritten in VECM form (1997) first in using the stationary bootstrap as our method of
resampling, and second, in using a sampling scheme in which
zt = x̃t  + zt−p + ut , (9) the residuals generated under the null hypothesis are resampled
and used to produce pseudo data using the estimates obtained
where x̃t = (1, zt−1 , . . . , zt−p+1 ),  = (µ,  1 , . . . ,  p−1 ) , with the null hypothesis imposed. We use the bootstrap to pro-
µ = (µ1 , µ2 )  i , and  are the 2 × 2 matrices of parame- duce critical values in each of the three major tests applied here:
ters γ i·jk and πj k (j , k = 1, 2). When the series are cointegrated, the Dickey–Fuller test; the Johansen procedure, and the test for
 is of reduced rank and can be decomposed as  = αβ  were noncausality.
α and β are (2 × 1) dimensional matrices. β is known as the
cointegrating vector.
4. Empirical procedure
3 The reverse can be tested using the restrictions a i.12 = 0, i = 1, . . . , p.
Where both sets of restrictions are rejected, causality runs in both directions Each of the series is tested for the presence of a unit root
and feedback is said to exist. by estimating an ADF equation both with and without the
84 R. Tiffin, X. Irz / Agricultural Economics 35 (2006) 79–89
deterministic trend. The number of lags in the ADF equation
is chosen by testing for serial correlation using the Breusch–
Godfrey statistic (Breusch, 1978; Godfrey, 1978). It is recog-
nized that this procedure is imperfect and that the ADF test is
sensitive to the number of lags chosen. We therefore use the
bootstrap procedure that has been outlined to account for the
fact that errors in the test equation may not be white noise.
The procedure adopted in testing for a unit root in the agricul-
tural value added series of the ith country as follows. 4 First the
test statistic is obtained as the t-statistic on δ in the following
equation:
vit = µi + δi vit−1 + γi t + uit . (11)
The following equation is then estimated:
vit = µi + uit , (12)
where µ is a constant. A bootstrap sample {u∗it | t = 1, . . . , T } is
obtained using the stationary bootstrap by drawing u∗i1 randomly
from {ûit }, the set of estimated residuals from (12). u∗i2 is then
obtained according to the following:
 
Pr u∗i2 = uij = 1 − ϕ, (13)
 
Pr u∗i2 = uik = ϕ, (14)
where j = i + 1 if i < T, j = 1 otherwise and k = j . {µ t } is
used to produce a pseudo sample {v it } using Eq. (12) with the
estimated value of µ. Equation (11) is then estimated and the
test statistic for the pseudo sample is saved. Critical values are
obtained by repeating the procedure and computing the centiles
of the saved test statistic.
Having eliminated the series for which the unit root can be
rejected by applying the ADF test to the individual series, we
use the Maddalla and Wu (1999) procedure that is outlined
in Section 3 in order to exploit the increased power of this
test to confirm the conclusion that the remaining series are
subject to unit roots. The test statistic is estimated by estimating
Eq. (11) with each series in the panel. The significance levels
for use in computing the statistic in Eq. (1) are obtained by
comparing the t-statistic on δ with a sample of 500,000 draws
from the distribution of this statistic under the null hypothesis. 5
Maddalla and Wu (1999) note that the Fisher test assumes that
the component test statistics are independent and that this may
be unrealistic in a panel data setting. We therefore follow their
suggestion in employing the stationary bootstrap to generate
critical values. The procedure used is essentially the same as
that employed in generating critical values for the ADF test
4 We outline the procedure for one of the variables and the alternative hy-
potheses of a deterministic trend. The equation used for testing GDP is obvious
while the stationary alternative is tested by omitting the trend in Eq. (11).
5 This sample is produced by repeatedly estimating Eq. (11) using simulated
data generated by a first-order autregressive model that is subject to a unit root.
above. A bootstrap sample {u∗t }, where u∗t = {u∗1t , . . . , u∗Nt }, is
produced by resampling the residuals from Eq. (12) in N-tuples
such that each observation in the sample has observations from
each cross-sectional unit in the same time period. Equation (12)
is then used to produce pseudo data under the null hypothesis
and the test statistic in (1) is computed. Critical values are
produced by repeating the procedure.
We test for cointegration using Pedroni’s (1999) procedure
7. Thus we estimate the following:
yit = αi + βi vit + γi t + uit i = 1, . . . , N, (15)
for each series in the panel. The residuals from this regression
are tested for unit roots by estimating the following:
ûit = δi ûit−1 + vit , (16)
and the test statistic is computed as the arithmetic mean of the
t-statistics on δ i across the cross-sectional units. Critical values
are obtained by bootstrapping under the null hypothesis that
the series are subject to unit roots but not cointegrated. Pseudo
data on v it and y it are thus generated in exactly the same way as
for use in generating critical values for the panel unit root test.
Critical values are obtained as the centiles of the test statistic
obtained through repeated estimation of Eqs. (15) and (16) using
the pseudo data.
The final stage is to test for causality. In the light of the Monte
Carlo results in Zapata and Rambaldi (1997) we choose to ap-
ply the modified Wald test suggested by Toda and Yamamoto
(1995) by estimating Eq. (10). Our explanation is for the case
in which we test causality from agricultural value added to
GDP. We obtain bootstrap critical values for this test as fol-
lows. First the VECM is estimated under the joint restrictions
required for Granger noncausality and cointegration. This in
itself entails two steps, the first follows Johansen and Juselius
(1990, pp. 199–200) in estimating α and β under the restric-
tions that the rank of  is one and α = (α 1 , 0) . The second
step is to estimate  following Mosconi and Gianini (1992, p.
407). 6 The estimated residuals from the restricted VECM are
resampled and used with the estimated parameters to produce
pseudo data which satisfies the null hypothesis. Critical values
for the test are obtained, by resampling repeatedly and testing
the null hypothesis using the modified Wald statistic. We use
a Monte Carlo experiment to assess the use of the bootstrap in
conducting this test. This is described in Appendix B.
6Zapata and Rambaldi (1997) note there are errors in the formula given by
Mosconi and Gianini (1992). We note that Zapata and Rambaldi (1997) do not
correct all of the errors and apply the following formula here:
˜ 1 (s1 s
ˆ = ˜ − s ˜ 1 )−1 s1 V(V
˜ 
(xx )−1 V)V (xx )−1 , (17)
where x = (x̃1 , . . . , x̃T ),

0
V= , (18)
Ip−1 ⊗ s
s = (1, 0) , and ˜ and 
˜ are as defined in Mosconi and Gianini (1992).
 R. Tiffin, X. Irz / Agricultural Economics 35 (2006) 79–89 85

Table 1 Table 2
Rejections of the null hypothesis of a unit root using ADF test Results of the Maddalla and Wu panel unit root tests

Country Series Statistic 5% bootstrap C.V. Series Alternative hypothesis Statistic 95% bootstrap C.V.

Austria GDP −3.777 −3.061 GDP Trend stationarity 245.779 350.444

Belgium GDP −3.531 −2.733 Ag. val. added Trend stationarity 106.701 207.301
Denmark GDP −2.550 −2.112 GDP Stationarity 81.941 197.623
France GDP −5.671 −3.707 Ag. val. added Stationarity 106.701 125.992
Germany GDP −2.119 −1.729
Greece GDP −4.328 −3.571
Italy GDP −4.846 −2.751
Table 3
Japan GDP −7.591 −3.825
Countries exhibiting bi-directional causality
Mauritania GDP −3.842 −3.390
Mexico GDP −2.392 −2.353 Country Stat GDP
AVA C.V. 95% Stat AVA
GDP C.V. 95%
Norway GDP −2.594 −1.979
Papua New Guinea GDP −2.872 −2.581 Burundi 37.061 21.253 31.478 26.085
Portugal GDP −2.707 −2.478 Fiji 15.511 7.543 50.959 8.294
South Africa GDP −3.061 −2.955 Finland 8.295 6.409 7.517 4.101
Spain GDP −5.079 −3.398 Malawi 12.393 9.588 70.347 7.641
Sweden GDP −2.902 −2.805 Senegal 62.331 32.132 227.172 16.604
Thailand Ag. val. added −1.753 −1.463
Togo GDP −3.176 −2.928
Venezuala Ag. val. added −2.815 −2.276 Table 4
Countries exhibiting causality from GDP to agricultural value added

Country Stat GDP
AVA C.V. 95% Stat AVA
GDP C.V. 95%
Following Gardner, we use data on agricultural value-added
per worker and GDP per capita in constant 1995 US$ from Benin 20.431 9.011 1.937 6.986
World Development Indicators. 7 We exclude countries for Honduras 6.689 4.531 0.283 4.346
Korea, Rep. 15.616 6.802 1.571 5.506
which either series has no observations prior to 1972, which
Peru 8.674 4.526 0.030 4.449
gives 85 countries. The remaining series are of varying lengths
(see Appendix A).

5. Results test statistic obtained is −2.586 compared with a bootstrap crit-

The results of the ADF tests for unit roots in each of the
individual series for which the null hypothesis of a unit root is
rejected are given in Table 1. The full set of results are given
in Appendix C. The ADF test was also carried out omitting
the term in the deterministic trend in Eq. (11). This leads to a
reduction in the number of rejections. Of the series which reject
with the trended model, only Denmark, Spain, and Sweden re-
ject when the trend is omitted. Of the series that fail to reject in
the trended model Brazil (Agricultural Value Added) and China
(GDP) reject with the trend omitted. Visual analysis suggests
that the trended alternative is the most appropriate hypothesis
and it is well known that the test lacks power against this al-
ternative when the trend is omitted from the test equation. We
therefore conclude that there is evidence to support the exclu-
sion of the countries in Table 1 from further analysis on the
grounds that they are not integrated. To confirm the conclusion
that the remaining series are subject to a unit root we apply
the Maddalla and Wu (1999) panel procedure. The results are
presented in Table 2 and in all cases, the null hypothesis that the
remaining series are subject to a unit root is not rejected regard-
less of the alternative hypothesis that is used. The next step is to
test for cointegration using the Pedroni (1999) procedure. The
7 These data are available online at http://www.worldbank.org/data/.
ical value at the 95% level of −1.723 and we therefore conclude
that there is pairwise cointegration between GDP per capita and
agricultural value added in all of the countries remaining in the
panel.
Having established that the series cointegrate we proceed to
test for Granger causality. The results are given in Tables 3–5.
In each of these Tables, columns 2 and 3 give the test statistic
and bootstrapped 5% critical value for the hypothesis that GDP
is noncausal of agricultural value added and columns 4 and 5
give the statistics and critical values for the noncausality in the
opposite direction. Table 4 shows the countries for which only
the hypothesis that GDP does not cause agricultural value added
can be rejected, Table 3 shows the countries for which both
hypotheses can be rejected, and Table 5 shows the countries for
which only the hypothesis that agricultural value added does not
cause GDP can be rejected. 8 The striking feature of these results
is that for the vast majority of cases, the evidence points to the
fact that agricultural value added is causal of GDP. Although
this conclusion applies mainly to developing countries, we also
note the unexpected presence of five developed countries in
Table 5, a point on which we expand in the conclusion.
8 Neither hypothesis can be rejected for the countries that do not appear in
Tables 3, 4, or 5.
86 R. Tiffin, X. Irz / Agricultural Economics 35 (2006) 79–89

Table 5 to consider the effect of bootstrapping the Granger causality test

Countries exhibiting causality from agricultural value added to GDP and show that it improves the size of the test in short time series
Country Stat 95% Stat 95% in comparison with the use of asymptotic critical values.
GDP
AVA C.V. AVA
GDP C.V. Applying the test to data from “World Development Indica-
Australia 52.089 71.902 53.603 7.917 tors,” we find that in the vast majority of cases causality runs in
Barbados 1.475 11.630 33.520 5.227 one direction from agricultural value added per worker to GDP
Botswana 1.567 6.008 17.193 3.165 per capita, or, in other words, that agriculture is the engine
Burkina Faso 7.307 25.943 36.017 13.017 of growth. This view is consistent with the popular paradigm
Canada 0.190 7.243 13.608 6.134
among agricultural economists that agricultural productivity
Chad 7.438 13.613 98.161 20.286
Dominican Republic 11.983 28.156 1,175.511 7.474 growth is necessary to “get the economy moving” because it
El Salvador 0.959 57.144 389.257 23.668 releases a surplus of food, labor, raw materials, capital, and
The Gambia 0.962 15.657 31.734 13.000 foreign exchange, while simultaneously generating demand for
Ghana 7.015 22.670 210.053 28.523 industrial goods and services. On the other hand, it seems to
Guatemala 0.284 6.130 4.511 4.166
contradict the contention expressed recently by Gardner that
India 5.972 6.420 30.355 6.175
Kenya 14.516 33.420 48.496 37.032 growth in agricultural income is driven primarily by changes
Lesotho 0.438 22.031 52.067 7.752 outside the sector, and most importantly growth of labor de-
Morocco 91.389 96.257 186.939 8.432 mand in the nonfarm economy. This is a comforting result for
Nepal 12.263 8.208 12.458 7.368 agricultural economists because it validates the standard policy
The Netherlands 4.970 17.851 11.744 6.539
recommendations aimed at stimulating growth and develop-
Niger 4.049 22.022 86.901 29.063
Paraguay 0.876 5.467 9.207 3.900 ment through expansion of agriculture. Hence, investments in
Sierra Leone 62.331 5.486 14.895 5.865 agricultural research and the provision of extension services
Singapore 1.839 12.799 18.743 5.497 as well as appropriate price incentives to farmers appear to be
Sri Lanka 2.079 8.103 38.628 5.401 effective and necessary ways of stimulating the other sectors of
Swaziland 0.218 19.932 27.003 10.870
the economy.
Syria 4.277 19.396 162.010 11.939
Trinidad and Tobago 8.387 234.871 1,747.736 10.052 However, while this set of results would have been expected
Tunisia 1.079 13.261 339.002 5.762 by many in the profession as far as developing countries are
UK 13.808 122.774 16,949.25 53.091 concerned, a surprising finding is the evidence in support of
U.S. 1.923 10.833 226.527 7.552 agriculture driving growth in highly developed economies as
Uruguay 0.254 10.645 111.797 5.877
well. Clearly, the relative economic importance of agriculture
Zimbabwe 0.997 10.107 35.888 6.625
in these countries is not high, and in this context it is difficult
to explain why the sector might retain its leading role in the
6. Conclusion growth process. A first possible explanation is that the data
span three decades over which the structural transformation of
This article extends the analysis presented by Gardner in his developed economies proceeded. For instance, the agricultural
2003 Elmhirst lecture on the relationship between agricultural workforce in Canada decreased from 8% of the total in 1970
and general economic growth by rigorously applying modern to barely more than 2% in 2000 (FAOSTAT), hence releasing
time-series econometric methods. After summarizing the ex- an important amount of productive labor from agriculture that
tensive literature on the role of agriculture in the process of contributed to economic growth. The same argument applies to
growth and development, the article has reviewed issues asso- Australia and the Netherlands but does not appear very convinc-
ciated with the application of Granger causality tests to inte- ing for the two countries in Table 5 that are at more advanced
grated data, before applying the tests to establish the direction of levels of their structural transformation (UK, U.S.). A second
causality between GDP and agricultural value added in a panel justification relies on the observation that, for a majority (12)
of developed and developing countries. The estimated VAR of developed countries in our data set, the series are simply not
model, though extremely simple, represents a reduced form of integrated (Table 1), which suggests that there is no long-term
the structural model of Feder (1982) as was first suggested by relationship between agricultural value added per worker and
Gemmell et al. (2000). Our contribution is twofold: first, the GDP per capita. Once that is recognized, the situation of Aus-
empirical application represents the first rigorous attempt 9 to tralia, Canada, the Netherlands, UK, and United States should
test for causality between agricultural and general economic be regarded as the exception rather than the rule. We also note
growth in a cross-country setting; and second, at an economet- that, with the exception of the UK, these five countries have a
ric level, we extend the analysis of Zapata and Rambaldi (1997) clear comparative advantage in agriculture and are major ex-
porters on world agricultural markets. Our results can therefore
9 By rigorous attempt we simply refer to methods that, in the words of Gardner,
be re-interpreted as suggesting that, with the possible exception
address explicitely “the econometric problems of sorting out causal effects from of countries with highly competitive agricultures, the farm sec-
trending time series” Gardner (2003). tor does not drive the growth process in developed countries.
 R. Tiffin, X. Irz / Agricultural Economics 35 (2006) 79–89 87

Acknowledgments Appendix A Continued.

Country Ag. val. added GDP
The authors are grateful to the two anonymous referees for
their helpful comments. All remaining errors are the responsi- Mexico 1965 1960
Morocco 1965 1960
bility of the authors.
Nepal 1965 1960
The Netherlands 1971 1960
Appendix A: Dates of first observations Nicaragua 1965 1960
Niger 1961 1960
Table A.1
Nigeria 1961 1960
Country Ag. val. added GDP Norway 1971 1960
Pakistan 1961 1960
Algeria 1961 1960 Papua New Guinea 1961 1960
Argentina 1965 1960 Paraguay 1962 1960
Australia 1971 1960 Peru 1961 1960
Austria 1971 1960 Philippines 1961 1960
Bangladesh 1961 1960 Portugal 1971 1960
Barbados 1966 1960 Rwanda 1965 1960
Belgium 1970 1960 Senegal 1961 1960
Belize 1970 1960 Sierra Leone 1964 1960
Benin 1970 1960 Singapore 1961 1960
Botswana 1961 1960 South Africa 1961 1960
Brazil 1965 1960 Spain 1971 1960
Burkino Faso 1970 1960 Sri Lanka 1961 1960
Burundi 1965 1960 Swaziland 1971 1970
Cameroon 1965 1960 Sweden 1970 1960
Canada 1971 1965 Syria 1965 1960
Central African Republic 1965 1960 Thailand 1961 1960
Chad 1967 1960 Togo 1965 1960
Chile 1961 1968 Trinidad and Tobago 1966 1960
China 1961 1960 Tunisia 1965 1961
Colombia 1965 1960 Turkey 1968 1968
Democratic Republic of Congo 1968 1960 United Kingdom 1971 1960
Republic of Congo 1961 1960 United States 1971 1960
Costa Rica 1961 1960 Uruguay 1961 1960
Cote d’Ivoire 1961 1960 Venezuela 1961 1960
Denmark 1966 1960 Zambia 1965 1960
Dominican Republic 1965 1960 Zimbabwe 1969 1960
Egypt 1965 1960
El Salvador 1961 1960
Fiji 1965 1960
Finland 1961 1960
Appendix B: Monte Carlo experiment
France 1971 1960
The Gambia 1966 1966 In order to assess the extent to which the bootstrap improves
Germany 1971 1971 the performance of the noncausality test we repeat Zapata and
Ghana 1965 1960 Rambaldi’s (1997) Monte Carlo experiment with their DGP(3).
Greece 1961 1960
Guatemala 1965 1960
We carry out 5,000 Monte Carlo trials and for each trial we
Guinea-Bissau 1970 1970 generate critical values using a bootstrap sample of 1,000 ob-
Guyana 1961 1960 servations. The probability ϕ used in the bootstrap (see Eqs.
Honduras 1961 1960 (13) and (14)) is 0.1. Table B.1 presents the results of the trial
India 1961 1960 along with the results reported by Zapata and Rambaldi (1997)
Indonesia 1961 1960
Italy 1970 1960
for comparison. Results are reported with the order of the esti-
Jamaica 1961 1960 mated VAR ( p, see Eq. (3)) equal to the true order, p = 2 with
Japan 1961 1960 cases where it is over-fitted ( p = 3) and under-fitted ( p = 1).
Kenya 1964 1960 In all cases, the nominal size of the tests is 0.05. The results
Korea 1961 1960 show that the use of the bootstrap gives an improvement in size
Lesotho 1970 1960
Madagascar 1970 1960
over the use of asymptotic critical values at the expense of the
Malawi 1967 1960 power of the test. The power of the bootstrap test is reasonable
Malaysia 1970 1960 with a sample size of 40 provided the correct number of lags are
Mali 1967 1967 used in the estimation. The consequences of underestimating
Mauritania 1961 1960 the number of lags are more severe than overestimation. Un-
Continued derestimation results in a severe reduction in the power of the
88 R. Tiffin, X. Irz / Agricultural Economics 35 (2006) 79–89

Table B.1 Appendix C Continued.

Comparison of size (S) and power (P) of the modified Wald test with asymptotic
(A) and bootstrap (B) critical values for Zapata and Rambaldi’s model 3, Country Ag. val. added GDP
nominal size 0.05 Stat. C.V. Stat. C.V.
Repetitions 25 30 40 50 75 100 200 400 Fiji −4.702 −5.859 −1.880 −3.967
p = 1 S A 0.146 – – 0.087 – 0.062 0.054 0.048 Finland −3.071 −3.531 −1.682 −2.876
B 0.030 0.029 0.027 0.026 0.032 0.028 0.027 0.030 France −3.260 −4.799 −2.502 −2.865
The Gambia −1.526 −3.243 −1.721 −3.497
P A 0.477 – – 0.835 – 0.988 1.000 1.000
Germany −3.084 −5.634 −1.753 −3.277
B 0.030 0.025 0.022 0.024 0.023 0.031 0.149 0.616
Ghana −2.041 −3.232 −0.590 −3.297
p = 2 S A 0.229 – – 0.108 – 0.070 0.052 0.051 Greece −2.946 −6.063 −2.757 −2.984
B 0.030 0.032 0.037 0.043 0.043 0.054 0.050 0.050 Guatemala −1.753 −3.022 −1.469 −3.194
P A 0.645 – – 0.937 – 0.998 1.000 1.000 Guinea-Bissau −2.238 −4.178 −3.254 −4.489
B 0.141 0.258 0.481 0.693 0.937 0.987 1.000 0.999 Guyana −2.662 −5.193 −1.351 −3.018
Honduras −2.456 −3.502 −1.529 −3.148
p = 3 S A 0.344 – – 0.140 – 0.078 0.064 0.043
India −4.217 −5.601 1.915 −2.229
B 0.028 0.039 0.046 0.046 0.048 0.047 0.047 0.050
Indonesia −1.016 −3.387 −0.171 −2.676
P A 0.727 – – 0.930 – 0.999 1.000 1.000 Italy −2.455 −3.687 −4.846 −2.751
B 0.082 0.114 0.155 0.179 0.284 0.416 0.895 1.000 Jamaica −1.689 −2.887 −1.982 −2.412
Japan −2.175 −4.134 −7.591 −3.825
Kenya −1.724 −3.933 −1.842 −2.920
test and underrejection of the null hypothesis. Overestimation Korea, Republic −2.086 −4.411 −0.192 −1.768
Lesotho −3.768 −4.527 −1.255 −1.917
has only a small impact on the size of the test relative to the Madagascar −2.269 −4.247 0.084 −2.177
correctly parameterized model, and there is also some reduction Malawi −2.656 −4.621 −2.115 −2.874
in power. Malaysia −1.657 −4.186 −0.755 −1.758
Mali −3.316 −3.631 −1.647 −2.471
Appendix C: Results of ADF tests Mauritania −2.320 −4.325 −3.842 −3.390
Mexico −2.986 −4.854 −2.392 −2.353
Table C.1 Morocco −5.270 −6.475 −0.940 −1.851
Nepal −2.319 −4.132 0.753 −2.504
Country Ag. val. added GDP The Netherlands −3.179 −3.735 −2.172 −2.446
Stat. C.V. Stat. C.V. Nicaragua −1.224 −3.294 −0.108 −2.464
Niger −1.939 −4.720 −0.556 −2.460
Algeria −2.754 −4.682 −1.817 −4.104 Nigeria −1.589 −3.089 −1.865 −2.915
Argentina −2.279 −3.499 −1.711 −2.971 Norway −2.301 −4.160 −2.594 −1.979
Australia −4.900 −5.660 −2.187 −3.372 Pakistan −2.079 −3.996 −2.040 −2.098
Austria −1.823 −3.949 −1.048 −3.465 Papua New Guinea −2.756 −3.750 −2.872 −2.581
Bangladesh −1.432 −4.065 −0.783 −3.596 Paraguay −1.114 −3.298 −2.178 −3.442
Barbados −2.958 −3.805 −2.227 −2.895 Peru −1.413 −3.738 −2.295 −2.432
Belgium −0.957 −3.548 −1.785 −3.313 Philippines −2.383 −3.973 −1.888 −2.297
Belize −2.487 −5.109 −1.782 −2.696 Portugal −2.706 −3.714 −2.707 −2.478
Benin −3.112 −4.227 −1.788 −3.195 Rwanda −3.201 −5.051 −2.107 −3.241
Botswana −0.953 −2.512 0.165 −2.762 Senegal −5.282 −5.723 −2.386 −3.353
Brazil −6.018 −5.620 −0.645 −3.337 Sierra Leone −0.684 −2.962 0.551 −2.653
Burkina Faso −3.620 −6.327 −3.663 −5.204 Singapore −1.458 −4.065 −2.253 −2.879
Burundi −1.960 −3.966 −0.680 −4.010 South Africa −3.720 −5.367 −3.061 −2.955
Cameroon −1.709 −3.626 −0.965 −3.066 Spain −3.338 −4.508 −5.079 −3.398
Canada −3.031 −3.099 −2.174 −3.034 Sri Lanka −2.560 −4.330 1.034 −2.253
Central African Republic 0.051 −2.950 −1.968 −3.662 Swaziland −3.430 −4.282 −1.820 −2.321
Chad −3.413 −6.233 −1.970 −3.726 Sweden −2.493 −4.093 −2.902 −2.805
Chile −2.648 −3.882 −1.109 −2.991 Syrian Arab Republic −3.791 −5.383 −1.705 −2.571
China −2.489 −3.830 −4.526 −3.093 Thailand −3.301 −6.140 −0.651 −2.102
Colombia −1.521 −3.488 0.404 −2.629 Togo −2.983 −4.261 −2.858 −3.280
Democratic Republic of Congo −2.240 −3.782 −0.939 −3.246 Trinidad and Tobago −1.891 −5.678 −1.610 −3.364
Republic of Congo −3.039 −4.228 −0.650 −2.651 Tunisia −3.087 −4.015 −1.763 −3.332
Costa Rica −1.569 −3.152 −1.375 −3.047 Turkey −3.447 −6.096 −2.755 −3.988
Cote d’Ivoire −2.296 −4.321 −2.032 −2.769 United Kingdom −1.301 −3.721 −2.433 −3.499
Denmark −3.857 −4.768 −3.375 −3.288 United States −2.100 −4.179 −2.751 −3.471
Dominican Republic −3.003 −5.411 −1.717 −3.262 Uruguay −4.598 −4.743 −1.779 −2.684
Egypt. −2.731 −3.464 −1.165 −2.822 Venezuela, RB −1.976 −3.034 −2.187 −3.506
El Salvador −2.727 −4.497 −1.343 −3.697 Zambia −5.112 −6.544 −2.391 −3.732
Zimbabwe −3.420 −5.268 −1.005 −3.054
Continued
 R. Tiffin, X. Irz / Agricultural Economics 35 (2006) 79–89
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