By Chrstopher L. Delgado, Jane Hopkins, Valerie A. Kelly
How a lot additional web source of revenue development may be had in rural parts of Africa by way of expanding the spending strength of neighborhood families? the reply will depend on how rural families spend increments to source of revenue, even if the goods wanted may be imported to the neighborhood zone based on elevated call for, and, if no longer, no matter if elevated call for will result in new neighborhood construction or just to cost rises. for each greenback in new farm source of revenue earned, not less than one additional-tional greenback can be discovered from development multipliers, in accordance with Agricultural progress Linkages in Sub-Saharan Africa, study record 107, through Christopher L. Delgado, Jane Hopkins, and Valerie A. Kelly, with Peter Hazell, Anna A. McKenna, Peter Gruhn, Behjat Hojjati, Jayashree Sil, and Claude Courbois.
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Extra info for Agricultural Growth Linkages in Sub-Saharan Africa
Furthermore, since the gains from increased nonfarm activity accrue to households that are also engaged in farming, nonfarm activity increases farm liquidity and spreads income risk. Thus, classifying goods into farm and nonfarm sectors, rather than into food/nonfood or rural/urban categories (which tend to be interpreted as farm and nonfarm in drawing policy conclusions), better captures the reality of the linkages between the farm and nonfarm sectors, at least in West Africa. The impact of local income growth on further local growth through the alleviation of local demand constraints depends not only on consumption responses to income growth, but also on whether goods are in fact demand-constrained.
Sectoral and Tradability Classification of Goods and Services As discussed in Chapter 2, the expected magnitude of growth multipliers depends to a large extent on the assumptions about demand constraints included in the sectoral classification of goods and services into tradables and nontradables. Since farmers in Africa typically earn half their income from activities other than the production of crops and livestock, it is misleading to define “farm” and “nonfarm” by location. In fact, farm households are also rural nonfarm households, especially in West Africa (Hopkins, Kelly, and Delgado 1994).
Infrastructure and regional characteristics in much of Africa are such that a significant range of goods and services fall within nontradables. Household budget surveys across Africa consistently show basic foods to be the main consumer expenditure item in rural areas. Because the costs of transporting and 20 marketing imports and exports of food are very high, most food consumption is from domestically produced sources. Exports of starchy food staples and livestock products to points outside of Africa are negligible.