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Taxing agriculture to mobilize resources for industrialization has been a widely used development strategy. Using novel cross-country time-series data sets with direct measures of agricultural taxation, we examine how a policy bias against agriculture affects the speed of convergence in income per capita, structural change, and economic growth. We find that distortionary agricultural policies in poor economies can account for the emergence of convergence clubs in our sample by significantly retarding their structural transformation and economic growth. Overall, we find no evidence suggesting that policies that discriminate against agriculture have been beneficial for long-term economic growth. [ABSTRACT FROM AUTHOR]

The article profiles Philip G. Pardey, a Fellow of the American Agricultural Economics Association in 2006. Pardey's various affiliations are presented. He is a professor of the Department of Applied Economics at the University of Minnesota from 2002 up to the present in 2006. He is also the director of the International Science and Technology Practice and Policy center at the University of Minnesota from 2004 up to the present. He comes to economics with a grounding in agricultural science that reinforced his interest in science and technology policy.

The growth in the share of resources devoted to food marketed through supermarkets and their accompanying marketing channels has grown at an unprecedented rate in developing countries during the 1990s. This article shows that differences in the relative capital intensity of the modern marketing channels, in contrast to the traditional channels, can explain part of this expansion as the process of economic growth gives rise to capital deepening in the economy even when the food share of total expenditures declines. In this case, the lack of complete markets and policy distortions can further exacerbate the effects of supermarkets on the traditional marketing system and the small farmers that it supports. The article proceeds by describing the conceptual framework of a Ramsey growth model to fit on data of the Moroccan economy. The empirical results show how capital deepening in transition growth can encourage the expansion of the supermarket system without the need to appeal to economies of scale or imperfect competition. The article concludes by noting how economic policy and other market imperfections can affect this process.

This article analyzes the role of foreign direct investment (FDI) and trade in promoting economic growth across selected developing countries and examines the interaction among FDI, trade, and economic growth. Data from 66 developing countries are examined. Results of the study suggest that FDI, trade, human capital, and domestic investment are important sources of economic growth for developing countries. It is discovered that there is a strong positive interaction between FDI and trade in advancing economic growth. Results also show that FDI stimulates domestic investment. The contribution of FDI to economic growth is enhanced by its positive interaction with human capital and sound macroeconomic policies and institutional stability. With the results, there is an implication that lowering the inflation rate, tax burden, and government consumption would advance economic growth in developing countries.