Chapter 6: Agricultural

Sector
By : Asst. Prof. Glenn Hernandez Sadiangcolor

ECO 310:
Economic Development

Transformations and Rural

Development
Southeast Asian Perspectives
DEFINITION:

 Agriculture sectors comprise

establishments primarily
engaged in growing crops,
raising animals, and harvesting
fish and other animals from a
farm, ranch, or their natural
habitats. 
Agricultural Systems
 Useful to view agriculture in a systems
framework: inputs, outputs and linkages
 Inputs- labor, fertilizer, seeds, land
preparation, land quality and tenure
 Outputs- production in form of mature
crops and income earned and allocated
 Linkages- labor intensity > type of crop
(rice, rubber, etc); land size>income
earned and traditional system
 But inputs, outputs are linked through
three overlapping milieu or environments
 A- Physical - Ecosystem-
especially climate (precipitation),
soil and vegetation Agricultural Systems
 B- Behavioral - how ecosystem
is perceived-physical and
behavioral may be in conflict
 C- Operational - culture,
values, class structures, A-Physical Environment
institutions and tradition, political
system, technology level-farm
management, land tenure-all
influence and govern machinery
of production, consumption and
exchange

B-Behavioral C-Operational
Environment Milieu
Agrarian Structure
 Agrarian structure refers to ways in which agricultural
system is developed on the land and includes land
ownership, cropping system, and institutions
 Land tenure- who owns or controls the land
 Communal tenure- land held by village where villagers
enjoy usufruct (right to use and profit)
 Estates –large estates where wage laborers are
employed by private sector firms (agri-business), or
plantations held by public sector
 Freehold- outright ownership with land being
transferred and divided equally among (usually males)
 Tenancy- farmers pay owners for use of land either in
cash or kind (production)
Forms of Agriculture
http://www.askasia.org/frclasrm/lessplan/l000008.htm

 Wet rice (sawah or padi) cultivation- rice grown in an

embanked field relying on natural rainfall or irrigation.
Highly labor intensive and naturally fertile. Irrigation adds
fertility through deposition of material in suspension.
Capable of involution and highly impacted by the Green
Revolution- hybrid seeds, fertilizers and pesticides used
to enhance productivity but assumes abundant water
Plantation or Estate Agriculture

 Plantation or Estate Agriculture- foreign capital or public

sector capital; large scale with rubber, oil palm, coffee
and sugar cane being dominant; high labor
requirements-labor supply problems; stimulated by
Western now Eastern demand as well; significant capital
investment-planting, processing, re-planting
 Sedentary Dry Farming

 Sedentary dry farming- mostly smallholders

growing cereal grains usually millets and
sorghums- occasionally grown under irrigation
where population density is generally low
Example: Khorat Plateau
 Shifting Agriculture

 Shifting cultivation- sometimes referred to as ‘swidden’ and means

occupancy of the land interrupted by lengthy rest periods, clearing field
and burning vegetation, sowing food crops; supports only a small
population; extensive type of agriculture; diversity of crops planted to
insure against natural hazard
 Shifting cultivation usually starts with cutting trees and a fire which
clears a spot for crop production (L)
 (R) newly prepared land in the center, background is untouched forest,
in the foreground the piece of land which has been left idle to re-growth
of a secondary forest from the previous cropping cycle, and on the
right the secondary growth awaiting cultivation during the next
cropping cycle.
 Higher elevation areas Highland Market
which allow cultivation of Gardens
temperate crops
 Largely labor intensive
vegetable or tea production
for urban markets
 Usually well organized and
if so export is possible
 Examples: Cameron
Highlands, Malaysia;
Berastagi, Karo Highlands,
Sumatra; Baguio,
Philippines

Constraints on Rural Southeast
Asian Agriculture
 Small size of farms limit productivity of labor
 Reduction in size of land parcels under
inheritance tends to increase tenancy
 Weak local or regional markets
 Expensive inputs unless subsidized by
government
 Farm to market transport often poor and may
be seasonal- collapsing in the wet season
Contrasting Peasant Agriculture: Asia
 In Latin America and Africa- too much land under control of too
few people
 In Asia- too many people crowded onto too little land
 Three forces have molded the traditional pattern of land
ownership into its present condition
 1. European rule-private property, rise of landlord and creation
of individual land titles
 2. Rise in power of the moneylender- with land titles land
became a negotiable asset
 3. Rapid growth of Asian populations- impact has been severe
fragmentation; as holdings shrink production falls below
poverty level; peasants forced to borrow at usurious rates;
large debts; forced to pay high rents with scarce land; labor
abundant so wages are low; Myrdal’s vicious circles of
poverty!!
Southeast Asia’s Green Revolution

 What is the Green Revolution?

 Basically a worldwide attempt to revolutionize
production of wheat and rice in many Third
World countries
 Most important development is the application
of new seeds or hybrid referred to as HYVs
(high yielding varieties)
 In Southeast Asia International Rice Research
Institute, Los Banos, Philippines
Hybrid Rice
 Especially responsive to fertilizers in conditions of
adequate water supply and effective management
 Spectacular yields- more than double normal which allows
nations to achieve rice self sufficiency and eliminates need
to import
 HYVs are locationally selective- best results where cheap
irrigation is available
 Geographic effect relate to distribution pattern of research
coops and relation to control center
 Successful where overcrowding encourages intensity of
production
 New seeds substitute for both land and labor since
productivity of both is increased
 Raise yields and are a substitute for land –very critical
 Impact of Green Revolution
 Commercial and environmental risks are raised with
increased dependence on success in the market
 Forced boom in irrigation and water control schemes
 Rise in fertilizer and pesticide consumption
 Increased dangers from new plant diseases
 Bottlenecks in labor supply- harvest time
 Widened income gap between rich and poor farmers
 Forces view of agricultural production as a technology
(imported) dependent process- progress translated into a
narrow technical problem
 Real problem is social task of releasing untapped and wasted
human resources
 Real problem also involves politicians and vested interests-
wealthy who benefit from status quo
 Such people can and do influence access to knowledge and
availability of credit needed by farmers to purchase inputs
Summary Impacts

 Demands access to critical inputs: water,

fertilizer, pesticides which may be costly for
poor farmers and incites over borrowing
 Information and access to information is critical
—remote farmers?
 Green Revolution may exacerbate income
differentials
 Case studies show failure results from access
to inputs but also inability to adjust to needs of
new system, lack of farmer experience and
disease
Toward a New Strategy for Rural
Development

 1. Land Reform- (reorganization of land

holdings and tenure structures by expropriation
and consolidation of fragmented and tiny
holdings) farm structures and tenure patterns
must fit need to:
 a. increase food production
 b. promote wider distribution of benefits of
agrarian progress – uneven land ownership
single most important factor in explaining
inequitable distribution of income
Toward a New Strategy for Rural
Development
 2. Supportive Policies- need state policies that
provide incentives and opportunities
 a. assure access to needed inputs
 b. corresponding changes in rural institutions
that control production (e.g banks and money
lenders)
 c. expand supporting government services
(credit, education, rural transport, health)
Toward a New Strategy for Rural
Development

 3. Integrated Development Objectives

 a. need simultaneous changes in income,
employment, education, health and
housing
 b. lessening of rural-urban imbalances
 c. capacity of rural sector to sustain these
improvements over time