Farm productivity and rural poverty in India

Armed with new data, we return to an old question from the pages of this journal: to what extent do India's rural poor share in agricultural growth? Combining data from 24 household sample surveys spanning 35 years with other sources, we estimate a model of the joint determination of consumption-poverty measures, agricultural wages, and food prices. We find that higher farm productivity brought both absolute and relative gains to poor rural households. A large share of the gains was via wages and prices, though these effects took time. The benefits to the poor were not confined to those near the poverty line.