Social Protection Expenditure and Growth in the Agricultural Sector in Asia

This article offers an alternative narrative to the current myth that social protection is obstructive to economic growth by analysing the impacts of social protection on agricultural growth and its stabilising role in growth by acting as a buffer against weather shocks. We exploit cross-country data with homogeneously measured fiscal variables to estimate the elasticities of agricultural gross domestic product to several measures of social protection. We find that fiscal stimulus channelled through social protection expenditure for the poor stimulates agricultural gross domestic product and counters the negative impacts of extreme weather shocks. Impacts are heterogeneous and vary according to the income level of countries.