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Agricultural Productivity and Structural Transformation: Evidence from Brazil

51 Pages Posted: 14 Aug 2013 Last revised: 17 Jun 2015

Paula Bustos

CREI; Universitat Pompeu Fabra; Barcelona GSE

Bruno Caprettini

University of Zurich

Jacopo Ponticelli

Kellogg School of Management - Department of Finance

Multiple version iconThere are 2 versions of this paper

Date Written: June 1, 2015

Abstract

We study the effects of the adoption of new agricultural technologies on structural transformation. To guide empirical work, we present a simple model where the effect of agricultural productivity on industrial development depends on the factor bias of technical change. We test the predictions of the model by studying the introduction of genetically engineered soybean seeds in Brazil, which had heterogeneous effects on agricultural productivity across areas with different soil and weather characteristics. We find that technical change in soy production was strongly labor saving and led to industrial growth, as predicted by the model.

Keywords: agricultural productivity, structural transformation, industrial development, labor saving technical change, genetically engineered soy

JEL Classification: F16, F43, 014, Q16

Suggested Citation

Bustos, Paula and Caprettini, Bruno and Ponticelli, Jacopo, Agricultural Productivity and Structural Transformation: Evidence from Brazil (June 1, 2015). Available at SSRN: https://ssrn.com/abstract=2309594 or http://dx.doi.org/10.2139/ssrn.2309594

Paula Bustos

CREI; Universitat Pompeu Fabra ( email )

Barcelona GSE ( email )

Ramon Trias Fargas, 25-27
Barcelona, Barcelona 08005
Spain

Bruno Caprettini

University of Zurich ( email )

Z├╝rich
Switzerland

Jacopo Ponticelli (Contact Author)

Kellogg School of Management - Department of Finance ( email )

Evanston, IL 60208
United States

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