Poverty is still a major problem in Pakistan. (...) We have long known that agricultural growth is closely related to poverty reduction. Recent studies (...) provide massive statistical evidence of this relationship. Rural growth and agricultural growth have a major effect on poverty reduction;...

This paper provides an explanation of the relation between agricultural growth and poverty reduction for open economies with full employment. The analysis also shows that the poverty-reducing impact of agricultural growth in an open economy is far greater if there is unemployed labour or if the...