A decomposition of aggregate labor productivity based on internationally comparable data reveals that a high share of employment and low labor productivity in agriculture are mainly responsible for low aggregate productivity in poor countries. Using a two-sector general-equilibrium model, we...

A decomposition of aggregate labor productivity based on internationally comparable data from FAO and Penn World Tables reveals that high labor shares and low productivity in agriculture are mainly responsible for poor countries<92> current position in the world income distribution. Using a...</92>

This paper develops a two-sector model that illuminates the role played by agricultural modernization in the transition from stagnation to growth. When agriculture relies on traditional technology, industrial development reduces the relative price of industrial products, but has a limited effect...