One common measure of structural change is the share of agriculture in total employment. Typically, as countries develop and per capita incomes rise, the share of agriculture in total employment falls. This presentation, held on 9th April 2015 at the ILRI Campus in Addis Ababa, shows recent research on this topic within Ethiopia, using survey data on the major occupation of workers.
It would appear from the survey data that Ethiopia has experienced very little structural change until only recently. The presentation explores the trends in structural change as traditionally measured using these data, as well as taking a more graduated gauge based on estimates of hours or days worked that explicitly takes into account secondary occupations. Under this latter approach, Ethiopia’s agricultural employment share is significantly lower, and yet it has already achieved a moderate level of structural change.
Our computable general equilibrium analysis shows, however, that simply promoting rural-urban migration will not be sufficient to achieve rapid reductions in the labor share of agriculture. This is partly because this migration flow from rural to urban tends to reduce agricultural production and raise food prices, which impacts new urban migrants. Continued investment in raising agricultural productivity is therefore essential for successful transformation, even while promoting an exodus of workers from agriculture. This research presentation also highlights the importance of the rural non-farm economy for overall growth and employment in Ethiopia. View Presentation.
This research was undertaken and presented by Paul Dorosh (IFPRI), Sherman Robinson (IFPRI) and James Thurlow (IFPRI)
