Externalities and labor market linkages in a dynamic two-sector model of tropical agriculture
2003
S. Purdue
This paper examines economic and environmental linkages between two parallel agricultural systems: one upstream and another downstream. Data collected in the Philippines is used to demonstrate how labor market linkages influence decisions that impact on local forests and watersheds. Furthermore, the paper assesses whether efficiency based criteria can be used to justify the redistribution of productivity gains between two agricultural sectors. Using a dynamic, two-sector model of an agricultural watershed, the analysis derived shows how natural processes and economic interactions among socioeconomic groups influence the benefits of agricultural intensification. The paper also explores interventions to minimize tradeoffs and achieve sustainable outcomes.
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