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Geography and the evolution of rural nonfarm sector in the Philippines, 1988-2006

Author

Listed:
  • Jonna P. Estudillo

    (Foundation for Advanced Studies on International Development, Tokyo, Japan)

  • Charity Gay Ramos

    (Joint Graduate Program, Tokyo, Japan, and National Economic and Development Authority, Philippines)

  • Keijiro Otsuka

    (Foundation for Advanced Studies on International Development, Tokyo, Japan)

Abstract
This paper aims to assess the changing impact of distance on the development of rural nonfarm sector by exploring the changing allocation of rural labor force between the farm and nonfarm sectors in the Philippines using provincial-level data from 1988 to 2006. The impact of distance of a province from a major city on the growth of its rural nonfarm sector did not change over time because of the concentration of infrastructure developments in provinces located near the major cities. A well-developed infrastructure system and the availability of an educated labor force appear to be the most potent stimuli in the transformation of the rural economies as these two factors have simultaneously induced the reallocation of rural labor force away from the farm toward the non-tradable sectors such as construction, trade, and transport. The labor absorption capacity of the rural tradable sector (e.g., manufacturing) has been critically affected by the improvements in electricity and concrete roads, not by the quality of human capital, as this sector continues to employ unskilled labor.

Suggested Citation

  • Jonna P. Estudillo & Charity Gay Ramos & Keijiro Otsuka, 2009. "Geography and the evolution of rural nonfarm sector in the Philippines, 1988-2006," Philippine Review of Economics, University of the Philippines School of Economics and Philippine Economic Society, vol. 46(2), pages 183-219, December.
    • Handle: RePEc:phs:prejrn:v:46:y:2009:i:2:p:183-219
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    File URL: http://pre.econ.upd.edu.ph/index.php/pre/article/view/1/676
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    More about this item

    Keywords

    development of rural nonfarm sector; modernizing factors; modern agricultural technology; Philippines; Asia;
    All these keywords.

    JEL classification:

    • O15 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Economic Development: Human Resources; Human Development; Income Distribution; Migration
    • O18 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Urban, Rural, Regional, and Transportation Analysis; Housing; Infrastructure
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes
    • O53 - Economic Development, Innovation, Technological Change, and Growth - - Economywide Country Studies - - - Asia including Middle East

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