Modern rice technology and regional wage differentials in the Philippines

Type Journal Article - Agricultural Economics
Title Modern rice technology and regional wage differentials in the Philippines
Volume 4
Issue 3
Publication (Day/Month/Year) 1990
Page numbers 297-314
Fear has been widely expressed that the modern rice varieties have created large disparities
in regional income distribution, as the productivity gap between favorable and unfavorable
rice-production environments widened due to differential technology adoption throughout
South and Southeast Asia over the last two decades.
Technology affects the income of farm population directly through its effects on productivity
and factor use, and indirectly through its effect on factor prices. In particular, the
ultimate distributional impact of modern varieties will critically depend on the interregional
labor-market adjustments through migration in response to regional wage differentials
created by the differential technology adoption, since labor is the main resource of the majority
of the rural population.
We studied favorable and unfavorable rice-growing villages in the Philippines, and found
that adoption of modern varieties during the 1970s was positively related to population
growth rate. Contrary to popular belief, no association was observed between wage rates and
adoption of modern varieties as of 1986. These findings support the hypothesis that the differential
adoption of modern rice varieties induced interregional labor migration toward
equalization of wage income across different production environments.

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