The agricultural input elasticity of rural-urban migration in South Africa

Abstract

The pace of rural-urban migration relative to urban job creation is of particular relevance in relation to the level of urban unemployment and poverty in many developing countries. Faced with high levels of urban unemployment and other socio-economic problems governments in developing countries adopted several policies to ameliorate the situation. Since such policies were mainly urban biased in nature it not only failed in most cases but also in some instance exacerbated the situation by stimulating more rural-urban migration. Rural-urban migration occurs where there is economic disparity between rural and urban areas. Some economists therefore, argue that boosting agricultural productivity and/or income can reduce the incidence of economic problems partially posed by rural-urban migration. In this paper, an attempt is made, using a recursive equation system and a South African data set for the period 1965–2002, to measure the indirect agricultural input elasticity of rural-urban migration. The results indicate that narrowing the urban-rural income differentials can reduce the massive rural-urban migration and high urban unemployment in the country. It is furthermore shown that developing agricultural land and infrastructure and increasing fertilizer use can boost agricultural income, reduce rural-urban migration and is consistent with policies aimed at curbing urban unemployment.