Resource information
This report shows that trends in farm
mechanization are attributable to differing approaches to
reform and differing agricultural resource endowments. The
level of reform determines the pattern and extent to which
labor and capital change, with land reform and commodity
market liberalization as the underlying forces for change.
These reforms substantially raise the incentives to invest
as a means to increase productivity and incomes. In
countries where this initial threshold of reform has not
been attained agricultural incomes grow more slowly and
there is less incentive to invest. Where the incentives to
invest are high a second round of reform is necessary to
facilitate investment reforms which deepen and strengthen
financial markets and improve the business environment.
