Urban bias in government policy is a common phenomenon in many developing countries. Bates (1981) has famously argued that the wish to industrialize, paired with the political clout of urban residents, results in distinctly anti-rural policies. Empirically, however, the strength of urban bias varies substantially across countries and over time. This paper explains this variation by developing an argument about a countervailing force to urban bias: the threat of a rural insurgency. The direction of urban and rural bias is a function of the political threat that geographically distinct groups pose to the survival of the central government. When the rural periphery lacks collective action capacity, urban bias emerges, but if there exists a credible threat of rural violence, urban bias is diminished. I test this proposition and competing explanations using data on net taxation in the agricultural sector, covering up to 55 low- and middle-income countries from 1955 to 2007. The results show a strong relationship between past territorial conflict (which proxies for credible rural threats) and lower levels of urban bias in the developing world. The findings are robust to alternative model specifications, measures, and sensitivity analyses.
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Later work by Arthur Lewis recognized the importance of increasing agricultural productivity (Lewis 1978).
In many high-income countries, support for the agricultural sector is also believed to emerge through the collective action potential of the shrunken farm sector (Swinnen 2010), but it is worth considering other threats to incumbent interests in the context of developing countries.
See Jones and Corbridge (2010) for a useful summary of the overall debate.
The World Bank Project on Distortions to Agricultural Incentives (www.worldbank.org/agdistortions).
It is formally defined as R R A = 100[(1 + N R A a g/100)/(1 + N R A n o n a g/100) − 1]. NRAag is the NRA to agricultural production, and NRAnonag is assistance to non-agricultural production (NRAnonag).
Overall, high-income countries have the highest rates of rural support on this measure.
It is unreasonable to think that a rural threat diminishes linearly over time.
Measured in thousands of US dollars.
See, for example, Krugman (Krugman 1991).
A large industrial sector in terms of value added does not necessarily imply the same degree of collective action problems as in the agricultural sector, since the owners of capital are generally a smaller share of the population.
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Pierskalla, J.H. The Politics of Urban Bias: Rural Threats and the Dual Dilemma of Political Survival. St Comp Int Dev 51, 286–307 (2016). https://doi.org/10.1007/s12116-015-9194-2
- Urban bias
- Political economy
- Agricultural policy
- Rural insurgency