Abstract
This chapter examines the changing role of agricultural production in Southeast Asia from the early decades of the twentieth century to the first decade of the twenty-first century. The chapter argues that the key drivers of agricultural growth in Southeast Asia have been population growth, leading to increased domestic demand for food, and increased involvement in international trade, which in Southeast Asia led to the rapid growth in production of a number of crops for global as well as domestic markets. Many of these crops were not indigenous to the region, but were introduced from other parts of Asia, Central and South America and Africa. A third driver has been technological change, which increased output per unit of factor input (both land and labour). Institutional changes, including changes in land tenure systems, changes in labour contracts and changes in government policies towards agriculture have also been important, but these changes have occurred mainly in response to the changes brought about by population growth, international trade and technological change.
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Notes
- 1.
- 2.
- 3.
In many parts of Southeast Asia , it was difficult to establish how much land was under smallholder non-food agriculture , at least until new technologies including satellite mapping became available. Growth rates of both area and output could be overstated because of underestimates in earlier decades.
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Thai rubber production was, and continues to be, entirely smallholder , and largely based in the south of the country. Production began in the 1930s, and increased rapidly after 1950. Smallholders received little government assistance until the 1970s, but since then the Rubber Research Institute of Thailand has been successful in encouraging replanting with higher yielding plants. Over the past four decades average yield of trees has increased by a factor of five (Delarue, 2011).
- 5.
Indonesia managed to achieve “self-sufficiency” in rice in the 1980s, but began to import again in the 1990s. In recent years, imports have been controlled, which has caused a rapid increase in local prices relative to international prices. Average wholesale prices in Indonesia in 2016 were around double the price of ex-Bangkok five per cent broken.
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Cramb & McCarthy (2016, pp. 42–43) report that over four million workers are involved in the palm oil industry in Indonesia and Malaysia ; most are Indonesians. Smallholders typically divide their time between palm oil cultivation and other activities.
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Fuglie (2010: Table 6) estimated that between 1961 and 2006 growth in total agricultural output was 3.6 per cent per annum, of which half came from total factor productivity growth, and half from growth in inputs.
- 8.
Ingram (1971, p. 256) suggested that the rice premium in Thailand , by depressing domestic rice prices, could have held down wages and facilitated the growth of the industrial and service sector. But it also aggravated income differentials between Bangkok and the north of the country. In Indonesia , rice prices have moved well above world prices in recent years (see footnote 5). This in turn has encouraged the government to increase the minimum wage. If rice prices were to follow global trends, it is probable that domestic production of rice would fall in periods of low world prices. On the other hand, poverty would fall, and employment in non-agricultural activities would increase, especially if the government was able to moderate increases in the minimum wage
- 9.
Detailed analyses of distortions in agricultural markets across Asia can be found in Anderson and Martin (2009).
- 10.
Where the proportion of the labour force in agriculture is falling in Southeast Asia in recent years, it appears that most of the increase in non-agricultural employment has been in services rather than manufacturing industry. The proportion of the non-agricultural labour force in services is higher in most parts of Southeast Asia than in Japan , Taiwan or South Korea when those countries had roughly similar levels of per-capita GDP (Booth, 2002: Table 6).
- 11.
According to the 2003 Agricultural Census, on average farm households derived 44 per cent of their income directly from the farm holding, although there was considerable variation across provinces (Booth, 2012b, p. 65). Income from the holding accounted for under 40 per cent of household incomes in Java and Bali and over 60 per cent in Central Kalimantan , Riau, South Sumatra , and Papua. Estimates from Thailand in 1998/1999 suggest that only 32 per cent of farm household cash income came from farm activities.
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Booth, A. (2018). Southeast Asian Agricultural Growth: 1930–2010. In: Pinilla, V., Willebald, H. (eds) Agricultural Development in the World Periphery. Palgrave Studies in Economic History. Palgrave Macmillan, Cham. https://doi.org/10.1007/978-3-319-66020-2_9
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