Policies, Institutions and Markets

Poverty and hunger remain enormous problems. Nearly 1 billion people in the world go hungry, and more than 1 billion live on just $1.25 a day. Seventy-five percent of the poor live in rural areas, and the majority of them depend on agriculture for their livelihoods. Food prices are high and rising—a situation that points to continued challenges in food security in the coming years. Despite global efforts to overcome these problems, one of the most promising tools for promoting development and reducing poverty—pro-poor, sustainable agricultural growth, particularly for small producers—has been underexploited. Evidence shows that agricultural growth reduces poverty by twice the rate of growth in nonagricultural sectors, but this growth has been held back by failures related to policies, institutions, and markets and will be further challenged by emerging trends such as climate change and natural resource scarcity. Past agricultural growth has also been constrained by a narrow focus on agriculture that excluded macroeconomic dimensions, environmental inputs and outcomes, and important enabling conditions, such as rural infrastructure, effective markets, and complementary services like credit and agricultural extension.

The purpose of the Policies, Institutions, and Markets research program, is to establish how these challenges and failures can be overcome so that policies, institutions, and markets can be used most effectively to reduce poverty, improve food security, and grow small producers’ incomes. Since developing countries face a tremendous variety of development challenges, and also vary greatly in their policy, institutional, and market capacities, the program has a strong focus on supporting country-led, country-driven, and country-owned development processes through collaborative research, partnership, and capacity building.

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