In recent years, a considerable change has taken place in the way in which analysts of economic development have come to understand the nature of the growth process in rural areas and the relations between agricultural and nonagricultural activity as industrialization takes place. Growing awareness of the significance of nonagricultural activities in rural areas, of rural industrialization, and of the “livelihood diversification strategies” adopted by rural households has prompted this shift in understanding (Ellis 1998, 1–2). The strict agriculture/industry divide of standard dual-economy models has been broken down, and scholars have recognized the implications, both theoretical and policy-related, of the existence and development of the “pluriactive” rural household that derives its income from a variety of sources alongside agriculture. Various ways of analyzing the nature and implications of agriculture/industry interaction within rural areas, and the economic activities of rural households that underlie them, have been developed, but central to much of the work on the issue has been a model of the “growth linkages” between agricultural and nonagricultural activity. This model seeks to demonstrate how backward and forward linkages between growth in agricultural output and the expansion of manufacturing activity in rural areas operate to produce a “virtuous circle” of expanding employment opportunities, rising and often quite equally distributed rural incomes, and improving standards of living.

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