The process involves a greater reliance on input and output delivery systems and increased integration of agriculture with other sectors of the domestic and international economies. Agricultural transformation is a necessary part of the broader process of structural transformation, in which an increasing proportion of economic output and employment are generated by sectors other than agriculture.
Chronic hunger derives from low real incomes.
The economy becomes less agriculturally oriented in a relative sense, although agriculture and, more broadly, the food system continue to grow absolutely and generate important growth linkages to the rest of the economy. Structural transformation thus involves a net resource transfer from agriculture to other sectors of the economy, over the long term. Many functions formerly conducted on the farm, such as input production and output processing, are shifted to off-farm elements of the economy. One implication of this process is that driving down the real cost of food to consumers requires increased attention to fostering technical and institutional changes in the off-farm elements of the food system. Increasing productivity at the farm level is absolutely necessary but is alone insufficient to assure decreases in the real price of food to consumers.