The gains are shared widely in the sense that no household group loses in absolute terms. However, in relative terms, urban households gain the most because they derive the bulk of their incomes from factors that are intensively used in dynamic sectors facing high income and price elasticities of demand. This distributional effect stems from the fact that these commodities, whose relative prices decline, primarily are demanded by households and producers in rural areas. The results demonstrate that, under realistic assumptions, it is possible to design a policy package and resulting development path that combine rapid and efficient growth in incomes and production throughout the economy with an improved relative position for the rural population. Download full-text discussion paper .
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