Such an outcome supports recent efforts to target investments directly to improving the livelihoods of the rural poor in remote and fragile environments (World Bank 2008). For example, in Ecuador, Madagascar and Cambodia poverty maps have been developed to target public investments to geographically defined sub-groups of the population according to their relative poverty status, which could substantially improve the performance of the programs in term of poverty alleviation (Elbers et al. 2007). A World Bank study that examined 122 targeted programs in 48 developing countries confirms their effectiveness in reducing poverty, if they are designed properly (Coady et al. 2004). A review of poverty alleviation programs in China, Indonesia, Mexico and Vietnam also finds evidence of “the value in specifically targeting spatially disadvantaged areas and households”, although the benefits are larger when programs, such as PROGRESA in Mexico, were successful in employing second-round targeting to identify households in poor locations and thus reducing leakages to non-poor households (Higgins et al. 2010, p. 20).

Appropriate targeting of research, extension and agricultural development has been shown to improve the livelihoods of the poor, increase employment opportunities and even reduce environmental degradation (Barbier 2005 and 2010; Carr 2009; Caviglia-Harris and Harris 2008; Coxhead et al. 2002; Dercon et al. 2009; Maertens et al. 2006). Empirical evidence of technical change, increased public investments and improved extension services in remote regions indicates that any resulting land improvements that do increase the value of homesteads can have a positive effect on both land rents and reducing agricultural expansion (Bellon et al. 2005; Coxhead et al. 2002; Dercon et al. 2009; Dillon et al. 2011; Maertens et al. 2006; Sills and Caviglia-Harris 2008).

Improving market integration for the rural poor may also depend on targeted investments in a range of public services and infrastructure in remote and ecologically fragile regions, such as extension services, roads, communications, protection of property, marketing services and other strategies to improve smallholder accessibility to larger markets (Barrett 2008; World Bank 2008). For example, for poor households in remote areas of a wide range of developing countries, the combination of targeting agricultural research and extension services to poor farmers combined with investments in rural road infrastructure to improve market access appears to generate positive development and poverty alleviation benefits (Ansoms and McKay 2010; Bellon et al. 2005; Cunguara and Damhofer 2011; Dercon et al. 2009; Dillon et al. 2011; Müller and Zeller 2002; Pattanayak et al. 2003;Yamano and Kijima 2010). In Mexico, poverty mapping was found to enhance the targeting of maize crop breeding efforts to poor rural communities in less favorable and remote areas (Bellon et al. 2005). In the Central Highlands of Vietnam, the introduction of fertilizer, improved access to rural roads and markets, and expansion of irrigation increased dramatically the agricultural productivity and incomes (Müller and Zeller 2002).

# **Conclusion**

The recent focus on structural transformation of developing economies has largely emphasized policies that promote growth of industries and highly commercialized agricultural and service activities (Lin 2011; McMillan and Rodrik 2011; Ocampo et al. 2009; Rodrik 2007 and 2010). This paper has attempted to show that, even if the modern sector is the source of dynamic growth through learning-by-doing and knowledge spillovers, the pattern of labor, land and natural resource use in the rural economy matters to the overall dynamics of structural 20