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The economic and social characteristics of rural Thailand improved dramatically between 1987 and 2004, according to a recent analysis.

In 2004, two researchers gathered data from two different provinces in rural Thailand—one in the Central Plains and the other in the Northeast—in order to make comparisons with 1987 findings from the same two areas. The Central Thailand province surveyed, Suphan Buri, is in the low, fertile, rice-growing plains about 100 km from Bangkok, while the other, Kyon Kaen province in the Northeast, is not as productive due to its poorer soils and less abundant rainfall.

The authors of the article make many interesting observations based on their data. Perhaps most significantly, the size of rural households in both provinces has declined noticeably, primarily because the number of children per household has dropped. During the period 1980 – 1985, the Thai population grew at a rate of 1.9 percent annually; from 1995 – 2000, the rate of increase had dropped to 0.8 percent annually. Both rural and urban areas of Thailand have been able to control their population growth.

The authors found that rural households are making more investments in schooling for their children. In 1987, children on average had attained a schooling level of 5.7 years. By 2004 that figure had jumped to 9.0 years. In 1987, 3 percent of the working members of rural households had graduated from upper secondary school or above; by 2004 that number had increased to 11 percent. One of the factors that may have helped children to achieve more education is the better condition of rural roads.

Several other factors are also influencing rural Thailand. Average farm size has decreased over the 17 year period. Many farmers have reduced the areas they cultivate (though some farms have significantly increased in size). The decreases in farm size are accompanied by less farm income, though the decline has been counterbalanced, to some extent, by increased income due to non-farming enterprises, which often are more profitable. The general decrease in sizes of farms is particularly noticeable in villages where rainfall is not as favorable. Many of the farmers who are less favored by rainfall have incurred too much debt. As a result, some of them have had to sell their farms to business people from Bangkok.

As rural residents migrate to cities to seek employment, many farms are being rented out to larger farming operations. In two of the sample villages of Suphan Buri province, near Bangkok, the farm size has increased due to this consolidation. In 1987, 77 percent of the farms in these villages were cultivated by the owners, while in 2004 that number had dropped to 53 percent. There are more owner-operated farms and fewer absentee landlords in the Northeast villages than in the Central Plains.

The actual rice production technology has also changed during the 17 year period. In 1987, 23 percent of the farms were planted to modern varieties of rice, a number that increased to 76 percent in 2004. The growth has been due to increased availability of irrigation, through either new pumps or other means of bringing water to rice fields. In one village in the Northeast, none of their rice was of the modern variety in 1987, while 17 years later 78 percent of the rice they produced was modern.

Predictably, intensive mechanization of farm work has accompanied these changes in agricultural production. Nearly 100 percent of the farmers use riding tractors now, and large mechanical threshers and combine harvesters are increasingly available, even in the poorer Northeast region. In the Central Plain, combine harvesters have replaced threshing machines. Rental services of this machinery have become competitive and charges have fallen.

As rural families spend less time on the production of rice, the share of rural income derived from non-farm work has risen. In the villages where agriculture is less favorable, non-farm income, including remittances from family members working in the cities, has risen to about 70 percent of the total rural income. In the villages located in the best farming areas, however, non-farm income was still, in 2004, only 35 percent of total family income.

The authors analyze the extent of poverty in both the Central Plains and the Northeast in 1987 and 2004. They conclude that, overall, the depth and severity of poverty have declined in all the study villages. While the incidence of poverty is lower in the Central Plains than in the Northeast, the rate of decline is also lower in the Central Plains. Not surprisingly, the villages with less favorable farming conditions have more poverty. Even though non-farm income has become more important in the drought-prone Northeast, there is still more poverty in that region.

The authors conclude that the increased amount of schooling appears to be a vital element in fostering the progress of rural Thailand out of poverty. “The quality of human capital captured by the proportion of working members graduating from higher education has significant and increasingly larger impacts on nonfarm income as well as on total household income,” they write (p.423).

Cherdchuchai, Supattra and Keijiro Otsuka. 2006. “Rural Income Dynamics and Poverty Reduction in Thai Villages from 1987 to 2004.” Agricultural Economics 35, suppl.: 409-423