INTRODUCTION
Rural-urban migration is of specific concern in Developing Countries and particularly in the still chiefly agrarian Sub-Saharan African countries where the migration of hundreds of millions of rural people to cities is creating the social, economic, and political problems of major significance (Nanavati, 2004). For many years, the economic development literature has viewed rural-urban migration favourably, but today it is also recognised that the phenomenon should go with suitable policy interventions particularly in rural areas.
The theoretical debate and its consequent policy recommendations can be articulated in four types of contributions.
The first category (type of contributions) refers to the dual economy models which emerged in the 1950s and 1960s and to the theoretical works of Lewis (1954) and Fai and Ranis (1961). They focus on the initial stage of development of an intensive agricultural economy and consider internal migration as a desirable phenomenon in the light of the assumed lack of capital and abundance of labour in agriculture (zero marginal productivity hypothesis): surplus of agricultural labour gradually withdraws from the rural sector to provide needed manpower for urban industrial growth process. In this context, there are at least two policy implications: governments should facilitate rural-urban migration and investment in industrial sector to favour economic take-off.
However, migration remains a major factor contributing to the phenomenon of urban surplus labour, exacerbating urban unemployment problems often brought about by the growing economic and structural imbalances between urban and rural areas. In this context, in the second group of theoretical analysis, that covers the models developed in the 1970s and 1980s and is referred to the Harris and Todaro framework, the focal point is the understanding of the reasons of urban unemployment and its link with rural out migration. The policy recommendations aimed at drive to a greater aggregate welfare suggested by these contributions are articulated around tow kind of interventions: migration flows restrictions and wage subsidies.
In the Harris and Todaro (1970) theoretical approach urban wage subsidies should be combined with restricting rural out migration in excess to urban labour market demand. This should not only prevent unemployment but also it should increase rural output without diminishing production in urban areas. Behind this core recommendations, Harris and Todaro recognise the need for a substantial compensation to rural areas. On the aspect, the contributions of Bhagwati and Srinivasan (1974) and Basu (1980) suggest the importance of setting an optimal uniform wage subsidy to both urban and rural sector to reach the target of reduction in urban unemployment and rural-urban migration flows. The importance of a specific policy interest in rural labour market is also emphasised by Field (2005) that within a Todarian framework. He concludes that interventions aimed at job creation in rural areas should have a positive implication also on inequality.
The current debate is articulate around two types of contributions mainly stimulated by the New Economics of Labour Migration. On the one side, there are those focused on the understanding of who, when and how to migrate (Bhattacharya, 1990; Carringlon, Detragiache, Vishwanath, 1996; Harris, Sabot, 1992; Katz, Stark, 1984; 1986a; 1986b; 1987; Ortega, 2000; Stark, 1984; Vishwanath, 1991). In these frameworks the role of governments is to support rural-urban migration increasing the efficiency of job matches through the improvement of imperfect information of migrants.
The second direction of the current debate emphasises the potentially positive link between internal migration and rural development (Katz, Stark, 1986a; Stark, Levhari, 1992; Stark, Lucas, 1988). In this context, remittances sent to rural areas have a key role as a source of escaping poverty in combination with specific policies aimed at optimising the migration-rural development nexus. The policy recommendations cover a wide variety of interventions from the support to rural remittances allocation by recipients to specific actions in favour of poor rural families without migrant members. In this direction there is a renew interest in agriculture as an engine of growth particularly in Sub-Saharan Africa where a specific attention is given the improvement in sector productivity.
Rural-urban migration is an inevitable component of the development process, and it has to be managed with the right mix of policies in order to avoid its adverse impacts. This is a key issue because urban migration is also an inevitable consequence of both asymmetric policies and economic development favouring urban areas and it is responsibility of government to reduce this disequilibrium. In this respect rural development policies aimed at creating more employment and income in rural areas are receiving greater emphasis and despite the situation varies depending on the country, agricultural development can be a positive factor in a country that is heavily dependent on inputs from rural areas. In most cases, rural development means increasing agricultural productivity which translates into income gains, inducing rural farmers toremain on farms. Furthermore, fewer policies benefit the poor, one of the main goals of development policies, more than those that directly or indirectly increase the incomes of rural areas (McCatty, 2004).
In the light of these considerations, the paper is aimed at assessing the impact of rural-urban migration on economic development and poverty in Kenya and the role of the technical efficiency change in agriculture.
Kenya provides a natural experiment to study rural-urban migration because rural migrants constitute a significant proportion of urban labour force, about 70 per cent. Furthermore, over time the phenomenon has been object of specific policy interventions mainly of Todarian nature. There has been the introduction of migration flows restrictions and urban wage subsidies and a very little attention has been devoted to rural areas. More recently, with the Poverty Reduction Strategy Paper and the commitment of the country on the MDGs, there has been a change of focus: agriculture is seen as the “growth sector” and it has been underlined the need for specific policies particularly aimed at increasing agricultural productivity. This explains the interest in simulation a technological efficiency change in agriculture with the understanding of the implications of rural-urban migration on poverty and growth.
The empirical analysis has made reference to a Computable General Equilibrium approach because as underlined by the recent theoretical literature on migration there is the need for understanding how a set of policies affects income, output and employment in both urban and rural areas and sectors simultaneously.
RURAL-URBAN MIGRATION AND POVERTY IN KENYA
Before European colonization, Kenya was mainly a rural nation except for a few villages or towns along the coast, such as Malindi, Mombasa and Lamu, mainly from Arab traders and fishermen (Obudbo, 1983). Urbanization pattern in Kenya during the colonial period was the genesis of the first flows of migration predominantly of rural-urban nature.
Urbanization in Kenya was a result of imperial capitalism that after the industrial revolution was in need of raw materials and new markets. In order to exploit raw materials in the country and particularly in Uganda, the Imperial companies realized the so called “Uganda Railway” from Mombasa, the enter-port city, to Kampala (Macharia, 2003). The line reached Kisumu in 1901 and the main part was extended from Nakuru towards Uganda getting to Kampala in 1931 (Miller, 1977). The railway become the node on which the future urban centres (first level urban centres) grow particularly Nairobi that become the central workshop for the railway engineers and their sleeping quarters and give rise to the “primate city phenomenon” in Kenya (Macharia, 2003). Later on, other towns were established by Europeans as administrative centres (second level urban centres) in order to increase their influence power and control the country (Encyclopedia Britannica, 2007).
During the colonial period the towns were, therefore, viewed as exclusive residence for Europeans and had little or no direct relevance to the indigenous population (O’Connor, 1983). The colonial settler economy developed only areas that were of interest of them promoting an uneven development (mainly concentrated in the first and second level cities) whose result was an uneven migration (primarily in those cities where job opportunities were to grow) that, in turn, contributed to further uneven development (Macharia, 2003).
The administrative centres become strategic for controlling the labour market, which was a primary target of the colonial system in Kenya in order to maintain the “Europeanness” of the cities (Kenyatta, 1971; Kitching, 1980). In Kenya primary aims of manpower development were attracting and maintaining sufficient quantity of workers for the colonial labour force: a workforce not associated with local African development but colonial enterprises, industries, farms and coastal plantations (Cummings, 1985).
Cheap labour practices, employment on temporary basis, deterrents for African men to bring their wives and children to live with them in towns and control of entry in the urban labour market were the main features of the labour practices that resulted racially discriminatory against women[1], restrictive and control oriented (Macharia, 2003; Stern, 1978).
“To ensure that the Africans could be recruited and paid at the mercy of the European employers, the colonial administration introduces taxes that could only be paid by cash money. This was the ensure a constant supply of labour for, inevitably, most Africans had to work for European employers in order to pay their taxes. Unskilled labour in the urban areas was typical of most urban employees” (Macharia, 2003).
During the post-colonial period, three phases can be distinguished that correspond to the leadership on power, Kenyatta presidency (1963-1978), Moi presidency (1978-2002) and Kibaki presidency (from 2002). the first post-colonial period can be articulated in two sub-phases.
Once attained political independence in 1963, the most important change that took place in Kenya was the relaxation of the restrictive colonial rules governing population mobility. Without the introduction of any institutional change, urban areas continued to be the “place of hope” particularly for formal employment, thus rural-urban migration increased strongly, contributing significantly to the phenomenon of a “boom urbanization”[2].
According to the census, during the first decade after independence, the annual rate of growth was more then 7 percent. As a result, towns were getting overcrowded, housing was a problem as well as high unemployment rates.
Despite this negative impact in a first phase the government did not introduce any specific measure to stop the flow towards cities. The reason mainly lays in the causes at the basis of the struggle for independence, that is the “perceived socio-economic and regional disparities and the authoritarian policies leading to the expropriation of the productive land. Independence leaders could not, therefore, renege on their promise to deliver the goods to African population by thwarting rural-urban migration” (Macoloo, 1998).
In a second phase of the Kenyatta presidency, from 1973 to 1978, the impact of the continuous massive population flow towards urban areas on the unbalance growth spurred the government to introduce specific policies aimed at decentralising urban growth and including two main interventions: the creation of a network of service centres as alternative to the main cities and the introduction of rural development programmes. These latter were intended to make rural areas equally attractive as locations of residence so as to reduce rural-urban migration (Macoloo, 1988). Of specific importance is the policy of “Back to Land” and the realization of certain public services like district administration, schools and hospitals and in 1983 the District Focus for Rural Development strategy with the major aim of decentralizing decision making on development projects. These interventions have very little impact on rural-urban migration due to several reasons. Among them, there is the fact that government was unable to ensure that new investment took place in rural areas, introduced a policy of minimum wage that discriminates against rural workers, did not realize suitable infrastructure for attracting investment and skilled workers, and underestimated the numbers of Kenyans available to return to rural area that exceeded the predicted in the agricultural settlement schemes. Furthermore, the education system in the post independence era continued to emphasise on career prospects in the white-collar jobs increasing the expectation for employment in service or industry sector in towns.
Under Moi presidency the net migration flow to cities intensified. Since the 1980s, the economy has performed below its potential, with low economic and employment growth and decline in productivity. As a result the standard of living has suffered. Per capita income, in constant 1982 prices, declined from US$ 271 in 1990 to US$ 239 in 2002, the unemployed reached 14.6 percent of the labour force, the number of “working poor” has increased with a rise in the proportion of population living in poverty from 48.8 percent in 1990 to 54.4 percent in 2001. The factors underlining this situation are both domestic and external. Among the former there are the persistence of pervasive governance failures[3], the slow pace of economic reforms, the cut of a lot of public programs due to the introduction of Structural Adjustment Programs, low savings and investment, intermittent shortages and high costs of power, and poor infrastructure (IMF, 2005).
The deterioration of international economic conditions, primarily the oil crisis, the reduction in price of agricultural row material and terrorism alert also affected negatively the socio-economic situation of the country. In this context, rural-urban migration intensified, sustained by the “false hope” of starting a business in urban areas. This flow strongly contributed to urbanization, unemployment and poverty.
The third post-colonial period reflects the international commitment to poverty reduction and the Millennium Development Goals (MDGs) achievement.
The adoption of the Poverty Reduction Strategy Paper contributed to bring about the release in May 2004 of the Economic Recovery Strategy for Wealth and Employment Creation 2003-2007 that was considered the major economic policy document for the new administration (Government of Kenya, 2003). It consists in a multi-faced strategy aimed at meeting economic growth, equity and poverty reduction, and governance enhancement objectives (IMF, 2005). In this context, agriculture and tourism are understood as the main source of recovery early on, while manufacturing, export-oriented agriculture and service sectors are projected to add to sustain economic growth over the medium term (Government of Kenya, 2000).
The commitment of the country to achieving the MDGs reinforced this strategy clarifying the need for development and equity (Government of Kenya, Government of Finland, 2005). The challenge of Kenyan government is twofold, to increase the economic growth rate because this reduces poverty, but also to do so in manner that ensures that the poor gain more than proportionally from economic growth. Also in this context, agriculture is confirmed as key sector for country’s economic recovery (Donor Consultative Group, 2003).