Agrarian transformation receives considerable attention in the literature on social and economic change in the developing nations of the world. Socio-economic differentiation of the peasantry is poorly understood at the household or village level, particularly with respect to household strategies of petty enterprise and labor mobility. This project will investigate social and economic differentiation of the peasantry in the context of the Indonesian Transmigration program. Under this program, poor, landless households in Java and Bali are recruited to move to the outer islands to new settlements where they receive land, allowances and training in agriculture. This attempt to cope with population growth and deforestation of the inner islands is seen by other nations as a possible solution to problems of overpopulation and its associated problems. Little is known about the impact of this resettlement scheme on the transmigrants, particularly their economic behavior and its effect on the household. This pilot project will employ surveys, in-depth interviews, and focus groups to examine the process of socio-economic differentiation at the regional and household level in selected areas involved in the transmigration program in Indonesia. Traditional agriculture continues to dominate the peasant economies of most developing parts of the world. In many areas, economic development has contributed to the commercialization of rural economies, leading to profound social and economic changes which threaten the viability of peasant economies. This project will provide new knowledge about how differentiation proceeds as a result of government sponsored migration. It will also refine a methodology for doing research in newly settled areas which are undergoing rapid socio-economic change. The results of this research will inform not only theory but also policy regarding an important regional development strategy.