Commercializing small farms: reducing transaction cost

Pingali, Prabhu; Khwaja, Yasmeen; Meijer, Madelon

doi:10.22004/ag.econ.289070

Cited by 19 publications

(1 citation statement)

References 38 publications

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“…As shown in Table 6, the heterogeneity analysis reveals that cluster farming improves commercialization outcomes for all crops, albeit to varying degrees. Our findings are consistent with other studies in developing countries that argue that agricultural commercialization is not limited to cash crops since staple food crops can also be marketed (Pingali et al, 2005;Gebre-ab, 2006;Alemu et al, 2006;Gidelew et al, 2022). According to these studies, the production of a marketable surplus of staple foods over what is needed for one's own consumption is the most common form of commercialization.…”

Section: Results On the Effect Of Heterogeneitysupporting

confidence: 91%

The new normal? Cluster farming and smallholder commercialization in Ethiopia

Dureti

Tabe‐Ojong²,

Owusu‐Sekyere

2023

Agricultural Economics

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Cluster farming is increasingly recognized as a viable means of improving smallholder economic integration and commercialization in many developing countries. However, little is known about its impact on smallholder welfare and livelihoods. We examine the relationship between cluster farming and smallholder commercialization using a large‐scale survey of 3969 farm households in Ethiopia cultivating high‐acreage crops such as teff, wheat, maize, barley, and sesame. Using switching regressions and instrumental variable estimators, we show that cluster farming is associated with commercialization measured as commercialization index, market surplus value, and market price. To further deal with endogeneity concerns, we also employ some pseudo‐panel models where we observe similar insights. Beyond this, we account for heterogeneities by disaggregating households based on farm scales and crops cultivated. Our findings show that cluster farming is positively associated with commercialization for all farms and crop types despite this disaggregation. However, the related gains are higher among medium and large farms and vary per crop type. These findings imply that cluster farming is crucial in improving smallholder commercialization and may be a critical entry and leveraging point for policy. We thus lend support to initiatives and plans that seek to upscale cluster farming as they can potentially improve smallholder commercialization with ensuing impacts on rural livelihoods and welfare.

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Section: Results On the Effect Of Heterogeneitysupporting

confidence: 91%

The new normal? Cluster farming and smallholder commercialization in Ethiopia

Dureti

Tabe‐Ojong²,

Owusu‐Sekyere

2023

Agricultural Economics

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PAPER ADAPTED FROM PRESENTATION AT INTERNATIONAL WORKSHOP ON INCREASING WHEAT YIELD POTENTIAL, CIMMYT, OBREGON, MEXICO, 20–24 MARCH 2006 U-impact pathway for diagnosis and impact assessment of crop improvement

et al. 2007

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Agricultural research has contributed enormously to poverty reduction and increased food security worldwide. Wheat crop improvement is a good example of this contribution. Public investments in wheat research from the Green Revolution onwards led to significant productivity increases: following the widespread adoption of semi-dwarf varieties, annual yield growth rates peaked at 2·75% p.a. in the 1980s. Since then, public and private investments in crop (including wheat) research have been modest despite the potential of such research to contribute substantially to the first Millennium Development Goal (MDG) of halving hunger and poverty by 2015. Drawing on a wide spectrum of recent literature, the present paper broadens the usual frame of reference for diagnosing the adoption of improved technology and measuring impact. The adoption of improved varieties and management practices is influenced on the supply side by the nature and performance of the input delivery pathway from research to the farm (input value chains), and on the demand side by the characteristics of the farm household system and the marketing or value-adding chains from the farm to the consumer (output value chains). These three elements (input value chains, farm household system characteristics, and output value chains) can be viewed as a U-impact pathway. This pathway determines the rate and extent of adoption of improved varieties and practices, the magnitude of direct and indirect impacts, and the potential for feedback loops leading to improved functioning of the input and output value chains. The U-impact pathway provides a framework to identify an expanded set of beneficiaries from crop improvement which extend beyond the common focus on producers and final consumers; conventional surplus analysis can then be used to estimate the wider benefits to crop improvement. Additional metrics may be needed to estimate impact related to non-economic benefits, such as poverty, health and social capital. The implication of this fuller accounting of impacts is that the benefits accruing to agricultural research may be greater, and more widely distributed across the economy, than previously recognized by research managers and policy-makers. This strengthens the case for maintained or increased public and private sector investment in crop improvement.

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Leaving the Household Out of Family Labour? The Implications for the Size–Efficiency Debate

Johnston

Roux

2007

Eur J Dev Res

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The debate about the inverse relationship between farm size and productivity has rarely focused on the issue of family labour. We argue that theory about the relative efficiency of such labour is based on simplistic assumptions about its supervisional advantages given a coalescence of intra-household incentives. These assumptions do not take account of the literature on household decision making, which suggests that the incentives of family labour may be far more complex. Nor does it consider the literature on farmworker productivity, which suggests a wider set of factors might lead to efficiency differences between family labour and hired labour. We end by considering the implications of these issues for the literature on farm productivity and on land redistribution. Le d�bat sur la relation inverse entre la taille et le rendement d'une exploitation agricole s'est rarement int�ress� � la main d'oeuvre familiale. Nous soutenons que la th�orie sur l'efficacit� relative de cette main d'oeuvre est fond�e sur des hypoth�ses simplistes quant aux avantages en mati�re de supervision � utiliser la main-d'oeuvre familiale eu �gard � une combinaison d'incitations intrafamiliales. Ces hypoth�ses ne prennent pas en compte la litt�rature sur la prise de d�cision au sein des m�nages qui sugg�re qu'un �ventail plus complexe de facteurs d�termine les incitations de la main-d'oeuvre familiale. Le d�bat ne s'int�resse pas non plus � la litt�rature sur la productivit� des exploitations agricoles qui sugg�re que les �carts de rendement entre main-d'oeuvre familiale et main-d'oeuvre salari�e sont la cons�quence d'un �ventail de facteurs nettement plus large. Nous terminons en consid�rant les implications de ces discussions pour la litt�rature sur la productivit� des exploitations agricoles et sur la redistribution des terres.

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Commercializing small farms: reducing transaction cost

Cited by 19 publications

References 38 publications

The new normal? Cluster farming and smallholder commercialization in Ethiopia

The new normal? Cluster farming and smallholder commercialization in Ethiopia

PAPER ADAPTED FROM PRESENTATION AT INTERNATIONAL WORKSHOP ON INCREASING WHEAT YIELD POTENTIAL, CIMMYT, OBREGON, MEXICO, 20–24 MARCH 2006 U-impact pathway for diagnosis and impact assessment of crop improvement

Leaving the Household Out of Family Labour? The Implications for the Size–Efficiency Debate

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