Smallholder Participation in the Commercialisation of Vegetables: Evidence from Kenyan Panel Data

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in AbstractThis paper describes the participation of smallholders in commercial horticultural farming in Kenya and identifies constraints and critical factors that influence their decision to participate in this industry by selling their produce. The study employs panel survey data on smallholder producers of both international (export) and domestic market vegetables and controls for unobserved heterogeneity across farmers. We find that participation of smallholders in both the domestic and export vegetable markets declined and that this trend is associated with weather risks, high costs of inputs and unskilled labour, and erratic vegetable prices, especially in the international market. Different factors are at play in determining a household's market choice for the commercialisation of vegetables: credit is important only when vegetables are (also) exported, livestock ownership is negatively related to production for the domestic market, and distance to the nearest market town positively related to all pathways of commercialisation, for example.

Drivers of farm commercialization in Nigeria and Tanzania

“…(2016) documented a significant rise in medium‐scale farms in SSA and their role in driving technological change and commercialization in African agriculture. Moreover, while the present article estimates a negative correlation between market participation and age and higher education completed (secondary) by household heads, a similar adverse effect of age and education on the market participation of smallholder vegetable farmers in Kenya has been documented by Muriithi and Matz (2014), the latter though not statistically significant.…”

“…It, however, differs from previous studies in several respects. Unlike Muriithi and Matz (2014), Mmbando et al. (2015), and Awotide et al.…”

“…According to the literature, market participation and the extent of participation can be modeled as a two‐step decision process (see, for example, Awotide et al., 2016; Goetz, 1992; Heltberg & Tarp, 2002; Muriithi & Matz, 2014; Mmbando et al., 2015; Olwande et al., 2011). The first stage involves a decision to participate in the market or not.…”

“…The choice of variables included in the model is guided by empirical considerations (Awotide et al., 2016; Ebata et al., 2017; Goetz, 1992; Muriithi & Matz, 2014; Mmbando et al., 2015; Olwande et al., 2011; Randela et al., 2008). The literature identifies household demographic characteristics, human capital, physical resource endowments, transaction costs, social capital, and agro‐ecological potential as the key determinants of commercialization/market participation.…”

Do Firm and Entrepreneur Characteristics Play a Role in SMEs’ Sustainable Growth in a Middle-Income Economy like Côte d’Ivoire?

“…In Nigeria, almost all owner-managers set up and finance their businesses from their personal savings, and this has been directly affecting the performance of their enterprises [64]. A study by Muriithi and Matz [65] on 309 companies in Kenya yielded contradictory results that the sources of finance do not affect the financial performance of the companies in Kenya. Based on these discussions, Hypothesis 6 (see H6 in Table 1) was formulated for this study.…”