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Contract farming and rural transformation : evidence from a field experiment in Benin

Author: Aminou Arouna; Jeffrey D Michler; Jourdain C Lokossou; National Bureau of Economic Research,
Publisher: Cambridge, Mass. : National Bureau of Economic Research, 2019.
Series: Working paper series (National Bureau of Economic Research), no. 25665.
Edition/Format:   eBook : Document : EnglishView all editions and formats
Summary:
In recent decades contract farming has emerged as a popular mechanism to encourage vertical coordination in developing country agriculture. The goal of such coordination is to better integrate smallholder farmers into the modern agricultural food system, fostering rural transformation. We use panel data from a randomized control trial to quantify the impact of different contract attributes on rural transformation  Read more...
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Material Type: Document, Internet resource
Document Type: Internet Resource, Computer File
All Authors / Contributors: Aminou Arouna; Jeffrey D Michler; Jourdain C Lokossou; National Bureau of Economic Research,
OCLC Number: 1090239311
Notes: "March 2019"
Description: 1 online resource (52 pages) : illustrations.
Series Title: Working paper series (National Bureau of Economic Research), no. 25665.
Responsibility: Aminou Arouna, Jeffrey D. Michler, Jourdain C. Lokossou.

Abstract:

In recent decades contract farming has emerged as a popular mechanism to encourage vertical coordination in developing country agriculture. The goal of such coordination is to better integrate smallholder farmers into the modern agricultural food system, fostering rural transformation. We use panel data from a randomized control trial to quantify the impact of different contract attributes on rural transformation and welfare of smallholder rice farmers in Benin. We vary the terms of contract, with some farmers being offered a contract that only guarantees a price, while other contracts add extension training or input loans. While all three types of contracts had positive and significant effects, we find that contracts which only included an agreement on price had nearly as large of an impact as did contracts with additional attributes. This suggests that once price uncertainty is resolved, farmers are able to address other constraints on their own.

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