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Does Large Farm Establishment Create Benefits for Neighboring Smallholders? Evidence from Ethiopia

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  • Daniel Ali
  • Klaus Deininger
  • Anthony Harris

Abstract

Large-scale agricultural investment has expanded rapidly over the past decade, justified partly by the expectation that established smallholders will benefit from positive spillovers. We estimate spillovers between large and small farms in Ethiopia, using variation over time in proximity or intensity of exposure to large farms. We find that between 2004 and 2014, establishing commercial farms did not lead to job creation and provided only modest benefits in terms of technology, input market access, and resilience to crop shocks. This suggests that in Ethiopia a more strategic approach may be needed to maximize benefits from large farm formation for smallholders.

Suggested Citation

  • Daniel Ali & Klaus Deininger & Anthony Harris, 2019. "Does Large Farm Establishment Create Benefits for Neighboring Smallholders? Evidence from Ethiopia," Land Economics, University of Wisconsin Press, vol. 95(1), pages 71-90.
    • Handle: RePEc:uwp:landec:v:95:y:2019:i:1:p:71-90
    Note: DOI: 10.3368/le.95.1.71
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    Cited by:

    1. Liao, Chuan & Jung, Suhyun & Brown, Daniel G. & Agrawal, Arun, 2024. "Does land tenure change accelerate deforestation? A matching-based four-country comparison," Ecological Economics, Elsevier, vol. 215(C).
    2. Edobor, Edeoba W., 2022. "Assessing the Role of Estates on Smallholder Household Labor Allocation in Sub-Saharan Africa: A Case Study of Malawi," 2022 Annual Meeting, July 31-August 2, Anaheim, California 322345, Agricultural and Applied Economics Association.
    3. Ali, Daniel Ayalew & Deininger, Klaus, 2021. "Does title increase large farm productivity? Institutional determinants of large land-based investments' performance in Zambia," 2021 Conference, August 17-31, 2021, Virtual 315328, International Association of Agricultural Economists.
    4. Kate Vaiknoras & Catherine Larochelle, 2023. "Training and seed production spillovers and technology adoption: The case of seed producer groups in Nepal," Agricultural Economics, International Association of Agricultural Economists, vol. 54(6), pages 921-942, November.
    5. Ali, Daniel Ayalew & Deininger, Klaus, 2022. "Institutional determinants of large land-based investments’ performance in Zambia: Does title enhance productivity and structural transformation?," World Development, Elsevier, vol. 157(C).
    6. Carletto,Calogero & Dillon,Andrew S. & Zezza,Alberto, 2021. "Agricultural Data Collection to Minimize Measurement Error and Maximize Coverage," Policy Research Working Paper Series 9745, The World Bank.
    7. Álvarez, Inmaculada C. & Orea, Luis & Perez-Mendez, Jose A., 2019. "Rural and agricultural development by land consolidation: a spatial production analysis of Asturias´ parishes," Efficiency Series Papers 2019/04, University of Oviedo, Department of Economics, Oviedo Efficiency Group (OEG).
    8. Lay, Jann & Nolte, Kerstin & Sipangule, Kacana, 2021. "Large-scale farms in Zambia: Locational patterns and spillovers to smallholder agriculture," World Development, Elsevier, vol. 140(C).
    9. Wen Xiang & Jianzhong Gao, 2023. "From Agricultural Green Production to Farmers’ Happiness: A Case Study of Kiwi Growers in China," IJERPH, MDPI, vol. 20(4), pages 1-25, February.
    10. Liverpool-Tasie, Saweda & Nuhu, Ahmed Salim & Awokuse, Titus O. & Jayne, Thomas S. & Muyanga, Milu & Aromolaran, Adebayo & Adelaja, Adesoji, 2020. "Spillover effects of Medium-Scale Farms on Smallholder Behavior and Welfare: Evidence from Nigeria," 2020 Annual Meeting, July 26-28, Kansas City, Missouri 304606, Agricultural and Applied Economics Association.
    11. Lenis Saweda O. Liverpool‐Tasie & Ahmed Salim Nuhu & Titus Awokuse & Thomas Jayne & Milu Muyanga & Adebayo Aromolaran & Adesoji Adelaja, 2023. "Can medium‐scale farms support smallholder commercialisation and improve welfare? Evidence from Nigeria," Journal of Agricultural Economics, Wiley Blackwell, vol. 74(1), pages 48-74, February.
    12. Abeygunawardane, Dilini & Kronenburg García, Angela & Sun, Zhanli & Müller, Daniel & Sitoe, Almeida & Meyfroidt, Patrick, 2022. "Resource frontiers and agglomeration economies: The varied logics of transnational land-based investing in Southern and Eastern Africa," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 51(6), pages 1535-1551.
    13. Wegenast, Tim & Richetta, Cécile & Krauser, Mario & Leibik, Alexander, 2022. "Grabbed trust? The impact of large-scale land acquisitions on social trust in Africa," World Development, Elsevier, vol. 159(C).
    14. Ruml, Anette & Chrisendo, Daniel & Iddrisu, Abdul Malik & Karakara, Alhassan A. & Nuryartono, Nunung & Osabuohien, Evans & Lay, Jann, 2022. "Smallholders in agro-industrial production: Lessons for rural development from a comparative analysis of Ghana’s and Indonesia’s oil palm sectors," Land Use Policy, Elsevier, vol. 119(C).
    15. Deininger, Klaus W. & Ali, Daniel Ayalew & Neyter, Roman, 2023. "Impacts of a mandatory shift to decentralized online auctions on revenue from public land leases in Ukraine," Journal of Economic Behavior & Organization, Elsevier, vol. 213(C), pages 432-450.
    16. Ayala Wineman & Thomas S. Jayne & Emma Isinika Modamba & Holger Kray, 2021. "Characteristics and Spillover Effects of Medium-Scale Farms in Tanzania," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 33(6), pages 1877-1898, December.

    More about this item

    JEL classification:

    • Q18 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Policy; Food Policy; Animal Welfare Policy
    • Q24 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Land

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