IDEAS home Printed from https://ideas.repec.org/a/ags/jordng/174481.html
   My bibliography  Save this article

Effects of Crop Commercial Orientation on Productivity of Smallholder Farmers in Drought-prone Areas of the Central Rift Valley of Ethiopia

Author

Listed:
  • Bekele, Adam
  • Belay, Kassa
  • Legesse, Belaineh
  • Lemma, Tesfaye

Abstract

This paper examines the tradeoff between commercial orientation and crop productivity among smallholder farm households living in drought risk-prone areas of the central rift valley of Ethiopia. The study was built on the hypothesis that there is a one-way causation between commercial orientation and productivity. The relationship between commercial orientation and crop productivity is assessed in a censored simultaneous equation model framework. Results indicate that there is a unidirectional relationship with total factor productivity being influenced by the endogenous commercial orientation factor. The influence of commercial orientation is expounded with the addition of farm and non-farm characteristics. Thus, in priority order, number of non-oxen livestock, commercial orientation, agricultural credit and sex have been important factors positively influencing productivity whereas labor availability for farming, distance and off-farm wage labor employment have been working against increased productivity of the smallholder farm households. However, it was observed that with a shift from commercial orientation criteria to unrestricted level of market participation in crop sales, the type, magnitude and direction of determinant factors have increased emphasizing the seriousness of performance influencing factors along with market participation to the majority of the smallholder farmers. The findings suggest that programs targeted at improving market access have the potential to increase agricultural productivity.

Suggested Citation

  • Bekele, Adam & Belay, Kassa & Legesse, Belaineh & Lemma, Tesfaye, 2010. "Effects of Crop Commercial Orientation on Productivity of Smallholder Farmers in Drought-prone Areas of the Central Rift Valley of Ethiopia," Journal of Rural Development/Nongchon-Gyeongje, Korea Rural Economic Institute, vol. 33(4), pages 1-24, October.
  • Handle: RePEc:ags:jordng:174481
    DOI: 10.22004/ag.econ.174481
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/174481/files/33_4_1.pdf
    Download Restriction: no

    File URL: https://libkey.io/10.22004/ag.econ.174481?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Hazell, Peter B. R. & Haddad, Lawrence James, 2001. "Agricultural research and poverty reduction," 2020 vision briefs 70, International Food Policy Research Institute (IFPRI).
    2. Joshua D. Angrist & Alan B. Krueger, 2001. "Instrumental Variables and the Search for Identification: From Supply and Demand to Natural Experiments," Journal of Economic Perspectives, American Economic Association, vol. 15(4), pages 69-85, Fall.
    3. Nigel Key & Elisabeth Sadoulet & Alain De Janvry, 2000. "Transactions Costs and Agricultural Household Supply Response," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 82(2), pages 245-259.
    4. Govereh, Jones & Jayne, T. S., 2003. "Cash cropping and food crop productivity: synergies or trade-offs?," Agricultural Economics, Blackwell, vol. 28(1), pages 39-50, January.
    5. Hazell, Peter, 2001. "Agriculture and the environment," Environment and Development Economics, Cambridge University Press, vol. 6(4), pages 503-531, October.
    6. Vella, Francis, 1993. "A Simple Estimator for Simultaneous Models with Censored Endogenous Regressors," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 34(2), pages 441-457, May.
    7. Marc F. Bellemare & Christopher B. Barrett, 2006. "An Ordered Tobit Model of Market Participation: Evidence from Kenya and Ethiopia," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 88(2), pages 324-337.
    8. Barrett, Christopher B., 1997. "Food marketing liberalization and trader entry: Evidence from Madagascar," World Development, Elsevier, vol. 25(5), pages 763-777, May.
    9. C. Peter Timmer, 1997. "Farmers and Markets: The Political Economy of New Paradigms," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 79(2), pages 621-627.
    10. Michael T. French & M. Christopher Roebuck & Pierre Kébreau Alexandre, 2001. "Illicit Drug Use, Employment, and Labor Force Participation," Southern Economic Journal, John Wiley & Sons, vol. 68(2), pages 349-368, October.
    11. Joshua Angrist & Alan Krueger, 2001. "Instrumental Variables and the Search for Identification: From Supply and Demand to Natural Experiments," Working Papers 834, Princeton University, Department of Economics, Industrial Relations Section..
    12. Bouis, Howarth E. & Haddad, Lawrence James, 1990. "Effects of agricultural commercialization on land tenure, household resource allocation, and nutrition in the Philippines:," Research reports 79, International Food Policy Research Institute (IFPRI).
    13. Strasberg, Paul J. & Jayne, Thomas S. & Yamano, Takashi & Nyoro, James K. & Karanja, Daniel David & Strauss, John, 1999. "Effects of Agricultural Commercialization on Food Crop Input Use and Productivity in Kenya," Food Security International Development Working Papers 54675, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    14. Gerald Shively & Monica Fisher, 2004. "Smallholder Labor and Deforestation: A Systems Approach," American Journal of Agricultural Economics, Agricultural and Applied Economics Association, vol. 86(5), pages 1361-1366.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Zhang, Jian & Mishra, Ashok K. & Hirsch, Stefan, 2021. "Market-oriented agriculture and farm performance: Evidence from rural China," Food Policy, Elsevier, vol. 100(C).
    2. Justus Ochieng & Beatrice Knerr & George Owuor & Emily Ouma, 2020. "Food crops commercialization and household livelihoods: Evidence from rural regions in Central Africa," Agribusiness, John Wiley & Sons, Ltd., vol. 36(2), pages 318-338, April.
    3. Kilimani, Nicholas & Buyinza, Faisal & Guloba, Madina, 2022. "Crop commercialization and nutrient intake among farming households in Uganda," Food Policy, Elsevier, vol. 113(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Rios, Ana R. & Masters, William A. & Shively, Gerald E., 2008. "Linkages between Market Participation and Productivity: Results from a Multi-Country Farm Household Sample," 2008 Annual Meeting, July 27-29, 2008, Orlando, Florida 6145, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    2. Rios, Ana R. & Shively, Gerald E. & Masters, William A., 2009. "Farm Productivity and Household Market Participation: Evidence from LSMS Data," 2009 Conference, August 16-22, 2009, Beijing, China 51031, International Association of Agricultural Economists.
    3. Tesfaye Woldeyohanes & Thomas Heckelei & Yves Surry, 2017. "Effect of off-farm income on smallholder commercialization: panel evidence from rural households in Ethiopia," Agricultural Economics, International Association of Agricultural Economists, vol. 48(2), pages 207-218, March.
    4. Barrett, Christopher B., 2008. "Smallholder market participation: Concepts and evidence from eastern and southern Africa," Food Policy, Elsevier, vol. 33(4), pages 299-317, August.
    5. Muricho, G. & Kulundu, D. & Sule, F., 2018. "Impact Assessment of Agricultural Commercialization on Food Security Among Smallholder Farmers in Kenya: An Application of Correlated Random Effects," 2018 Conference, July 28-August 2, 2018, Vancouver, British Columbia 277325, International Association of Agricultural Economists.
    6. Guilhem Bascle, 2008. "Controlling for endogeneity with instrumental variables in strategic management research," Post-Print hal-00576795, HAL.
    7. Gebremedhin, Berhanu & Jaleta, Moti, 2013. "Policy Imperatives of Commercial Transformation of Smallholders: Market Orientation Versus market Participation in Ethiopia," 2013 Fourth International Conference, September 22-25, 2013, Hammamet, Tunisia 160580, African Association of Agricultural Economists (AAAE).
    8. Erfan Rezvani & Christian Rojas, 2022. "Firm responsiveness to consumers' reviews: The effect on online reputation," Journal of Economics & Management Strategy, Wiley Blackwell, vol. 31(4), pages 898-922, November.
    9. Dzanku, Fred M., 2015. "Household-specific food price differentials and high-value crop production in rural Ghana," Food Policy, Elsevier, vol. 57(C), pages 73-82.
    10. Githiomi, Caroline & Muriithi, Beatrice & Irungu, Patrick & Mwungu, Chris M. & Diiro, Gracious & Affognon, Hippolyte & Mburu, John & Ekesi, Sunday, 2019. "Economic analysis of spillover effects of an integrated pest management (IPM) strategy for suppression of mango fruit fly in Kenya," Food Policy, Elsevier, vol. 84(C), pages 121-132.
    11. Keita, Moussa, 2012. "Impact of subsidized inputs credits on land allocation and market-oriented agriculture in rural households in Mali," MPRA Paper 57542, University Library of Munich, Germany.
    12. Michael T. French & Ioana Popovici, 2011. "That instrument is lousy! In search of agreement when using instrumental variables estimation in substance use research," Health Economics, John Wiley & Sons, Ltd., vol. 20(2), pages 127-146, February.
    13. Gebremedhin, Berhanu & Jaleta, Moti, 2010. "Commercialization of Smallholders: Is Market Participation Enough?," 2010 AAAE Third Conference/AEASA 48th Conference, September 19-23, 2010, Cape Town, South Africa 96159, African Association of Agricultural Economists (AAAE).
    14. Jan Fałkowski & Agata Malak-Rawlikowska & Dominika Milczarek-Andrzejewska, 2013. "Determinants and Consequences of Participating in a Restructured Supply Chain: the Experience of the Dairy Sector in Poland," Ekonomia journal, Faculty of Economic Sciences, University of Warsaw, vol. 34.
    15. Lenis Saweda O. Liverpool-Tasie, 2014. "Fertilizer subsidies and private market participation: the case of Kano State, Nigeria," Agricultural Economics, International Association of Agricultural Economists, vol. 45(6), pages 663-678, November.
    16. Mather, David & Boughton, Duncan & Jayne, Thomas S., 2011. "Smallholder Heterogeneity and Maize Market Participation in Southern and Eastern Africa: Implications for Investment Strategies to Increase Marketed Food Staple Supply," Food Security International Development Working Papers 118473, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    17. Adane, Tuffa Debela, 2009. "Impact of Perennial Cash Cropping On Food Crop Production and Productivity," Ethiopian Journal of Economics, Ethiopian Economics Association, vol. 18(1), pages 116-116, December.
    18. Costa Storti, Cláudia & Grauwe, Paul & Sabadash, Anna & Montanari, Linda, 2011. "Unemployment and drug treatment," MPRA Paper 61799, University Library of Munich, Germany.
    19. Kirk, Angeli & Kilic, Talip & Carletto, Calogero, 2018. "Composition of Household Income and Child Nutrition Outcomes Evidence from Uganda," World Development, Elsevier, vol. 109(C), pages 452-469.
    20. Justus Ochieng & Beatrice Knerr & George Owuor & Emily Ouma, 2020. "Food crops commercialization and household livelihoods: Evidence from rural regions in Central Africa," Agribusiness, John Wiley & Sons, Ltd., vol. 36(2), pages 318-338, April.

    More about this item

    Keywords

    Crop Production/Industries;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:jordng:174481. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/kreinkr.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.