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Assets, activities and income generation in rural Mexico: factoring in social and public capital

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  • Winters, Paul
  • Davis, Benjamin
  • Corral, Leonardo

Abstract

Direct benefits from contracting accrue to smallholders from improved access to markets, improved technology, better management of risk and opportunities for employment of family members. Indirect benefits occur from empowerment of women and increased commercial acumen on the part of smallholders. Contract farming has the potential to improve the welfare of smallholders however it is not a sufficient condition for such improvement. Smaller farmers can be excluded from contracts because of selection bias by agribusiness firms awarding contracts to larger farms, be adversely affected by the second-round effects of contracts on incomes and prices and suffer from narrowing of markets that lie outside of contracts. Institutional developments that might ameliorate this type of exclusion are anti-trust legislation, policies to directly improve the contracting environment, policies to address specific problems smallholders face in entering contracts and participation by NGOs in contract facilitation.

Suggested Citation

  • Winters, Paul & Davis, Benjamin & Corral, Leonardo, 2001. "Assets, activities and income generation in rural Mexico: factoring in social and public capital," ESA Working Papers 289111, Food and Agriculture Organization of the United Nations, Agricultural Development Economics Division (ESA).
    • Handle: RePEc:ags:faoaes:289111
    DOI: 10.22004/ag.econ.289111
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    References listed on IDEAS

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    More about this item

    Keywords

    Agricultural Finance; Community/Rural/Urban Development;

    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products

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