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Agriculture, Income Risks and Rural Poverty Dynamics: Strategies of Smallholder Producers in Kenya

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  • Kuyiah, Joanne Wasswa
  • Obare, Gideon A.
  • Herrero, Mario
  • Waithaka, Michael M.

Abstract

Poverty in Kenya has been on the increase over the last decade. It is estimated that 56% of the total population live in absolute poverty. Most of the poor reside in rural areas where agriculture is the main livelihood activity. Majority of Kenya's farmers are smallholders. They account for 75% of the total agricultural output and about 70% of marketed agricultural produce. The fate of smallholder agriculture in this country is therefore central to poverty reduction. A collapse in output and incomes from smallholder agriculture is likely to have damaging welfare effects and retard pro-poor economic growth. Smallholders often operate in a risky environment, which affects the level and variability of household resource endowments and income. The importance of risk analysis in smallholder production systems arises from the fact that strategies to help farmers raise their productivity and income require an understanding of how risk affects their production decisions. Using cross-sectional input-output data from 240 randomly selected households from Vihiga and Kilifi districts covering the 2003/4 agricultural year, and time series data on yields, this study investigates how risk affects farmers' production choices in the crop-livestock systems. Further, it explores the possibility of improving production and income on these smallholder farms. Linear programming and MOTAD are used in analysis. Results indicate there is potential to improve production and income on these smallholder farms through a change in the enterprise mix. The farm plans are sensitive to risk, with trade-offs occurring between higher risk and returns.

Suggested Citation

  • Kuyiah, Joanne Wasswa & Obare, Gideon A. & Herrero, Mario & Waithaka, Michael M., 2006. "Agriculture, Income Risks and Rural Poverty Dynamics: Strategies of Smallholder Producers in Kenya," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25596, International Association of Agricultural Economists.
  • Handle: RePEc:ags:iaae06:25596
    DOI: 10.22004/ag.econ.25596
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    References listed on IDEAS

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    Cited by:

    1. Ibendahl, Gregory A. & Norvell, Jonathan, 2005. "When to Replace Machinery Under Accelerated Deprecation Laws," 2005 Annual meeting, July 24-27, Providence, RI 9351, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    2. Zhang, Lin & Findeis, Jill L., 2010. "Intra-Household Time Allocation and Labor Migration Decisions in Rural South China," 2010 Annual Meeting, July 25-27, 2010, Denver, Colorado 61520, Agricultural and Applied Economics Association.
    3. Ochieng, Sylvester O. & Okello, Julius J. & Otieno, David J., 2013. "Impact of Information and Communication Technology-based Market Information Services on Smallholder Farm Input Use and Productivity: The Case of Kenya," 2013 Fourth International Conference, September 22-25, 2013, Hammamet, Tunisia 161454, African Association of Agricultural Economists (AAAE).
    4. Mehta, Shefali V. & Homans, Frances R. & Haight, Robert G. & Polasky, Stephen, 2005. "Optimal Bioeconomic Management Strategies for Prevention and Control of Invasive Alien Species," 2005 Annual meeting, July 24-27, Providence, RI 19505, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    5. Waithira, Waweru Caroline, 2017. "An Analysis Of Risk Attitudes And Risk Management Strategies Among Dairy Farmers In Murang’A County, Kenya," Research Theses 276428, Collaborative Masters Program in Agricultural and Applied Economics.
    6. Chen, Susan E. & Florax, Raymond J.G.M. & Snyder, Samantha D., 2007. "Does Where We Live Matter? Understanding the Link Between Obesity and the Market for Food," 2007 Annual Meeting, July 29-August 1, 2007, Portland, Oregon 9682, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    7. Bernard Kiprono, Rotich, 2012. "Contribution of On-Farm Diversification to Incomes of Smallholder Farmers in Konoin District, Bomet County," Research Theses 243441, Collaborative Masters Program in Agricultural and Applied Economics.
    8. Waweru, Caroline Waithira & Nyikal, Rose & Busienei, John R, 2017. "An Analysis Of Risk Attitudes And Risk Management Strategies Among Dairy Farmers In Murang’A County, Kenya," Dissertations and Theses 271063, University of Nairobi, Department of Agricultural Economics.
    9. Shane, Mathew & Roe, Terry L. & Langrock, Ines, 2004. "Exchange Rates, Foreign Income, and U.S. Agricultural Trade," 2004 Annual meeting, August 1-4, Denver, CO 20042, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).
    10. Elton Mykerezi & Bradford F. Mills, 2008. "The Wage Earnings Impact of Historically Black Colleges and Universities," Southern Economic Journal, John Wiley & Sons, vol. 75(1), pages 173-187, July.
    11. Ogutu, Sylvester O. & Okello, Julius J. & Otieno, David J., 2013. "Impact of Information and Communication Technology-based Market Information Services on Smallholder Farm Input Use and Productivity: The Case of Kenya," 2013 Fourth International Conference, September 22-25, 2013, Hammamet, Tunisia 157770, African Association of Agricultural Economists (AAAE).
    12. Ochieng’, Sylvester O. & Okello, Julius J. & Otieno, David J., 2012. "Impact of ICT-based Market Information Service Projects on Smallholder Farm Input Use and Productivity in Kenya," 2012 Eighth AFMA Congress, November 25-29, 2012, Nairobi, Kenya 159429, African Farm Management Association (AFMA).
    13. Keeney, Roman & Hertel, Thomas W., 2006. "Supply Response in Agriculture: Farm-Level and Sector-Wide Adjustment Reconciled," 2006 Annual meeting, July 23-26, Long Beach, CA 21179, American Agricultural Economics Association (New Name 2008: Agricultural and Applied Economics Association).

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