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Social networks and factor markets: Panel data evidence from Ethiopia:

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  • Abay, Kibrom A.
  • Kahsay, Goytom A.
  • Berhane, Guush

Abstract

We investigate the role of an indigenous social network in Ethiopia, the iddir, in facilitating factor market transactions among smallholder farmers. Using detailed longitudinal household survey data and employing a difference-in-differences approach, we find that iddir membership improves households’ access to factor markets.

Suggested Citation

  • Abay, Kibrom A. & Kahsay, Goytom A. & Berhane, Guush, 2014. "Social networks and factor markets: Panel data evidence from Ethiopia:," ESSP working papers 68, International Food Policy Research Institute (IFPRI).
    • Handle: RePEc:fpr:esspwp:68
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    2. Seck, Abdoulaye, 2018. "Heterogeneous Credit Constraints and Smallholder Farming in Senegal," 92nd Annual Conference, April 16-18, 2018, Warwick University, Coventry, UK 273491, Agricultural Economics Society.
    3. Will, Meike & Groeneveld, Jürgen & Lenel, Friederike & Frank, Karin & Müller, Birgit, 2023. "Determinants of Household Vulnerability in Networks with Formal Insurance and Informal Risk-Sharing," Ecological Economics, Elsevier, vol. 212(C).
    4. Kahsay, Goytom Abraha & Bulte, Erwin, 2019. "Trust, regulation and participatory forest management: Micro-level evidence on forest governance from Ethiopia," World Development, Elsevier, vol. 120(C), pages 118-132.
    5. Sharmistha Self & Richard Grabowski, 2018. "Factors influencing knowledge of HIV/AIDS in Nepal: role of socioeconomic interactions," Journal of Social and Economic Development, Springer;Institute for Social and Economic Change, vol. 20(1), pages 174-191, April.
    6. Marcelo Arbex & Jéssica Faciroli & Ricardo Silva Freguglia & Marcel de Toledo Vieira, 2023. "Brazil’s Bolsa Família: Neighborhood and Racial Group Networks," Journal of Development Studies, Taylor & Francis Journals, vol. 59(4), pages 593-610, April.
    7. Meike Will & Jürgen Groeneveld & Karin Frank & Birgit Müller, 2021. "Informal risk-sharing between smallholders may be threatened by formal insurance: Lessons from a stylized agent-based model," PLOS ONE, Public Library of Science, vol. 16(3), pages 1-18, March.
    8. Gelo, Dambala & Muchapondwa, Edwin & Koch, Steven F., 2016. "Decentralization, market integration and efficiency-equity trade-offs: Evidence from Joint Forest Management in Ethiopian villages," Journal of Forest Economics, Elsevier, vol. 22(C), pages 1-23.

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    More about this item

    Keywords

    social networks; iddir networks; factor market imperfections; factor market transactions; crowding-out;
    All these keywords.

    JEL classification:

    • D02 - Microeconomics - - General - - - Institutions: Design, Formation, Operations, and Impact
    • D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation
    • D71 - Microeconomics - - Analysis of Collective Decision-Making - - - Social Choice; Clubs; Committees; Associations
    • D83 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Search; Learning; Information and Knowledge; Communication; Belief; Unawareness
    • D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
    • J46 - Labor and Demographic Economics - - Particular Labor Markets - - - Informal Labor Market
    • O17 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Formal and Informal Sectors; Shadow Economy; Institutional Arrangements
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets

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