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Interlinked credit and farm intensification: evidence from Kenya

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  • Jayne, T.S.
  • Yamano, Takashi
  • Nyoro, James

Abstract

This paper addresses the potential for interlinked credit/input/output marketing arrangements for cash crops to promote food crop intensification. Using panel survey data from Kenya, we estimate a household fixed-effects model of fertilizer use per hectare of food crops. Results indicate that households engaging in interlinked marketing programs for selected cash crops applied considerably more fertilizer on other crops (primarily cereals) not directly purchased by the cash crop trading firm. These findings suggest that, in addition to the direct stimulus that interlinked cash crop marketing arrangements can have on small farmer incomes, these institutional arrangements may provide spillover benefits for the productivity of farmers' other activities such as food cropping.
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  • Jayne, T.S. & Yamano, Takashi & Nyoro, James, 2004. "Interlinked credit and farm intensification: evidence from Kenya," Agricultural Economics, Blackwell, vol. 31(2-3), pages 209-218, December.
    • Handle: RePEc:eee:agecon:v:31:y:2004:i:2-3:p:209-218
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    2. Lubungu, Mary & Burke, William J. & Sitko, Nicholas J., 2013. "Analysis of the Soya Bean Value Chain in Zambia’s Eastern Province," Food Security Collaborative Working Papers 154937, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    3. Biggeri, Mario & Burchi, Francesco & Ciani, Federico & Herrmann, Raoul, 2018. "Linking small-scale farmers to the durum wheat value chain in Ethiopia: Assessing the effects on production and wellbeing," Food Policy, Elsevier, vol. 79(C), pages 77-91.
    4. Larson, Donald F. & Gurara, Daniel Zerfu, 2013. "A conceptual model of incomplete markets and the consequences for technology adoption policies in Ethiopia," Policy Research Working Paper Series 6681, The World Bank.
    5. Olwande, John & Mathenge, Mary K., 2012. "Market Participation among Poor Rural Households in Kenya," 2012 Conference, August 18-24, 2012, Foz do Iguacu, Brazil 126711, International Association of Agricultural Economists.
    6. Ariga, Joshua & Jayne, Thomas S. & Nyoro, James K., 2006. "Factors Driving the Growth in Fertilizer Consumption in Kenya, 1990-2005: Sustaining the Momentum in Kenya and Lessons for Broader Replicability in Sub-Saharan Africa," Food Security Collaborative Working Papers 55167, Michigan State University, Department of Agricultural, Food, and Resource Economics.
    7. Mutayoba, Venance & Ngaruko, Deus, 2015. "Determinants of Farmers’ participation in high value crops in Tanzania," African Journal of Economic Review, African Journal of Economic Review, vol. 3(2), July.
    8. Angioloni, Simone & Kudabaev, Zarylbek & Ames, Glenn & Wetzstein, Michael, 2015. "Household Allocation of Microfinance Loans in Kyrgyzstan," 2015 Conference, August 9-14, 2015, Milan, Italy 210949, International Association of Agricultural Economists.
    9. Olwande, John & Mathenge, Mary K., 2011. "Market Participation Among Poor Rural Households in Kenya," Working Papers 202599, Egerton University, Tegemeo Institute of Agricultural Policy and Development.
    10. Tharakan, Joe & Lefèvre, Mélanie, 2011. "Intermediaries, transport costs and interlinked transactions," CEPR Discussion Papers 8615, C.E.P.R. Discussion Papers.
    11. Schut, Marc & van Asten, Piet & Okafor, Chris & Hicintuka, Cyrille & Mapatano, Sylvain & Nabahungu, Nsharwasi Léon & Kagabo, Desire & Muchunguzi, Perez & Njukwe, Emmanuel & Dontsop-Nguezet, Paul M. & , 2016. "Sustainable intensification of agricultural systems in the Central African Highlands: The need for institutional innovation," Agricultural Systems, Elsevier, vol. 145(C), pages 165-176.
    12. Swinnen, Johan F.M. & Vandeplas, Anneleen, 2007. "Contracting, Competition, and Rent Distribution Theory and Empirical Evidence from Developing and Transition Countries," 103rd Seminar, April 23-25, 2007, Barcelona, Spain 9413, European Association of Agricultural Economists.
    13. Hendrik Feyaerts & Goedele Van den Broeck & Miet Maertens, 2020. "Global and local food value chains in Africa: A review," Agricultural Economics, International Association of Agricultural Economists, vol. 51(1), pages 143-157, January.
    14. Maredia, Mywish K., 2009. "Improving the proof: Evolution of and emerging trends in impact assessment methods and approaches in agricultural development," IFPRI discussion papers 929, International Food Policy Research Institute (IFPRI).
    15. Jayne, T. S. & Govereh, J. & Wanzala, M. & Demeke, M., 2003. "Fertilizer market development: a comparative analysis of Ethiopia, Kenya, and Zambia," Food Policy, Elsevier, vol. 28(4), pages 293-316, August.
    16. Theriault, Veronique & Tschirley, David L., 2014. "How Institutions Mediate the Impact of Cash Cropping on Food Crop Intensification: An Application to Cotton in Sub-Saharan Africa," World Development, Elsevier, vol. 64(C), pages 298-310.
    17. Raoul Herrmann & Ephraim Nkonya & Anja Faße, 2018. "Food value chain linkages and household food security in Tanzania," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 10(4), pages 827-839, August.
    18. Benfica, Rui M.S. & Tschirley, David L. & Boughton, Duncan, 2006. "Interlinked Transactions in Cash Cropping Economies: The Determinants of Farmer Participation and Performance in the Zambezi River Valley of Mozambique," 2006 Annual Meeting, August 12-18, 2006, Queensland, Australia 25244, International Association of Agricultural Economists.
    19. Hounkonnou, Dominique & Kossou, Dansou & Kuyper, Thomas W. & Leeuwis, Cees & Nederlof, E. Suzanne & Röling, Niels & Sakyi-Dawson, Owuraku & Traoré, Mamoudou & van Huis, Arnold, 2012. "An innovation systems approach to institutional change: Smallholder development in West Africa," Agricultural Systems, Elsevier, vol. 108(C), pages 74-83.
    20. Beatrice W. Muriithi & Nancy G. Gathogo & Gracious M. Diiro & Samira A. Mohamed & Sunday Ekesi, 2020. "Potential Adoption of Integrated Pest Management Strategy for Suppression of Mango Fruit Flies in East Africa: An Ex Ante and Ex Post Analysis in Ethiopia and Kenya," Agriculture, MDPI, vol. 10(7), pages 1-23, July.

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