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Capital and credit constraints in the engagement of youth in Ghanaian agriculture

Author

Listed:
  • Martinson Ankrah Twumasi
  • Yuansheng Jiang
  • Monica Owusu Acheampong

Abstract

Purpose - The purpose of this paper is to determine the factors influencing rural youth farmers’ credit constraints status and the effect of credit constraint on the intensity of participation of these farmers in Ghana. Design/methodology/approach - The econometric estimation is based on cross-sectional data collected in 2018 from the Brong Ahafo region in Ghana. The sample data set consists of 450 rural youth farmers. The collected data were analyzed through different econometric techniques, using the endogenous switching regression model (ERSM). Findings - The direct elicitation approach employed in this study revealed that out of the 450 farmers, 211 (47 percent) of the respondents were credit constrained compared to 239 (53 percent) of their counterparts who were unconstrained. The ERSM indicated that youth farmers education, age, savings, parents occupation reduced the probability of the rural youth farmer to be credit constrained but cumbersome loan application procedure and loan disbursement time positively affect credit constraint. Moreover, farmers that are credit constrained have lower intensity of participation in agriculture activities than a random farmer from the sample. This suggests that access to credit has a positive impact on the intensity of participation in agriculture activities. Research limitations/implications - In this study, only rural youth farmers in a particular region were considered. However, there are youths all over the nation. Therefore, future researchers could consider other youth’s farmers elsewhere in the country. Originality/value - Although existing studies have examined rural youth farmers’ participation in agriculture and credit constraint separately, the unique contribution of this paper is the analysis of credit constraint of rural youth farmers as well as the impact of credit constraint on the intensity of participation in agriculture activities.

Suggested Citation

  • Martinson Ankrah Twumasi & Yuansheng Jiang & Monica Owusu Acheampong, 2019. "Capital and credit constraints in the engagement of youth in Ghanaian agriculture," Agricultural Finance Review, Emerald Group Publishing Limited, vol. 80(1), pages 22-37, October.
    • Handle: RePEc:eme:afrpps:afr-11-2018-0100
    DOI: 10.1108/AFR-11-2018-0100
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    Citations

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    Cited by:

    1. Kamaldeen Mohammed & Evans Batung & Moses Kansanga & Hanson Nyantakyi-Frimpong & Isaac Luginaah, 2021. "Livelihood diversification strategies and resilience to climate change in semi-arid northern Ghana," Climatic Change, Springer, vol. 164(3), pages 1-23, February.
    2. Martinson Ankrah Twumasi & Yuansheng Jiang & Evans B. Ntiamoah & Selorm Akaba & Kwabena N. Darfor & Linda K. Boateng, 2022. "Access to credit and farmland abandonment nexus: The case of rural Ghana," Natural Resources Forum, Blackwell Publishing, vol. 46(1), pages 3-20, February.
    3. Saeed Ur Rahman & Zia Ur Rahman & Aabera Atta & Faiza Afzal, 2022. "An Implication of Impulse Response Function in the Perspective of Green Revolution, Credit Disbursement, and Fossil Fuel Utilization in Pakistan," Journal of Economic Impact, Science Impact Publishers, vol. 4(2), pages 58-64.
    4. Mohammed, Kamaldeen & Batung, Evans & Saaka, Sulemana Ansumah & Kansanga, Moses Mosonsieyiri & Luginaah, Isaac, 2023. "Determinants of mechanized technology adoption in smallholder agriculture: Implications for agricultural policy," Land Use Policy, Elsevier, vol. 129(C).
    5. Kouakou Kouakou, Paul-Alfred, 2020. "Role of trade in natural rubber and palm oil in the composition of GDP in Ivory Coast," Agricultural and Resource Economics: International Scientific E-Journal, Agricultural and Resource Economics: International Scientific E-Journal, vol. 6(3), September.
    6. Martinson Ankrah Twumasi & Hongyun Zheng & Love Offeibea Asiedu-Ayeh & Anthony Siaw & Yuansheng Jiang, 2023. "Access to Financial Services and Its Impact on Household Income: Evidence from Rural Ghana," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 35(4), pages 869-890, August.
    7. Martinson Ankrah Twumasi & Yuansheng Jiang & Zhao Ding & Pengcheng Wang & Wonder Abgenyo, 2022. "The Mediating Role of Access to Financial Services in the Effect of Financial Literacy on Household Income: The Case of Rural Ghana," SAGE Open, , vol. 12(1), pages 21582440221, February.

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