Gustavo Anríquez (Agricultural and Development Economics Division, Food and Agriculture Organization) Silvio Daidone (Agricultural and Development Economics Division, Food and Agriculture Organization)
Abstract
In the light of an expanding rural non-farm (RNF) sector in developing rural economies, this paper explores the effects of this expansion within the household. Using rural Ghana as a case study this paper explores if the RNF economy allows for economies of diversification within farms; how input demands, agricultural-specific and shared, are transformed by the expansion of this sector; and if this expansion has measurable effects in overall household production efficiency. We first explore the characteristic of the intra-household linkages (technological and welfare driven) between the agricultural and RNF sectors both assuming perfectly working input and output markets, and assuming market failures, in particular missing labor and credit markets. We then try to measure the identified linkages by estimating a household level input distance function. This function is estimated consistently without making log-transformations as has been previously done in the literature. Our empirical analysis suggests that there are high levels of inefficiency in Ghanaian farms. Also, there are cost-complementarities between the RNF sector and the agricultural sector, particularly with food crops in which the poorest tend to specialize. The expansion of the RNF sector increases demand for most inputs including agricultural land. Finally, we show that smaller farms tend to be more efficient, and that RNF output is helping the farm household to become more efficient, but the latter result is not robust.
Download Info
To download:
If you experience problems downloading a file, check if you have the
proper application to
view it first. Information about this may be contained
in the File-Format links below. In case of further problems read
the IDEAS help
page. Note that these files are not on the IDEAS
site. Please be patient as the files may be large.
Publisher Info
Paper provided by Agricultural and Development Economics Division of the Food and Agriculture Organization of the United Nations (FAO - ESA) in its series Working Papers with number
08-01.
Length: 40 pages Date of creation: 2008 Date of revision: Handle: RePEc:fao:wpaper:0801
Contact details of provider: Postal: Agricultural Sector in Economic Development Service FAO Viale delle Terme di Caracalla 00153 Rome Italy Phone: +39(6) 57051 Fax: +39 06 57055522 Email: Web page: http://www.fao.org/es/esa/ More information through EDIRC
For technical questions regarding this item, or to correct its listing, contact: (Gustavo Anríquez).
Find related papers by JEL classification: D13 - Microeconomics - - Household Behavior - - - Household Production and Intrahouse Allocation Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
References listed on IDEAS Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
Benjamin Davis & Paul Winters & Gero Carletto & Katia Covarrubias & Esteban Quinones & Alberto Zezza & Kostas Stamoulis & Genny Bonomi & Stefania DiGiuseppe, 2007.
"Rural Income Generating Activities; A Cross Country Comparison,"
Working Papers
07-16, Agricultural and Development Economics Division of the Food and Agriculture Organization of the United Nations (FAO - ESA).
[Downloadable!]