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Efficiency and distribution in contract farming:The case of Indian poultry growers

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Author Info
Bharat Ramaswami () (Indian Statistical Institute, New Delhi)
Pratap Singh Birthal (National Centre for Agricultural Economics and Policy Research)
P.K. Joshi (International Food Policy Research Institute)

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Abstract

This paper is an empirical analysis of the gains from contract farming in the case of poultry production in the state of Andhra Pradesh in India. The paper finds that contract production is more efficient than noncontract production. The efficiency surplus is largely appropriated by the processor. Despite this, contract growers still gain appreciably from contracting in terms of lower risk and higher expected returns. Improved technology and production practices as well as the way in which the processor selects growers is what makes these outcomes possible. In terms of observed and unobserved characteristics, contract growers have relatively poor prospects as independent growers. With contract production, these growers achieve incomes comparable to that of independent growers

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Publisher Info
Paper provided by Indian Statistical Institute, New Delhi, India in its series Indian Statistical Institute, Planning Unit, New Delhi Discussion Papers with number 05-01.

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Length: 38 pages
Date of creation: Feb 2005
Date of revision:
Handle: RePEc:ind:isipdp:05-01

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Related research
Keywords: Contract Farming; Contracting; Poultry; Vertical Integration;

Other versions of this item:

Find related papers by JEL classification:
L23 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Organization of Production
L24 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Contracting Out; Joint Ventures
Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness

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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.:
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Full references

Cited by:
(explanations, 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.)

  1. Birthal, Pratap S. & Jha, Awadhesh K. & Tiongco, Marites & Narrod, Clare, 2008. "Improving farm-to-market linkages through contract farming: A case study of smallholder dairying in India," IFPRI discussion papers 814, International Food Policy Research Institute (IFPRI). [Downloadable!]
  2. Birthal, Pratap S. & Jha, Awadhesh K. & Singh, Harvinder, 2007. "Linking Farmers to Markets for High-Value Agricultural Commodities," Agricultural Economics Research Review, Agricultural Economics Research Association (India), vol. 20(2007). [Downloadable!]
  3. Chowdhury, Nuimuddin & Farid, Nasir & Roy, Devesh, 2006. "Food policy liberalization in Bangladesh: how the government and the markets delivered," MTID discussion papers 92, International Food Policy Research Institute (IFPRI). [Downloadable!]
  4. Rakotoarisoa, Manitra A., 2006. "Policy distortions in the segmented rice market:," MTID discussion papers 94, International Food Policy Research Institute (IFPRI). [Downloadable!]
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