How Costly is it for Poor Farmers to Lift Themselves out of Subsistence?
AbstractThe main objective of this paper is to provide estimates of the cost of moving out of subsistence for Madagascar's farmers. The analysis is based on a simple asset-return model of occupational choice. Estimates suggest that the entry (sunk) cost associated with moving out of subsistence can be quite large |somewhere between 124 and 153 percent of a subsistence farmer's annual production. Our results make it possible to identify farm characteristics likely to generatee large gains if moved out of subsistence, yielding useful information for the targeting of trade-adjustment assistance programs.
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Bibliographic InfoPaper provided by Université de Lausanne, Faculté des HEC, DEEP in its series Cahiers de Recherches Economiques du Département d'Econométrie et d'Economie politique (DEEP) with number 05.09.
Length: 44 pages
Date of creation: Nov 2005
Date of revision:
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More information through EDIRC
threshold regression; switching regression; unknown sample separation; Madagascar; subsistence; entry costs;
Other versions of this item:
- Cadot, Olivier & Dutoit, Laure & Olarreaga, Marcelo, 2005. "How Costly is it for Poor Farmers to Lift Themselves out of Subsistence?," CEPR Discussion Papers 5392, C.E.P.R. Discussion Papers.
- F10 - International Economics - - Trade - - - General
- O12 - Economic Development, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
- O19 - Economic Development, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations
This paper has been announced in the following NEP Reports:
- NEP-AGR-2006-01-01 (Agricultural Economics)
- NEP-ALL-2006-01-01 (All new papers)
- NEP-DEV-2006-01-01 (Development)
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