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Should African rural development strategies depend on smallholder farms ? an exploration of the inverse productivity hypothesis

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  • Larson, Donald F.
  • Otsuka, Keijiro
  • Matsumoto, Tomoya
  • Kilic, Talip

Abstract

In Africa, most development strategies include efforts to improve the productivity of staple crops grown on smallholder farms. An underlying premise is that small farms are productive in the African context and that smallholders do not forgo economies of scale -- a premise supported by the often observed phenomenon that staple cereal yields decline as the scale of production increases. This paper explores a research design conundrum that encourages researchers who study the relationship between productivity and scale to use surveys with a narrow geographic reach, when policy would be better served with studies based on wide and heterogeneous settings. Using a model of endogenous technology choice, the authors explore the relationship between maize yields and scale using alternative data. Since rich descriptions of the decision environments that farmers face are needed to identify the applied technologies that generate the data, improvements in the location specificity of the data should reduce the likelihood of identification errors and biased estimates. However, the analysis finds that the inverse productivity hypothesis holds up well across a broad platform of data, despite obvious shortcomings with some components. It also finds surprising consistency in the estimated scale elasticities.

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Bibliographic Info

Paper provided by The World Bank in its series Policy Research Working Paper Series with number 6190.

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Date of creation: 01 Sep 2012
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Handle: RePEc:wbk:wbrwps:6190

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Keywords: Crops&Crop Management Systems; Climate Change and Agriculture; Rural Development Knowledge&Information Systems; Economic Theory&Research; Labor Policies;

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Citations

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Cited by:
  1. Kilic, Talip & Palacios-Lopez, Amparo & Goldstein, Markus, 2013. "Caught in a productivity trap: a distributional perspective on gender differences in Malawian agriculture," Policy Research Working Paper Series 6381, The World Bank.
  2. Brooks, Karen & Zorya, Sergiy & Gautam, Amy & Goyal, Aparajita, 2013. "Agriculture as a sector of opportunity for young people in Africa," Policy Research Working Paper Series 6473, The World Bank.
  3. 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.
  4. Harris, David & Orr, Alastair, 2014. "Is rainfed agriculture really a pathway from poverty?," Agricultural Systems, Elsevier, vol. 123(C), pages 84-96.
  5. Kilic, Talip & Zezza, Alberto & Carletto, Calogero & Savastano, Sara, 2013. "Missing(ness) in action : selectivity bias in GPS-based land area measurements," Policy Research Working Paper Series 6490, The World Bank.
  6. Holden, Stein & Otsuka, Keijiro, 2013. "The Roles of Land Tenure Reforms and Land Markets in the Context of Population Growth and Land Use Intensification in Africa," CLTS Working Papers 15/13, Centre for Land Tenure Studies, Norwegian University of Life Sciences.
  7. Keijiro Otsuka & Frank Place, 2013. "Evolutionary Changes in Land Tenure and Agricultural Intensification in Sub-Saharan Africa," GRIPS Discussion Papers 13-22, National Graduate Institute for Policy Studies.
  8. Ali, Daniel Ayalew & Deininger, Klaus, 2014. "Is there a farm-size productivity relationship in African agriculture ? evidence from Rwanda," Policy Research Working Paper Series 6770, The World Bank.

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