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Global value chains, large-scale farming, and poverty: Long-term effects in Senegal

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  • Van den Broeck, Goedele
  • Swinnen, Johan
  • Maertens, Miet

Abstract

This paper presents panel data evidence on the impact of expansion of global value chains and large-scale export-oriented farms in developing countries over almost a decade. We estimate the income effects of wage employment on large-scale farms in the horticultural export sector in Senegal, using data from two survey rounds covering a seven-years period of rapid expansion of the sector. We estimate average income effects as well as heterogeneous income effects, using fixed effects and quantile fixed effects regressions. We find that poverty and inequality reduced much faster in the research area than elsewhere in Senegal. Employment in the horticultural export sector is associated with higher household income and the income effect is strongest for the poorest households. Expansion of the horticultural export sector in Senegal has been particularly pro-poor through creating employment that is accessible and creates substantial income gains for the poorest half of the rural population. These pro-poor employment effects contrast with insights in the literature on increased inequality from rural wage employment.

Suggested Citation

  • Van den Broeck, Goedele & Swinnen, Johan & Maertens, Miet, 2017. "Global value chains, large-scale farming, and poverty: Long-term effects in Senegal," Food Policy, Elsevier, vol. 66(C), pages 97-107.
  • Handle: RePEc:eee:jfpoli:v:66:y:2017:i:c:p:97-107
    DOI: 10.1016/j.foodpol.2016.12.003
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    11. Van Den Broeck, G & Van Hoyweghen, K & Maertens, M, 2017. "Horticultural exports and food security in Senegal," Working Papers 258322, Katholieke Universiteit Leuven, Centre for Agricultural and Food Economics.
    12. Khadjavi, Menusch & Sipangule, Kacana & Thiele, Rainer, 2020. "Social Capital and Large-Scale Agricultural Investments: An Experimental Investigation," Open Access Publications from Kiel Institute for the World Economy 230937, Kiel Institute for the World Economy (IfW).
    13. Kaat Van Hoyweghen & Goedele Van den Broeck & Miet Maertens, 2020. "Employment Dynamics and Linkages in the Rural Economy: Insights from Senegal," Journal of Agricultural Economics, Wiley Blackwell, vol. 71(3), pages 904-928, September.
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    15. Delera, Michele, 2021. "Is production in global value chains (GVCs) sustainable? A review of the empirical evidence on social and environmental sustainabilitiy in GVCs," PEGNet Policy Studies 04/2020, PEGNet - Poverty Reduction, Equity and Growth Network, Kiel Institute for the World Economy (IfW).
    16. Christine Bosch & Manfred Zeller, 2019. "Large-scale biofuel production and food security of smallholders: Evidence from Jatropha in Madagascar," Food Security: The Science, Sociology and Economics of Food Production and Access to Food, Springer;The International Society for Plant Pathology, vol. 11(2), pages 431-445, April.
    17. Suzuki, Aya & Mano, Yukichi & Abebe, Girum, 2018. "Earnings, savings, and job satisfaction in a labor-intensive export sector: Evidence from the cut flower industry in Ethiopia," World Development, Elsevier, vol. 110(C), pages 176-191.
    18. German, Laura A. & Bonanno, Anya M. & Foster, Laura Catherine & Cotula, Lorenzo, 2020. "“Inclusive business” in agriculture: Evidence from the evolution of agricultural value chains," World Development, Elsevier, vol. 134(C).
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    More about this item

    Keywords

    Globalization; High-value supply chains; Rural wage employment; Quantile regression; Panel data; Long-term effects;
    All these keywords.

    JEL classification:

    • F16 - International Economics - - Trade - - - Trade and Labor Market Interactions
    • J14 - Labor and Demographic Economics - - Demographic Economics - - - Economics of the Elderly; Economics of the Handicapped; Non-Labor Market Discrimination
    • O19 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - International Linkages to Development; Role of International Organizations
    • Q17 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agriculture in International Trade
    • R23 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Household Analysis - - - Regional Migration; Regional Labor Markets; Population

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