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The Economics of Smallholder Organic Contract Farming in Tropical Africa

  • Bolwig, Simon
  • Gibbon, Peter
  • Jones, Sam
Registered author(s):

    Summary The paper examines the revenue effects of certified organic contract farming for smallholders and of adoption of organic agricultural farming methods in a tropical African context. The comparison in both cases is with farming systems that are "organic by default." Survey data from a large organic coffee contract farming scheme in Uganda are reported and analyzed using a standard OLS regression and a full information maximum likelihood (FIML) estimate of the Heckman selection model. The analysis finds that, controlling for a range of factors, there are positive revenue effects both from participation in the scheme and, more modestly, from applying organic farming techniques.

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    Article provided by Elsevier in its journal World Development.

    Volume (Year): 37 (2009)
    Issue (Month): 6 (June)
    Pages: 1094-1104

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    Handle: RePEc:eee:wdevel:v:37:y:2009:i:6:p:1094-1104
    Contact details of provider: Web page: http://www.elsevier.com/locate/worlddev

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    1. Richard Blundell & Monica Costa Dias, 2008. "Alternative approaches to evaluation in empirical microeconomics," CeMMAP working papers CWP26/08, Centre for Microdata Methods and Practice, Institute for Fiscal Studies.
    2. Ravallion, Martin, 2005. "Evaluating anti-poverty programs," Policy Research Working Paper Series 3625, The World Bank.
    3. Andrew Dorward & Shenggen Fan & Jonathan Kydd & Hans Lofgren & Jamie Morrison & Colin Poulton & Neetha Rao & Laurence Smith & Hardwick Tchale & Sukhadeo Thorat & Ian Urey & Peter Wobst, 2004. "Institutions and Policies for Pro-poor Agricultural Growth," Development Policy Review, Overseas Development Institute, vol. 22(6), pages 611-622, November.
    4. Phil Simmons, 2002. "Overview of Smallholder Contract Farming in Developing Countries," Working Papers 02-04, Agricultural and Development Economics Division of the Food and Agriculture Organization of the United Nations (FAO - ESA).
    5. Vella, Francis & Verbeek, Marno, 1999. "Estimating and Interpreting Models with Endogenous Treatment Effects," Journal of Business & Economic Statistics, American Statistical Association, vol. 17(4), pages 473-78, October.
    6. Bacon, Christopher, 2005. "Confronting the Coffee Crisis: Can Fair Trade, Organic, and Specialty Coffees Reduce Small-Scale Farmer Vulnerability in Northern Nicaragua?," World Development, Elsevier, vol. 33(3), pages 497-511, March.
    7. Puhani, Patrick A, 2000. " The Heckman Correction for Sample Selection and Its Critique," Journal of Economic Surveys, Wiley Blackwell, vol. 14(1), pages 53-68, February.
    8. Heckman, James J, 1979. "Sample Selection Bias as a Specification Error," Econometrica, Econometric Society, vol. 47(1), pages 153-61, January.
    9. Dorward, Andrew & Fan, Shenggen & Kydd, Jonathan & Lofgren, Hans & Morrison, Jamie & Poulton, Colin & Rao, Neetha & Smith, Laurence & Tchale, Hardwick & Thorat, Sukhadeo & Urey, Ian & Wobst, Peter, 2004. "Institutions and economic policies for pro-poor agricultural growth," DSGD discussion papers 15, International Food Policy Research Institute (IFPRI).
    10. Warning, Matthew & Key, Nigel, 2002. "The Social Performance and Distributional Consequences of Contract Farming: An Equilibrium Analysis of the Arachide de Bouche Program in Senegal," World Development, Elsevier, vol. 30(2), pages 255-263, February.
    11. Richard Blundell & Monica Costa Dias, 2000. "Evaluation methods for non-experimental data," Fiscal Studies, Institute for Fiscal Studies, vol. 21(4), pages 427-468, January.
    12. Key, Nigel & Runsten, David, 1999. "Contract Farming, Smallholders, and Rural Development in Latin America: The Organization of Agroprocessing Firms and the Scale of Outgrower Production," World Development, Elsevier, vol. 27(2), pages 381-401, February.
    13. Heckman, James J. & Lalonde, Robert J. & Smith, Jeffrey A., 1999. "The economics and econometrics of active labor market programs," Handbook of Labor Economics, in: O. Ashenfelter & D. Card (ed.), Handbook of Labor Economics, edition 1, volume 3, chapter 31, pages 1865-2097 Elsevier.
    14. Poulton, Colin & Gibbon, Peter & Hanyani-Mlambo, Benjamine & Kydd, Jonathan & Maro, Wilbald & Larsen, Marianne Nylandsted & Osorio, Afonso & Tschirley, David & Zulu, Ballard, 2004. "Competition and Coordination in Liberalized African Cotton Market Systems," World Development, Elsevier, vol. 32(3), pages 519-536, March.
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