The impact of large-scale agricultural investments on welfare of local communities: a meta-analysis

Large-scale agricultural investments (LSAIs) are promoted as pro-poor investments by governments in developing countries. However, their impact on local communities has remained contested due to concerns that these investments are associated with land concessions and displacements. A recent body of literature has documented mixed effects, leaving their broader impact inconclusive. This meta-analysis aimed to understand the overall effect of these investments on local communities. We computed the average effect size using partial correlation coefficients (pcc). The analysis is conducted on 39 primary studies obtained from Web of Science, Scopus and Google Scholar. To account for dependencies among effect sizes arising from multiple estimates within single studies, we used robust variance estimation (RVE) to estimate the average effect size. The results revealed a statistically positive, but marginal, average pcc of 0.043. This implies that LSAIs explain only less than one percent of the variation in welfare of local communities, suggesting that LSAIs have limited practical impact on improving living standards of local communities. The positive effect, though marginal, is achieved through the pathways of the role of LSAIs to improve income and food security. The analysis also indicated that the impact on local welfare varies based on the different LSAI models. Out-grower and contract farming models of LSAI appear to yield more positive outcomes to the local community compared to plantation-based LSAI models. Given the positive but marginal overall effect, policy makers should exercise caution when considering further LSAIs in developing countries to maximize potential benefits by mitigating its negative impacts. Future research could explore cross-country heterogeneity, long-term impacts, national-level effects, and non-operational LSAIs to better inform policy.