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Food vs. Wood: Dynamic Choices for Kenyan Smallholders

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  • Peralta, Maria Alexandra
  • Swinton, Scott M.

Abstract

Smallholder farmers in many areas of the semiarid tropics are planting exotic tree species that provide alternative income sources, fuel, and building materials. While providing other benefits, these trees often occupy land that could produce annual food crops. This study uses a polyperiod, linear programming model, to explore the opportunity cost of planting Eucalyptus grandis and Grevillea robusta trees compared to crops in the Nyando watershed of western Kenya. Results of the ten-year period wealth maximization model suggest that a representative farmer’s decisions on farm resource allocation are sensitive to changes in the relative prices of short rotation tree products and annual crops. The model also suggests that there are economic tradeoffs between planting trees and crops, as well as between planting different tree species. Timber production is not likely to replace food crops for two main reasons: (1) the high cost of meeting household subsistence requirements from marketed grains, (2) household cash flow needs met by annual crops. Farmers plant eucalyptus for commercial purposes because they can obtain timber products within four years; however if the prices of these short rotation products go down, farmers will prefer to grow timber from high yield grevillea.
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Suggested Citation

  • Peralta, Maria Alexandra & Swinton, Scott M., 2009. "Food vs. Wood: Dynamic Choices for Kenyan Smallholders," 2009 Annual Meeting, July 26-28, 2009, Milwaukee, Wisconsin 49401, Agricultural and Applied Economics Association.
  • Handle: RePEc:ags:aaea09:49401
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    File URL: http://purl.umn.edu/49401
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    References listed on IDEAS

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    1. Labarta, Ricardo A. & White, Douglas S. & Swinton, Scott M., 2008. "Does Charcoal Production Slow Agricultural Expansion into the Peruvian Amazon Rainforest?," World Development, Elsevier, vol. 36(3), pages 527-540, March.
    2. Fafchamps, Marcel, 2000. "Ethnicity and credit in African manufacturing," Journal of Development Economics, Elsevier, vol. 61(1), pages 205-235, February.
    3. Amacher, Gregory S. & Merry, Frank D. & Bowman, Maria S., 2009. "Smallholder timber sale decisions on the Amazon frontier," Ecological Economics, Elsevier, vol. 68(6), pages 1787-1796, April.
    4. Jalota, R. K. & Sangha, K. K., 2000. "Comparative ecological-economic analysis of growth performance of exotic Eucalyptus tereticornis and indigenous Dalbergia sissoo in mono-culture plantations," Ecological Economics, Elsevier, vol. 33(3), pages 487-495, June.
    5. Niskanen, Anssi, 1998. "Value of external environmental impacts of reforestation in Thailand," Ecological Economics, Elsevier, vol. 26(3), pages 287-297, September.
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    Cited by:

    1. Call, Isabel & Vosti, Stephen A. & Boucher, Stephen R. & Luedeling, Eike, 2012. "Technology Adoption and Climate-Related Policy Evaluation among East African Smallholders: A Bioeconomic Model of the Trade-offs between Trees and Subsistence," 2012 Annual Meeting, August 12-14, 2012, Seattle, Washington 125015, Agricultural and Applied Economics Association.

    More about this item

    Keywords

    agroforestry; eucalyptus; food security; Kenya; linear programming; smallholder agriculture; whole farm model; Crop Production/Industries; International Development; Production Economics; Resource /Energy Economics and Policy; O13; Q12;

    JEL classification:

    • O13 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Agriculture; Natural Resources; Environment; Other Primary Products
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets

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