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Market Imperfections And Class Structure: The Case Of South Africa

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  • Lovo, Stefania

Abstract

Land and market imperfections shape the organization of agricultural production and lead to different production regimes within rural farm households in South Africa. This paper presents a theoretical model to explain the presence of three main households groups (classes) determined on the basis of the labor regime adopted: small peasants (working both on and off farm), self cultivators (autarkic in labor) and hiring in households. Membership in the three categories is determined by the endogenous shadow wage and the effective market wages. A generalized ordered logit model is used to test the main predictions of the model. Market imperfections, which prevent household from accessing markets, are expected to have different impacts on heterogenous households; in this study, a Brant test on coefficient constancy helps to identify the household specific factors affecting market participation.

Suggested Citation

  • Lovo, Stefania, 2008. "Market Imperfections And Class Structure: The Case Of South Africa," 107th Seminar, January 30-February 1, 2008, Sevilla, Spain 6675, European Association of Agricultural Economists.
    • Handle: RePEc:ags:eaa107:6675
    DOI: 10.22004/ag.econ.6675
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    References listed on IDEAS

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