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The supermarket revolution and impacts on agricultural labor markets: Empirical evidence from Kenya

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  • Rao, Elizaphan J.O.
  • Qaim, Matin

Abstract

Many developing countries are currently experiencing a rapid expansion of supermarkets. New supermarket procurement systems could have important implications for farming and wider rural development. While previous studies have analyzed farm profit and income effects, possible employment effects have received much less attention. Building on data from a recent survey of vegetable farmers in Kenya, in this article a double-hurdle model of hired labor use is developed and estimated. Farmer participation in supermarket channels increases the likelihood of hiring labor by 13% and overall demand for hired labor by 38%. A gender disaggregation shows that positive employment effects are especially pronounced for female hired labor. Given that agricultural wage labor is primarily an activity of low-income households in rural areas, the poor benefit over-proportionally.

Suggested Citation

  • Rao, Elizaphan J.O. & Qaim, Matin, 2011. "The supermarket revolution and impacts on agricultural labor markets: Empirical evidence from Kenya," Discussion Papers 107745, Georg-August-Universitaet Goettingen, GlobalFood, Department of Agricultural Economics and Rural Development.
  • Handle: RePEc:ags:gagfdp:107745
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    References listed on IDEAS

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    Cited by:

    1. Masinde, Wanyama J. & Obare, Gideon A. & Owuor, George & Wasilwa, Lusike, 2013. "Factors Influencing Adoption of Tissue Culture Banana in Western Kenya," 2013 AAAE Fourth International Conference, September 22-25, 2013, Hammamet, Tunisia 160519, African Association of Agricultural Economists (AAAE).

    More about this item

    Keywords

    Supermarkets; Off-farm income; Hired labor; Double-hurdle model; Kenya; Agricultural and Food Policy; Community/Rural/Urban Development; Consumer/Household Economics; Crop Production/Industries; Demand and Price Analysis; Farm Management; Food Consumption/Nutrition/Food Safety; Food Security and Poverty; Labor and Human Capital; Land Economics/Use; Livestock Production/Industries; Productivity Analysis; C34; Q12; Q13; J43;

    JEL classification:

    • C34 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Truncated and Censored Models; Switching Regression Models
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness
    • J43 - Labor and Demographic Economics - - Particular Labor Markets - - - Agricultural Labor Markets

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