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Agricultural mechanization in Ghana: Is specialization in agricultural mechanization a viable business model?

Author

Listed:
  • Houssou, Nazaire
  • Diao, Xinshen
  • Cossar, Frances
  • Kolavalli, Shashidhara
  • Jimah, Kipo
  • Aboagye, Patrick

Abstract

Even though the intention of the government is to promote private sector-led mechanization, findings suggest that the AMSEC model is unlikely to be a profitable business model attractive to private investors even with the current level of subsidy. The low tractor utilization rate as a result of low operational scale is the most important constraint to the intertemporal profitability of tractor-hire services. The government can play an important role in facilitating the development of a tractor service market; however, the successful development of such a market depends on the incentive and innovation of the private sector, including farmers who want to own tractors as part of their business portfolio, traders who know how to bring in affordable tractors and expand the market, and manufacturers in exporting countries who want to seek a long-term potential market opportunity in Ghana and in other west African countries.

Suggested Citation

  • Houssou, Nazaire & Diao, Xinshen & Cossar, Frances & Kolavalli, Shashidhara & Jimah, Kipo & Aboagye, Patrick, 2013. "Agricultural mechanization in Ghana: Is specialization in agricultural mechanization a viable business model?," IFPRI discussion papers 1255, International Food Policy Research Institute (IFPRI).
  • Handle: RePEc:fpr:ifprid:1255
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    References listed on IDEAS

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    1. Hayami, Yujiro & Kawagoe, Toshihiko, 1989. "Farm mechanization, scale economies and polarization : The Japanese experience," Journal of Development Economics, Elsevier, vol. 31(2), pages 221-239, October.
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    Cited by:

    1. Houssou, Nazaire & Chapoto, Antony, 2014. "The changing landscape of agriculture in Ghana: Drivers of farm mechanization and its impacts on cropland expansion and intensification:," IFPRI discussion papers 1392, International Food Policy Research Institute (IFPRI).
    2. Hiroyuki Takeshima & Hyacinth O. Edeh & Akeem O. Lawal & Moshudi A. Isiaka, 2015. "Characteristics of Private-Sector Tractor Service Provisions: Insights from Nigeria," The Developing Economies, Institute of Developing Economies, vol. 53(3), pages 188-217, September.
    3. Diao, Xinshen & Agandin, John & Fang, Peixun & Justice, Scott E. & Kufoalor, Doreen S. & Takeshima, Hiroyuki, 2018. "Agricultural mechanization in Ghana: Insights from a recent field study:," IFPRI discussion papers 1729, International Food Policy Research Institute (IFPRI).
    4. Houssou, Nazaire & Chapoto, Anthony & Asante-Addo, Collins, 2016. "Farm transition and indigenous growth: The rise to medium- and large-scale farming in Ghana:," IFPRI discussion papers 1499, International Food Policy Research Institute (IFPRI).
    5. Diao, Xinshen & Cossar, Frances & Houssou, Nazaire & Kolavalli, Shashidhara, 2014. "Mechanization in Ghana: Emerging demand, and the search for alternative supply models," Food Policy, Elsevier, vol. 48(C), pages 168-181.
    6. Ghebru, Hosaena & Khan, Huma & Lambrecht, Isabel, 2016. "Perceived land tenure security and rural transformation: Empirical evidence from Ghana:," IFPRI discussion papers 1545, International Food Policy Research Institute (IFPRI).
    7. Amagoia Sagasta & José M. Usategui, 2015. "Purchase and rental subsidies in durable-oligopolies," Hacienda Pública Española, IEF, vol. 213(2), pages 11-40, June.
    8. Houssou, Nazaire & Diao, Xinshen & Kolavalli, Shashi, 2014. "Can the private sector lead agricultural mechanization in Ghana?:," GSSP policy notes 4, International Food Policy Research Institute (IFPRI).
    9. Gulati, Kajal & Lybbert, Travis J. & Spielman, David J., 2017. "Diffusing to level fields: Evolution of laser land leveling technology markets in India," 2017 Annual Meeting, July 30-August 1, Chicago, Illinois 258387, Agricultural and Applied Economics Association.
    10. Houssou, Nazaire & Aboagye, Patrick Ohene & Kolavalli, Shashidhara, 2016. "Meeting Ghanaian farmers' demand for a full range of mechanization services:," GSSP policy notes 9, International Food Policy Research Institute (IFPRI).
    11. Takeshima, Hiroyuki & Edeh, Hyacinth & Lawal, Akeem & Isiaka, Moshud, 2014. "Tractor owner-operators in Nigeria: Insights from a small survey in Kaduna and Nasarawa states:," IFPRI discussion papers 1355, International Food Policy Research Institute (IFPRI).
    12. Houssou, Nazaire & Chapoto, Anthony, 2015. "Adoption of Farm Mechanization, Cropland Expansion, and Intensification in Ghana," 2015 Conference, August 9-14, 2015, Milan, Italy 211744, International Association of Agricultural Economists.

    More about this item

    Keywords

    agricultural transformation; mechanization; agricultural mechanization; tractor hire; Investment; Government policy; subsidies; Private ownership; Market development; Private sector;

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