How Does Participation in Value Chains Matter to African Farmers?
Trade and participation in global value chains can play a key role in economic diversification and development. This paper deepens the discussion about productivity growth and upgrading in agriculture in Africa, and the role of national, regional,...
| Main Authors: | , , , |
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| Format: | Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2018
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/625351530882059462/How-does-participation-in-value-chains-matter-to-African-farmers http://hdl.handle.net/10986/29979 |
| Summary: | Trade and participation in global value
chains can play a key role in economic diversification and
development. This paper deepens the discussion about
productivity growth and upgrading in agriculture in Africa,
and the role of national, regional, and international value
chains in supporting such structural change. The analysis in
this report is based on quantitative and qualitative surveys
undertaken in 2016 in Ghana, Kenya, and Zambia, where 3,935
farmers, 60 aggregators, and 56 buyers in the maize,
cassava, and sorghum value chains were interviewed in the
three countries. The descriptive results show that farmers
who were on a contract saw greater structural
transformation; higher output; and better access to seeds,
fertilizers, pesticides, technology, and extension services
compared with farmers who were not on a contract. To
identify more robustly the link between value chain
participation and contract farming with productivity and
upgrading, the paper looks at the relationship using a
variety of empirical methodologies, ranging from ordinary
least squares and probit regressions to propensity score
matching. Based on the empirical evidence, the hypothesis
that value chain participation leads to structural
transformation cannot be confirmed. The paper does find
evidence that formal or informal contractual arrangements
that regulate the provision of inputs to production, such as
fertilizer, technology, extension services, and market
information, positively affect upgrading. It remains
nevertheless important to understand the impact of
government policies on the emergence of value chains given
that value chains support contractual arrangements. |
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