Locking Crops to Unlock Investment : Experimental Evidence on Warrantage in Burkina Faso

Locking Crops to Unlock Investment : Experimental Evidence on Warrantage in Burkina Faso

Financial market imperfections remain pervasive in developing countries, constraining potentially profitable investment decisions, especially for rural smallholder farmers. Warrantage is an innovative model of rural finance with the potential to ov...

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Bibliographic Details
Main Authors: Delavallade, Clara, Godlonton, Susan
Format: Working Paper
Language:English
Published: World Bank, Washington, DC 2020
Subjects:
RURAL FINANCE
INVENTORY CREDIT
STORAGE
WARRANTAGE
AGRICULTURAL INVESTMENT
AFRICA GENDER POLICY
GENDER INNOVATION LAB
Online Access:http://documents.worldbank.org/curated/en/415991589810744520/Locking-Crops-to-Unlock-Investment-Experimental-Evidence-on-Warrantage-in-Burkina-Faso
http://hdl.handle.net/10986/33795
id okr-10986-33795
recordtype oai_dc
spelling okr-10986-337952022-09-20T00:12:31Z Locking Crops to Unlock Investment : Experimental Evidence on Warrantage in Burkina Faso Delavallade, Clara Godlonton, Susan RURAL FINANCE INVENTORY CREDIT STORAGE WARRANTAGE AGRICULTURAL INVESTMENT AFRICA GENDER POLICY GENDER INNOVATION LAB Financial market imperfections remain pervasive in developing countries, constraining potentially profitable investment decisions, especially for rural smallholder farmers. Warrantage is an innovative model of rural finance with the potential to overcome credit, storage, and commitment constraints through a localized inventory credit scheme. Exploiting random variations in household access to warrantage and intensity of access across villages, this paper studies the direct impact of this scheme on beneficiaries as well as its spillover effects. Take-up of storage is high (94 percent), while credit take-up is moderate (38 percent). Households with access to warrantage primarily store sorghum and maize and sell their production over an extended period of time, earning higher average prices and resulting in higher sales revenue ($248, or 33 percent, on average). Increased incomes are spent on long-term investments, including human capital expenditures (education), livestock purchases, and investment in agricultural inputs for the subsequent year. 2020-05-21T19:01:21Z 2020-05-21T19:01:21Z 2020-05 Working Paper http://documents.worldbank.org/curated/en/415991589810744520/Locking-Crops-to-Unlock-Investment-Experimental-Evidence-on-Warrantage-in-Burkina-Faso http://hdl.handle.net/10986/33795 English Policy Research Working Paper;No. 9248 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo World Bank World Bank, Washington, DC Publications & Research Publications & Research :: Policy Research Working Paper Africa Burkina Faso
repository_type Digital Repository
institution_category Foreign Institution
institution Digital Repositories
building World Bank Open Knowledge Repository
collection World Bank
language English
topic RURAL FINANCE
INVENTORY CREDIT
STORAGE
WARRANTAGE
AGRICULTURAL INVESTMENT
AFRICA GENDER POLICY
GENDER INNOVATION LAB
spellingShingle RURAL FINANCE
INVENTORY CREDIT
STORAGE
WARRANTAGE
AGRICULTURAL INVESTMENT
AFRICA GENDER POLICY
GENDER INNOVATION LAB
Delavallade, Clara
Godlonton, Susan
Locking Crops to Unlock Investment : Experimental Evidence on Warrantage in Burkina Faso
geographic_facet Africa
Burkina Faso
relation Policy Research Working Paper;No. 9248
description Financial market imperfections remain pervasive in developing countries, constraining potentially profitable investment decisions, especially for rural smallholder farmers. Warrantage is an innovative model of rural finance with the potential to overcome credit, storage, and commitment constraints through a localized inventory credit scheme. Exploiting random variations in household access to warrantage and intensity of access across villages, this paper studies the direct impact of this scheme on beneficiaries as well as its spillover effects. Take-up of storage is high (94 percent), while credit take-up is moderate (38 percent). Households with access to warrantage primarily store sorghum and maize and sell their production over an extended period of time, earning higher average prices and resulting in higher sales revenue ($248, or 33 percent, on average). Increased incomes are spent on long-term investments, including human capital expenditures (education), livestock purchases, and investment in agricultural inputs for the subsequent year.
format Working Paper
author Delavallade, Clara
Godlonton, Susan
author_facet Delavallade, Clara
Godlonton, Susan
author_sort Delavallade, Clara
title Locking Crops to Unlock Investment : Experimental Evidence on Warrantage in Burkina Faso
title_short Locking Crops to Unlock Investment : Experimental Evidence on Warrantage in Burkina Faso
title_full Locking Crops to Unlock Investment : Experimental Evidence on Warrantage in Burkina Faso
title_fullStr Locking Crops to Unlock Investment : Experimental Evidence on Warrantage in Burkina Faso
title_full_unstemmed Locking Crops to Unlock Investment : Experimental Evidence on Warrantage in Burkina Faso
title_sort locking crops to unlock investment : experimental evidence on warrantage in burkina faso
publisher World Bank, Washington, DC
publishDate 2020
url http://documents.worldbank.org/curated/en/415991589810744520/Locking-Crops-to-Unlock-Investment-Experimental-Evidence-on-Warrantage-in-Burkina-Faso
http://hdl.handle.net/10986/33795
_version_ 1764479533787906048

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