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Should African rural development strategies depend on smallholder farms ? an exploration of the inverse productivity hypothesis

Author:	Larson, Donald F.; Otsuka, Keijiro; Matsumoto, Tomoya; Kilic, Talip;	Collection Title:	Policy Research working paper ; no. WPS 6190
Country:	Africa;	Date Stored:	2012/09/06
Document Date:	2012/09/01	Document Type:	Policy Research Working Paper
Language:	English	Major Sector:	Agriculture, fishing, and forestry
Rel. Proj ID:	3A-Can Agricultural Growth Strategies Rely On African Smallholders -- -- P126407;	Region:	Africa
Report Number:	WPS6190	Sub Sectors:	General agriculture, fishing and forestry sector; Crops
SubTopics:	Crops and Crop Management Systems; Economic Theory & Research; Climate Change and Agriculture; Labor Policies; Rural Development Knowledge & Information Systems	Volume No:	1 of 1

Summary: In Africa, most development strategies include efforts to improve the productivity of staple crops grown on smallholder farms. An underlying premise is that small farms are productive in the African context and that smallholders do not forgo economies of scale -- a premise supported by the often observed phenomenon that staple cereal yields decline as the scale of production increases. This paper explores a research design conundrum that encourages researchers who study the relationship between productivity and scale to use surveys with a narrow geographic reach, when policy would be better served with studies based on wide and heterogeneous settings. Using a model of endogenous technology choice, the authors explore the relationship between maize yields and scale using alternative data. Since rich descriptions of the decision environments that farmers face are needed to identify the applied technologies that generate the data, improvements in the location specificity of the data should reduce the likelihood of identification errors and biased estimates. However, the analysis finds that the inverse productivity hypothesis holds up well across a broad platform of data, despite obvious shortcomings with some components. It also finds surprising consistency in the estimated scale elasticities.


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