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Linkages between Farm and Non-Farm Sectors at the Household Level in Rural Ghana

A consistent stochastic distance function approach









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    Linkages and rural non-farm employment creation: Changing challenges and policies in Indonesia 2003
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    Increasing problems of rural unemployment in Indonesia are at the core of this report. Numbers of unemployed increased dramatically after the 1997 economic crisis and millions of people searched to be reabsorbed in rural labour markets. Agricultural land is scarce, however, and entry barriers are often high in non-farm businesses. Access to capital and information is limited for the rural poor and uneducated people. During successful periods of economic growth in Indonesia, various linkages in f actor and commodity markets were created. Any return to the state-dominated economy and substantial government interventions in markets is unrealistic, but linkages may nevertheless be manipulated for political ends like employment creation. Policy instruments may still be applicable for reducing market failures and to facilitate commercial transactions in an economy characterised by disintegration and sectoral and geographical disconnection. This paper aims to assess experiences from former lin kage strategies for rural non-farm employment creation and to point at new policies suitable in various and changing economic, political and cultural contexts of Indonesia. A conclusion is that linkages and rural employment creation strategies should aim towards mobilising the variety of local natural and cultural resources and encourage horizontal communication and economic transactions between regions and peoples.
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    Strengthening farm-agribusiness linkages in Africa
    Summary results of five country studies in Ghana, Nigeria, Kenya, Uganda and South Africa
    2004
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    Over the past decade, Africa and other developing regions have been in the midst of tremendous changes. Market liberalisation and governmental decentralisation policies have interfaced with globalisation and urbanisation trends to dramatically transform social, political, economic and cultural lives. Agriculture can no longer remain behind-serving only to meet subsistence food needs. Agriculture has to become a dynamic and integral part of the market economy. If African agriculture is by-passed by the economic transformation going on world wide, then large numbers of Africans and perhaps all of Africa will remain poor and food insecure. The fundamental purpose behind the FAO initiative to strengthening farm-agribusiness linkages is to help transform the agricultural sector in order to accelerate productivity growth, increase income and employment generation, improve food security, and increase competitiveness in regional and international trade. In 2001 and 2002 five country case studies on farm-agribusiness linkages were undertaken in Ghana, Nigeria, Kenya, Uganda and South Africa. The main purpose of the studies was to get an insight into current farm-agribusiness linking arrangements. This included identifying and analysing successful linkages highlighting different methods and practices as well as exploring key factors that have led to successful partnerships. The country studies also contained a brief agribusiness sector overview. The work in Africa began with preparation of five case studies which are presented as summary results as well as individually. FAO work on farm-agribusiness linkages emerged from a broader cross-regional study on farm-agribusiness linkages launched in 2000. The first stage was a series of country studies and a regional consultation in Asia. During 2001 and 2002, case studies and a regional workshop on agribusiness linkages were carried out in Latin America. This was followed by a workshop on strategies for improving neg otiation and compliance capabilities, held in November 2002 in Peru. An expert consultation on strengthening farm-agribusiness linkages in Africa was held in March 2003 in Nairobi, Kenya.
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    Agriculture and poverty in commodity dependent African countries
    A rural household perspective from the United Republic of Tanzania
    2006
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    This report explores how farm productivity affects poverty, and how various factor market constraints affect farm productivity. The empirical analysis draws on representative surveys of farm households in Kilimanjaro and Ruvuma, two cash crop growing regions in the United Republic of Tanzania. Poorer households were found not only to possess fewer assets, but also to be much less productive. Findings show that agricultural productivity directly affects household consumption and hence overall pov erty and welfare. Stochastic production frontier analysis indicates that many farmers are farming well below best practice in the region. Holding inputs constant, they attain on average only 60 percent of the output obtained by their best counterparts. Analysis of allocative efficiency suggests that family labour is substantially overutilized, a sign of considerable excess labour supply. Use of intermediate inputs on the other hand is well below what is commensurate with the estimated value of t heir marginal productivities. An important reason for low input use is lack of credit to purchase inputs, but difficult access to the inputs themselves and being connected to the economy more broadly are also important impediments. Easy access to credit is positively associated with being a member of a savings association or being in a contractual arrangement with a cooperative or firm. Irrigation infrastructure facilitates access to credit. Together these findings support a continuing emphasis on increasing agricultural productivity in designing poverty reduction policies. Better agronomic practices and increased input use will be crucial in this strategy. Better access to inputs and improved roads and transport services will further help boost input application. Financial constraints might be relieved through fostering institutional arrangements facilitating contract enforcement (e.g. contract farming, marketing cooperatives) and institutions that facilitate saving by the households themselves. They may also be relieved by the provision of more adequate consumption safety nets. The overall results suggest that a pro-poor rural development strategy needs to be anchored around improvements in agricultural productivity.

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