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How Does Participation in Value Chains Matter to African Farmers? (Inglês)

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, sixty aggregators, and fifty-six 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 authors look at the relationship using a variety of empirical methodologies, ranging from ordinary least squares (OLS) 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. Rather, any type of formal or informal agreement which regulates the provision of inputs to production, such as fertilizer, technology, extension services and market information is likely to have a stronger effect on upgrading than value chain participation per se. 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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    Dihel,Nora Carina, Grover,Arti Goswami, Hollweg,Claire Honore, Slany,Anja

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    How Does Participation in Value Chains Matter to African Farmers?

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    farmer; national policy need; regional and global value chains; contract farming; fresh fruit and vegetable; impact of climate change; access to foreign market; Democratic Republic of Congo; supply of raw material; impact on poverty reduction; productivity growth; Agricultural Value Chain; agriculture sector; propensity score matching; contractual arrangement; agricultural productivity growth; factor of production; regional value chain; domestic food security; extension service; inputs to production; share of output; measure of trade; investments in infrastructure; food value chain; return to investment; dependence on commodities; panel data set; labor productivity growth; access to import; improvement in technology; impact of trade; reallocation of resource; production of staple; production of cassava; gross domestic product; allocation of labor; efficient production methods; improvements in access; employment in industry; trade and investment; rural infrastructure development; drip irrigation technology; change in income; modern economic growth; domestic value added; control over quality; higher profit margin; economies of scale; access to land; share of import; demand for good; high productivity growth; forms of participation; commodity export sector; staple food crop



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