Umeå Economic Studies, Department of Economics, Umeå University
No 810:
Changing the Risk at the Margin Smallholder Farming and Public Policy in Developing Countries
Camilla Andersson ()
Abstract: This thesis consists of a summary and four self-contained
papers. Paper [I] examines whether the implementation of a social safety
net programme in Ethiopia has affected the value, risk and composition of
farmers’ crop portfolios. The empirical analysis suggests that the value
and risk of the crop portfolio have not been altered due to the programme.
However, the programme seems to have brought about some changes in the land
allocated to different crops. Paper [II] studies how a social safety net
affects farmers’ (dis)investments in productive assets. More specifically,
it studies how the Productive Safety Net Programme in Ethiopia has changed
livestock and tree holdings. The results indicate no significant effect on
livestock holdings, but a significant increase in tree holdings. Paper
[III] investigates if there is a problem of adverse selection in formal
microlending in rural Bangladesh. The results indicate that farmers who
only borrow formally have a shadow price of capital that is substantially
higher than the average informal interest rate. This suggests that farmers
that only borrow formally are perceived as poor credit risks by informal
lenders. Paper [IV] explores the economic incentives surrounding the
cultivation of opium poppy in Afghanistan. Specifically, it examines the
impact of eradication policies when opium is used as a means of obtaining
credit, and when the crops are produced in sharecropping arrangements. The
results indicate that both these features are likely to affect the outcome
of eradication policies.
Keywords: Smallholder farming; Public policy; Informal risk strategies; Microcredit; Opium eradication; Development economics; Food policy; (follow links to similar papers)
JEL-Codes: O22; Q12; Q18; Q18; Q28; (follow links to similar papers)
135 pages, May 19, 2010
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