Price Support and Farm Incomes: Comparative Study of Rice Growing Regions in Southern India and Mekong-Delta Vietnam

Deepak Johnson and Takashi Kurosaki

No 741, Discussion Paper Series from Institute of Economic Research, Hitotsubashi University

Abstract: Drawing on the broad literature on agricultural development and particularly on the contribution of price and non-price factors, this study examines how government support contributes to farm incomes from rice cultivation in two frontier rice-growing regions in Asia: Kerala, southern India and Mekong Delta, Vietnam. We use a detailed case study approach to offer a unique comparison between two best-performing areas that are similar in agroclimatic conditions and institutional trajectories, which is generally wanting in literature. Our farm budget analysis and counterfactual simulations using household-level data show that the local (state-level) price support contributes to more than half of the average crop income per hectare in Kerala. While the per hectare crop income for a single season in Vietnam was significantly lower than in Kerala, the annual incomes were higher due to multiple cropping. We combine these survey-based results with qualitative insights to examine how various factors have led to the observed scenario. This comparative analysis demonstrates the need for specific non-price interventions, particularly in terms of research and extension services, in enhancing incomes for agriculturally advanced regions within developing countries.

Keywords: Farm households; Rice cultivation; Agricultural policy; India; Vietnam; Price support; Infrastructure (search for similar items in EconPapers)
JEL-codes: O13 Q12 Q16 Q18 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2023-05
New Economics Papers: this item is included in nep-agr, nep-dev and nep-sea
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Persistent link: https://EconPapers.repec.org/RePEc:hit:hituec:741

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