Small growers’ direct participation in the market and its impact on farm income

Ujjwal Kanti Paul, Gurudas Das, Malabika Das and Tanuj Mathur

Journal of Agribusiness in Developing and Emerging Economies, 2020, vol. 11, issue 3, 241-254

Abstract: Purpose - The existing literature on linking growers directly with the market mostly overlooks the case of smallholders. They grow commercial–perishable crops and have to rely on the efficacy of the marketing system. The present paper intends to fill this void. Design/methodology/approach - The paper studies the performance of two local markets among 216 pineapple producers and 50 traders using the structure–conduct–performance framework. Following which the authors attempt to unravel the determinants of growers' direct participation in the market and the impact of such involvement on the farm income using the Heckman two-stage treatment effect model. Findings - The study analysis shows that the likelihood of growers’ direct participation in markets, found oligopolistic, increases with education, price information and family labor unit, while decreases with the growers' age, distance from market and the footfall of intermediaries at the farm gate. The second stage of the model has established a positive impact of participation on farm income. Research limitations/implications - The small sample size could restrict generalization. The authors used only operating efficiency as an indicator of the performance of the marketing system due to the unavailability of district-level time series data on pineapple pricing. Originality/value - This study shows that local food markets are oligopolistic. Growers fetch very less share in consumers' price and become vulnerable to food insecurity. The study highlights the determinants of growers' direct participation in the local market and the impact of such involvement on farm income.

Keywords: Market performance; Farm income; Smallholder; Direct participation (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jadeep:jadee-05-2019-0067

DOI: 10.1108/JADEE-05-2019-0067

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