Heterogeneous market participation channels and household welfare
Date
2023
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Oxford Development Studies
Abstract
This paper uses panel data and qualitative interviews from southwestern
Ghana to analyse farmers’ heterogeneous oil palm marketing decisions and
the effect on household welfare. We show that, despite the supposed
benefits that smallholders could derive from participation in global agricultural value chains via formal contracts, such arrangements are rare
although two of Ghana’s ‘big four’ industrial oil palm companies are located
in the study area. In the absence of formal contracts, farmers self-select into
four main oil palm marketing channels (OPMCs). These OPMCs are associated with varying levels of welfare, with processing households and those
connected to industrial companies by verbal contracts, being better off.
Furthermore, own-processing of palm fruits has been shown to reduce gender gaps
in household welfare. We also unearth community and household level
factors that hamper or facilitate participation in remunerative OPMCs. These
results have implications for development policy and practice related to
inclusive agricultural commercialization.
Description
Research Article
Keywords
Market participation, household welfare, Ghana