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Article
Publication date: 15 December 2020

Abdoul Karim Diamoutene and John Baptist D. Jatoe

The aim of this paper is to analyze the effects of access to credit on maize productivity in Mali, by identifying the determinants of credit market participation and maize yield…

290

Abstract

Purpose

The aim of this paper is to analyze the effects of access to credit on maize productivity in Mali, by identifying the determinants of credit market participation and maize yield, and then estimating the impact of credit on maize yield.

Design/methodology/approach

This study analyzes the impact of credit on maize productivity using data from the World Bank 2014 Living Standards Measurement Survey (LSMS) on Mali, and the endogenous switching regression (ESR) model.

Findings

The results suggest a positive effect of credit on maize yield in Mali. Farm size, production shocks and the female gender exert negative effects on credit market participation, unlike education, intercropping with cotton, male family labor and fertilizer use which show positive effects. Farm size has a negative effect on maize yield, but both male family labor, and fertilizer use exert positive effects. Although the use of credit improves agricultural yields, the results show a greater potential effect for rationed producers, than credit users.

Research limitations/implications

These results suggest that implementing a credit strategy that allows those currently excluded from the credit market, to participate, could substantially increase productivity and maize production output in furtherance of the country's food security strategy. Gender-based targeting is needed to bridge the gender gap in access to credit.

Originality/value

As far as the authors are aware, this study is the first to explore the credit-farm productivity links in Mali, while addressing selection bias.

Details

Agricultural Finance Review, vol. 81 no. 3
Type: Research Article
ISSN: 0002-1466

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Article
Publication date: 3 July 2017

Mohamed Porgo, John K.M. Kuwornu, Pam Zahonogo, John Baptist D. Jatoe and Irene S. Egyir

Credit is central in labour allocation decisions in smallholder agriculture in developing countries. The purpose of this paper is to analyse the effect of credit constraints on…

407

Abstract

Purpose

Credit is central in labour allocation decisions in smallholder agriculture in developing countries. The purpose of this paper is to analyse the effect of credit constraints on farm households’ labour allocation decisions in rural Burkina Faso.

Design/methodology/approach

The study used a direct elicitation approach of credit constraints and applied a farm household model to categorize households into four labour market participation regimes. A joint estimation of both the multinomial logit model and probit model was applied on survey data from Burkina Faso to assess the effect of credit constraint on the probability of choosing one of the four alternatives.

Findings

The results of the probit model showed that households’ endowment of livestock, access to news, and membership to an farmer-based organization were factors lowering the probability of being credit constrained in rural Burkina Faso. The multinomial logit model results showed that credit constraints negatively influenced the likelihood of a farm household to use hired labour in agricultural production and perhaps more importantly it induces farm households to hire out labour off farm. The results also showed that the other components of household characteristics and farm attributes are important factors determining the relative probability of selecting a particular labour market participation regime.

Social implications

Facilitating access to credit in rural Burkina Faso can encourage farm households to use hired labour in agricultural production and thereby positively impacting farm productivity and relieving unemployment pressures.

Originality/value

In order to identify the effect of credit constraints on farm households’ labour decisions, this study examined farm households’ decisions of hiring on-farm labour, supplying labour off-farm or simultaneously hiring on-farm labour and supplying family labour off-farm under credit constraints using the direct elicitation approach of credit constraints. To the best of the authors’ knowledge, this study is the first to examine this problem in Burkina Faso.

Details

Agricultural Finance Review, vol. 77 no. 2
Type: Research Article
ISSN: 0002-1466

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Article
Publication date: 8 August 2024

Kwame Asiam Addey and John Baptist D. Jatoe

The objective of this paper is to examine crop yield predictions and their implications on MPCI in Ghana. Farmers in developing countries struggle with their ability to deal with…

66

Abstract

Purpose

The objective of this paper is to examine crop yield predictions and their implications on MPCI in Ghana. Farmers in developing countries struggle with their ability to deal with agricultural risks. Providing aid for farmers and their households remains instrumental in combatting poverty in Africa. Several studies have shown that correctly understanding and implementing risk management strategies will help in the poverty alleviation agenda.

Design/methodology/approach

This study examines the importance of crop yield distributions in Ghana and its implication on multiperil crop insurance (MPCI) rating using the Lasso regression model. A Bonferroni test was employed to test the independence of crop yields across the regions while the Kruskal-Wallis H test was conducted to examine statistical differences in mean yields of crops across the ten regions. The Bayesian information criteria and k-fold cross-validation methods are used to select an appropriate Lasso regression model for the prediction of crop yields. The study focuses on the variability of the threshold yields across regions based on the chosen model.

Findings

It is revealed that threshold yields differ significantly across the regions in the country. This implies that the payment of claims will not be evenly distributed across the regions, and hence regional disparities need to be considered when pricing MPCI products. In other words, policymakers may choose to assign respective weights across regions based on their threshold yields.

Research limitations/implications

The primary limitation is the unavailability of regional climate data which could have helped in a better explanation of the variation across the regions.

Originality/value

This is the first study to examine the implications of regional crop yield variations on multiperil crop insurance rating in Ghana.

Details

Agricultural Finance Review, vol. 84 no. 2/3
Type: Research Article
ISSN: 0002-1466

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Article
Publication date: 30 June 2020

Kwame Asiam Addey, John Baptist D. Jatoe and George Tsey-Mensah Kwadzo

The aim of this paper is to identify the factors that influence rice farmers' decisions to adopt crop insurance and premium payments (willingness to pay [WTP] amounts). The paper…

433

Abstract

Purpose

The aim of this paper is to identify the factors that influence rice farmers' decisions to adopt crop insurance and premium payments (willingness to pay [WTP] amounts). The paper also demonstrates the usefulness of the complementary log-log (cloglog) truncated Poisson double-hurdle model as an alternative hurdle model.

Design/methodology/approach

The study first investigated the nature of the dependent variable, which had non-normal residuals and was overdispersed. The probit truncated normal regression double-hurdle model was tried but it failed the normality and homoscedasticity tests; hence, the cloglog truncated Poisson double-hurdle model was employed in the study.

Findings

An estimated 61% of respondents would purchase crop insurance, despite farmers not having prior experience with this product. Amongst others, the factors that influence insurance adoption amongst rice farmers are the share of rice in total income, reliability perception of crop insurance schemes and the probability of failure to achieve target yields. The latter helps the authors to address adverse selection, a central issue to the viability of such an insurance programme. The determinants of farmers' WTP are also identified.

Research limitations/implications

Sampling was limited to farmers using irrigation and living in one region of Ghana, which may limit the study’s wider applicability.

Originality/value

As far as the authors are aware, this study is the first to select the appropriate hurdle model based on established properties of the dependent variable on this topic – crop insurance decisions.

Details

Agricultural Finance Review, vol. 81 no. 1
Type: Research Article
ISSN: 0002-1466

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Article
Publication date: 16 May 2016

Baah Prince Annor, Akwasi Mensah-Bonsu and John Baptist D. Jatoe

The purpose of this paper is to assess the adherence, constraints and key factors associated with smallholder pineapple farmers’ compliance with Global working group for Good…

535

Abstract

Purpose

The purpose of this paper is to assess the adherence, constraints and key factors associated with smallholder pineapple farmers’ compliance with Global working group for Good Agricultural Practice (GLOBALGAP) standards in the Akuapem-South Municipal area, Ghana. It utilizes the modeling of socio-economic, farm, market and institutional factors influencing smallholder farmers’ compliance with GLOBALGAP standards. This paper aims to enhance smallholder farmers’ compliance with food safety standards in particular GLOBALGAP so they can continue to participate in international food trade.

Design/methodology/approach

The study uses mainly primary data solicited from 150 randomly selected smallholder farmers. Descriptive statistics are employed in estimating compliant farmers’ rate of adherence with standards requirements and identifying constraints of farmers while a probit regression model is used to determine the factors influencing GLOBALGAP compliance decision of farmers.

Findings

Findings of the study show that compliant farmers’ rate of adherence with the standard is about 90 percent and this is below the minor musts compliance criteria of 95 percent. The results also indicate that lack of access to farm credits, high cost of farm inputs and high cost of labor are the major constraints to GLOBALGAP compliance. Factors found to positively influence farmers’ compliance decision are number of pineapple farms, access to off-farm income, access to market information and extension services. However, compliance is negatively influenced by age.

Research limitations/implications

Majority of Ghanaian smallholder pineapple farmers are not GLOBALGAP certified. The study was limited to Akuapem-South because most farmers produce pineapple for the export market and are certified under the Option II GLOBALGAP group certification.

Originality/value

This paper brings to bear issues confronting food safety standards compliance among smallholder farmers in developing countries, particularly Ghana.

Details

Journal of Agribusiness in Developing and Emerging Economies, vol. 6 no. 1
Type: Research Article
ISSN: 2044-0839

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Case study
Publication date: 19 January 2018

Prince Baah Annor

Agricultural Trade, Farm Management, Economics of Food Safety

Abstract

Subject area

Agricultural Trade, Farm Management, Economics of Food Safety

Study level/applicability

Both undergraduate and postgraduate studies in Agribusiness and Agricultural Economics.

Case overview

The pineapple production sector plays a very significant role in the Ghanaian horticultural industry. Production and export of fresh pineapple has been Ghana’s most developed high-value supply chain. However, the introduction of the GlobalGAP food safety standard in 2007 resulted in a fall in smallholder farmers’ participation in exportable pineapple production and subsequently led to declining trends in pineapple exports. The Ghanaian horticultural industry received quite a number of interventions over the years aimed at revitalizing the horticultural export sector and enhancing international competitiveness. However, the pineapple export sub-sector is still constrained with production and market access challenges meaning the sector struggles to survive.

Expected learning outcomes

The GlobalGAP standard compliance case is an appropriate way of explaining how smallholder farmers make informed decisions concerning the adoption of new farm practices. The case presents a careful evaluation of technical, institutional and socio-economic factors influencing a farmer’s decision to comply or not to comply with the GlobalGAP standard. Students should be able to apply farm management decision-making concepts and tools such as profit maximization and binary choice modelling techniques to explain a farmers’ final decisions on GlobalGAP standard compliance. This case should enable students to appreciate key factors constraining agricultural export trade performance in developing countries. The case should also contribute to students’ understanding of smallholder farmers’ decisions on food safety standards compliance, particularly GlobalGAP, and the challenges associated with the entire compliance process. Moreover, this case should provide students with possible policy considerations geared towards making food safety standards compliance easier, effective and sustainable in developing countries so as to enhance market access while ensuring food quality and safety along high-value food supply chains.

Supplementary materials

Teaching Notes are available for educators only. Please contact your library to gain login details or email support@emeraldinsight.com to request teaching notes.

Subject code

CSS 7 Management Science

Details

Emerald Emerging Markets Case Studies, vol. 8 no. 1
Type: Case Study
ISSN: 2045-0621

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