Should African Rural Development Strategies Depend on Smallholder Farms? An Exploration of the Inverse Productivity Hypothesis

32 Pages Posted: 20 Apr 2016 Last revised: 2 Jun 2020

See all articles by Donald F. Larson

Donald F. Larson

Global Research Institute

Keijiro Otsuka

National Graduate Institute for Policy Studies (GRIPS)

Tomoya Matsumoto

World Bank

Talip Kilic

World Bank - Development Data Group (DECDG)

Keijiro Otsuka

affiliation not provided to SSRN

Date Written: September 1, 2012

Abstract

In Africa, most development strategies include efforts to improve the productivity of staple crops grown on smallholder farms. An underlying premise is that small farms are productive in the African context and that smallholders do not forgo economies of scale -- a premise supported by the often observed phenomenon that staple cereal yields decline as the scale of production increases. This paper explores a research design conundrum that encourages researchers who study the relationship between productivity and scale to use surveys with a narrow geographic reach, when policy would be better served with studies based on wide and heterogeneous settings. Using a model of endogenous technology choice, the authors explore the relationship between maize yields and scale using alternative data. Since rich descriptions of the decision environments that farmers face are needed to identify the applied technologies that generate the data, improvements in the location specificity of the data should reduce the likelihood of identification errors and biased estimates. However, the analysis finds that the inverse productivity hypothesis holds up well across a broad platform of data, despite obvious shortcomings with some components. It also finds surprising consistency in the estimated scale elasticities.

Keywords: Food Security, Agricultural Growth and Rural Development, Rural Settlements, Climate Change and Agriculture, Crops and Crop Management Systems, Inequality, Rural Labor Markets, Labor Markets

Suggested Citation

Larson, Donald F. and Otsuka, Keijiro and Matsumoto, Tomoya and Kilic, Talip and Otsuka, Keijiro, Should African Rural Development Strategies Depend on Smallholder Farms? An Exploration of the Inverse Productivity Hypothesis (September 1, 2012). World Bank Policy Research Working Paper No. 6190, Available at SSRN: https://ssrn.com/abstract=2143064

Donald F. Larson (Contact Author)

Global Research Institute ( email )

P.O. Box 8795
Williamsburg, VA 23185
United States

HOME PAGE: http://https://sites.google.com/site/decrgdonaldflarson/

Keijiro Otsuka

National Graduate Institute for Policy Studies (GRIPS) ( email )

7-22-1 Roppongi,Minato,
Tokyo 106-8677
Japan

Tomoya Matsumoto

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Talip Kilic

World Bank - Development Data Group (DECDG) ( email )

Via Labicana 110
Rome, Lazio 00184
Italy

Keijiro Otsuka

affiliation not provided to SSRN

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