Impact of Agricultural Cooperatives on Smallholders’ Technical Efficiency: Evidence from Ethiopia

32 Pages Posted: 14 Mar 2013

See all articles by Gashaw Tadesse Abate

Gashaw Tadesse Abate

University of Trento; European Research Institute on Cooperative & Social Enterprises (EURICSE)

Gian Nicola Francesconi

Committee of Sustainable Assessment (COSA)

Kindie Getnet

International Water Management Institute (IWMI)

Date Written: February 27, 2013

Abstract

Using household survey data from Ethiopia, this paper evaluates the impact of agricultural cooperatives on smallholders’ technical efficiency. We utilize propensity score matching to compare the average difference in technical efficiency between cooperative farmers and similar independent farmers. The approach assumes exogenous cooperative formation and similar farm technology across households. The results show that agricultural cooperatives are effective in providing support services that significantly contribute to members’ technical efficiency. These results are found to be insensitive to hidden bias and consistent with the idea that agricultural cooperatives enhance members’ efficiency by easing access to productive inputs and facilitating extension linkages. Based on the findings, increased participation in agricultural cooperatives should further enhance efficiency gains among smallholder farmers.

Keywords: Agricultural cooperatives, smallholder farmers, technical efficiency, Ethiopia

JEL Classification: Q12, Q13, Q16

Suggested Citation

Abate, Gashaw Tadesse and Francesconi, Gian Nicola and Getnet, Kindie, Impact of Agricultural Cooperatives on Smallholders’ Technical Efficiency: Evidence from Ethiopia (February 27, 2013). Euricse Working Paper No. 50 | 13. Available at SSRN: https://ssrn.com/abstract=2225791 or http://dx.doi.org/10.2139/ssrn.2225791

Gashaw Tadesse Abate (Contact Author)

University of Trento ( email )

Via Giuseppe Verdi 26
Trento, Trento 38152
Italy

European Research Institute on Cooperative & Social Enterprises (EURICSE) ( email )

Via S. Giovanni 36
38122 Trento (TN)
Italy

Gian Nicola Francesconi

Committee of Sustainable Assessment (COSA) ( email )

Dakar
Senegal

Kindie Getnet

International Water Management Institute (IWMI) ( email )

Addis Ababa
Ethiopia

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