Market Participation by Rural Households in a Low-Income Country: An Asset Based Approach Applied to Mozambique

Faith and Economics Vol 50, Fall 2007: 64-101

56 Pages Posted: 6 Jan 2019

See all articles by Duncan Boughton

Duncan Boughton

Michigan State University - Department of Agricultural, Food and Resource Economics

David Mather

Michigan State University - Department of Agricultural Economics

Christopher B. Barrett

Cornell University - Charles H. Dyson School of Applied Economics & Management

Rui S Benfica

International Fund for Agricultural Development (IFAD)

Danilo Abdula

affiliation not provided to SSRN

David Tschirley

Michigan State University - Department of Agricultural Economics

Benedito Cunguara

Michigan State University - Department of Agricultural, Food and Resource Economics

Multiple version iconThere are 2 versions of this paper

Date Written: 2007

Abstract

Market participation is both a cause and a consequence of economic development. Markets offer households the opportunity to specialize according to comparative advantage and thereby enjoy welfare gains from trade. Recognition of the potential of markets as engines of economic development and structural transformation gave rise to a market-led paradigm of agricultural development during the 1980s (Reardon and Timmer, 2006) that was accompanied by widespread promotion of market liberalization policy agendas in Sub-Saharan Africa (SSA) and other low-income regions. Furthermore, as households’ disposable income increases, so does demand for variety in goods and services, thereby inducing increased demand-side market participation, which further increases the demand for cash and thus supply-side market participation. The standard process of agrarian and rural transformation thus involves households’ transition from a subsistence mode, where most inputs are provided and most outputs consumed internally, to a market engagement mode, with inputs and products increasingly purchased and sold off the farm (Timmer, 1988; Staatz, 1994).

Suggested Citation

Boughton, Duncan and Mather, David and Barrett, Christopher B. and Benfica, Rui S and Abdula, Danilo and Tschirley, David and Cunguara, Benedito, Market Participation by Rural Households in a Low-Income Country: An Asset Based Approach Applied to Mozambique (2007). Faith and Economics Vol 50, Fall 2007: 64-101 , Available at SSRN: https://ssrn.com/abstract=3305075

Duncan Boughton

Michigan State University - Department of Agricultural, Food and Resource Economics ( email )

MI
United States

David Mather

Michigan State University - Department of Agricultural Economics ( email )

East Lansing, MI 48824
United States

Christopher B. Barrett

Cornell University - Charles H. Dyson School of Applied Economics & Management ( email )

315 Warren Hall
Ithaca, NY 14853-7801
United States
607-255-4489 (Phone)
607-255-9984 (Fax)

HOME PAGE: http://aem.cornell.edu/faculty_sites/cbb2/

Rui S Benfica (Contact Author)

International Fund for Agricultural Development (IFAD) ( email )

Via Paolo di Dono
Rome, 00142
Italy

Danilo Abdula

affiliation not provided to SSRN ( email )

David Tschirley

Michigan State University - Department of Agricultural Economics ( email )

East Lansing, MI 48824
United States

Benedito Cunguara

Michigan State University - Department of Agricultural, Food and Resource Economics ( email )

MI
United States

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