Please use this identifier to cite or link to this item: http://hdl.handle.net/10625/42597
Title: Finding missing markets (and a disturbing epilogue) : evidence from an export crop adoption and marketing intervention in Kenya
Authors: Ashraf, Nava
Giné, Xavier
Karlan, Dean
Keywords: FIELD EXPERIMENT
AGRICULTURAL EXTENSION
EXPORT CROP
FOOD STANDARDS
QUALITY STANDARDS
NONTARIFF BARRIERS
ACCESS TO MARKETS
KENYA
Date: 2008
Publisher: World Bank, Washington, DC, US
Abstract: In much of the developing world, many farmers grow crops for local or personal consumption despite export options that appear to be more profitable. Thus many conjecture that one or several markets are missing. This paper reports on a randomized controlled trial conducted by DrumNet in Kenya that attempts to help farmers adopt and market export crops. DrumNet provides smallholder farmers with information about how to switch to export crops, makes in-kind loans for the purchase of the agricultural inputs, and provides marketing services by facilitating the transaction with exporters. The experimental evaluation design randomly assigns pre-existing farmer self-help groups to one of three groups: (1) a treatment group that receives all DrumNet services, (2) a treatment group that receives all DrumNet services except credit, or (3) a control group. After one year, DrumNet services led to an increase in production of export oriented crops and lower marketing costs; this translated into household income gains for new adopters. However, one year after the study ended, the exporter refused to continue buying the cash crops from the farmers because the conditions of the farms did not satisfy European export requirements. DrumNet collapsed in this region as farmers were forced to sell to middlemen and defaulted on their loans. The risk of such events may explain, at least partly, why many seemingly more profitable export crops are not adopted.
URI: http://hdl.handle.net/10625/42597
Project Number: 103745
Project Title: DrumNet : Building a GSM-enabled Information System for Smallholder Farmers in Kenya - Phase II
Access: IDRC Only
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