NATIONAL BUREAU OF ECONOMIC RESEARCH
NATIONAL BUREAU OF ECONOMIC RESEARCH
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Jeffrey D. Michler

University of Arizona
McClelland Park 301K
650 N. Park Ave.
Tucson, ARIZ 85719

E-Mail: EmailAddress: hidden: you can email any NBER-related person as first underscore last at nber dot org
Institutional Affiliation: University of Arizona

NBER Working Papers and Publications

March 2019Contract Farming and Rural Transformation: Evidence from a Field Experiment in Benin
with Aminou Arouna, Jourdain C. Lokossou: w25665
In recent decades contract farming has emerged as a popular mechanism to encourage vertical coordination in developing country agriculture. The goal of such coordination is to better integrate smallholder farmers into the modern agricultural food system, fostering rural transformation. We use panel data from a randomized control trial to quantify the impact of different contract attributes on rural transformation and welfare of smallholder rice farmers in Benin. We vary the terms of contract, with some farmers being offered a contract that only guarantees a price, while other contracts add extension training or input loans. While all three types of contracts had positive and significant effects, we find that contracts which only included an agreement on price had nearly as large of an impa...
 
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