Smallholders, Market Failures, and Agricultural Production: Evidence from India

Arbeitspapier

Market completeness has important implications for household behavior. I firmly reject complete markets for smallholders but am unable to do so for non-smallholders. This leads to important differences in production behavior: smallholders reallocate labor across activities less in response to intra-seasonal crop price changes than do non-smallholders. A counterfactual exercise indicates smallholders could increase revenue by almost nine percent if they were to reallocate labor similarly to non-smallholders. The overall pattern of results is consistent with small-holders lacking sufficient wage employment opportunities. Since non-smallholders have to hire in for agricultural production, this lack of opportunities does not affect their decisions.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: IZA Discussion Papers ; No. 13682

Classification and Topics

• Classification: Wirtschaft ; Demand and Supply of Labor: General ; Agricultural Labor Markets ; Economic Development: Agriculture; Natural Resources; Energy; Environment; Other Primary Products ; Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets ; Agricultural Markets and Marketing; Cooperatives; Agribusiness
• Subject: markets ; market failures ; agriculture ; labor

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Merfeld, Joshua D.
• Event: Veröffentlichung
• (who): Institute of Labor Economics (IZA)
• (where): Bonn
• (when): 2020

Further information

• Handle: http://hdl.handle.net/10419/227209
• Last update: 10.03.2025, 11:43 AM CET