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Farmer constraints and relational contracts: evidence from agricultural value chains in East Africa

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posted on 2023-06-10, 04:54 authored by Mohamed Ali Abdelfattah Ali Abouaziza
This thesis focuses on farmer constraints and relational contracts in three different agricultural value chains in East Africa. The first chapter examines the impacts of a business plan competition on mitigating credit constraints among horticulture farmers in Rwanda. In a regression discontinuity framework, the chapter provides empirical evidence that the competition effectively improved formal funding, business inputs and outcomes. The relevant effects are mediated more through existing rather than new businesses. The second paper focuses on cash constraints and savings commitment devices between dairy farmers in Kenya. Based on a difference-in-differences with multiple periods and administrative data on more than 48,000 dairy farmers, results reveal that softening deferred payments by offering a cash-in-advance service enhances relational contracts (i.e., daily milk delivery) between farmers and dairy cooperatives. The chapter also provides evidence about impacts’ heterogeneity in terms of gender and the method of financial transactions. The third chapter investigates how to build and maintain long-term relationships between coffee farmers and washing stations in Rwanda. Specifically, it assesses the effects of being invited to a farmer development program and the impacts of several organisational interventions on relational practices with farmers using experimental and quasi-experimental designs. The conclusion is that the farmer development program successfully affected short-term outcomes such as awareness and take-up of good agricultural practices, sessions attendance, trust towards the Partner, and coffee delivery.


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University of Sussex

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