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Jumat, 25 April 2008

Why should we care about the future of small-scale agriculture?

The efficiency of smaller production units in most developing countries is demonstrated
by an impressive body of empirical studies showing an inverse relationship between unit
size and land productivity (Heltberg, 1998). Moreover, small producers often achieve higher
land productivity with lower capital intensities than large units. These are important
efficiency advantages in many poor countries where land and capital are scarce relative to
labour.
The greater land productivity of small units stems from their greater abundance of
household labour per hectare cultivated. Household workers are typically more motivated
than hired workers are, and they provide higher quality and self-supervising labour. They
also tend to think in terms of whole jobs or livelihoods rather than hours worked, and are
less driven by wage rates at the margin than hired workers. Small producers exploit labourusing
technologies that increase yields (hence land productivity), and they use labourintensive
methods rather than capital-intensive machines. As a result, their land and
capital productivities are higher and their labour productivity is typically lower than that
of large production units. This is a strength in labour-surplus economies, but it becomes a
weakness for the long-term viability of small-scale production as countries get richer and
labour becomes more expensive.
In poor, labour-abundant economies, small producers are not only more efficient but
they also account for large shares of the rural and total poor, so small production unit
development can be win-win for growth and poverty reduction. Asia’s Green Revolution
showed how agricultural growth that reaches large numbers of small units could
transform rural economies and raise enormous numbers of people out of poverty
(Rosegrant and Hazell, 2000). Recent studies show that a more egalitarian distribution of
land not only leads to higher economic growth but also helps ensure that the growth
achieved is more beneficial to the poor (Deininger and Squire, 1998; Ravallion and
Datt, 2002). Small producers also contribute to greater food security, particularly in
subsistence agriculture and in backward areas where locally produced foods avoid the high
transport and marketing costs associated with many purchased foods.
Small producer households have more favourable expenditure patterns for promoting
growth of the local rural economy, including rural towns. They spend higher shares of
incremental income on rural non-tradables than large production units (Mellor, 1976;
Hazell and Roell, 1983), thereby creating additional demand for the many labour-intensive
goods and services that are produced in local villages and towns. These demand-driven
growth links provide greater income-earning opportunities for small producers an
landless workers.

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