A Two-stage Empirical Analysis of Market Participation in Yam-growing Areas of West Africa

Abstract

The transition from semi-subsistence to commercialized agriculture has been subject of global debates in Africa for more than a half century. This is the reminiscence of the necessity to formulate policies and programs to increase the yields and stimulate the investments in agriculture. Participation in agricultural markets could be a viable channel to transform subsistence agriculture thereby lifting millions of poor farmers out of hunger and poverty traps. Unfortunately, most of the potential beneficiaries are hindered by several factors in their quest to participate in yam market. This study investigated the underpinning drivers of market participation among small-scale farmers in the yam belt of West Africa. Using a multistage random sample of 1,400 households form Nigeria and Ghana, the study tested the hypothesis that factors affecting the farmers' decision to participate are not necessarily the same as those affecting the level of participation. Non-price constraints played a significant role in decision-making concerning market participation. Creation of an enabling environment and strengthening the social institutions should be considered in order to generate adequate marketable surplus to make market participation possible and valuable. Policies that reduce transaction costs and encourage farmers to commercialise their production could be alternatives to price-based policies. Moreover, improving the productivity of farmers will not only increase the likelihood of market participation but also the volumes offered for sale