Participation in agricultural markets among the Poor and marginalized: analysis of factors Influencing participation and impacts on income and Poverty in kenya

 

Author(s):  Mary Mathenge, Frank Place, John Olwande, Dagmar Mithoefer
Introduction

Poverty in Africa has been found to be predominantly a rural phenomenon. About 75 percent of the world’s poor are believed to work and live in rural areas, and it is estimated that, by the year 2020, 60 percent of the poor will still be rural. Among the worst hit in these rural communities are women and those in marginal agricultural production areas. Meeting the challenge of reducing poverty and improving rural incomes in Africa, especially for these marginalized groups, will require some form of transformation out of the semi-subsistence production systems that currently characterize much of rural Africa to a more commercialized agriculture. Increased market participation by the poor has been found to be important as a means of breaking from the traditional semi-subsistence farming. It has been argued that market-oriented production can achieve welfare gains through specialization and comparative advantage, economies of scale and regular interaction and exchange of ideas. Unfortunately, the most vulnerable who need this kind of welfare boost may be constrained by several factors in their quest to participate in the market for their goods and services.

This study aimed at assessing the extent of market participation among smallholder farmers in Kenya with a view to identifying potential market opportunities and constraints for the vulnerable and marginalized groups. The study is within the broader project by Tegemeo Institute of Egerton University, Makerere University and the World Agroforestry Centre (ICRAF) looking at market participation among marginalized groups in Kenya and Uganda.

In this study, we use a three-year panel data set collected in 2000, 2004 and 2007 and across various agro-ecological zones of Kenya under the Tegemeo Agricultural Policy Research and Analysis (TAPRA) project. The study assessed the potential output market opportunities for different marginalized rural populations in Kenya and identified factors that could enhance their participation in both output and input markets. The study was carried out mainly through desk top analysis of the existing data set with some complementary secondary data. Additional information was received through a few key informant and stakeholder consultations.

The data analysis mainly focused on the characteristics of these marginalized groups and their participation in different input and output markets. Critical questions under the study related to the type of markets that these marginalized groups access, their important enterprises and degree of commercial orientation, and market opportunities that could help them increase their incomes and transition out of poverty, among others. The study also looked at how access to financial services, agricultural information and participation in farmer groups impact on market participation. In addition, the study explored factors that affect participation in different markets for the marginalized groups.

Participation in agricultural markets among the Poor and marginalized: analysis of factors Influencing participation and impacts on income and Poverty in kenya