Where to Sell? Market Facilities and Agricultural Marketing

Shilpi, Forhad; Umali-Deininger, Dina

Where to Sell? Market Facilities and Agricultural Marketing

2007

Shilpi, Forhad | Umali-Deininger, Dina

This paper analyzes the effect of facilities and infrastructure available at the market place on a farmer's decision to sell at the market using a comprehensive survey of farmers, markets and villages conducted in Tamil Nadu, India in 2005. The econometric estimation shows that the likelihood of sales at the market increases significantly with an improvement in market facilities and a decrease in travel time from the village to the market. The results suggest that wealth reduces a farmer's cost of accessing market facilities more than it increases her/his opportunity cost of leisure. The wealthy farmers are able to capture a disproportionate share of the benefits of facilities available at congested markets. The policy simulation, however, shows that the marginal benefits from an improvement in market facilities will favor poorer farmers in the context of India.

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AGROVOC Keywords

access to markets accounting agricultural commodities commercial banks commercialization communities developing countries economic development equipment expenditure fixed costs gross domestic product households instrument international bank international trade land ownership market access marketing opportunity costs retail returns rural areas rural development sales shops sub-saharan africa trade liberalization transaction costs transport transportation trips trucks urban development urbanization vehicles villages

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Intervention; Wealth; Bus; Access to market; Shadow price; Credit constraint; Cost increases; Average travel time; Public spending; Market efficiency; Equipments; Bus station; Cost of transportation; True; Warehouse; Police; Police station; Competitive market; Road; Labor market; Districts; Storage capacity; Missing markets; Opportunity cost; Sale; Transportation costs; Produce marketing board; Congestion; Police stations; Market infrastructure; Travel time; Bus stations; Transport costs; Return; Trading; Rural roads; Rural transportation; Market price; Post office; Income growth; Local governments; Total sales; Market place; Post offices; Consumption expenditure; Female; Transaction; Positive coefficient; Market reforms; Transaction cost; Market transaction; Public transportation; Relevant markets; Interventions; Transportation cost; Transportation network; Rural infrastructure

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Where to Sell? Market Facilities and Agricultural Marketing

2007

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