Large-scale agro-industrial investments and rural poverty

Evidence from sugarcane in Malawi

verfasst von

Raoul Herrmann, Ulrike Grote

Abstract

This article investigates the potential household welfare implications of large-scale agro-industry investments in Sub-Saharan Africa. Specifically, it compares the income and poverty of households integrated into a Malawian sugar investment with those households not integrated. Two different supply-chain set-ups are studied: smallholder outgrower and vertically integrated estate-production systems. Potential selection bias is addressed using propensity score matching and a number of robustness checks. We find significant positive income differences between participants in either supply-chain set-up and the respective counterfactual. Overall, income poverty is significantly lower among outgrowers relative to the counterfactual, whereas in the case of estate workers these differences are only significant for the extreme poverty line. Qualitative interviews confirm these results, but they also allude to risks for the rural poor associated with social conflicts in the expansion of new outgrower schemes as well as a lack of transparency in the operation of existing schemes, which are likely to undermine the poverty-reducing potentials of such investments.

Organisationseinheit(en)

Institut für Umweltökonomik und Welthandel

Externe Organisation(en)

German Institute of Development and Sustainability (IDOS)

Typ

Artikel

Journal

Journal of African economies

Band

24

Seiten

645-676

Anzahl der Seiten

32

ISSN

0963-8024

Publikationsdatum

11.2015

Publikationsstatus

Veröffentlicht

Peer-reviewed

Ja

ASJC Scopus Sachgebiete

Entwicklung, Volkswirtschaftslehre und Ökonometrie

Ziele für nachhaltige Entwicklung

SDG 1 – Keine Armut

Elektronische Version(en)

https://doi.org/10.1093/jae/ejv015 (Zugang: Geschlossen)