CAREER: Agricultural Markets, Firms, and Development

This CAREER award funds a research agenda that will use four projects to study how inefficient functioning of agricultural markets along the supply chains prevents farmers from moving into high value export-oriented agriculture. Moving into high value-added, export- oriented agriculture is the first step in income growth and economic modernization.

However, inefficiencies in agricultural markets, including limited competition, lack of information, and financing, may prevent this transition in low-income countries. All four projects will study the effectiveness of common policies to reduce these market inefficiencies along the agricultural supply chain. In addition to informing farmers and policymakers in low-income countries, the results of this project will also be helpful for donors such as the US.

This project also embeds an education plan to mentor students and support a pipeline of scholars in the US and around the world and thus contribute to the development of future scientific researchers.

This CAREER award funds a research consisting of four experiments to study how market frictions at each step of the agricultural supply chains impedes structural transformation in low-income countries. Project 1 uses an RCT to study the limited pass-through of quality incentives from world markets to upstream coffee producers to identify whether intermediary market power constrain quality upgrading by farmers.

Projects 2 and 3 explore the role of search costs and information constraints in preventing agricultural small and medium enterprises (SMEs) from connecting with exporters and multinational buyers. Project 4 uses an RCT of an export loan facility to test whether agricultural exporters are constrained by limited finance. In all projects, original data collection and administrative data access allow measurement of causal effects on directly impacted firms, on competitors and on upstream suppliers.

The results of this research project will help to identify policies to improve agricultural markets in low-income countries, hence increase agricultural incomes and accelerate structural transformation as well as enhance the effectiveness of US foreign aid.

This award reflects NSF's statutory mission and has been deemed worthy of support through evaluation using the Foundation's intellectual merit and broader impacts review criteria.