Joint UNU-MERIT/School of Governance Seminar: “Agricultural Extension as an Escape from the Poverty Trap: Evidence from the Peruvian Highlands”
This seminar will feature a presentation by Prof. Isabelle Bonjean (University of Namur).
It is now commonly accepted that poverty alleviation requires a significant increase in incomes drawn from land-related activities (FAO 2009). The fear that increasingly stringent food quality and safety norms will result in the exclusion of small farmers from the agri-food supply chain reinforces the call for best practices and technology. These concerns have resulted in numerous projects aiming to diffuse new technologies, which are reported by a growing literature assessing the return of these innovations. In this literature, prices received for each unit of output are usually assumed to be homogeneous among all households.
Prof. Bonjean contests this over-simplification, and will discuss how it could lead us to a misunderstanding of the distributional effects of monetary gains following the diffusion of new technologies. She uses the implementation of a community extension programme in the Peruvian highlands, where the main income source is raw milk and fresh cheese production sold on a highly segmented market, to assess the heterogeneity of the increase in the production value following the innovation process.
It appears that households that where poorer before the implementation of the programme benefit more from the presence of an extension agent in their community. This effect is driven by two channels of return: a quantity increase and a price increase. She will discuss the mechanisms behind both effects and their implications for the income distribution. The findings stress the importance of considering and understanding the price mechanism, when assessing the return to innovation adoption on segmented markets, which are highly common in the developing world.
For more information, see the Future Events page on the UNU-MERIT website.