Background: Food security has been observed to be severe in northern Ghana than any other area of the country. Though this has been acknowledged, few attempts have been made to curb the situation. One of such intervention areas resides in providing policy-based evidence to guide efforts in fighting this problem. This study employs an ordered probit model using data set from the baseline survey of the USAID's Feed the Future programme in Ghana to estimate the determinants of food security in northern Ghana. We perform the analysis using a new indicator of food security-the household hunger scale. This measure is different from other household food insecurity indicators since it has been specifically developed and validated for cross-cultural use.
Results:The estimates show that crop producers, multiple crop producers, yield and commercialization are key policy variables that determine food security. A key policy implication of this result is in tandem with one of the intermediate results of the Ghana Feed the Future Initiative which seeks to increase competitiveness of food value chains through increased productivity and market access.
Conclusions:Based on the results, stakeholders should step up efforts to enhance productivity of farm households and provide necessary market infrastructure to boost commercialization, as these are fundamental to ensuring food security.
Purpose
The purpose of this paper is to investigate the connections between financial inclusion and agricultural commercialization among farmers in Ghana.
Design/methodology/approach
In order to address endogeneity and sample selectivity bias, the study employs endogenous switching regressions (ESRs) to examine whether financially included and financially excluded maize farm households differ in their commercialization behavior and whether financial inclusion affects commercialization. The Heckman Treatment Effect (HTE) model is used to test for robustness of the results. The data used contain a random sample of 2,230 maize farmers across the ten regions of Ghana.
Findings
The results from the ESRs show that financial inclusion significantly fosters agricultural commercialization. Specifically, financially included households sell 13.25 percent more output than their financially excluded counterparts. In terms of the counterfactual, financially excluded households would have sold 5.04 percent more output if they were to have access to financial services. Results from the HTE model confirm that financial inclusion promotes agricultural commercialization.
Practical implications
Financial inclusion is low among maize farmers; this implies that there are more benefits to be gained by ensuring that farmers have access to a broad range of financial services.
Social implications
The findings imply that the quest for the integration of smallholder farmers into markets cannot overlook measures to ensure financial inclusion.
Originality/value
It represents the first attempt at linking financial inclusion to agricultural commercialization using econometric methodology. The study serves as a foundation paper and for that matter will serve as a guide to future research on the financial inclusion-agricultural commercialization nexus.
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