Factor Market Failures And The Adoption Of Irrigation In Rwanda

Abstract

The Policy Research Working Paper Series disseminates the findings of work in progress to encourage the exchange of ideas about development issues. An objective of the series is to get the findings out quickly, even if the presentations are less than fully polished. The papers carry the names of the authors and should be cited accordingly. The findings, interpretations, and conclusions expressed in this paper are entirely those of the authors. They do not necessarily represent the views of the International Bank for Reconstruction and Development/World Bank and its affiliated organizations, or those of the Executive Directors of the World Bank or the governments they represent.

Farm Profits, Prices and Household Behavior

“…The model, which dates back at least to Chayanov (1966), integrates production of goods that are consumed by a farm-household into a standard utility maximization framework and has been used to provide important insights into a broad array of economic questions. These include, for example, links between nutrition and labor markets (Strauss, 1982(Strauss, , 1984Thomas et al, 2016), wage determination, labor supply and agricultural productivity shocks (Rosenzweig, 1980;Kochar, 1999;Jayachandran, 2006;Kaur, 2019, Breza et al, 2019, risk and human capital invesments (Jacoby and Skoufias, 1997), the allocation of resources among family members (Udry, 1996;Duflo and Udry, 2004;Edmonds and Theoharides, 2019;Rangel and Thomas, 2019), property rights (Field, 2007), technology adoption (Barnum and Squire, 1979;de Janvry, Fafchamps and Sadoulet, 1991;Conley and Udry, 2010;Suri, 2011, Jones et al, 2019 and microcredit and financial markets (Kaboski and Townsend, 2011;Beaman, Karlan, Thuysbaert and Udry, 2015).…”

Summaries of Doctoral Dissertations

“…Finally, the Coase Theorem (Coase 1960) holds that under ideal conditions, market transactions will efficiently distribute productive assets regardless of initial allocations. In practice, such dynamics depend on the size of transaction costs and the enforceability of property rights (Hornbeck 2010; Jones et al 2019). Throughout history, different societies have distributed land in diverse fashions, but it is thus unclear which, if any, could positively impact long-run prosperity.…”

Decision-Making in Complex Households

“…As Udry (1996) puts it, it is difficult to reconcile this behavior with Pareto efficiency in the allocation of resources in the farm household. Recent work suggests that at least part of the explanation of these results is likely due to contamination in the estimates arising from measurement error and unobserved heterogenity at the plot level (Goldstein and Udry, 2008;Gollin and Udry, 2019) or because of the failure of markets that differentially affects plots owned by a household (Jones et al, 2019).…”