TY - JOUR

T1 - Large-scale farms in Zambia

T2 - Locational patterns and spillovers to smallholder agriculture

AU - Lay, Jann

AU - Nolte, Kerstin

AU - Sipangule, Kacana

N1 - Funding Information: This work was supported by the German Federal Ministry of Economic Cooperation and Development (BMZ), (project: “Large-Scale Land Acquisitions: Data, Patterns, Impacts, and Policies”) and the African Growth and Development Policy Modeling Consortium (AGRODEP) (2012 GAPS IN RESEARCH GRANT). An earlier version of this paper was circulated under the title: “The Impact of Foreign Large-Scale Land Acquisitions on Smallholder Productivity: Evidence from Zambia.” We are grateful to Viviane Griesinger for her support in creating the maps for this paper and to Rainer Thiele and Johanna Bodewing for their valuable comments. We appreciate helpful advice from the Indaba Agricultural Policy Research Institute (IAPR). We would also like to thank the Central Statistical Office of Zambia for sharing their data and providing advice throughout the research process. Moreover, we are thankful for feedback received during several presentations, including presentations at the Annual World Bank Conference on Land and Poverty 2016, the PEGNet Conference 2016, the Open Science meeting of the Global Land Programme 2016, the FLARE Interdisciplinary Workshop on Environmental Governance 2018, and the Young Researchers Seminar at the Kiel Institute for the World Economy. We are also thankful for helpful and constructive comments from two anonymous reviewers.

PY - 2021/4

Y1 - 2021/4

N2 - The accelerated growth of large-scale farming operations in developing countries, in particular Africa, has raised concerns that smallholders may be negatively affected. Drawing on nationally representative smallholder data and a census of large-scale farms in Zambia, this study investigates spillovers from large-scale farms to smallholders. First, we conceptually discuss potential spillovers from larg-scale farms to smallholders and sources of spillover heterogeneity. Second, we analyze the large-scale farm sector and its locational pattern. Large-scale farms operate in areas with good infrastructure and market access, i.e. in proximity to smallholders. Third, we adopt a difference-in-differences approach to estimate the spillovers of large-scale farms to smallholders’ area cultivated, access to fertilizer, and maize yields. We observe that the establishment of large-scale farms has little effect on average farm sizes of smallholders. However, we find a strong shift of crop portfolios towards maize among smallholders near recently established large-scale farms to the detriment of other staple crops. We do not find any spillovers on fertilizer adoption by smallholder farmers but large positive effects on maize yields. The locational pattern suggest that large-scale farms compete with smallholders for land. In sum, it is crucial not to overestimate the development potential of large-scale farms. Instead, immediate threats to smallholders need to be addressed, in particular through securing land tenure rights. Further, the mechanisms of spillovers need to be better understood in order to design infrastructure and agricultural extension policies that can complement and reinforce positive spillovers from large-scale farms and mitigate potential negative spillovers including environmental impacts.

AB - The accelerated growth of large-scale farming operations in developing countries, in particular Africa, has raised concerns that smallholders may be negatively affected. Drawing on nationally representative smallholder data and a census of large-scale farms in Zambia, this study investigates spillovers from large-scale farms to smallholders. First, we conceptually discuss potential spillovers from larg-scale farms to smallholders and sources of spillover heterogeneity. Second, we analyze the large-scale farm sector and its locational pattern. Large-scale farms operate in areas with good infrastructure and market access, i.e. in proximity to smallholders. Third, we adopt a difference-in-differences approach to estimate the spillovers of large-scale farms to smallholders’ area cultivated, access to fertilizer, and maize yields. We observe that the establishment of large-scale farms has little effect on average farm sizes of smallholders. However, we find a strong shift of crop portfolios towards maize among smallholders near recently established large-scale farms to the detriment of other staple crops. We do not find any spillovers on fertilizer adoption by smallholder farmers but large positive effects on maize yields. The locational pattern suggest that large-scale farms compete with smallholders for land. In sum, it is crucial not to overestimate the development potential of large-scale farms. Instead, immediate threats to smallholders need to be addressed, in particular through securing land tenure rights. Further, the mechanisms of spillovers need to be better understood in order to design infrastructure and agricultural extension policies that can complement and reinforce positive spillovers from large-scale farms and mitigate potential negative spillovers including environmental impacts.

KW - Agriculture

KW - Land grabs

KW - Large-scale farms

KW - Smallholders

KW - Spillovers

KW - Yields

KW - Zambia

UR - http://www.scopus.com/inward/record.url?scp=85096605988&partnerID=8YFLogxK

U2 - 10.1016/j.worlddev.2020.105277

DO - 10.1016/j.worlddev.2020.105277

M3 - Article

AN - SCOPUS:85096605988

VL - 140

JO - World development

JF - World development

SN - 0305-750X

M1 - 105277

ER -