A working paper by Moti Jaleta and Berhanu Gebremedhin on ‘Interdependence of smallholders’ net market positions in crop and livestock markets: Evidence from Ethiopia was released on 12 April 2011.
Using simultaneous-equation models, this paper examines whether there is interdependence between smallholders’ net market positions in crop and live animal markets under mixed crop-and-livestock production systems. Data collected in 2009 from 1075 sample households in 10 districts of Ethiopia are used for the analyses. Results confirm that households’ net positions in crop and live animal are interdependent and, further, that the net position of households in live animal markets is dictated by their net position in crop markets. Households are building their live animal assets by selling their surplus crops and are financing their crop purchases through live animal sales.
Before they get involved in live animal markets, farm households tend to analyze their position in crop production, consumption, marketable surplus and their ability to meet cash requirements through crop sales. This suggests that policies and strategies aiming to enhance mixed smallholder participation in crop and live animal markets should pay equal and simultaneous attention to the production and marketing of both commodities.