Synopsis: Social networks and factor markets: Panel data evidence from Ethiopia
In the absence of well-established factor markets, the roles of indigenous institutions and social networks as mobilizing factors for agricultural production can be substantial. We investigate the role of an indigenous social network in Ethiopia, the iddir, in facilitating factor market transactions...
| Main Authors: | , , |
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| Format: | Brief |
| Language: | Inglés |
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International Food Policy Research Institute
2015
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| Subjects: | |
| Online Access: | https://hdl.handle.net/10568/150268 |
| _version_ | 1855534063154102272 |
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| author | Abay, Kibrom A. Kahsay, Goytom A Berhane, Guush |
| author_browse | Abay, Kibrom A. Berhane, Guush Kahsay, Goytom A |
| author_facet | Abay, Kibrom A. Kahsay, Goytom A Berhane, Guush |
| author_sort | Abay, Kibrom A. |
| collection | Repository of Agricultural Research Outputs (CGSpace) |
| description | In the absence of well-established factor markets, the roles of indigenous institutions and social networks as mobilizing factors for agricultural production can be substantial. We investigate the role of an indigenous social network in Ethiopia, the iddir, in facilitating factor market transactions among smallholder farmers. Using detailed longitudinal household survey data and employing a difference-in-differences approach, we find that iddir membership improves households’ access to factor markets. Specifically, we find that by joining an iddir network, households’ access to land, labor, and credit improves between 7 and 11 percentage points. Furthermore, our findings indicate that iddir networks crowd-out borrowing from local moneylenders (locally referred as Arata Abedari), a relatively expensive credit source, virtually without affecting borrowing from formal credit sources. These results improve our understanding of the role informal market arrangements, such as social networks, can play in mitigating factor market inefficiencies in poor rural markets. The results also have important policy implications for designing alternative policy measures which aim to improve these markets. |
| format | Brief |
| id | CGSpace150268 |
| institution | CGIAR Consortium |
| language | Inglés |
| publishDate | 2015 |
| publishDateRange | 2015 |
| publishDateSort | 2015 |
| publisher | International Food Policy Research Institute |
| publisherStr | International Food Policy Research Institute |
| record_format | dspace |
| spelling | CGSpace1502682025-12-08T10:29:22Z Synopsis: Social networks and factor markets: Panel data evidence from Ethiopia Abay, Kibrom A. Kahsay, Goytom A Berhane, Guush data social networks crowding-out In the absence of well-established factor markets, the roles of indigenous institutions and social networks as mobilizing factors for agricultural production can be substantial. We investigate the role of an indigenous social network in Ethiopia, the iddir, in facilitating factor market transactions among smallholder farmers. Using detailed longitudinal household survey data and employing a difference-in-differences approach, we find that iddir membership improves households’ access to factor markets. Specifically, we find that by joining an iddir network, households’ access to land, labor, and credit improves between 7 and 11 percentage points. Furthermore, our findings indicate that iddir networks crowd-out borrowing from local moneylenders (locally referred as Arata Abedari), a relatively expensive credit source, virtually without affecting borrowing from formal credit sources. These results improve our understanding of the role informal market arrangements, such as social networks, can play in mitigating factor market inefficiencies in poor rural markets. The results also have important policy implications for designing alternative policy measures which aim to improve these markets. 2015-02-20 2024-08-01T02:51:14Z 2024-08-01T02:51:14Z Brief https://hdl.handle.net/10568/150268 en https://hdl.handle.net/10568/150180 https://doi.org/10.1080/00220388.2017.1288224 Open Access application/pdf International Food Policy Research Institute Ethiopian Development Research Institute Abay, Kibrom A.; Kahsay, Goytom A; Berhane, Guush. 2015. Synopsis: Social networks and factor markets: Panel data evidence from Ethiopia. ESSP II Research Note 37. Washington, DC and Addis Ababa, Ethiopia: International Food Policy Research Institute and Ethiopian Development Research Institute (EDRI). https://hdl.handle.net/10568/150268 |
| spellingShingle | data social networks crowding-out Abay, Kibrom A. Kahsay, Goytom A Berhane, Guush Synopsis: Social networks and factor markets: Panel data evidence from Ethiopia |
| title | Synopsis: Social networks and factor markets: Panel data evidence from Ethiopia |
| title_full | Synopsis: Social networks and factor markets: Panel data evidence from Ethiopia |
| title_fullStr | Synopsis: Social networks and factor markets: Panel data evidence from Ethiopia |
| title_full_unstemmed | Synopsis: Social networks and factor markets: Panel data evidence from Ethiopia |
| title_short | Synopsis: Social networks and factor markets: Panel data evidence from Ethiopia |
| title_sort | synopsis social networks and factor markets panel data evidence from ethiopia |
| topic | data social networks crowding-out |
| url | https://hdl.handle.net/10568/150268 |
| work_keys_str_mv | AT abaykibroma synopsissocialnetworksandfactormarketspaneldataevidencefromethiopia AT kahsaygoytoma synopsissocialnetworksandfactormarketspaneldataevidencefromethiopia AT berhaneguush synopsissocialnetworksandfactormarketspaneldataevidencefromethiopia |