Rural Market Imperfections and the Farm Size-Productivity Relationship: Evidence from Pakistan
World Development, Vol. 26, No. 10, October 1998
Posted: 26 Dec 1998
This article analyzes the relationships between farm size and productivity and between farm size and profitability. A framework is set out to explain the inverse farm size--productivity relationship based on imperfections in the markets for labor, land, credit and risk. Hypotheses are derived and tested on a recent farm-level panel data from Pakistan. A strong inverse relationship between farm size and yield is found. This holds even when household fixed effects are used to account for unobserved heterogeneity, a novel feature of the paper. The market imperfections framework is consistent with the data.
Note: This is a description of the paper and not the actual abstract.
JEL Classification: O13, O17, Q12, Q15, D23
Suggested Citation: Suggested Citation