Smallholder rice farmers' post-harvest decisions: Preferences and structural factors

Abstract

We study post-harvest decisions among Tanzanian rice farmers. Risk and time preference experiments are used to understand post-harvest decisions. In particular, we investigate storage and processing decisions, which according to our study can increase income by more than 50 per cent, but also introduce risk and time delays. Experimentally elicited risk and time preferences are statistically significant in explaining these post-harvest decisions. Impatient farmers are less likely to store paddy, and risk-averse farmers are less likely both to process and store paddy for future sales. Also, structural factors, such as milling costs, transportation costs and storage losses, influence the post-harvest choices.