Does participation in contracts affect agricultural income? An empirical evidence from parboiled rice farmers in central Benin

Abstract

The purpose of this article is to analyze the economic impact of participation of parboiled rice stakeholders in contract farming. Data were collected from a random sample of 200 farming households including 150 participants and 50 non-participants in the department of Collines in Benin. The results of econometric estimates show that the participation in contract is mainly determined by membership in a group of rice farmers, technical extension assistance and access to markets, good quality agricultural products, gender and formal education. Findings also reveal that contractualization has a positive effect on the income of the main primary players, in particular producers and processors of parboiled rice. It is therefore urgent that the agricultural contract remains a very important lever in rural areas in Benin. The contracts are likely to improve the economic efficiency of the adopters. Appropriate flexible contract measures are necessary and essential to boost growth in developing countries.