Opportunity costs and decision-making in peasant agriculture.

Abstract

Opportunity costs of labour and land in peasant agriculture are shown to be positive and often substantial. Opportunity costs are defined as the price that can be obtained for alternative uses of labour and land. This thesis is contrary to popular notions about zero opportunity cost of agricultural labour in poor countries. Quantitative illustrations are given on the factor opportunity cost arising out of farmer decisions relating to timeliness of operations, level of yields, choice of crops, cash-crop quality and levels of mulching. If these costs are taken into account, a divergence will frequently exist between technical and economic efficiency: lower technical levels in certain cases may be more economic. T. A. (Abstract retrieved from CAB Abstracts by CABI’s permission)