Cash Crops, Rural Markets, and the Subsistence Farmer: Does Commercialization Increase Food Security in Ethiopia?

Abstract

Concerns over rising food demand and the corresponding requirements for food production are becoming more significant as the world’s population is projected to grow to over 9 billion by 2050. In Africa, high levels of population growth are especially alarming given that the region has both the highest levels of hunger and the lowest crop yields worldwide. In recent years, agricultural scholars have debated whether producing high-return, high-risk cash crops can increase food security on smallholder farms more effectively than the production of low-return, low-risk food crops. The literature from both sides of the discussion has provided mixed evidence. This thesis contributes to the cash crop debate by assessing the effects of commercialization on household food security in Ethiopia. In the past, studies within this field have focused only on a few villages within a country. In contrast, I use a nationally-representative dataset for my analysis. I perform a logistic and zero-inflated poisson regression to determine if there is a correlation between household levels of commercialization and food availability, as well as dietary diversity. I find that despite the poor state of market infrastructure and transportation in Ethiopia, farmers who sell a greater proportion of their crops experience higher food availability in the short- and long-term. I interpret this finding as evidence that a transition towards commercialization will increase food security—even in countries like Ethiopia with poor market access. I conclude that the Ethiopian government should focus its food security strategy on increasing market linkages and developing credit and insurance institutions in order to reduce the risks associated with commercialization. Policies such as these will encourage more farmers to produce crops for sale—ultimately increasing both household welfare and food security in the country.