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Does cooperative membership impact the yield and efficiency of smallholder farmers? Evidence from potato farmers in Mongolia

Samuel Ahado (Faculty of Tropical AgriSciences, Czech University of Life Sciences Prague, Praha, Czech Republic)
Jiří Hejkrlík (Faculty of Tropical AgriSciences, Czech University of Life Sciences Prague, Praha, Czech Republic)
Anudari Enkhtur (Faculty of Tropical AgriSciences, Czech University of Life Sciences Prague, Praha, Czech Republic)
Tserendavaa Tseren (School of Economics and Business, Mongolian University of Life Sciences, Ulaanbaatar, Mongolia)
Tomáš Ratinger (Faculty of Tropical AgriSciences, Czech University of Life Sciences Prague, Praha, Czech Republic)

China Agricultural Economic Review

ISSN: 1756-137X

Article publication date: 31 August 2021

Issue publication date: 19 October 2021

412

Abstract

Purpose

The purpose of this paper is to examine the impact of agricultural cooperative membership on potato production and technical efficiency.

Design/methodology/approach

A combination of propensity score matching technique and sample selection stochastic frontier framework that addresses potential selection bias due to observable and unobservable attributes is used to estimate the effect of participation between cooperative members and non-members. Using a stochastic meta-frontier approach, the technical efficiency of farmers was estimated and compared.

Findings

The empirical results show that the effect of participation in agricultural cooperatives is associated with increased yield and technical efficiency. A comparison of group-specific frontiers indicates that cooperative members perform better than non-members. Cooperative membership decisions is significantly associated with household and farm characteristics (e.g. education, participation in off-farm work, total farmland, distance to market and geographic location).

Practical implications

The findings of this study demonstrate that cooperative organisations can be an important tool to enhance the productivity and efficiency of smallholder farmers. Successful cooperative models together with training programs designed to enlighten farmers on the importance and tangible benefits of collective action should be used to enlarge participation in cooperative organisations. In addition, governments and development agencies should implement targeted investment and capacity building programs related to irrigation management, gender-sensitive awareness and development of the internal institutional mechanisms in cooperatives for the transfer of knowledge and mutual learning so that all members benefit from cooperatives.

Originality/value

Despite the pervasive evidence of the impact of cooperatives on productivity and technical efficiency in the Asian region, this study is probably the first attempt in the crop sector in Mongolia. It provides a rigorous empirical analysis of the impact of agricultural cooperative membership on potato production and technical efficiency through a counterfactual design.

Keywords

Acknowledgements

The authors gratefully acknowledge the financial support provided by the Internal Grant Agency of the Czech University of Life Sciences Prague, (CIGA) project No. (20185001) and the Internal Grant Agency (IGA) of the Faculty of Tropical AgriSciences, Czech University of Life Sciences Prague, project No. (20205008). The authors are also grateful to the journal editor, and two anonymous reviewers for their helpful comments and suggestions on an earlier version.

Citation

Ahado, S., Hejkrlík, J., Enkhtur, A., Tseren, T. and Ratinger, T. (2021), "Does cooperative membership impact the yield and efficiency of smallholder farmers? Evidence from potato farmers in Mongolia", China Agricultural Economic Review, Vol. 13 No. 4, pp. 736-755. https://doi.org/10.1108/CAER-01-2021-0013

Publisher

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Emerald Publishing Limited

Copyright © 2021, Emerald Publishing Limited

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