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Do coffee cooperatives benefit farmers? An exploration of heterogeneous impact of coffee cooperative membership in Southwest Ethiopia

Authors
  • Shumeta, Zekarias1
  • D’Haese, Marijke2
  • 1 Assistant professor, Department of Agricultural Economics and Extension, Jimma University, P.O. Box 307, Jimma, Ethiopia
  • 2 Professor, Department of Agricultural Economics, Ghent University, Coupure Links 653, 9000 Gent, Belgium
Type
Published Article
Journal
International Food and Agribusiness Management Review
Publisher
Wageningen Academic Publishers
Publication Date
Dec 01, 2016
Volume
19
Issue
4
Pages
37–52
Identifiers
DOI: 10.22434/IFAMR2015.0110
Source
Wageningen Academic Publishers
Keywords
License
Green

Abstract

Smallholder farmers’ participation in agricultural cooperatives is often promoted as a promising strategy for overcoming market imperfections and to increase farmers’ productivity and income. In recognition of this potential, in recent years, Ethiopia has shown renewed interest in promoting cooperatives. However, there is lack of empirical evidence of the impact that cooperatives have on farmers’ performance in Ethiopia. Using a matching technique, we evaluate the impact of coffee cooperatives on the performance of their member households in terms of income and coffee production. We use data from coffee farmers in south-west Ethiopia. The overall results suggest that members of cooperatives are not faring much better than non-members. The treatment effects we measured were not statistically significant from zero. Yet, the aggregate figures mask differences between cooperatives and amongst individual cooperative members. Average treatment effects on members differ between cooperatives, in general older members, those who have benefitted from more education and those with larger coffee plantations seem to benefit more from membership. Our analysis sheds light on the heterogeneity in the impact that membership of a cooperative can have: this differs by cooperative and by members within cooperatives, a finding that has important policy implications.

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