From subsistence to market production : Implications for rural household food security in Uganda

Abstract

Food insecurity remains a significant and persistent challenge in sub-Saharan Africa. This has been partly attributed to low food availability associated with subsistence farming and limited access to nutritious foods. In response, most countries including Uganda have made effort to promote and support market-oriented crop production, in the hope that households will be food secure through the market other than self-sufficiency characteristic of subsistence production. This thesis aims to better understand how agricultural transition, from subsistence to market-oriented crop production, impacts rural household food security. The thesis investigates how market production correlates with four key interconnected aspects that drive the outcomes of market production. Specifically, we analyse market production effects on; household food consumption, women control and allocation of household income and productive resources, and technical efficiency of staple crops. Further, we investigate the role of the informal credit market and local traders in stabilizing seasonal grain prices. This empirical information is important as an input into the process of agricultural production reforms to guide policy decisions based on facts. The empirical analysis is based on survey data collected from farm households, informal financial institutions and grain traders from rural western Uganda. Uganda provides a relevant context to address the above objective because of its agricultural policy which aims to promote cash crops. In addition to survey data, we use a simple experiment to construct women empowerment indices which are used as proxies for women bargaining power in household income expenditure and resource allocation in assessing market production effects. The thesis employs various analytical methods including; propensity score matching approach and instrumental variable estimators to identify a causal link between market production and household food security. Our findings show that while market production is a good strategy for increasing rural household income, production income has not been reflected in household calorie consumption. However, there is evidence of improved dietary diversity which is a positive indicator for nutrition security. Still, we find that market oriented households are more vulnerable to food insecurity in terms of access. This research also shows that as households increasingly engage into market oriented production, women tend to be less involved in production decisions and this negatively impacts household food security. The analysis of productivity levels in terms of technical efficiency shows that a majority households operate below the potential for the biophysical environment for both the cash and staple crops implying that they can increase their output and ultimately improve their food security. The negative effects could be reversed if market oriented households increasingly involve women in production decisions and income allocation; and increase the share of production income on food purchases as well as on productivity enhancing technologies such as quality seed and labour saving technologies. To attain the goals of market production, there is need to strengthen linkages between farmers and production support services. Financial services in particularly are crucial to enable farmers smooth consumption and take advantage of intertemporal arbitrage opportunities. Investing in infrastructure especially the road network and rural markets, and organizing farmers into cooperatives/groups to bulk and store their produce will reduce transaction costs, promote competition between traders and improve the functioning of food markets.