Supported cooperative groups and the economic performance of small farmers: evidence from Georgia

Abstract

ABSTRACT The reintroduction of cooperatives is part of the Georgian government’s new rural development policy, supported by several international donors’ interventions. This paper estimates the impact of small farmers’ participation in new collective actions. We employ farm-level data from 210 Georgian hazelnuts, grapes and honey farmers and use a treatment effects model that accounts for selection bias. We find a positive and significant impact of participation in new groups on farm revenue and net returns. The findings indicate that even though the cooperatives are still young, the government policies and donor interventions already bring some tangible economic benefits to small farmers.