The Value of Value Chains: An Experiment Linking Farmers' Co-ops with Maize Processors in Rwanda

The Moynihan Institute’s program for Trade, Development and Political Economy welcomes Alan Spearot from UC Santa Cruz.

Lack of access to output markets is a key barrier to productivity growth of agriculture in developing countries, in part because it reduces the profitability of investments in productivity. We conduct a field experiment with 180 maize-growing cooperatives in rural Rwanda where a treatment group received support from the WFP Farm to Market Alliance to form connections with processors, while a control group farmed as usual. We find that the program immediately increased the probability of selling into the formal output value chain, and dramatically increased revenue by 150%-300%, driven largely by large increases in land under cultivation and input usage.