Impact Of Agricultural Market Reforms On Smallholder Farmers In ...

FCFA/adult equivalent/year, 69 percent of which was allocated to food. The study also found that
36 percent of the under-five population was malnourished and a rate of illiteracy of 73 percent. The
three problems cited most often by rural households were 1) the burden of manual agricultural
work, 2) declining soil fertility, and 3) the lack of agricultural credit (UNDP/MDR, 1996).
The same project also made use of the Enquête Legère aupres les Ménages Urbains (ELAM) in
1995-96 to develop an urban poverty profile. This study found that the average expenditure was
264 thousand FCFA, 2.7 times as great as the comparable figure in rural areas. Just 45 percent of
the urban budget was allocated to food compared to 69 percent in rural areas. Because the poverty
line was much higher for urban households, the urban poverty rate was 33 percent, similar to the
rural poverty rate (UNDP/INSAE, 1996). It is debatable, however, whether the urban and rural
poverty lines really represent a similar standard of living. The lower food shares in urban areas
would strongly suggest that poverty is less there than in rural areas. Rural poverty rates are greater
than urban poverty rates in almost all developing countries, with the exception of some middleincome
Latin American countries 1 .
Economic reforms Several studies have looked at the effect of devaluation and other
reforms on agriculture. Senahoun et al (2000) examine the welfare impact of the 1994 devaluation
of the CFA franc by combining historical price data over 1993-97 and models of household
behavior. The farm models describe production decisions of different types of farmers in different
regions, while a demand system is used to model consumption. They find that the devaluation had
an “almost immediate positive impact” on cotton farmers and a delayed but positive impact on food
crop farmers. The model also shows that the impact of the devaluation on urban households has
been negative, particularly for poor households that spend a large share of their budgets on food.
Ahoyo Adjovia and Heidhues (1997) study the effect of the devaluation on the economics of rice
production. They find that the higher rice prices due to devaluation raised the incomes of rice
farmers more than enough to compensate for higher consumer prices. Rice has become more
profitable and output has expanded significantly.
Senahoun et al (1999) simulate the impact of structural adjustment on soil erosion in northern
Benin using a bio-economic model. The results indicate that the reform program “appears to have
1
Probably different standards were used in constructing the list of “basic” consumption requirements.
The UNDP/INSAE (1996) reports that the poverty line is relatively high for Cotonou because (among other
factors) “the pressure to maintain a certain social standing through higher spending on clothing and other
items” and the cost of university education for children.
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