strategies to deal with the decline in maize incomes, and those that did apply coping
strategies postponed making any long-term investments such as buying a working
animal or motorcycle, or they took out a loan. It can therefore be assumed that
households invested their extra income in 2007 in durable goods rather than
everyday consumption activities. The magnitude of the consumption expenditure
increase in 2009 should, however, be interpreted with caution and may have been
due to the perception bias caused by the high inflation rates experienced in 2008
(23 %, GSO 2010) and the difficulties we had obtaining precise expenditure data
due to recall issues.
4 Following this explanation, the size of the household asset
base did not appear to help stabilize consumption expenditures, and in fact, the
relationship between asset base and consumption expenditures was negative only
for households who owned a large amount of land (À4 % points), which can be
attributed to the fact that, over the study period, households with more land also had
a larger proportion of maize related income (Spearman rho correlation coefficient
p < 0.01). The impact of growing maize on household income levels was, therefore, not completely neutral, as confirmed by the positive regression coefficient for
the non-maize selling households (that is, households carrying out other agricultural
activities and/or taking part in off-farm employment such as government jobs and
trade activities). Households that did not sell maize did comparatively better;
increasing their consumption expenditure by an additional 41 % points as compared
to those households selling maize.
Another significant influence on household consumption expenditures was
exercised by social events and individual shocks. Expensive social events increased
consumption expenditure (for example, weddings by 10 % and funerals by 60 %),
while the death of a working member decreased consumption expenditure by 19 %,
probably due to the decrease in available manpower able to generate an income.
Crop failures increased consumption expenditure by 19 %, most of which can be
attributed to rice crop failures, since these events forced households to purchase
additional rice during the lean season (January to April), the period of our investigation. The analysis above raises the question as to which factors limited the
households’ capacity to adapt to maize price fluctuations. One of the factors
identified in our research was the limited capacity of households to store maize
after the harvest and to sell it later in the season at possibly higher prices. Only 19 %
of households owned a permanent shed in the study area; the majority stored maize
at home (53 %), with the remaining storage areas being temporary sheds (25 %) and
other locations (3 %). The ownership of a permanent storage facility increased
significantly the ability of households to store maize at the appropriate quality for a
longer period (8.5 weeks) as compared to storing it around the household (6.8
weeks) or in a temporary shed (7.3 weeks) (p < 0.05). Analyzing households’
decision-making in terms of choosing the right time to sell maize in 2010, most
mentioned preventing a (further) loss of quality as the single most important reason
4 Data on consumption expenditure for January-April 2008 were captured in May/June 2009, then
compared to expenditure information for January-April 2009, by category.
12 Policies for Sustainable Development: The Commercialization of Smallholder. . .
469
strategies postponed making any long-term investments such as buying a working
animal or motorcycle, or they took out a loan. It can therefore be assumed that
households invested their extra income in 2007 in durable goods rather than
everyday consumption activities. The magnitude of the consumption expenditure
increase in 2009 should, however, be interpreted with caution and may have been
due to the perception bias caused by the high inflation rates experienced in 2008
(23 %, GSO 2010) and the difficulties we had obtaining precise expenditure data
due to recall issues.
4 Following this explanation, the size of the household asset
base did not appear to help stabilize consumption expenditures, and in fact, the
relationship between asset base and consumption expenditures was negative only
for households who owned a large amount of land (À4 % points), which can be
attributed to the fact that, over the study period, households with more land also had
a larger proportion of maize related income (Spearman rho correlation coefficient
p < 0.01). The impact of growing maize on household income levels was, therefore, not completely neutral, as confirmed by the positive regression coefficient for
the non-maize selling households (that is, households carrying out other agricultural
activities and/or taking part in off-farm employment such as government jobs and
trade activities). Households that did not sell maize did comparatively better;
increasing their consumption expenditure by an additional 41 % points as compared
to those households selling maize.
Another significant influence on household consumption expenditures was
exercised by social events and individual shocks. Expensive social events increased
consumption expenditure (for example, weddings by 10 % and funerals by 60 %),
while the death of a working member decreased consumption expenditure by 19 %,
probably due to the decrease in available manpower able to generate an income.
Crop failures increased consumption expenditure by 19 %, most of which can be
attributed to rice crop failures, since these events forced households to purchase
additional rice during the lean season (January to April), the period of our investigation. The analysis above raises the question as to which factors limited the
households’ capacity to adapt to maize price fluctuations. One of the factors
identified in our research was the limited capacity of households to store maize
after the harvest and to sell it later in the season at possibly higher prices. Only 19 %
of households owned a permanent shed in the study area; the majority stored maize
at home (53 %), with the remaining storage areas being temporary sheds (25 %) and
other locations (3 %). The ownership of a permanent storage facility increased
significantly the ability of households to store maize at the appropriate quality for a
longer period (8.5 weeks) as compared to storing it around the household (6.8
weeks) or in a temporary shed (7.3 weeks) (p < 0.05). Analyzing households’
decision-making in terms of choosing the right time to sell maize in 2010, most
mentioned preventing a (further) loss of quality as the single most important reason
4 Data on consumption expenditure for January-April 2008 were captured in May/June 2009, then
compared to expenditure information for January-April 2009, by category.
12 Policies for Sustainable Development: The Commercialization of Smallholder. . .
469