Demand, Supply, Sustainability and Security
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Edited by Raghbendra Jha, Raghav Gaiha and Anil B. Deolalikar
Chapter 18: Viability of small-scale farms in Asia
The inverse relationship between farm size and productivity is oftentimes found in South Asia, which indicates that small farms are more efficient than large farms (e.g. Heltberg, 1998). In sub-Saharan Africa, too, the inverse relationship seems to have emerged with the gradual intensification of farming systems (Larson et al., 2013). In the cultivation of commercial crops, such as sugarcane and pineapples, in Asia the production grows faster under the peasant mode of production (e.g. Thailand) than under the plantation system (e.g. the Philippines), according to Hayami (2001, 2009). Such observations also indicate the higher efficiency of small farms over large farms. Furthermore, it is well-known that Green Revolution technology was rapidly adopted by small farmers in tropical Asia, which contributed to income growth, poverty reduction and food security (David and Otsuka, 1994; Pingali et al., 1997; Otsuka et al., 2009). In consequence, small-scale farms dominate throughout Asia with a very few exceptions. The high production efficiency of small-scale farming in the past, however, does not guarantee the equally high efficiency at present and in the future. Indeed, according to a recent study of Foster and Rozensweig (2010), large farms have become more productive than small farms in India with the introduction of farm machinery responding to rising labor costs, indicating that small farms are no longer more productive in this country. In high income economies in Asia, such as Japan, a positive relationship is found between farm size and productivity (Hayami and Kawagoe, 1989).
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