Determinants of market participation and the institutional constraints: Case study of Kweneng West, Botswana

Abstract

For smallholder livestock farmers to benefit from their livestock, they need to fully participate in the market. This study identifies the determinants of market participation by smallholder livestock farmers in Botswana. The study used data collected from 132 smallholder livestock farmers in Kweneng West in 2007. A logit model was used to identify factors that determine whether smallholder farmers will participate in the market or not. The results indicate that the age of household head negatively and significantly affects market participation, implying that older farmers are less likely to participate in the market; planting crops increases the chances of market participation, as does the accessibility to market price information. The major limitation facing smallholder livestock farmers is the requirement that the animals should have a bolus (for traceability) and veterinary permits. In order to stimulate the participation of smallholder farmers in the market, policies aimed at promoting participation of youth in agriculture should be explored. In addition, policies should target service delivery improvement by all institutions involved in the marketing of cattle including those issuing cattle movement or veterinary permits. This will go a long way in increasing smallholders’ income from livestock and hence improve their living standards. Key words: Botswana, market participation, institutional constraints, transaction costs, logistic regression.