Endnotes

¹2nd ACMECS Summit, held 3 November 2005 in Bangkok, Thailand. The Ayeyawady-Chao Phraya MekongEconomic Cooperation Strategy (ACMECS) is a cooperation agreement among Thailand, Myanmar, Cambodia, the Lao PDR, and Viet Nam, which aims to promote balanced development in the Mekong region.

²US$1 = 9,478.80 kip at the time of this writing (27 November 2007).

³The “average performance under the contract” in this report means the average of the performance of all farmers (irrespective of their actual contract choices) if they are under the contract. The “average performance without the contract” in this report means the average of the performance of all farmers (irrespective of their actual contract choices) if they are without the contract.

⁴Due to the unavailability of data to formulate a traditional profit function, we resort to a more “ad hoc” specification in this case.

Download this Discussion Paper [ PDF 127.3KB| 24 pages ].

Post a Comment

We welcome your feedback on this publication. Post a comment. ADBI is not obliged to acknowledge or publish comments and may abridge or edit them before web posting.

Comment(s)

There are [1] comment(s) for this entry. Post a comment.

1. Axelle Boulay
   (posted 22 September 2008 / 01:44:23 PM)
   
   Thank you very much for this publication that analyzes in-depth the impacts of contracts on adopters' livelihoods.
   
   You write: "contract farmers would have lower profits than non-contract farmers if they operated outside of the contract." and you deduce from this finding that "better-off farmers choose to produce independently rather than taking on the burden of fulfilling the requirements of a contract." I think it is important to mention that this deduction is only valid in the context of contract arrangements that include a provision of credit to contract farmers.
   
   In the context of my PhD, I conducted a study of contract farming for eucalyptus in Thailand. Contracting companies, which are using eucalyptus wood for pulp and paper production, do not provide credit to contract tree farmers. Based on an household survey of 450 eucalyptus tree farmers, I found that better-off farmers are more likely to adopt a contract because they have the financial capacity to comply with the terms of the contract (such as a minimum rotation length).
   
   Axelle Boulay, PhD scholar
   Australian National University