Ashraf, NavaGiné, XavierKarlan, Dean2012-05-252012-05-252008-01https://hdl.handle.net/10986/6448In much of the developing world, many farmers grow crops for local or personal consumption despite export options that appear to be more profitable. Thus many conjecture that one or several markets are missing. This paper reports on a randomized controlled trial conducted by DrumNet in Kenya that attempts to help farmers adopt and market export crops. DrumNet provides smallholder farmers with information about how to switch to export crops, makes in-kind loans for the purchase of the agricultural inputs, and provides marketing services by facilitating the transaction with exporters. The experimental evaluation design randomly assigns pre-existing farmer self-help groups to one of three groups: (1) a treatment group that receives all DrumNet services, (2) a treatment group that receives all DrumNet services except credit, or (3) a control group. After one year, DrumNet services led to an increase in production of export oriented crops and lower marketing costs; this translated into household income gains for new adopters. However, one year after the study ended, the exporter refused to continue buying the cash crops from the farmers because the conditions of the farms did not satisfy European export requirements. DrumNet collapsed in this region as farmers were forced to sell to middlemen and defaulted on their loans. The risk of such events may explain, at least partly, why many seemingly more profitable export crops are not adopted.CC BY 3.0 IGOACCESS TO CREDITADMINISTRATIVE DATAAGRICULTURAL ECONOMICSAGRICULTURAL EXTENSIONAGRICULTURAL INPUTSAGRICULTURAL LABORAGRICULTURAL PRACTICESAGRICULTURAL TECHNOLOGYAGRICULTURAL TRADEAGRICULTUREANIMALSAUDITSBANANASBASE YEARBEANSBORROWINGBUSINESS PROFITABILITYBUSINESS SCHOOLBUYERBUYERSCASH CROPSCERTIFICATION COSTSCHECKSCOFFEECOLLATERALCOMMERCIAL BANKCOMMERCIAL BANKSCOMMERCIALIZATIONCOMPETITIVE MARKETSCONSUMERSCONTRACT FARMINGCONTRIBUTIONCOOPERATIVESCORNCOST OF TRANSPORTCREDIT GROUPCREDIT GROUPSCREDIT PROGRAMCREDITSCROPCROP PRODUCTIONCROP VARIETIESCROPSCULTIVATIONDECISION MAKINGDEPOSITDEVELOPMENT ECONOMICSECONOMIC DEVELOPMENTEXPECTED VALUEEXPENDITUREEXPENDITURESEXPORT CROPEXPORT CROPSEXTENSION SERVICESFAMILY MEMBERSFAOFARMFARM ACTIVITIESFARMERFARMERSFARMINGFARMSFERTILIZERFINANCIAL INSTITUTIONSFISHERIESFLOWERSFOOD SAFETYFORMAL BANKFORMAL FINANCIAL INSTITUTIONSGREEN REVOLUTIONHARVESTINGHORTICULTURAL CROPSHORTICULTURAL EXPORTSHORTICULTURAL MARKETSHORTICULTUREHORTICULTURE DEVELOPMENTHORTICULTURE SECTORHOUSEHOLD INCOMEHOUSEHOLDSHUMAN CAPITALIDSIFPRIINFORMED DECISIONINSURANCEINTERNATIONAL BANKINTERNATIONAL PRICELACK OF ACCESSLATRINESLINE OF CREDITLITERACYLOANLOAN REPAYMENTLOAN SIZELOTTERIESLOW-INCOMEMAINTENANCE COSTSMAIZEMARKETINGMICRO-CREDITNET LOSSOUTREACHPENSIONPENSIONSPERSONAL SAVINGSPESTICIDEPESTICIDE RESIDUEPLANTATIONSPLANTINGPOLITICAL ECONOMYPOTATOESPOULTRYPRICE FLUCTUATIONSPRICE INDEXPROBABILITYPRODUCEPRODUCTIVITYPROFITABILITYPUBLIC TRANSPORTRECEIPTSRECORD KEEPINGREMITTANCESREPAYMENTRESEARCH ASSISTANCERISK TOLERANCESALARIESSALESAVINGS ACCOUNTSAVINGS ACCOUNTSSAVINGS SERVICESSEEDSSELF-EMPLOYMENTSMALL FARMERSSMALL FARMSSMALL-SCALE FARMERSSMALL-SCALE PRODUCERSSMALLHOLDERSMALLHOLDER FARMERSSMALLHOLDERSSOCIAL ASSISTANCESOCIAL NETWORKSSOCIAL SERVICESSOIL ANALYSISSOURCES OF INCOMESTATE UNIVERSITYSUB-SAHARAN AFRICATAKE-UP RATESTOMATOESTOTAL COSTTOTAL SAVINGSTRANSACTIONTRANSPORTATION SERVICESVALUABLEVEGETABLE TRADEVEGETABLESVILLAGEVILLAGESWAGESYIELDSWorld Bank10.1596/1813-9450-4477