Rural Non-Farm Engagement and Agriculture Commercialization in Ghana : Complements or Competitors ? working paper 2018-07 November 2018

We used an endogenous switching probit and a generalized structural equation model (GSEM) to assess the effect of non-farm participation on householders’ decisions to sell and on the level of commercialization of agricultural goods in Ghana. For this study, we used the Ghana Living Standards Survey for the years 2012-2013 and found that non-farm participation consistently increased both the probability of selling crops and quantities sold. We concluded that non-farm engagement by farmers boosts market participation and commercialization in Ghana, implying that non-farm engagement and agricultural commercialization are complementary. Developing the agricultural sector requires the government to create the conditions necessary to stimulate farmers’ participation in nonfarm activities. JEL: D13; 012; Q13