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Establishing the link between market orientation and agricultural commercialization: Empirical evidence from Northern Ghana

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Abstract

This paper established a positive relationship between market orientation and intensity of commercialization among rural farm households in northern Ghana. The IV Tobit regression estimate suggests that intensity of maize commercialization is significantly determined by education, agro-ecology, household size, total livestock units, farm size, access to formal markets and market orientation. In addition, a highly and unbiased significant positive effect is observed between market orientation and intensity of maize commercialization after controlling for endogeneity in market orientation. Intensity of maize commercialization increased by 0.86% for a 0.1 unit increase in the market orientation index. The empirical implications of the results are discussed.

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Acknowledgements

This research is made possible through the financial support provided by the Alliance for a Green Revolution in Africa (AGRA) under the grant AGRA Soil Health Project 005. The administrative support of the host institution, CSIR-Savanna Agricultural Research Institute is acknowledged. Finally, the valuable comments of the reviewers are much appreciated.

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Authors and Affiliations

  1. CSIR-Savanna Agricultural Research Institute (CSIR-SARI), P.O. Box TL, 52, Tamale, Ghana

    Edward Martey, Prince M. Etwire, Alexander Nimo Wiredu & Benjamin D. K. Ahiabor

  2. University of Illinois, Urbana-Champaign, IL, USA

    Edward Martey

  3. International Institute of Tropical Agriculture, PMB 5320, Oyo Road, Ibadan, Oyo State, 200001, Nigeria

    Alexander Nimo Wiredu

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  1. Edward Martey
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Correspondence to Edward Martey.

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Appendices

Appendix 1

Table 5 List of explanatory variables
Full size table

Appendix 2: Hausman test of endogeneity

figure e

Appendix 3: Test of weak instruments (Exact and over-identification test)

ᅟ

Case of one instrument (Land fragmentation index) – Exact identification

figure f

Case of one instrument (Elevation) – Exact identification

figure g

Case of two instruments (Land fragmentation index and elevation)

figure h

Appendix 4: IV Tobit estimation of maize commercialization

figure i

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Martey, E., Etwire, P.M., Wiredu, A.N. et al. Establishing the link between market orientation and agricultural commercialization: Empirical evidence from Northern Ghana. Food Sec. 9, 849–866 (2017). https://doi.org/10.1007/s12571-017-0688-9

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