Leah Bevis, Ohio State University – University of Copenhagen

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Leah Bevis, Ohio State University

"Close to the Edge: High Productivity at Plot Peripheries and the Inverse Size-Productivity Relationship"

Abstract

Smaller farms and plots are more productive per hectare than larger ones. Some researchers hypothesize that it reflects household-specific shadow prices; others writers reject the relationship as spurious, invoking measurement error or omitted variables. Using unique, plot-level panel data from Uganda, we estimate the inverse relationship at the plot level and provide causal evidence that while the conventional explanations fail to explain the puzzle, the “edge effect” (productivity being highest around the periphery of plots) fully explains the phenomenon.

We also find evidence that the edge effect arises due to a behavioral mechanism; labor intensity as well as productivity rises around plot edges. Productivity is also boosted by mere perceptions of plot size, illustrating that purely behavioral mechanisms can drive productivity

Contact person: Neda Trifkovic