This project aims to provide first-hand empirical evidence on the potential of agricultural cooperatives in transforming smallholder and traditional farming in Ethiopia. Evaluating the effectiveness of these local organisations in terms of the promises they are supposed to deliver and facilitating agricultural transformation and commercialisation provides relevant empirical evidence that may help in improving agricultural policy in Ethiopia. Considering the common services that these community-based institutions provide to their members, we particularly aim to address the following research questions:
- Can Rural Savings and Credit Cooperatives (RuSACCOs) and producer cooperatives facilitate the transformation of traditional farming by improving farmers’ access to modern inputs and market outlet for commercialisation of farm output?
- Do agricultural cooperatives improve farmers’ access to off-farm employment, and hence enable farmers to participate in the non-farm sector of the economy? By this, we aim to indirectly test if agricultural cooperatives can solve farmers’ occupational trap in the farm sector.
- What is the optimal size, composition, and organisational structure of cooperatives for providing effective services to their members?
- Do collective (or participatory) management and exclusive membership strategy help to tackle opportunistic behavior and adverse selection in cooperative formation?