ISSN (Print) - 0012-9976 | ISSN (Online) - 2349-8846

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Is Fixed Price Contract a Viable Option for Farmers?

This paper explores the economics of contract versus non-contract potato farming in West Bengal, India, using primary data collected from a household survey of 263 farmers (2021–22 potato season). While proponents of contract farming argue that fixed prices and secure markets provide farmers with better returns, this study shows that non-contract farmers actually obtained much higher farm investment income (`42,413.63) per acre than contract farmers (`9,703.94). Without any significant differences in yield and production costs, the higher open market price (`1,458) per quintal benefits non-contract potato farmers despite production loss, while the fixed price in contract farming (`1,106) leads to significantly less farm returns for contract potato farmers.

Regional Inequality in India

We discuss the relationship of our initial paper [Singh, Bhandari, Chen and Khare 2003] to the work of Deaton and Dreze (2002).

Poverty in India in the 1990s

The authors examine the poverty situation in 15 major states across four distinct dimensions of headcount ratio, size of the poor population, depth and severity for the rural, the urban and the total population. The poverty situation, they find, worsened over the six-year period 1993-94 to 1999-2000 in Assam, Madhya Pradesh and Orissa. In the remaining 12 states there was a distinct improvement in terms of the most visible indicator, namely, the absolute size of the poor population. Overall, despite diversity across poverty indicators and across states, the overwhelming impression is one of greater improvement in the poverty situation in the 1990s than in the previous 10�½-year period.

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