Whether the negative relationship between farm size and
productivity that is confirmed in a large global literature
holds in Africa is of considerable policy relevance. This
paper revisits this issue and examines potential causes
of the inverse productivity relationship in Rwanda,
where policy makers consider land fragmentation and
small farm sizes to be key bottlenecks for the growth of
the agricultural sector. Nationwide plot-level data from
Rwanda point toward a constant returns to scale crop
production function and a strong negative relationship
This paper is a product of the Agriculture and Rural Development Team, Development Research Group. It is part of a
larger effort by the World Bank to provide open access to its research and make a contribution to development policy
discussions around the world. Policy Research Working Papers are also posted on the Web at http://econ.worldbank.org.
The authors may be contacted at dali1@worldbank.org.
between farm size and output per hectare as well as
intensity of labor use that is robust across specifications.
The inverse relationship continues to hold if profits
with family labor valued at shadow wages are used, but
disappears if family labor is rather valued at village-level
market wage rates. These findings imply that, in Rwanda,
labor market imperfections, rather than other unobserved
factors, seem to be a key reason for the inverse farm-size
productivity relationship.