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Appendix
Appendix Table A1: Average Treatment Effect on the Treated (ATT) Estimation Results for Two Contracts Pooled – PSM
Treatment: Either or Both Contracts
Control: Non-Contract
|-----Kernel Matching--------|
Rosenbaum
bounds
Unit
Treatment Control
ATT
S.E.
critical
level of
odds ratio
Potato Price
USD Per 100Kg 8.33
5.69
2.64***
0.51
3.00
Potato Yield
Tons per acre
10.46
10.25
0.21
0.22
n.a
Potato Income per Acre
USD/Acre
85.86
-73.77 159.63***
55.02
2.50
Percent of Land Allocated to Potato Percent
75.24
70.93
4.32
4.34
n.a
Maize Price
USD Per 100Kg 20.82
20.70
0.12
0.37
n.a
Maize Yield
Tons per acre
2.69
2.81
-0.12
0.08
n.a
Maize Income per Acre
USD/Acre
175.15 158.23
16.92
25.13
n.a
Percent of Land Allocated to Maize Percent
68.47
69.74
-1.26
4.41
n.a
Total Farm Income per Acre
USD/Acre
249.72 134.73 115.00***
41.73
2.00
Total Farm Income
USD
34,816 15,172 19,644***
6,756
1.50
Total Farm Profit
USD
24,186 2,394 21,791**
6,859
2.00
Total Household Income
USD
45,702 23,909 21,793***
7,506
1.50
Non-Potato-Maize Crop Income
USD
3,518
5,397
-1,878
2,243
n.a
Livestock Income
USD
8,375
8078
297
1,550
n.a
Other Income
USD
2,510
658
1852*
1,070
1.00
Number of Salaried Workers
6.34
5.76
0.58
0.82
n.a
Cost of Salaried Workers
USD/Year
7,964
7,320
645
1,165
n.a.
|----------NN Matching--------|
Rosenbaum
bounds
ATT
S.E.
critical
level of
odds ratio
2.76***
0.5
3.50
0.34*
0.27
1.50
174.3*** 47.706
3.00
4.92
4.10
n.a
0.18
0.43
n.a
-0.11*
0.10
1.50
14.90
27.57
n.a
-0.78
4.74
n.a
119.5*** 45.58
2.00
16,886** 7,982
1.75
19,105
7,954
1.75
18,267** 8,766
1.50
-3,791
2,756
n.a
-409
1,934
n.a
1790
1144
n.a
0.48
1.04
n.a
628
1,507
n.a.
Standard errors are obtained by bootstrapping. *Significant at 10% level; **Significant at 5% level; ***Significant at 1% level.
58
Off Support
in PSM
184
184
184
184
177
177
177
177
200
200
200
200
200
200
200
200
200
Appendix Table A2: ATT Estimation Results for Potato Contract – PSM
Treatment: Potato Contract
Control: Non-Contract
Potato Price
Potato Yield
Potato-Gross Output Value
Potato-Cost of Machinery
Potato-Cost of Inputs
Potato-Cost of Casual Labor
Potato-Cost of Salaried Labor
Percent of Land Allocated to Potato
Potato Income per Acre
Total Farm Income per Acre
Total Farm Income
Total Farm Profit
Total Household Income
Non-potato Crop Income
Livestock Income
Other Income
Number of Salaried Workers
Cost of Salaried Workers
Unit
Treatment
Control
USD Per 100Kg
Tons per acre
USD/Acre
USD/Acre
USD/Acre
USD/Acre
USD/Acre
Percent
USD/Acre
USD/Acre
USD
USD
USD
USD
USD
USD
16.10
10.14
1,100.9
74.68
553.63
81.9
23.81
80.67
366.91
486.12
67,000
55,281
77,742
25,778
9,718
1,024
7.11
9,097
5.57
10.26
568.97
73.44
488.73
84.2
23.16
72.02
-100.59
124.33
13,851
922
21,205
16,309
6,951
402
5.38
6,885
USD/Year
|-------Kernel Matching--------|
Rosenbau
m bounds
ATT
S.E.
critical
level of
odds ratio
10.53***
0.48
9.00
-0.12
0.32
n.a
531.97***
95.51
6.50
1.24
6.14
n.a
64.90***
23.19
4.00
-2.30
5.08
n.a
0.65
4.93
n.a
8.65
4.91
n.a
467.49***
96.50
6.00
361.79*** 129.91
2.75
53,149**
22,896
3.50
54,358**
22,280
3.50
56,537**
22,401
4.00
9,469
9,402
n.a
2,766
3,323
n.a
621
729
n.a
1.72
1.84
n.a
2,212
2,220
n.a
Standard errors are obtained by bootstrapping. *Significant at 10% level; **Significant at 5% level; ***Significant at 1% level.
59
|---------NN Matching----------|
Rosenbau
m bounds
ATT
S.E.
critical
level of
odds ratio
10.39*** 0.47
10.00
0.00
0.47
n.a
531.98*** 104.91
5.25
-1.09
6.40
n.a
73.45*** 27.67
3.00
-2.04
5.61
n.a
1.43
7.32
n.a
3.28
7.96
n.a
460.22*** 110.81
4.75
334.35** 123.79
2.25
52,260** 21,080
3.50
54,407*** 20,091
3.50
57,015*** 20,723
5.00
9,004
10,075
n.a
3,951
3,051
n.a
804
734
n.a
3.02**
1.69
2.25
5,594** 2,464
2.25
Off
Support
in PSM
101
101
101
101
101
101
101
101
101
117
117
117
117
117
117
117
117
117
Appendix Table A3: ATT Estimation Results for Maize Contract – PSM
Treatment: Maize Contract
Control: Non-Contract
|-------Kernel Matching-------|
Treatment
Control
ATT
S.E.
Rosenbau
m bounds
critical
level of
odds ratio
USD Per 100Kg
Tons per acre
USD/Acre
USD/Acre
USD/Acre
USD/Acre
USD/Acre
20.77
2.67
572.03
45.33
252.53
87.38
15.30
20.69
2.80
554.06
48.13
247.76
85.36
16.15
0.08
-0.13
17.97
-2.80
4.77
2.01
-0.85
0.35
0.09
21.12
2.52
6.54
1.64
3.00
n.a
n.a
n.a
n.a
n.a
n.a
n.a
-0.02
-0.18***
-0.9
-3.52
5.58
2.19
-1.31
0.39
0.09
23.66
3.23
8.35
1.84
3.87
n.a
1.75
n.a
n.a
n.a
n.a
n.a
162
162
162
162
162
162
162
Percent
67.25
69.59
-2.35
4.58
n.a
-2.80
5.53
n.a
162
USD/Acre
USD/Acre
USD
USD
USD
USD
USD
USD
170.91
195.84
28,850
1,8262
39,731
11,463
8,106
2,775
6.46
8,147
156.65
134.27
15,329
2,521
24,799
4,524
8,749
720
6.16
7,936
14.25
61.57
13,520*
1,5741*
14,932
6,938
-644
2,055
0.30
210
21.44
45.67
7,642
8,019
9,152
4,854
3,019
1,620
1.64
2,417
n.a
n.a
1.25
1.25
n.a
n.a
n.a
n.a
n.a
n.a
-4.42
59.51
12,870*
14,627*
13,185
6,601*
-1,320
2,020
-0.52
-767
26.08
55.09
8,855
9,309
10,508
5,932
3,371
1,565
1.90
3,224
n.a
n.a
1.25
1.25
n.a
1.00
n.a
n.a
n.a
n.a
162
184
184
184
184
184
184
184
184
184
Unit
Maize Price
Maize Yield
Maize-Gross Output Value
Maize-Cost of Machinery
Maize-Cost of Inputs
Maize-Cost of Hired Labor
Maize-Cost of Salaried Labor
Percent of Land Allocated to
Maize
Maize Income per Acre
Total Farm Income per Acre
Total Farm Income
Total Farm Profit
Total Household Income
Non-maize Crop Income
Livestock Income
Other Income
Number of Salaried Workers
Cost of Salaried Workers
|----------NN Matching---------|
USD/Year
ATT
Standard errors are obtained by bootstrapping. *Significant at 10% level; **Significant at 5% level; ***Significant at 1% level.
60
S.E.
Rosenbau
m bounds
critical
level of
odds ratio
Off
Support
in PSM
Appendix Table A4: Income and Cost Structure of five farmers who contract with both companies
Potato
Maize
Price (USD per 100 KG)
16.54
20.48
Yield (tons per acre)
10.56
1.81
Gross Output Value (USD per acre)
1005.33
374.52
Paid Cost of Machinery (USD per acre)
66.67
39.28
Paid Cost of Inputs (USD per acre)
559.24
190.00
Paid Cost of Casual Labor (USD per acre)
78.78
86.29
Paid Cost of Salaried Workers (USD per acre)
40.55
29.10
Income (USD per acre)
260.10
29.85
61
Appendix Table A5: Characteristics of representative farmers from other secondary data sources
Data Source
PRHPS 20121
PSLM 2018-192
Key characteristics:
Education of the farmer (years)
7.32
7.33
(3.25)
(2.63)
Age of the farmers (years)
47.42
52.44
(14.66)
(15.53)
Amount of land owned (acres)
4.84
4.34
(3.61)
(5.57)
Number of farmers
57
34
Standard deviations in parentheses.
Notes:
1: PRHPS refers to the Pakistan Rural Household Panel Survey. These statistics are from the first round of the survey which
was conducted in 2012. This dataset contains about 57 households from the district of Kasur (adjoining district of Okara) who
are engaged in farming and were randomly selected for the survey and thus they are regarded as almost representative farmers
from the study site.
2: PSLM refers to the Pakistan Social and Living Standard Measurement Survey. This nationally representative dataset
contains information about 34 families from the adjacent districts of Sahiwal, Pakpattan and Okara.
62
Appendix Table A6: Correlates of attrition from the second-round survey
(1)
(2)
(3)
(4)
VARIABLES
Probit
Probit
Probit
Probit
Family size
Age of farmer
Education
Contract farmer
-0.00463
(0.0167)
-0.0194**
(0.00970)
-0.0263
(0.0271)
-0.111
(0.242)
Land owned
Contract farmers known
Livestock owned
Land rented-in
-0.0115
(0.0183)
-0.0198**
(0.00978)
-0.0274
(0.0289)
-0.189
(0.258)
-0.0101
(0.0321)
0.00319
(0.00508)
0.0535
(0.0506)
-0.0116
(0.0184)
-0.0199**
(0.00980)
-0.0278
(0.0290)
-0.189
(0.258)
-0.0113
(0.0339)
0.00334
(0.00512)
0.0554
(0.0514)
-0.00301
(0.0126)
Area under tobacco
Constant
-0.413
-0.460
-0.429
(0.525)
(0.531)
(0.546)
Observations
286
286
286
Standard errors in parentheses. *** p<0.01, ** p<0.05, * p<0.1
63
-0.00826
(0.0190)
-0.0208**
(0.00998)
-0.0277
(0.0293)
-0.105
(0.266)
0.00689
(0.0357)
0.00399
(0.00518)
0.0478
(0.0526)
0.00858
(0.0149)
-0.0973
(0.0754)
-0.282
(0.575)
286
Appendix Table A7: Probit model results for outside contract sale in 2018
Outside contract
sale in 2018
Dep. Variable
(Dummy)
Age
Education
Family Size
Land owned
Number of livestock owned
Number of farm assets owned
Number of other contract farmers known
Birth order
Constant
-0.00104
(0.00839)
0.0177
(0.0262)
0.0287*
(0.0169)
-0.0389
(0.0428)
-0.0709
(0.0443)
0.0882*
(0.0487)
0.0103*
(0.00601)
-0.0998
(0.0781)
-0.424
(0.521)
Observations
163
Pseudo R-squared
0.0678
Standard errors in parentheses. *** p<0.01, ** p<0.05, * p<0.1
64
Appendix Table A8: Probit model estimation results for determinants of new entry into contract in 2019
among non-contract farmers in 2018
New contract in 2019
(dummy)
Dep. Variable
Covariates
Outside contract sale to PTC in 2018
0.781***
(0.224)
0.0212
(0.0274)
0.000420
(0.00878)
0.0127
(0.0180)
0.0379
(0.0405)
-0.0851
(0.0527)
-0.663
(0.504)
146
Education
Age
Family Size
Land owned
Farm assets
Constant
Observations
Standard errors in parentheses. *** p<0.01, ** p<0.05, * p<0.1
65
Appendix Table A9: First stage results for IV 2SLS
Dep. Variable
Year (dummy = 1 if 2019)
HH head education (years)
HH head age (years)
Family_Size
# of people met per day
(1)
Contract Farmer (Dummy)
(2)
Contract Farmer (Dummy)
0.20***
(0.032)
0.016***
(0.0057)
0.0039*
(0.0021)
0.0058*
(0.0032)
0.00067
(0.00095)
0.19***
(0.032)
0.013**
(0.0059)
0.0038*
(0.0020)
0.0040
(0.0032)
0.00057
(0.00095)
0.0024
(0.0028)
0.011
(0.010)
-0.010
(0.32)
-0.050
(0.051)
0.0049
(0.0040)
0.0043***
(0.0011)
-0.11
(0.16)
532
0.23
YES
266
16.2
0.23
Land owned (acres)
Number of farm assets
Loan from formal source (Dummy)
No credit (dummy)
Tobacco cultivated area (acres)
Contract farmers known
Constant
Observations
R-squared
Village Dummies
Number of hhid
F-stat
R-squared overall
0.0047***
(0.0011)
-0.078
(0.16)
532
0.21
YES
266
19.29
0.21
Robust standard errors in parentheses. *** p<0.01, ** p<0.05, * p<0.1
66
Appendix Table A10: Impact of participation in tobacco contract farming on production costs and crop income
(1)
(2)
(3)
(4)
(5)
(6)
(7)
(8)
|-------------------------------------------Production costs---------------------------------------------|
Per acre
Total
Per acre
Total
expense
expense
expense
expense
Per acre
of inputs Total all of inputs
Per acre
of inputs
Total all
of inputs
all
Dependent Variable
not
inputs
not
all inputs
not
inputs
not
inputs
supplied expenses supplied
expense
supplied
expenses
supplied
expense
under
under
under
under
contract
contract
contract
contract
Estimation method
|---------------- Pooled OLS ----------------|
|------------------------ IV-2SLS -------------------|
Year (dummy = 1 if 2019)
-4.65
-3.81
-101**
-111***
-9.45
-6.08
-278***
-249***
(4.72)
(3.95)
(42.6)
(39.6)
(7.02)
(5.64)
(103)
(86.7)
Contract farmer (dummy)
23.8***
5.94
197***
131**
48.3*
17.5
1,102***
842**
(5.21)
(4.37)
(43.8)
(51.9)
(25.3)
(20.7)
(399)
(338)
HH head education (years)
0.32
0.17
10.7*
6.27
-0.058
-0.0023
-3.01
-4.21
(0.55)
(0.49)
(6.40)
(5.65)
(0.69)
(0.59)
(9.05)
(8.15)
HH head age (years)
0.090
0.025
2.88
0.79
-0.0075
-0.021
-0.70
-1.98
(0.19)
(0.17)
(2.26)
(2.01)
(0.22)
(0.19)
(3.14)
(2.85)
Family Size
-0.21
-0.045
-3.28
1.62
-0.30
-0.088
-6.54
-0.74
(0.35)
(0.32)
(3.42)
(3.32)
(0.35)
(0.29)
(4.67)
(4.59)
Land owned (acres)
-0.20
-0.14
7.11
11.6
-0.24
-0.16
5.88
11.1
(0.32)
(0.27)
(10.8)
(8.76)
(0.28)
(0.27)
(8.60)
(7.34)
Tobacco cultivated area (acres)
-0.27*
-0.22**
72.1***
35.1***
-0.44
-0.30*
65.4***
28.3***
(0.15)
(0.10)
(6.20)
(11.1)
(0.28)
(0.18)
(2.66)
(6.35)
Number of farm assets
2.25**
1.16
38.7***
29.6***
1.91*
1.00
26.6*
21.3
(0.98)
(0.87)
(12.0)
(10.8)
(1.04)
(0.96)
(14.0)
(13.4)
# of people met per day
0.094
0.067
0.14
0.27
0.078
0.059
-0.43
-0.15
(0.082)
(0.073)
(0.78)
(0.80)
(0.088)
(0.077)
(1.08)
(1.16)
Constant
56.7***
46.6***
-277
-171
56.7***
46.6***
-272
-149
(13.1)
(11.4)
(184)
(161)
(15.4)
(13.3)
(259)
(244)
Observations
532
532
532
532
532
532
532
532
R-squared
0.124
0.071
0.759
0.531
0.11
0.061
0.62
0.37
Number of hhid
266
266
266
266
266
266
266
266
Village Dummies
YES
YES
YES
YES
YES
YES
YES
YES
Robust standard errors in parentheses. *** p<0.01, ** p<0.05, * p<0.1
67
(9)
(10)
(11)
(12)
|---------------Crop income--------------|
Total
Income
from
the
crop
Income
per acre
|----Pooled OLS---|
667*** 51.4***
(164)
(16.9)
85.4
46.7**
(178)
(18.7)
8.30
-1.47
(25.2)
(2.03)
5.77
-0.42
(7.49)
(0.75)
-19.7
-1.65
(15.9)
(1.21)
-3.54
0.31
(22.0)
(0.98)
359***
0.70
(19.1)
(0.60)
-108**
-6.77*
(45.2)
(3.59)
0.63
0.054
(4.16)
(0.35)
194
330***
(860)
(57.7)
532
532
0.803
0.114
266
266
YES
YES
Total
Income
from
the crop
Income
per acre
|------IV-2SLS-----|
648***
33.1
(250)
(23.7)
178
140
(1,043)
(94.0)
6.66
-2.88
(28.3)
(2.57)
5.37
-0.79
(7.44)
(0.88)
-20.2
-1.99
(18.2)
(1.28)
-4.05
0.18
(26.7)
(1.34)
360***
0.022
(18.0)
(0.76)
-110**
-8.03*
(44.6)
(4.17)
0.55
-0.0048
(4.09)
(0.38)
179
330***
(889)
(60.8)
532
532
0.80
0.091
266
266
YES
YES
Appendix Table A11: Relation between contract farming and having account at bank
VARIABLES
Contract farmer (dummy)
(1)
OLS
Dependent variable: Account at bank (dummy)
(2)
(3)
(4)
(5)
OLS
OLS
Probit
Probit
0.111**
(0.050)
0.027***
(0.006)
0.002
(0.002)
-0.004
(0.003)
0.114**
0.120**
0.409*
(0.050)
(0.048)
(0.214)
HH head education (years)
0.028*** 0.024***
0.089***
(0.006)
(0.006)
(0.021)
HH head age (years)
0.002
0.004**
0.007
(0.002)
(0.002)
(0.007)
Family Size
-0.004
-0.006**
-0.013
(0.003)
(0.003)
(0.012)
Land owned (acres)
-0.005*
-0.004
(0.003)
(0.003)
Number of farm assets
0.006
0.012
(0.010)
(0.009)
# of people met per day
0.004*** 0.004*** 0.003***
0.012***
(0.001)
(0.001)
(0.001)
(0.003)
Constant
-0.161
-0.181*
0.431*** -2.164***
(0.100)
(0.100)
(0.137)
(0.448)
Observations
266
266
266
266
R-squared
0.190
0.195
0.379
0.170
Village Fixed Effects
No
No
Yes
No
Robust standard errors inZ parentheses. *** p<0.01, ** p<0.05, * p<0.1
68
0.418*
(0.215)
0.098***
(0.023)
0.009
(0.007)
-0.012
(0.013)
-0.026
(0.021)
0.030
(0.035)
0.013***
(0.003)
-2.313***
(0.477)
266
0.177
No
(6)
Probit
(7)
2SLS
(8)
2SLS
(9)
2SLS
...
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