The Role of Agricultural Market Information System on Farmers' Agricultural Outcomes: Evidence from Smallholder Coffee Producers in Ethiopia

Abstract

Using data from 466 smallholder coffee farmers in Ethiopia, this paper examines the effect of a public agricultural market information system (AMIS) on production. Our findings confirm that providing market price information via an AMIS is positively related to coffee sales, the ratio of sales to production, and coffee revenue. In addition, our study considered market heterogeneity by comparing two zones with different market characteristics. The AMIS was positively associated with increasing coffee sales, the ratio of sales to production, and coffee revenue in only one zone with lower market participation. The sales and revenue of AMIS users in the other zone with higher market participation did not increase, although the selling price did. While public information provided through information and communication technology (ICT) is beneficial to underdeveloped markets, we suggest correcting other market imperfections, which is important to maximize the utility of AMISs, would be of greater utility.