A Game Theoretic Approach to Analyse Cooperation between Rural Households in Northern Nigeria

To improve the livelihood of the poor in Sub-Saharan Africa (SSA) much attention has been paid to the development of new agricultural technologies. We hypothesize that farmers can also improve their livelihood through cooperation. Partial cooperation, in which knowledge is shared or bargaining power improved, is relatively common in SSA, while cooperation where all resources are fully shared, which we address, has rarely been investigated. An important pre-requisite to establish such cooperation, is the need for a fair division rule for the gains of the cooperation. This paper combines linear programming and cooperative game theory to model the effects of cooperation of (individual) households on income and farm plans. Linear programming establishes insight in the optimal farm plans in cooperation, and cooperative game theory is used to generate fair division rules. The model is applied to a village in Northern Nigeria. Households are clustered based on socio-economic parameters, and we explore cooperation between clusters. Cooperation leads to increased income and results in changes in farm plans, because more efficient use of resources leads to more intensified agriculture (labour intensive – high value crops).

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Expanding the Frontiers of Agricultural Economics to Meet the Challenges of Agricultural Development in achieving the Millennium Development Goals.

 Record created 2017-04-01, last modified 2018-01-22

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