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Abstract

This paper first identifies an interesting pattern in farm household livestock production in many developing countries: an inverted-U shape relationship between household livestock production and the levels of economic development (or farm household income). Using backyard hog production as a case study, the paper documents the ways in which trends in market development appear to correspond with observed trends in household hog production. After providing theoretical explanation of linkage between market development and household hog production, the paper econometrically estimates the effects of market development on household hog production. The results indicate that grain and labor market development can explain a significant portion of the rise and fall in China's backyard hog sector over the past two decades.

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