Commercialization & Food Security
Outcomes:
chi-square Test
Source: Babu and Sanyal (2009)
Commercialization
• Concept: Refers to growing cash crops; it may
also include traditional crops (grown for selfconsumption) if one markets the produced
surplus or adopts a purchased input
technology.
• Measure:
Proportion
of
production that is marketed
agricultural
Commercialization
• Advantages: Growth in income, hence, food
and nutrition security.
• Disadvantages: Growth at the cost of
subsistence crops, hence, food and nutrition
security.
• Query: Trace the macro economic and
distributional consequences with respect to
socio-economic-regional profiles.
Commercialization
• Advantages Process specification:
1. cash crops contribute to livelihood diversification and improve
food and nutrition security by directly increasing the farm
household’s income earning potential which, in turn, increases the
household’s spending potential.
2. Most cash crops tend to be labor intensive, cash cropping entails a
substantial expansion of the demand for hired labor. This
employment effect for households that hire out labor may
represent significant livelihood improvement
3. Introduction of cash crops contributes to the development of rural
financial markets, which partially relieves the cash constraints.
4. Cash cropping opportunities are also accompanied by improved
technology.
Commercialization
• Counter arguments:
1. Missing Factor Markets and hence limited scope
for uniform spread of income and employment
benefits of commercialization across households
2. Weak financial markets for expenditure and
consumption smoothing.
• Issue: Verify empirical evidence on
commercialization, food and nutrition security.
Effects of Commercialization
• Crucial three characteristics of intrahousehold
decision making:
1. Household consumption expenditure allocation
between food and non-food (mainly health and
sanitation).
2. Allocation of food expenditure among the various
types and quantities of foods.
3. Distribution of food and other consumption items
among household members.
4. Gender allocation of time, labor and control of
income.
Issues
• Is it more likely for a cash crop growing
household than a traditional crop growing
household to be food secure?
• Is it more likely for a cash crop growing
household than a traditional crop growing
household to have children with adequate
nutrition, i.e. absence of malnutrition?
Verification Requirements
• Information on household characteristics such
as incomes by family members, expenditure on
food and non-food items, demographic
characteristics of the members and food intake
by family members.
• Measures of the children’s nutritional status.
• Test procedure: Pearson’s chi-square test to
determine if the observed relationship between
the nominal or categorical variable is statistically
significant or is due to random variability.
Empirical Analysis
• Evidence from Malawi
• CASHCROP: tobacco, groundnuts, cotton and
plantain (major cash crops in Malawi).
• Dummy variable CASHCROP = 1 if the
household grows at least one of these four
major cash crops and 0 otherwise.
• CASHCROP a measure of commercialization
of agriculture at the household level.
Empirical Analysis
• Household food security measures:
1) f(dependency ratio, number of meals)
2) Per adult equivalent calorie intake
(CALADEQ)
• Food security: Households that can satisfy at
least 80 per cent of the requirement for
calorie intake.
Nutrition Measures
• ZHANEW, ZWANEW, and ZWHNEW:
– the Z-scores that identify malnutrition in children
ZHA (height for age Z-score), ZWA (weight for age
Z-score) and ZWH (weight for height Z-score).
– ZHANEW indicates presence or absence of
stunting,
– ZWANEW indicates if the child has low weight for
age ,
– ZWHNEW indicates the presence or absence of
wasting.
Nutrition Measures
• Procedure:
1. Exclude Z-scores with absolute values ≶ 5
(outliers)
2. two categories for three indicators of
malnutrition are: (i) Z-score <-2 and (ii) Zscore ≥2
Criteria for classification
1 if ZHA  - 2(Nostunting)
ZHANEW 
 0 otherwise(Stunting)
1 if ZWA - 2(Notunder weight)
ZWANEW 
 0 otherwise(under weight)
1 if ZWH - 2(No wasting)
ZWHNEW 
 0 otherwise(Wasting)
Descriptive analysis: cross-tabulation
results
• First, Association between CASHCROP, and the
two food security measures.
• It is important to note that all the above
variables are nominal or categorical variables.
• H0 : No relationship between commercialization
(CASHCROP) & food security (CALREQ and
INSECURE).
• This is tested using cross-tabulation procedures
(Table 3.1).
Test of Independence between
Commercialization and Nutrition
Food Security Measure: Calorie
adequacy
Table 3.1 Cross-tabulation results of cash crop growers
and CALREQ
CASHCROP
No
No
CALREQ
Yes
Total
Yes
Total
225
126
64.10%
35.90%
169
84
66.80%
33.20%
394
210
351
253
604 = n
Commercialization and Nutrition
• Cross-tabulation results: 35.9 per cent of the
cash crop growing households are food
insecure (as measured by CALREQ) compared
to 64.1 per cent of the non-cash crop growing
households.
• Cash crop generates additional income for
the household to purchase more food.
Test of Independence between
Commercialization and Nutrition
Food Security Measure: Dependency
ratio & number of meals
Table 3.2 Cross-tabulation results of cash crop growers
and INSECURE
CASHCROP
No
Secure
Moderately insecure
Yes
Total
49
26
65.30%
34.70%
64
23
73.60%
26.40%
116
77
60.10%
39.90%
165
84
66.30%
33.70%
394
210
75
87
INSECURE
Highly insecure
Totally insecure
Total
193
249
604 =n
Commercialization and Nutrition
• Cash crop growers are relatively more food
secure compared to non-cash crop growers.
• This could be due to household’s
participation in a commercialized crop
scheme enables it to acquire resources that
otherwise would not be available.
Commercialization and Child
Nutrition
Nutrition Measures: Anthropometric
Indicators
Table 3.3 Cross-tabulation results of cash crop growers
and height for age Z-scores for children under 5 years
CASHCROP
No
Low
Yes
Total
66
57
53.70%
46.30%
54
43
55.70%
44.30%
120
100
123
ZHANEW
Normal
Total
97
220=n
Commercialization and Child
Nutrition - Stunting
• Cross-tabulation: 53.7 per cent of preschoolers
of the households not growing cash crops are
stunted, while 46.3 per cent of preschoolers for
households growing cash crops are stunted.
• Extra income generated through sale of cash
crops achieves greater income, which helps in
moderating food insecurity of the household.
• Household members can obtain higher energy
intake as well as greater dietary diversity. The
higher energy intake results in better child
nutritional status.
Table 3.4 Cross-tabulation results of cash crop growers
and weight for age Z-scores for children under 5 years
CASHCROP
No
Low
ZWANEW
Normal
Total
Yes
Total
97
79
55.1
44.90%
44
38
53.70%
46.30%
141
117
176
82
258=n
Commercialization and Child
Nutrition -Underweight
• The incidence of underweight preschoolers
was 55.1 per cent for households who did not
grow cash crops, and 44.9 per cent for
households who grew cash crops.
• Underweight children are less likely to occur
in cash crop growing households relative to
non-cash crop growing households.
Table 3.5 Cross-tabulation results of cash crop growers
and weight for height Z-scores for children under 5
years
CASHCROP
No
Low
Yes
Total
121
91
57.08%
42.92%
7
15
31.82%
68.18%
128
106
212
ZWHNEW
Normal
Total
22
234 =n
Commercialization and Child
Nutrition - Wasting
• Incidence of wasting (42.9 per cent) among
commercial crops grower is less compared to
households who did not grow the crops (57.1
per cent).
• Statistical verification calls for test: chisquare test.
Chi-square test
• Issue under review: Relationship between cash
crop growing and household food security and
nutrition situation.
• Test: Chi-square test
• Purpose: Compare two characteristics and
verify if they are linked or related to each other.
• Task: Compare the observed frequencies with
the expected frequencies derived under the
hypothesis of independence.
Chi-square test
• The square of a standard normal variable
follows chi-square distribution
• Chi-square test:
– often used with contingency tables (cross tabulations),
say, gender and smoking.
– Test of independence: To verify if the columns are
contingent on the rows in the table.
– Null hypothesis: No relationship between row and
column frequencies.
• H0: The 2 variables are independent
Assumptions
• Random sample
• Data are in the form of frequencies
• Variables are independent
• Categories for each variable are mutually
exclusive and exhaustive
Crosstab: Gender x Smoking
Smoker
Non Smoker
Total
( Tj )
Male
46
(40.97)
71
(76.02)
117
Female
37
(42.03)
83
(77.97)
120
Observed
Expected
Total ( Ti )
83
154
237
31
Table 3.6 Chi-square tests between CASHCROP and
CALREQ
Value
p value
Test statistic
0.471
0.492
Number of valid
cases
604
Commercialization and Nutrition
• H0 : No relationship exists commercialization and food
security.
• The value of Pearson chi-square is 0.471 with significance
level (P value) of 0.492, the null hypothesis cannot be
rejected at the 10 per cent level.
• The incidence of food insecurity is not statistically different
between cash crop growers and non-growers.
• Although we find that cash crop growers have better food
security using the cross-tabulation tests, we cannot infer
that this relationship is statistically significant.
Table 3.7 Chi-square tests between CASHCROP and
height for age Z-scores for children under 5 years
Value
p value
Test statistic
0.089
0.766
Number of valid
cases
220
Commercialization and Stunting
• p value of the test statistic is quite high (0.766).
• Do not reject the null hypothesis.
• There is no observed pattern of relationship
between cash crop growing and stunted
preschoolers.
• Although, from the cross-tabulation results we
find that cash crop growing reduces stunting,
this relationship is not significant and is only due
to random variability.
Table 3.8 Chi-square tests between CASHCROP and
weight for age Z-scores for children under 5 years
Value
p value
Test statistic
0.048
0.827
Number of valid
cases
258
Commercialization and Underweight
• p value = 0.827 > 0.1.
• Do not reject null hypothesis that there is no
observed pattern of relationship between
cash crop growing and underweight
preschoolers.
• Incidences of underweight preschoolers are
not statistically different between these two
groups.
Table 3.9 Chi-square tests between CASHCROP and
weight for height Z-scores for children under 5 years
Value
p value
Test statistic
5.131
0.023
Number of valid
cases
234
Commercialization and Wasting
• p value = 0.023 and is significant.
• Cash crop growing reduces the incidence of wasting
among preschoolers.
• Weight for height Z scores (WHZ) are a short-term
indicator of nutritional status and, at least in the
short run, cash crop growing can benefit households
by generating greater income and achieving food
security.
• Improvement in food security status leads to greater
distribution of food and other resources at the intrahousehold level which, in turn, alleviates the problem
of malnutrition for preschoolers.