. .2 iatafirfia s... .. .14" L L». is . . 2.: .: .: .33” .1 . . at... In D in“ .35. n A! .Iil.~.L'l)flI¢L% 21:11.... In! . . r hr. "aqua-imwu. .. . h. E2... .5 . fin». .. .5..,.uu..... . .ufll a2 93?: .u but «ma. ‘1. , .3: _ in 3 In“... . . =1 .5: a... .. é a :3 .3 . 4 n kw. V i s . z: . .. .L :4 .. 1. .3 ha; :2... 4...... 3...)... .2 . . .4 (Ln. 2;: x. q. 2 ya. . s ; 2mm t .r r 5.! 3.5.9. . Fin-15...; , . 5.? .u “43...; 553$... . 5: s...- .......y I 2... 9.3.4.3? .. ....a4n...za:..!J..r zilflauflhflflg\7: 31>. Fiasfir. in: Its-«ha. . a I. 23...}... 1.5.3.8. . a... 2:»... .. .3 as 5:: ’1’: .‘A in: 1k. .{i my it. . ~ . niacigaanzw..§.€\g.!uh.tc. ._ .Ikznii‘uez bl.r\..uwnl.va.3{.cwx§ .M.’Hu9§n.lxb \hfi..:.fim. “Sunni... 1 2513“}? I.) ‘5... . . 1 . h”. 3215 t 3r! .3 éfilfltgzéaltnua. 1!)?!33: : . i. .fon Gilda: 389.5" is... 3%. 1:5. 3.3.5... 2...... figixhgfi. .53.:33: .. i. -1953... .... . hmhn: a. blag: it t. . 5.: ts .- \ zeitglxlill 33A,)... ‘0’: t ‘.V1‘D.Xr.llv.10|ll. . (15...... i.n‘§‘t‘x’§,llll.\a 2.1.2.: 11.5.... 2. .2 k1...) igwrhfiziix . a s1. .. x e. .. s. z»... ‘0 2.51:, 3. {r .3. It) 9. .. . x..- .. i. , Ganfli tuttvafrritttl )..!v.:..l!it‘.i £22.... Isa-5’53”.” .125. vfi :3... 111.59! r5. 3.st :Uru. . .52! 1.: a!!! . littv. ‘ .vit ...:9LnM1..¢1. ; x but... gum»)... z: I... . 7/ 7 0°“ This is to certify that the thesis entitled ASUBSECTOR ANALYSIS OF THE IMPROVED BEAN MARKET IN HAITI presented by WILLIAM HARR SHIELDS has been accepted towards fulfillment of the requirements for MS degree in AGRICULTURAL ECONOMICS Ewen. Major professor Date l lIJB'lDl 0-7639 MS U is an Affirmative Action/Equal Opportunity Institution LIBRARY Michigan State University PLACE IN RETURN BOX to remove this checkout from your record. TO AVOID FINES return on or before date due. MAY BE RECALLED with earlier due date if requested. DATE DUE DATE DUE ' DATE DUE JAN 1 8 2084 6/01 c:/CIRCJDaIeDue.p65-p.15 A SUBSECTOR ANALYSIS OF THE IMPROVED BEAN MARKET IN HAITI By William Harr Shields A THESIS Submitted to Michigan State University in partial fulfillment of the requirements for the degree of MASTER’S OF SCIENCE Department of Agricultural Economics 2001 ABSTRACT A SUBSECTOR ANALYSIS OF THE IMPROVED BEAN MARKET IN HAITI By William Harr Shields Lack of farmer access to improved crop seeds is one of the chief constraints to increasing agricultural production in developing countries. In Haiti, one of the poorest countries in the world, a small but vibrant seed sector is slowly emerging from mostly informal partnerships between public, private, and non-governmental organizations to provide Haitian farmers with improved seeds. This study describes the Haitian market for improved bean seed through a subsector analysis and observes actors’ attempts to minimize their information-related transaction costs. These transaction costs are particularly high in Haiti because decades of economic and political turmoil have enervated the public institutions that would otherwise work to reduce them. The study finds that this nascent seed industry relies upon linkages with international research organizations, social capital, and traditional farmer organizations to reduce information costs in the subsector. An unexpected finding is that even the poorest Haitian farmers have a strong seasonal demand for improved bean seed and are willing to pay a premium price for it. This result suggests that govemment-level institutional and policy reforms may further reduce information costs, help increase farmer adoption of improved beans, and enable the development of a strong private sector. ACKNOWLEDGEMENTS I commence these acknowledgements with a thank you to my major advisor, Dr. Richard H. Bernsten, for his guidance and encouragement throughout the past three years. Mere words cannot express how I have relied upon and benefited from his wisdom, dedication, and friendship during my tenure at Michigan State University. I also acknowledge the guidance and thoughtful comments of my thesis committee, Dr. Irvin E. Widders and Dr. John M. Staatz. Dr. A Allan Schmid likewise deserves my heartfelt thanks for his contribution to the institutional analysis section of this study. I hope that he can recognize his influence! This study was made possible by the generous support of the Bean/Cowpea CRSP office at Michigan State University, which funded my research and travel in Haiti over the summer of 2000 and a subsequent semester of study. In Haiti, a special thanks to Emmanuel Prophete from the Haitian Ministry of Agriculture, Natural Resources, and Rural Development’s Center for Agricultural Research and Development. His knowledge, logistical support, and tireless effort were incredible. I also thank Alfredo Mena Pantaleon, Lavael Eugene, and the wonderful staff at the Inter-American Institute for Agricultural Cooperation (IICA) for their logistical support in Port au Prince. Jean Lesky Dominique from the Inter-Sectoral Commission of Production and Distribution of Improved Seeds provided hours of assistance on the details of CIPDSA’s operations. Likewise, a thank you to Eliassant Magloire and Mousson Finnigan of the Organization for the Rehabilitation of the Environment, and Jean-Philippe Eveillard of AgroTechnique for their information and advice. iii A warm thank you to Jean-Robert Pasquette of AgroTechnique for providing transportation around Camp Perrin. Also a thank you to Gardy Horigéne for tolerating my driving, providing the wonderful Creole translation of the survey, and enumerating the farmer survey. I also thank the staff at the Levy farm research station in Camp Perrin for their logistical support and fabulous cooking. Finally, I thank my parents, Bruce and Carolyn Shields, for their unflinching support of my every effort. I dedicate this effort to my lovely wife, Iva Petrova, who watched with great trepidation last June as I departed for a summer in Haiti a bare three weeks after we exchanged wedding vows. Her unconditional support made it all possible. iv TABLE OF CONTENTS LIST OF TABLES ......................................................................................................... ix LIST OF FIGURES ........................................................................................................ xi LIST OF FIGURES ........................................................................................................ xi KEY TO ABBREVIATIONS ........................................................................................ xii CHAPTER 1 INTRODUCTION ................................................................................... 1 1.1 Problem Statement ......................................................................................... 1 1.1.1 Evolving Role of Government ................................................................ 2 1.1.2 Challenge for Haitian Agriculture ........................................................... 3 1.1.3 Importance of Beans in Haiti .................................................................. 4 1.2 Objective of Study ......................................................................................... 5 1.3 Research Questions ........................................................................................ 6 1.4 Thesis Organization ....................................................................................... 7 CHAPTER 2 ECONOMIC AND POLITICAL DEVELOPMENT IN HAITI ................ 8 2.1 Physical and Demographic Setting ................................................................. 8 2.1.1 Agricultural Land ................................................................................... 8 2. 1.2 Demographics ........................................................................................ 9 2.2 Economic Setting ........................................................................................... 9 2.3 Political and Economic History ...................................................................... 12 2.3.1 1697-1804, The French and Frwdom ..................................................... 12 2.3.2 1805-1820, Latin America’s First Land Reforms .................................... 13 2.3.3 1821-1915, Reforms and Decades of Turmoil ......................................... 14 2.3.4 1916-1986, The First US. Invasion and ‘Papa Doc’ ............................... 14 2.3.5 1987-2001, Instability and the Second U.S. Invasion .............................. 15 2.4 The Weight of History .................................................................................... 15 2.5 Haitian Economic Reforms ............................................................................ 17 2.5.1 Reforms in the Seed Sector ..................................................................... 18 2.5.2 Seed System Overview ........................................................................... 19 CHAPTER 3 THEORETICAL FOUNDATIONS, RESEARCH DESIGN, AND ANALYTICAL FRAMEWORK ............................................................. 21 3.1 Theoretical Foundations ................................................................................. 21 3.1.1 The Dual Nature of Seed ........................................................................ 22 3.1.2 Characteristics of Improved Seed ........................................................... 22 3.1.3 Transactions and Transactions Costs ...................................................... 24 3.1.4 The Behavioralist Approach ................................................................... 25 3. 1.5 Institutional Change ............................................................................... 26 3.1.6 Role of Institutions in Development ....................................................... 26 3. 1.7 Social Capital ......................................................................................... 27 3 .2 Research Design ............................................................................................. 28 3.2.1 Survey Area ........................................................................................... 29 3.2.2 Target Population ................................................................................... 30 3.2.3 Survey Description and Data Collection ................................................. 31 vi 3.3 Analytical Framework .................................................................................... 32 3.3.1 Subsector Analysis ................................................................................. 33 3.3.2 Determinants of Subsector Performance ................................................. 33 CHAPTER 4 THE BEAN SUBSECTOR ...................................................................... 35 4.1 Introduction ................................................................................................... 35 4.2 Subsector Overview ....................................................................................... 36 4.2.1 Haitian Bean Production ......................................................................... 38 4.2.2 Legal Environment ................................................................................. 39 4.3 Subsector Description .................................................................................... 40 4.3.1 MARNDR-CRDA .................................................................................. 42 4.3.2 CIPDSA ................................................................................................. 44 4.3.3 AgroTechnique ....................................................................................... 47 4.3.4 ORE ....................................................................................................... 51 4.3.5 Farmers .................................................................................................. 55 4.3.6 Farmer Groupement ............................................................................... 68 4.3.7 Traditional Bean Marketing: Role of Madam Sara ................................. 70 4.4 Transaction Costs in the Subsector ................................................................. 73 4.4.1 Varietal Development ............................................................................. 74 4.4.2 Seed Production and Multiplication ........................................................ 76 4.4.3 Sales and Distribution ............................................................................. 78 vii CHAPTER 5 SUMMARY AND CONCLUSIONS ....................................................... 81 5.1 Summary ........................................................................................................ 81 5.1.1 Purpose ofthe Study ............................................................................... 82 5.1.2 Data Sources and Methodology .............................................................. 82 5.1.3 Subsector Relationships .......................................................................... 83 5.1.4 Farmer Demand for Beans ...................................................................... 84 5.2 Policy Implications and Recommendations .................................................... 85 5.2.1 Varietal Development ............................................................................. 85 5.2.2 Seed Production ..................................................................................... 86 5.2.3 Storage ................................................................................................... 87 5.2.4 Sales ....................................................................................................... 88 5.3 Study Limitations and Implications for Future Research ................................. 90 APPENDIX A MAP OF HAITI ..................................................................................... 91 APPENDD( B FIRST GROWING SEASON VARIABLES AND TEST RESULTS ..... 92 APPENDIX C WILLINGNESS TO PAY TEST RESULTS. .......................................... 94 APPENDIX D BEAN FARMER SURVEY ................................................................... 95 BIBLIOGRAPHY ............................................................................................................. 105 viii Table l : Table 2 : Table 3 : Table 4 : Table 5 : Table 6 Table 7 : Table 8 : Table 9 : Table 10 : Table 11 : Table 12 : Table 13 : Table 1 Table 15 Table 16 : LIST OF TABLES Economic Characteristics of Improved Beans ................................................ 23 Bean Farmer Survey Respondents, July-August 2000, Camp Perrin, Haiti ..... 31 Haitian National Bean Production, 1990-2000 ............................................... 38 AgroTechnique Experience with Improved Beans, Haiti, 1999-2000 ............. 49 ORE Experience with Improved Beans, Camp Perrin, Haiti, 1999-2000 ........ 53 : Education and Frequency of Market Visits by Variety Planted, Camp Perrin, Haiti, 2000 ................................................................................................... 57 Farmer Bean Seed Source by Planting Season, Camp Perrin, Haiti, 2000 ....... 57 Farmer Bean Varieties by Planting Season, Camp Perrin, Haiti, 2000 ............ 58 Reasons Farmers Purchased Bean Seed, Camp Perrin, Haiti, 2000 ................. 59 Reasons Farmers Purchased an Improved vs. Local Bean Variety ................ 60 Factors Considered in Last Bean Purchase, Camp Perrin, Haiti, 2000 .......... 61 Area and Seeding Rate by Planting Season, Camp Perrin, Haiti, 2000 .......... 61 Basic Technologies Used by Farmers, Camp Perrin, Haiti, 2000 .................. 62 4 : Cash Input Costs % Share of Total Costs in First Growing Season, Camp Perrin, Haiti, 2000 ........................................................................................ 63 : Comparison of Proportions Test on lst Season Production Total Costs, Camp Perrin, Haiti, 2000 ........................................................................................ 63 Average Farmer Harvest by Variety, Camp Perrin, Haiti, 2000 .................... 64 Table 17 : Result of Comparison of Proportions Tests for lst Season Bean Harvest, Camp Perrin, Haiti, 2000 .............................................................................. 65 ix Table 18 : Average Disposition of Bean Harvests, Camp Perrin, Haiti, 2000 ................ 66 Table 19 : Groupement Interviewed in Survey, Camp Perrin Region, Haiti, 2000 ......... 70 Table 20 : Rapid Appraisal of Madam Sara Trading Costs, Camp Perrin, Haiti, August 2000 ............................................................................................................. 72 LIST OF FIGURES Figure l : Rainfall and Cropping Patterns in Camp Perrin, Haiti, Aug. 99-Jul. 00 ......... 30 Figure 2 : Haitian Bean Market Subsector Map ............................................................ 37 Figure 3 : Organization Chart of Haitian Government Agricultural Activities ............... 41 Figure 4 : Willingness to Pay for Improved Beans Among Farmers that Planted Local Beans, Camp Perrin, Haiti, 2000 .................................................................. 67 Figure 5 : Willingness to Pay for Improved Beans Among Farmers that Planted Improved Beans, Camp Perrin, Haiti, 2000 .................................................. 68 xi ALN .......................... BGMV ..................... CRDA ...................... CRSP ....................... DDA ......................... EU ............................ FAO ......................... ORE ......................... PNIS ........................ PROFIJOL ................ SNS .......................... UPSA ........................ KEY TO ABBREVIATIONS Arroyo Loro Negro Bean Golden Mosaic Virus Agricultural Input Boutiques International Center for Tropical Agriculture Inter-Sectoral Commission of Production and Distribution of Improved Seeds Center for Agricultural Research and Development Bean/Cowpea Collaborative Research Support Program Departmental Agriculture Directorates European Union Food and Agriculture Organization Haitian Gourde (HT G 20 = US $1) Haitian Ministry of Agriculture, Natural Resources, and Rural Development Organization for the Rehabilitation of the Environment National Input Program for Seed Cooperative Regional Bean Program for Mexico, Central America, and the Caribbean National Seed Service Artisanal Seed Production Unit xii CHAPTER 1 INTRODUCTION 1.1 Problem Statement The history of agriculture chronicles mankind’s remarkable success with increasing food production to meet the alimentary demands of growing human populations. Expanded food production has historically resulted fi'om cropland extensifrcation as well as modest advances in cultural techniques, tools, and plant genetics. Over the past 40 years, as the quantity of land available for agricultural extensification has dwindled, farmers have increased their reliance upon chemical fertilizers, pesticides, and better plant genetics to intensify agricultural production. Within the compass of technological change in agriculture, the continual enhancement of plant genetics, as embodied in the seed of improved varieties, remains the primary vehicle for moving new agricultural technology onto the farm. Increasing farmer access to and adoption of improved varieties requires that farmers, traders, and private, public, and international organizations minimize the cost of acquiring, evaluating, and disseminating information about their respective activities. Thus, these actors affect market performance by structuring their relationships in ways that minimize transaction costs in the marketplace. 1.1.1 Evolving Role of Government Historically, the Haitian government has not emphasized the development of staple food markets and their supporting structures, focusing instead on earning foreign exchange from export crops such as coffee, cocoa, and sugar. This long-standing focus on export industries began to change following the return of civilian government to Haiti in 1994 when international aid donors conditioned their renewal of financial support upon the enactment of widespread economic and social reforms. Since 1994, advocates of two conflicting visions of the state’s role in agricultural market reforms have competed for primacy within the Haitian government. Some in the government and major aid donors «such as the European Union, USAID, and the World Bank- favor decentralization and withdrawal of the state from even minor roles in seed marketing activities. Supporters of this market liberalization wish to limit the role of the Haitian Ministry of Agriculture, Natural Resources, and Rural Development (MARNDR) in the improved varieties market to one of supervision, administration of resource allocation, and general policy design. Proponents of the second, statist approach, cite difficulty coordinating activities among decentralized organizations and the need to define clear policy priorities as reasons to strengthen state control at all levels of the improved seed sector (Prophéte, 2000), (Manigat, 1999). The November 2000 re- election of Jean-Berthrand Aristide is widely thought to strengthen the position of statists in the debate over the precise role of the state in agricultural reform.l ' Recent events reinforce this view: The repaired Darbonne sugar plant will start to produce sugar under state ownership in early 2001. The government also plans to repair and run ENAOL, an edible oil prowesing plant. ENAOL previously closed due to low local supplies of soybean, cotton, and peanuts. 2 1.1.2 Challenge for Haitian Agriculture To achieve national food self-sufficiency, each hectare of arable land in Haiti must support, on average, more than 14 people (F A0, 2001).2 Currently, national production falls far short of this benchmark, providing an average of 59 percent of national caloric requirements, with commercial imports and food aid contributing 34 and 7 percent, respectively (Gagnon, 1998). According to the FAO, Haiti imported a total of 35,000 Mt. of dry beans in 1999 worth $16 million. Not surprisingly then, food purchases represent a major expense for both urban and rural Haitians. In urban and rural areas, food purchases represent 34 percent and 39 percent of total household budgets, respectively. These same purchases account for 93 percent and 76 percent of total food consumption in urban and rural areas, respectively (Jensen, et al., 1990a). . Haiti’s rural food-purchasing patterns are similar to those in many other developing countries (Weber, et al., 1988).3 Because even farm households in agricultural areas are net purchasers of food, government policies that artificially raise food prices above market levels as an incentive for farmers to increase production are inappropriate strategies for Haiti. Under these circumstances, price increases will increase rural poverty, even among farmers (Gagnon, 1998). Presently both urban and rural Haitians are food insecure; that is, they have insufficient access to the calories and protein to meet their daily nutritional needs throughout the year. The 1987 HECS4 estimated that 49 percent of Haitian households consumed less than 75 percent of the 2 This compares with an average of only 1.6 people per hectare of arable land in the United States 3 Several studies indicate that between 30 and 73 percent of rural African households are net buyers of coarse grains. ‘ ’The Haiti Household Expenditure and Consumption Survey (HECS) conducted by the Institut Haitien de Statistique et d’Informatique (IIISI) with support from USAID/Haiti. 3 recommended level of food energy available, and 37 percent of households consumed less than 75 percent of the recommended protein level (Jensen, et al., 1990b). Thus, the only long-run solution for reducing rural poverty and malnutrition in Haiti is to raise farm income through agricultural intensification. Given the low productivity of Haitian agriculture, even modest gains in domestic production have the potential to affect positively the 65 percent of Haitians that inhabit rural areas. Increased access to and adoption of improved varieties is a vital component of any effort to intensify agricultural production. 1.1.3 Importance of Beans in Haiti Beans play an important role in Haiti’s rural economy and in the diet of urban and rural Haitians. Malnutrition is a direct consequence of poverty. In Haiti, beans are an affordable source of complementary amino acids for the poor, who typically receive most of their calories from cereals and tuber crops. Only a few food items provide most nutrition in the Haitian diet. Ranked by expenditure, the most important food items are rice, beans, cooking oil, green bananas, bread, and goat meat. Purchases of rice, beans, and cooking oil alone represent, on average, between 21 and 24 percent of total household food expenditures. Beans are second only to rice in average valuation of household food expenditures, equal to 8.3 percent for rural and 6.9 percent for urban areas (Jensen, et al., 1990a). From an income perspective, beans provide more than 14 percent of gross production value on Haitian farms, well ahead of the 3.6 percent share of production value represented by cash crops such as coffee. For the poorest group of Haitian farmers, those with small farms in the arid mountains, beans represent almost 20 percent of gross farm production value (Wiens and Sobrado, 1998). 1.2 Objective of Study The general objective of this inquiry is to use a subsector analysis to describe the current structure and performance of the marketing system for improved beans in Haiti. Of particular concern are relationships between actors in the subsector and the effect information costs have on the underlying structure of their interactions. The specific objectives of the inquiry are to: Develop a conceptual framework for analyzing the demand for improved beans. Describe major actors in the bean subsector and the nature of their interactions. Examine how current government policy affects farmers’ access to improved beans. Identify organizational factors that constrain farmers’ access to improved beans. Identify how institutional innovations in the bean subsector affect farmers’ access to improved beans. Assess farmer demand and willingness to pay for improved beans. Identify insights about the Haitian market for improved beans that are transferable other nations that face similar challenges. Propose activities required for the development of a sustainable improved bean marketing system. 1.3 Research Questions Subsector analysis fundamentally involves the study of factors that affect the supply of and demand for a product. These factors originate from an amalgam of organic economic constraints inherent in a particular good, the institutions that affect interaction and decision making among industry participants, and national economic conditions. To meet the objectives of this inquiry, research will concentrate on the following questions. R i hi in h r' 0 How do the state and seed companies acquire new varieties for evaluation and eventual distribution to farmers? 0 What are the inherent characteristics of improved beans and how do these affect the structure of the market? 0 How do actors in the subsector deal with the transactions costs that they encounter? 0 How do the different choices made by actors affect performance in the subsector? Farmg demand for improved seed: 0 Why do Haitian farmers purchase beans and where do they purchase them? 0 How do farmers acquire their beans and what characteristics influence their decision to favor one variety over another? 0 What are the characteristics of farmers who use improved beans? 0 Are farmers willing to pay more for improved beans and if so, how much? 0 How do seed companies and the state stimulate demand for improved beans? 1.4 Thesis Organization The thesis contains five chapters. The frrst chapter outlines the problem statement, defines thesis objectives, and describes the research questions. Chapter Two presents an overview of the problem setting and reviews studies related to the thesis objectives and hypotheses. Chapter Three presents the data collection method and outlines the framework for analyzing the subsector. Chapter Four describes Haiti’s improved bean seed subsector, analyzes the data collected, and presents empirical results. Chapter Five summarizes the thesis and describes the policy implications and opportunities for future research. CHAPTER 2 ECONOMIC AND POLITICAL DEVELOPMENT IN HAITI 2.1 Physical and Demographic Setting Haiti and the Dominican Republic occupy the western and eastern sides, respectively, of the island of Hispaniola in the northern Caribbean Sea. Located between 18’ and 20’ north of the equator, Haiti enjoys a mild tropical climate. The number and complexity of Haiti’s ecosystems belie the nation’s surface area of 28,000 Km2 (10,360 M2) «roughly equal to the size of Maryland. Extensive mountain ranges, some with peaks reaching a height of more than 2,600 meters above sea level, create localized climates with annual rainfall ranging from 400 mm to more than 2,500 mm. 2.1.1 Agricultural Land The topography that creates a diverse climate also challenges efforts to increase agricultural output, for more than one-half of Haiti’s land area consists of mountains with slopes that exceed 40 degrees. Nearly 30 percent of Haiti’s cultivated area classifies as marginal agricultural land. The deforestation that accompanies expansion of farmland into marginal areas creates severe erosion. In turn, silt and highly variable water flows from this erosion threatens reservoirs for irrigation and power generation. Heavy erosion is a special problem in Haiti because it lies directly in the path of tropical weather patterns. Major hurricanes periodically hit Haiti and devastate both standing crops and agricultural infrastructure. The last major hurricane to hit Haiti, hurricane Georges in September 1998, caused an estimated 400 casualties and over $80 million in direct losses to crops and agricultural, private, and public infrastructure. With indirect and secondary losses included, damage totals reached over $180 million (U SAID, 2000). 2.1.2 Demographics Haiti’s population in the year 2000 is an estimated 7.8 million, which gives it a population density of more than 300 people per square kilometer. Roughly 65 percent of all Haitians live in rural areas. An infant mortality rate of 71 per 1,000 contributes to a life expectancy of 54 years, almost 16 years lower than the average for Latin American nations. The total fertility rate is 4.3 births per woman, which indicates an annual population growth rate of approximately 2.1 percent. F orty-nine percent of the adult population is literate, as compared to the Latin American average of 78 percent. Haiti is the poorest nation in the Western Hemisphere, and ranks among the poorest nations in the world. Its GNP per capita of $460 is only about 12 percent of the Latin American average GNP per capita of $3,840 (WorldBank, 2000). 2.2 Economic Setting Haiti’s poverty is a direct result of poor economic performance. During the past four decades, growth in per capita income has stagnated. Indeed, GNP per capita fell at a rate of 5.2 percent a year over the 1985 to 1995 period. The fact that only 20 percent of public sector resources go to rural areas, where 65 percent of the people live, exacerbates this situation. Not surprisingly, about 80 percent of the rural Haitian population lives in poverty, with rural poverty rates in the north and northwestern departments exceeding 90 percent. The World Bank estimates that Haiti requires an annual growth rate of at least 5 percent to achieve significant progress in poverty reduction (WorldBank, 1998). The structure of the Haitian economy, in terms of sector contribution to national GDP, is approximately 30 percent agricultural, 20 percent industrial, and 49 percent services. Average growth in agriculture and industry actually fell between 1979 and 1999. Annually, agriculture fell at a rate of —0.5 percent between 1979 and 1989, and — 3.2 percent in the 1989 to 1999 period (WorldBank, 2000). Political turmoiL and donor nations’ response to it in particular, has had long-term negative effects on economic growth. The economic sanctions imposed by the international community after the 1991 military overthrow of Jean-Berthrand Aristide devastated the Haitian economy. For example, agricultural production dropped by 17 percent between 1991 and 1994. Before the 1991 economic embargo, 70 percent of the Haitian population was food secure. By 1998, almost four years after the removal of the embargo, the proportion of the population that was food secure declined to 50 percent (WorldBank, 1998a). The government of Haiti relies heavily upon foreign aid. Between 1971 and 1994 Haiti received more than $3.1 billion in foreign assistance, with $1.4 billion coming from the United States. This sum, on average, represents about 10 percent of Haiti’s annual GDP. Aid from the United States over this period averaged $130 million each year, or about $16 per capita per year (Bandow, 1997). Currently, the United States is Haiti’s largest single source of foreign aid funds. USAID’s fiscal year 2000 request for $96.5 10 million consists of $70 million in econonric support and $26.5 million in direct food aid (USAID, 2000).’ Economic activity in Haiti does not generate enough tax revenue to concurrently support essential government functions and investments in agriculture, education, infrastructure, and security. To address this situation, the national budget has two components: operations and investment. The operations budget pays the basic salaries of government employees from national tax collections and donor support. Between 1994 and 1996, donors financed approximately 27 percent of Haiti’s annual government operations budget. After political turmoil in 1997, this proportion dropped to approximately 7 percent between 1997 and 1999. The investment budget is firnded primarily by grants or loans fiom organizations such as the World Bank, the Inter American Development Bank, the European Union, the Japanese International Cooperation Agency, the Republic of China (Taiwan), and USAID (U SAID, 2000). Often the funds available from the operations budget are sufficient to pay only the salaries of government employees, with no funds available for those employees to carry out their work plans. Donor response to political conditions in Haiti frequently delays the disbursement of funds promised for the investment budget. For the year 2000, the Haitian government expected external assistance to fund as much as 70 percent of the investment budget (Prophéte, 2000). However, donor concern over the conduct of the May 2000 legislative elections led the foreign community to bypass Haitian government channels and primarily disburse aid money through private voluntary organizations. ‘ For Haiti in 1999, this occurred under PL. 430, Title II. 1 1 ' Thus, political instability severely constrains the Haitian government’s role in creating programs for long-term and sustainable economic development. 2.3 Political and Economic History The problems of modern Haiti result from the cumulative effects of its history. It is a nation whose past mortgages its firture. Despite numerous attempts to establish democratic rule, despotism, terror, corruption, and neglect are hallmarks of the Haitian experience. Haiti has never known a competitive political system, with honest elections or benevolent government. The failure of innumerable reform efforts and billions of dollars in foreign aid to effect change is the source of great frustration for the international community. But Haiti did not start, as one commentator now terms it, as the “sick man” of the hemisphere (Rotberg, 1988). 2.3.1 1697-1804, The French and Freedom‘ Rapid improvement in agricultural production followed France’s 1697 acquisition of Haiti from the Spanish, earning the island the moniker ‘Pearl of the Antilles’. Colonial era investments in roads, irrigation schemes, and the consolidation of land into large plantations took full advantage of Haiti’s mild climate and rich soils. The urgent need for plantation labor led the French to continue the Spanish policy of slave importation, with more than 500,000 slaves of Afiican origin inhabiting Haiti by the last decade of the 18‘” century. For almost 100 years, a lucrative trade in cotton, sugar, coffee, and indigo led Haiti to become what Adam Smith declared the “most important of the sugar colonies of 12 the West Indies”. The slave rebellion that ended with independence in 1804 devastated the Haitian agricultural sector. White and mulatto landowners were killed or fled their land. Plantations, irrigation systems, and processing facilities all suffered substantial, though reparable damage during thirteen years of insurrection and neglect. 2.3.2 1805-1820, Latin America’s First Land Reforms Haiti’s first post-revolution leader, Jean Jacques Dessalines, attempted to restore plantation agriculture through a system of forced labor, which utilized citizens not engaged in skilled trades. Afier Dessalines’ assassination in 1806, the new nation split into two feuding states. The leader of the southern republic, Alexandre Pétion, undertook land reform by giving subdivided plantations to his army officers and supporters and selling land to emancipated slaves. Pe'tion made no great effort to restore plantation agriculture in southern Haiti. Rather, he sought to stimulate productivity through price supports for sugar and coffee, métayer (sharecropping), and promotion of exports. In contrast to Pétion, the policies of his opponent in the kingdom to the north, Henri Christophe, more closely followed those set by Dessalines. Through the introduction of a legal code, the Code Henri, he sought to instill virtues of discipline and hard work in his subjects. Under Henri’s iron rule, plantation agriculture and the commercial economy in the kingdom flourished until a military coup induced the unpopular Henri to commit suicide. 6 Unless otherwise noted. this section to 2.3.5 draws from (Moore, 1972) 13 2.3.3 1821-1915, Reforms and Decades of Turmoil Jean Pierre Boyer reunified Haiti in 1820. Boyer extended Pétion’s policy into the north of Haiti and subdivided plantations into smallholdings. While the lives of the former slaves improved, Boyer’s action decimated commercial agricultural production. Boyer also adopted elements of Christophe’s coercive legal code in an attempt to force peasants to produce export crops. Neither strategy worked well and at the time of Boyer’s overthrow in 1842, peasant production of crops for domestic consumption predominated in most areas. The seven decades following Boyer’s departure were years of intense political instability. Until the arrival of US marines in 1915, only one out of twenty-two heads of state served out his prescribed term in office. Investments in public services were minimal and, as families expanded from one generation to another, smallholdings were divided into increasingly small plots of land. 2.3.4 1916-1986, The First US. Invasion and ‘Papa Doc’ Agriculture rebounded slightly during nineteen years of US military occupation from 1915 until 1934. The United States undertook vast infi'astructure projects and maintained tight fiscal control of the government. Progress continued and peaked during the presidency of Paul Magloire (1950-1957), supported by a strong American business presence, sustained aid from the US and the nascent United Nations, and relatively high world sugar prices. The regimes of Francois ‘Papa Doc’ and his son Jean Claude ‘Baby Doc’ Duvalier marked the end of this era of agricultural progress in Haiti. For thirty years, the Duvalier government largely ignored impoverished rural populations, save for the purposes of exploitation through repressive taxes and theft of development and 14 humanitarian aid. During this time foreign donors frequently suspended development aid due to concerns over human rights abuses and anger over the outright theft of development funds (Lundahl, 1983). 2.3.5 1987-2001, Instability and the Second U.S. Invasion Since the overthrow of ‘Baby Doc’ Duvalier in 1986, Haiti has careened from one severe constitutional crisis to another. In 1988, military junta strongman Lt. General Henri Namphy summarized the mood of the Haitian elite when he rejected the post- Duvalier constitution with the proclamation: “Constitutions are not for Haiti”. However, the deepest crisis in recent years involved the 1991 military coup and consequent exile of the democratically elected government of Jean Berthrand Aristide. For the three years of Aristide’s exile, donor nations suspended all but humanitarian aid and placed Haiti under an economic embargo. By the time Aristide returned to power in late 1994, the Haitian economy had essentially collapsed, particularly the agricultural sector. Since Aristide’s return, political turmoil in Haiti has continued, even as economic and political reforms proceed with the encouragement and financial backing of the international community. 2.4 The Weight of History For almost 200 years, the primary concern of the Haitian state apparatus has been to extract wealth from agricultural production and extend patronage to political supporters. One lingering consequence of Pétion’s land reform was that the dominant class lost its ability to create wealth from land and turned to government service as a source of income. Thus, the political arena became a venue where a number of small 15 elite groups fought to firrther their own interests and despoil the economy. This system not only excluded the peasantry from any form of real political influence, but also siphoned away the private and government investment necessary to drive productivity and growth. Throughout the latter half of the nineteenth century, this elite unflinchingly indebted the nation, with international loans destined for the pockets of politicians. Because of this uninhibited race for the spoils and perquisites of office, Haiti became a state where corruption was ubiquitous (Lundahl, 1983). The most notorious of Haiti’s modern ‘presidents’, Francois Duvalier, wrote of this phenomenon in I 1959, and unconsciously telegraphed the attitude his own regime would only perpetuate: “Our governments never cared about the national inheritance and never attempted to stop social griefs. They talked a lot about liberty, only to fool the fi'ee world instead of using it fairly as a domestic policy. The country is split into two groups; the exploiters —restless and foolhardy minority- monopolize the administrative power and paralyze the progress of the masses; the exploited —the great majority- (are) victims of a wrongful and cruel system.” (Rotberg, 1988).7 In the later half of the twentieth century, foreign assistance projects sought to provide many of the public service responsibilities abdicated by the Haitian government. Deeply rooted corruption required that international and private assistance bypass government channels in order to reach targeted groups. In the 1950s, direct international involvement in agricultural and human capital investments became an effective means of routing funds away from the grasp of the Duvalier regime. This change greatly 7 Quoted in Jean-Pierre O. Gringas, Duvalier, Caribbean Cyclone: The History of Haiti and Its Present Government, New York: Exposition Press, 1967, pp. 105-106 16 strengthened the later emergence of the Non Governmental Organization (N GO) sector and fostered the development of local and national NGOs. Over time, as the Haitian government abdicated more and more of its public responsibilities to aid donors, the services provided by NGOs evolved into a parallel government for the provision of public services in agriculture, education, and public health sectors. By the end of the 19903, NGOs delivered about 50 percent of primary and curative services and either N60 or private for-profit institutions ran almost 80 percent of all primary and secondary schools (White and Smucker, 1998). Today, hundreds ”of local and international NGOs operate in Haiti and perform most tasks commonly associated with national government.8 2.5 Haitian Economic Reforms Aid donors renewed their efforts to implement economic reform programs with the return of civilian government to Haiti in late 1994. A major objective of these reforms has been to improve the standard of living of the population through high levels of sustained grth (Guzman, et al., 1998). As with all development-related projects in Haiti, foreign aid finances the majority of investments. Currently, donor activities support three general goals: redefining the public sector’s role to one that better meets the development needs of the country, promoting efficiency and effectiveness of the public service in the delivery of basic services, and creating of an environment conducive to private sector development (W orldBank, 1998). The most recent reform efforts focus on ' Estimates vary as to the exact number of NGOs that operate in Haiti. The number registered with the Ministry of Planning is 170. The FAO reports that other estimates are in the range of 800-2,000. ‘ l7 fiscal discipline, privatization, and civil service downsizing in the pursuit of the overall policy objectives. 2.5.1 Reforms in the Seed Sector In 1997, the Haitian government identified two strategies for developing its agricultural sector: organizing farmers at the grassroots level and reinforcing their means of production. Within the latter strategy, the government noted that improved seed deserves special consideration for increasing agricultural production (CIPDSA, 1997). The government of Haiti has developed national seed research and marketing plans for more than 30 years. However, a chronic lack of funds and political upheaval continue to impede the activities of the Ministry of Agriculture, Natural Resources, and Rural Development (MARNDR), the responsible ministry. A unit within MARNDR, the Center for Agricultural Research and Development (CRDA), is responsible for conducting varietal research and development. However, due to the chronic lack of funds in the investment budget, CRDA researchers do not have the resources and opportunities to actively pursue varietal development. While a few highly motivated CRDA researchers collaborate with public, private, and NGO researchers throughout the Caribbean, Latin America, and the US, (including the International Center for Tropical Agriculture (CIAT) and the Bean/Cowpea Collaborative Research Support Program (CRSP), there is generally little varietal development for most crops. Consequently, CRDA programs typically have little impact on development of the seed sector. Still, Haiti’s government recognizes that the creation of a vigorous improved seed market is one of many reforms needed to reverse decades of agricultural stagnation and decline. 18 2.5.2 Seed System Overview Douglas delineates four stages of national seed sector development: sustenance, early commercial, expanded commercial, and mature. In the first, or sustenance stage, farmers produce and save seed for personal consumption and local sale or exchange. Varietal improvement occurs gradually at a local level through farmer self-selection and introduction of new local land races. During this stage, formal seed breeding activities consist of limited evaluation and distribution of non-native varieties obtained through linkages with international research organizations (Douglas, 1980). In the second, or early commercial stage, public sector research programs identify varieties from local and external sources that perform well under local conditions. This research leads to opportunities for the development of small, commercial seed markets. At this stage, public programs provide resources for research and development, while a small private sector multiplies and sells seed of a limited numbers of major crops to the more successfiil farmers. Because of the limited quantities of improved seed available, most farmers remain outside the formal seed system, which constrains improvements in crop production. At the third stage, expanded commercial seed activities place greater emphasis on the development of a seed market as high-yielding varieties replace traditional ones. Varietal development in the private sector broadens and the private sector emphasizes higher profit hybrids. Competition in the private sector may lack intensity and government contract ofien subsidizes the production of commercial seed subsidized. However, seed quality may be poor, distribution inefficient, and market supply exceeds farmer demand for seed. 19 In the fourth stage, active public and private varietal research and development are characterized by a focus on the needs of consumers in mature seed systems. Private firms may either specialize their operations into niche markets or diversify to encompass many related activities. Most farmers purchase at least a portion of their seed from commercial sources and demand not only seed, but also new and high-performing varieties (Douglas, 1980). Under Douglas’ classification, the Haitian seed sector is clearly in the early commercial stage. The essential question for Haitian policy makers is how to promote a seed sector that effectively provides Haitian farmers with the best possible seed. The chapter that follows describes how this sort of transformation occurs and constructs an analytical fiamework for examining Haiti’s seed sector. 20 CHAPTER 3 THEORETICAL FOUNDATIONS, RESEARCH DESIGN, AND ANALYTICAL FRAMEWORK 3.1 Theoretical Foundations The current focus of the Haitian government and aid donors on agricultural market reform recognizes the potential benefits that private sector investment may bring to the Haitian economy. These benefits include lower input prices, greater and faster farmer adoption of new technology, and increased yields that arise when new technologies and structural changes allow markets to move improved varieties efficiently onto farms. Physical and genetic improvements to the seed farmers plant are one important source of change in the market. However, these changes alone are usually not sufficient to move the new technology into farmers’ fields. Ruttan and Hayami note that one of the most important areas for public investment in agriculture is the “modernization of the marketing system through the establishment of information and communication linkages necessary for the efficient firnctioning of factor and product markets” (Ruttan and Hayami, 1990). Market performance then, is a consequence of the way actors in the market organize their information and communication linkages. Public investment, which includes agricultural laws and policies, helps set the boundaries and incentives under which actors organize their market activities. 21 3.1.1 The Dual Nature of Seed Seed is both a consumable input and a source of genetic information. As a consumable input, seed combines with land, labor, water, and fertilizer to produce a crop. Seed is also the source of germplasm, the genetic information that determines how the input transformation process occurs and exactly what products result from it. Even if a farmer desires only one attribute of seed purchased off-farm, both manifest themselves in the purchased seed. Robert Tripp emphasizes that, since farmers demand seed off-farm for various reasons, formal seed provision activities must first strive to identify the nature of this demand. Demand for germplasm, Tripp notes, is not the same as demand for a consumable input. Farmers may purchase germplasm to obtain a new variety, renew genetically degraded stock, or to grow a new crop. They may also purchase seed because of high costs or technical requirements associated with on-farm seed conditioning and storage. Finally, because poverty forces many farmers to monetize their harvest, they may simply require seed of any type for planting (Tripp, 1997). 3.1.2 Characteristics of Improved Seed Every economic good has inalienable, organic characteristics that are firnctions of physics and biology. These characteristics create boundaries that define the range of economic choices that actors in the market can make (Schnrid, 1987). Three attributes of improved varieties affect production and consumption incentives in the market. These are transparency, subtractability, and excludability (Morris, et al., 1998). Transparency refers to the degree to which improved variety attributes are evident to potential users. As a consumable input, beans, for example, have low transparency: visual inspection may not accurately reveal the health, viability, and genetic purity of the seed. As germplasm, 22 beans are non-transparent: non-destructive determination of their genetic composition is impossible. Subtractability refers to the degree to which use of a variety by one person precludes its use by another. Since two farmers cannot both plant the same bag of seed, all varieties have high subtractability as consumable inputs. However, as a source of genetic material, beans have low subtractability: one farmer’s use does not directly affect the ability of another to plant the same variety.9 Excludability refers to the ease with which a seed seller can deny access to unauthorized users. As a consumable input, all varieties have high excludability since a vendor can easily exclude unauthorized users through control of the price. Differences in the way varieties reproduce influence the degree of excludability. Self-pollinated varieties, such as beans, have low excludability since each new generation not only contains the same information as the preceding one, but the rate of genetic decline is slow. Therefore, control of the genetic information contained in self-pollinated varieties such as beans is nearly impossible once a farmer makes his purchase. By contrast, hybrid varieties have high excludability: duplication of hybrids is easily restricted to those who know the pedigree and/or have access to the parent lines (Morris, et al., 1998). Table l : Economic Characteristics of Improved Beans Attribute Use Genetic Material Consumable Input Transparency Non-Transparent Low Transparency Sutractability Low Subtractability High Subtractability Excludability Low Excludability High Excludability 9 Morris notes tlmt indirect effects may occur when use of a particular variety affects market price. 23 3.1.3 Transactions and Transactions Costs Transparency, subtractability, and excludability affect the structure of the market by imposing transaction costs on potential users of improved varieties. Since the precise combination of these three attributes varies, the type and severity of transaction costs depends upon the species and variety. John Commons first identified transactions as the base unit in institutional economic analysis. Commons posits that the transfer of rights to future ownership between actors occurs within a combination of formal and informal rules enforced through collective action. These rules, or institutions, create expectations about the behavior of transacting parties (Commons, 1931). Ronald Coase expands upon Common’s theme with his observation that how assets are used is an important determination of economic performance. For Coase, organization of a firm represents an alternative way to achieve the same result as would have occurred in the market, but possibly at lower cost. Firms organize to avoid future transaction costs that arise from two sources: agency and asset specificity problems. The agency problem is, in general terms, a situation that arises when the action of an agent affects another, the principal. The central question for the frrm is whether it costs less to monitor the actions of its own employees or those of someone else. The uncertainty that surrounds a firm’s investment in assets that are expensive to convert for use in other economic activities creates asset specificity problems. In the case of asset specificity, the question for the firm is whether internal production costs are less than transactions in the market (Coase, 1937). Coase also argues that governmental administrative regulation may be economically efficient when transactions must occur between many actors. Thus, 24 the challenge for government is to create an arrangement that will best encourage economic efficiency (Coase, 1960). 3.1.4 The Behavioralist Approach For Oliver Williamson, the problem is not when to transact, but how. Williamson observes that some costs have their source in unpredictable human behavior. To this point, Williamson makes two observations about the behavior of individuals. The first is that a decision-maker inevitably has a limited ability to process information. This assumption of ‘bounded rationality’ helps to explain why individuals may transact inefficiently. The second observation is that individuals often act opportunistically, and do so with guile. Thus, the challenge for the organization of economic activity is to economize on bounded rationality and safeguard transactions against the hazards of opportunism (Williamson, 1988). Williamson and Commons each bring a slightly different perspective to the problem that transaction costs create in economic organization. Williamson recognizes that the unpredictable nature of individual behavior, as expressed through bounded rationality and opportunism, give rise to measurement and contractual problems. For Williamson, transaction costs arise fi'om the quality and quantity of information. For his part, Coase recognizes a problem with uncertainty of information about the future. Thus, the agency problem and asset specificity create transaction costs that place limits on the ways firms can profitably organize. 25 3.1.5 Institutional Change Institutions, Douglass North observes, are human-devised constraints that may reduce some of these transaction costs. Thus, the vital role of institutions is to reduce the uncertainty inherent in human interaction and limit and define the set of choices of individuals by establishing conventions, codes of conduct, norms of behavior, laws, and contracts. These rules evolve over time and modify economic behavior through progressive modifications in the range of available choices. The costs directly attributed to determining the value of goods, protection of rights, and policing of agreements between transacting parties necessitate the creation and maintenance of institutions. North also argues that the state is an important institution that reduces transaction costs when it impartially operates a well-specified legal system and enforcing the rights of economic actors (North, 1990). 3.1.6 Role of Institutions in Development Economic literature often refers to the important role that institutions serve in facilitating economic development. Nabli and Nugent note that institutions can facilitate or retard economic growth, but in either case institutional change lies at the heart of the long-run economic development process. The degree to which well-developed and efficiently firnctioning markets exist, they argue, depends critically upon the ability of institutions to affect the reliability of information and monitor and modify opportunistic behavior. By setting rules and constraints, governments in developing nations influence the conduct of the economy (Nabli and Nugent, 1989). Given the link between seed attributes and economic incentives, the firndamental decision for government concerns identifying the policy changes necessary to increase 26 access to improved seed and reduce its cost. One way for government to encourage change in a positive direction is to adopt, enact, or enforce rules that reduce uncertainty and increase opportunities for economic actors. These rules of society, collectively referred to as institutions, may be economic, legal, or moral in nature. In each case, institutions facilitate coordination among economic actors by helping them form expectations about the behavior of others. “Institutions that govern the use of technology”, Ruttan and Hayami write, can induce changes that enable “both individuals and society to take fuller advantage of new technical opportunities under favorable market conditions” (Ruttan and Hayami, 1990). 3.1.7 Social Capital The term ‘social capital’ generally describes the resources associated with interpersonal relationships (Robison, et al., 1999). More specifically, the Social Capital Initiative at Michigan State University defines social capital as “a person's or group's sympathy or sense of obligation toward another person or group that may produce a potential benefit, advantage, and preferential treatment to that other person or group of persons beyond that which might be expected in a selfish exchange relationship”. In marketing activities, social capital reduces transaction costs when an actor’s sense of obligation or sympathy prevents that actor fiom using guile or the bounded rationality of others to exploit them. Fafchamps and Minten’s study of traders in Madagascar found evidence that social capital “enables traders to deal with each other in a more trustworthy manner by granting and receiving credit, exchanging price information, and economizing on quality inspection.” Their research identifies three dimensions of social capital that are 27 important to reducing transaction costs among actors in the market: 1) relationships with other traders, which help firms to reduce transaction costs; 2) relationships with individuals who can help in time of financial stress, which insures traders against liquidity risk and: 3) family relationships, which reduce efficiency, possibly because families demand use of business resources (Fafchamps and Minten, 1999). Murray and Alvarez’s 1973 analysis of the Haitian bean marketing system similarly emphasizes the importance of pratik, or personalized regular trading relations, as an important component of bean marketing activity in Haiti. They note that these relationships are important at all stages from producer to the retail vendor (Murray and Alvarez, 1973). 3.2 Research Design Haiti consists of nine administrative divisions, or departement. Research for this study was carried out in two separate geographical areas, the capital of Haiti, Port au Prince, and in the mountains and on the Les Cayes plain near Camp Perrin in the departement du Sud. The coastal city of Les Cayes, the administrative center for the departement, is located approximately 220 kilometers west of Port au Prince (see Appendix A for map). The departement du Sud has a population of approximately 655,000. For simplicity, this study refers to the survey area simply as ‘Camp Perrin’. Two physical features dominate the Camp Perrin area. The Pare National Macaya is a 5,500 Ha national park that surrounds the 2,300, meter tall Pic de Macaya. From the Pare National Macaya flows the Ravine du Sud, a large river that enters the plain of Les Cayes near Camp Perrin village. These two natural features support a vital man-made resource in the area, the d ’Avezac canal, which irrigates more than 4,000 Ha 28 of the plain and makes Camp Perrin an important agricultural region. Irrigation allows farmers to grow several staple crops a year, including maize, sorghum, vegetables, and, most importantly, beans. 3.2.1 Survey Area Several criteria guided the selection of Camp Perrin for the survey. The first requirement was that the survey should occur in a region where both hillside and irrigated farmers had experience with the same improved bean varieties. The second was that the survey region should be a major bean-producing region. Camp Perrin met these requirements with the added benefit that two separate sources of improved beans exist in the region. For these reasons, Camp Perrin does not represent a typical bean-growing region in Haiti. However, the widespread production and multiplication of improved beans by both rainfed and irrigated farmers in Camp Perrin makes it appropriate as a study area. One caveat attached to the survey results is that the results of the farmer interviews in this one small region may not necessarily represent the national situation. However, information obtained from the government, NGO, and private sector indicates that the data are consistent with national level data. In Camp Perrin, farmers plant beans in the irrigated plain in early November and again in February. Planting in the mountains occurs in February and, in the higher rainfall areas, again in July. Farmers in the mountains around Beaumont, located about 20 Km to the north of Camp Perrin, produce a third crop of beans each year. These cropping patterns ensure a supply of fresh beans in the local markets throughout the year. Rainfall, which averages about 1,400 mm per year in the region, depends upon elevation. As for all crops, bean production depends more upon rainfall than upon any other factor. 29 Figure l : Rainfall and Cropping Patterns in Camp Perrin, Haiti, Aug. 99-Jul. 00 Month Plant _ Harvest —Irrigated Plantin 'nfed Planting — —Rainfall 3.2.2 Target Population More than 50,000 people live near the town of Camp Perrin. Agriculture employs approximately 75 percent of this population, with the remainder employed in retail and other trades. The rural poverty rate is approximately 80 percent in the Sud (Wiens and Sobrado, 1998)”. While this poverty rate is less than in other parts of the country, it is still very high. Government extension agents and a private seed firm provided information about farmer organizations that had received improved bean seed. Many farmers in Haiti, '° The World Bank calculates the poverty line for Haiti by taking the local cost of reaching the FAO minimum nutritional standard of 2,240 calories daily per capita and adding expenditures on non-food commodities, such that the percentage of food expenditure in total expenditure matches the average for poor rural households. In terms of annual per capita income, the estimated poverty line was around $220. 30 particularly those who use improved seed, belong to local farmer organizations known as groupement. Respondents for the survey were selected at random from eight different groupernenr membership lists. In addition, separate interviews were conducted with groupernenr leaders, two production managers from organizations that multiply improved bean seed, and individual bean sellers in the Camp Perrin market. Table 2 : Bean Farmer Survey Respondents, July-August 2000, Camp Perrin, Haiti October-November Planting Traditional Variety Improved Variety Total Irrigated Field 18 6 24 Non-Irrigated Field 7 l 8 Total 25 7 32 January-March Planting Irrigated Field 15 14 29 Non-Irrigated Field 38 14 52 Total 53 28 81 3.2.3 Survey Description and Data Collection The study was carried out between June 25 and August 15 2000. The first phase was conducted in Port au Prince, the capital of Haiti. Interviews with government officials in the MARNDR, CRDA, and the Inter-Sectoral Commission of Production and Distribution of Improved Seeds (CIPDSA) and review of official documents took place between June 25 and July 23. Interviews with the seed production managers for a private seed firm and an NGO also took place during this period. The second stage took place July 23-August 15, 2000 in Camp Perrin. In this stage, three separate survey instnrments were used to interview farmers, groupement leaders, and seed firm managers. The farmer survey collected bean production data, 31 cropping patterns, and farmers’ experience with improved bean seed fi'om 83 farmers who planted a total of 197 separate bean fields. Leaders of seven groupemenr provided background information on their groups’ membership and their history. Finally, a one- day rapid appraisal of the Camp Perrin market gathered information about market integration, profit margins, and trading habits from five bean vendors and one truck driver. Data collected during the farmers survey were entered into Excel for statistical analysis. 3 .3 Analytical Framework Shaffer’s concept of subsector analysis emphasizes that study of an agricultural commodity market should examine both horizontal and vertical relationships in order to identify opportunities to make performance enhancing changes. Changing relationships of technology, preferences, and institutions are explicitly part of this process. While the essential question is of vertical coordination, dynamic and organic factors that influence performance across the subsector are also important factors for consideration (Shaffer, 1973) ’ Shaffer envisaged two parallel systems at work in a subsector, a physical transformation system, and a coordination system that controls the physical one. Administrative or market processes enable the coordination system to exert its control over the physical one. “Major issues in subsector studies”, Shaffer writes, “involve the extent of these two forms of coordination and the practices and institutions which affect them.” (Shaffer, 1973). Many consider the subsector methodology, as originally described by Shaffer, as a lengthy, intensive, and time consuming process. However, 32 economists such as Holtzman have developed a modified subsector approach that uses rapid appraisal techniques to generate an overview of the subsector (Holtzman, 1986). Accordingly, this study adopts the approach of Holtzman while retaining Shaffer’s parallel systems concept. 3.3.1 Subsector Analysis This study uses rapid appraisal methods to describe and assess the bean subsector in Haiti, focusing on the market for improved beans. Activities in the improved bean subsector occur over four vertically connected component stages: varietal development, seed production, processing and storage, and sales and distribution. Varietal development seeks to improve existing plant varieties by selecting desirable genetic traits and producing initial quantities of genetically stable seed. Seed production operations multiply this stable seed into large quantities of commercially exploitable seed. Processing and storage activities prepare and store seed for later use. Sales and distribution operations promote the product, ensure its timely delivery, and provides feedback on the product to preceding stages (J affee and Srivastava, 1992, Pray and Ramaswami, 1991). 3.3.2 Determinants of Subsector Performance Subsector analysis starts from the premise that decisions likely to change performance are those that use minimal adjustments in market structure to the maximum effect. This is known as leverage. In addition to leverage, three other concepts guide the systematic search in the subsector for alternate structural relationships that may affect performance. Examining the vertical supply chains that link actors in the subsector to 33 each other identifies product movements down each chain, maps relationships between actors, and identifies alternate ways to arrive at similar outcomes. Analyzing variations in competitive practices helps illustrate how one actor develops an advantage over another in the market. Differences in technology adoption and strategic interactions between actors affect the competitive practices that each organization employs. Finally, identifying the level of coordination, or linkages, between actors demonstrates how policies and regulations influence market access and interaction, and how they decide to regulate product flows across component stages (Haggblade and Gamser, 1991). Leverage, supply chain, competition, and coordination choices made within the subsector influence performance, as measured by thiequity, cost-effectiveness, and responsiveness with which economic actors interact. Institutions firrther affect performance by refining the range of alternate choices within market structures. They accomplish this by moderating the interplay of economic actors. As relationships emerge and evolve to take advantage of alternative opportunities, institutions change, thus creating new occasions for action (North, 1990). Performance then is a consequence of organic characteristics, institutional structures, and choice alternatives made within biological and institutional constraints. 34 CHAPTER 4 THE BEAN SUBSECTOR 4. 1 Introduction This chapter presents results obtained through interviews with farmers, farrner groups, government, NGO, and private company officials. The first section provides a brief overview of the bean subsector. The second section introduces the major subsector actors in Camp Perrin and describes the present system for developing and marketing improved beans in southern Haiti. The third section describes how market structure responds to attributes of improved beans with respect to transaction costs in the subsector. AgroTechnique is a privately held Haitian firm that was founded in 1974 as the Haitian agent for Petoseed.‘l In 1991, AgroTechnique began multiplying beans for sale to government and NGO-sponsored food aid programs. Because the bean varieties that AgroTechnique initially multiplied were not genetically improved (i.e. They were high quality local varieties), farmers saw little increase in yield. In 1998, AgroTechnique commenced multiplication of an improved black bean fi'om the Dominican Republic known as Arroyo Loro Negro (ALN), a variety that does have the potential to increase farmer’s yields. Because private firms seldom find the multiplication of self-pollinated varieties to be profitable, AgroTechnique’s foray into the bean seed market is interesting. " Until 1995 Petoseed was an American vegetable seed company. It is currently a division of the Mexican- based Seminis corporation 35 The underlying question that guides this study is why is AgroTechnique apparently successful, or believes it can succeed, in a business that seed firms in other developing countries usually ignore. Even more important, what are the implications of AgroTechnique’s experience for other Caribbean and Central American nations that wish to encourage private sector investment in bean seed production? 4.2 Subsector Overview Most improved bean varieties that arrive in Haiti are initially evaluated by MARNDR-CRDA Figure 2 provides an overview of Haiti’s bean seed system. These improved beans originate with the Bean/Cowpea CRSP, CIAT, and researchers in the Dominican Republic. Once the CRDA researcher identifies a variety that performs well under Haitian conditions, samples are sent to interested groups for secondary evaluations, principally AgroTechnique and ORE. These organizations then conduct their own field trials and provide the CRDA with additional feedback. Starting in late 2000, small lots of improved bean varieties were sent to Haiti through an arrangement between ORE and CIAT, under which ORE agreed to test these improved materials. When AgroTechnique and ORE believe that they have identified a commercially viable bean variety, they start multiplying that variety with farmers. AgroTechnique and ORE conduct all their seed processing operations in-house. After treatment and storage, AgroTechnique and ORE sell improved beans to large distributors such as CARE and CIPDSA These organizations pay AgroTechnique and ORE a quality premium for the improved beans and then distribute the beans to farmers through their programs. While 36 ORE sells a small quantity of improved beans directly to farmers, this type of distribution is not part of a concerted marketing effort. Figure 2 : Haitian Bean Market Subsector Map Traditional Beans Improved Beans Varietal Develop-eat F A Seed G R M O E T E Processing] E C Stone: H R N I S Q Sales! Madam U Distribution Sara E a FARMERS Earl Use 37 4.2.1 Haitian Bean Production During the past decade, Haiti’s bean area has averaged 70,000 Ha, producing 48,000 Mt per year, with yields averaging 693 Kg/Ha (FAO, 2000). Although yields have held more or less steady since the early 1990s, the bean area and total production has trended downward fi'om a high of 97,000 Ha in 1993 to a low of around 51,000 Ha from 1998-2000 (Table 3).12 Black beans make up approximately 60 percent of the market, mottled and red about 30 percent and yellow, and white an additional 10 percent. Most varieties grown in Haiti are traditional land races. Table 3 : Haitian National Bean Production, 1990-2000 Year Crop Area Production Ha. Mt. 1990 87,000 60,000 1991 94,000 65,000 1992 97,000 67,101 1993 72,000 50,000 1994 72,000 50,000 1995 43,000 30,000 1996 71,300 49,200 1997 72,500 50,000 1998 50,724 35,100 1999 51,000 35,500 2000 51,000 35,500 Average 69,229 47,946 Source : FAQ A complex system of climatic zones and growing seasons allow Haitian farmers to plant several bean crops each year. Farmers produce beans under both irrigated and rainfed conditions. The largest and most important irrigated bean growing areas in Haiti ‘2 Given the rudimentary system for collecting agricultural data in Haiti, these data are only approximate estimates. 38 are the Les Cayes plain and the Artibonite valley. Nationally, Haitian farmers grow beans on approximately 10,000 out of the 75,000 Ha of irrigated cropland. These farmers typically harvest their single irrigated crop, depending on the location, between December and late March, although some irrigation schemes have enough water for two bean crops a year (Prophéte, 2000). Farmers in the mountains grow beans under rain-fed conditions during two cropping seasons. These farmers, who plant approximately 40,000 Ha of beans in each season, harvest in April and September. In the first season, beans are typically planted in association with a cereal crop such as maize or sorghum. Second season plantings in the mountains are usually monocropped. While some high-rainfall mountain areas have enough rain for three crops a year, others have just enough for one crop (Prophete, 2000). 4.2.2 Legal Environment Haiti has no official legislation that concerns the breeding or introduction of improved varieties. The government requires that imported seeds meet phyto-sanitary standards, but no rules exist to guide varietal introduction or release. Firms that wish to import seed must obtain a license from the Ministry of Commerce, which respondents claim is not difficult. Other than this requirement, there are no tariffs or licensing requirements for importers. Even though no rules exist with respect to the importation or introduction of genetically modified organisms (GMOs), private and public researchers currently do not evaluate GMO varieties. Participants in the sector voluntarily follow official regulations. But, since with no enforcement mechanism, regulations are essentially informal in nature. Currently, the Haitian government does not certify seed, although it plans to do so in the fixture through 39 the National Seed Service (SNS). No grades and standards exist for seed used in planting or sold for consumption. Thus, at present, seed-multiplying organizations carry out seed certification under their own standards and regulations (Dominique, 2000). 4.3 Subsector Description The Haitian government coordinates government activities in the bean market through two organizations (Figure 3). At the ministerial level, the MARNDR sets general research priorities for the CRDA, and allocates agricultural extension resources to the nine departement through a network of Directorates of Departmental Agriculture (DDA). However, due to the shortage of firnding, publicly funded extension has limited visibility in the rural areas. The other organization, the Inter-Sectoral Commission of Production and Distribution of Improved Seeds (CIPDSA), is primarily responsible for coordinating improved seed policy between aid donors, the CRDA, NGOs, and private Haitian seed companies. 40 Figure 3 : Organization Chart of Haitian Government Agricultural Activities R Ministry of Agriculture, Natural Resources, and Rural Development ' must * . Inter-Sectoral Commission of General Technical Production and Distribution of Directonte Services Improved Seeds - , MS SEA National Input Center for Program for Seed Agricultural Research and Development PM. SE5 Departmental National Seed Service Agriculture Directorates m MA Agricultural Input Artisanal Seed Boutiques Production Unit Farmers 41 4.3.1 MARNDR-CRDA The Ministry of Agriculture, Natural Resources, and Rural Development (MARNDR) is responsible for coordinating agricultural development in Haiti. Technical services fall into twelve divisions. One of these, the CRDA is responsible for varietal research and development. CRDA research activities suffer from a chronic lack of funds, due to the structure of the MARNDR budget. Since varietal research falls under the foreign donor-funded ‘investment’ budget, the current shortage of direct development aid prevents sustainable research activities. at the ministerial level. The CRDA bean researcher, for example, does not have refrigerated storage or a reliable supply of electricity at the main research center at Damien near Port au Prince. Furthermore, CRDA staff fi'equently rely on acquaintances in private industry and NGOs to provide transportation to visit research fields and satellite research centers. 4.3.1.1 Bean Breeding and Selection Activities A practical consequence of this chronic lack of research funding is that no govemment-supported bean breeding occurs in Haiti. Presently, most of CRDA’s bean research focuses on evaluating bean varieties obtained from research centers throughout the Caribbean and Latin America. Over the past 5 years, the Cooperative Regional Bean Program for Mexico, Central America, and the Caribbean (PROFUOL) and Bean/Cowpea CRSP have provided total annual funding of $6,000-$9,000 for a series of Haitian evaluations of improved beans (Prophéte, 2000). The Bean/Cowpea CRSP and CIAT are the most important sources of improved beans in Haiti. Annually, CRDA screens around 200 new breeding lines fi'om the following market classes: Andean mottled reds, small Meso-American reds, small whites, 42 and small blacks. The CRDA tested imported Pinto lines for the first time in 1999. New bean lines include stable F8 lines or families and a few early generation families, F1 to F4, which usually combine resistance to Bean Golden Mosaic Virus (BGMV), good yield, and other qualities, such as multiple disease resistance (Prophete, 2000).”‘“ Despite a lack of CRDA firnding for a domestic bean-breeding program, preparations for future breeding activities continue in the face of financial constraints. A current research project focuses on evaluating the CRDA’s collection of approximately 500 Haitian bean land races for disease and insect resistance. Once identified, land races with superior traits will be released as new varieties or possibly used as parents in the future, when Haiti is able to obtain resources to establish a breeding program. The Haitian germplasm collection effort is approximately 4 years old and includes material fiom eight of the nine departements throughout the country (Prophete, 2000). 4.3.1.2 Links with the Dominican Republic The exact quantity of beans traded annually between Haiti and the Dominican Republic is unknown. Cross-border trade that does occur is at a local level and escapes, perhaps purposefully, the notice of government officials. Farmers from San Juan de la Maguana in the Dominican Republic reportedly sell black beans over the border in Haiti at Elias Piilas. '3 The most important diseases that Haitian breeders seek resistance to are Bean Golden Mosaic Virus (BGMV), rust, and bacterial blight. Since bacterial blight is also a seed borne disease, careful field inspections are needed to produce certified seed. "In2000, mnd90hnescamefiomBeaNCowpeaCRSP-Hondumsandaround80fiom8eaNCowpea CRSP -Puerto Rico. In 2000, CIAT provided an additional 27 F2 families ofsmall red beans. 43 At the research and development level, the bean program at CRDA has maintained contact for many years with the bean programs in the Dominican Republic, PROFRIJOL, and the USAID-funded Bean/Cowpea CRSP. SEA (the Dominican Department of Agriculture), which is largely funded by the BIG CRSP, developed the black bean Arroyo Loro Negro as well as PC 50, a large red bean. In addition, the B/c CRSP has provided a modest level of financial in recent years to the Haitian bean research program. 4.3.2 CIPDSA CIPDSA is an inter-sectoral unit composed of nine members from private and public organizations, NGOs, and farmer organizations, who work together to propose seed market policy changes to the MARNDR CIPDSA’s involvement in the seed market dates fiom 1992, when the Aristide govemment-in-exile asked the Food and Agriculture Organization (F A0) and the European Union (EU) to help develop Haiti’s seed market. The goal of this intervention was to increase yields through the development of improved varieties and to create a seed distribution system. However, one condition of this intervention was that it not violate the international economic sanctions in place at the time or help to keep the military government in power. Rather than creating a sustainable seed distribution system, FAO’s emergency program distributed seed at no cost to farmers. Since yields of the improved varieties available at the time were only marginally better than the traditional ones, FAO’s program made no distinction between emergency relief and developing a sustainable seed system. Rather, the scheme emphasized the physical attributes of traditional varieties such as color, size, moisture content, and germination rate. Thus, the FAO program did not distribute improved 44 varieties, but merely subsidized the costs of shipping, grading, and storing traditional seed (Dominique, 2000). 4.3.2.1 Planned Seed Market Interventions CIPDSA market interventions have had four thrusts. First, in 1994, CIPDSA negotiated changes in the F AO emergency seed program to allow for the sale of program seed at market prices. At this time, CIPDSA’s responsibility changed from coordinating emergency aid to creating a sustainable distribution system for improved varieties. Subsequently, CIPDSA purchased high-quality foundation seed from seed-producing firms for emergency distribution and to farmer organizations, rather than purchasing local varieties in the market. This program included corn, beans, and sorghum. Second, the National Input Program for Seed (PNIS) administers EU firnding for the provision of subsidized seed, fertilizer, and other inputs to farmers. Under the original PNIS program, which was initiated ca.1995, Haitian NGOs and private firms acquired seed, generally in low-price areas, and sorted and treated the seed before selling it to CIPDSA. As the program matured, CIPDSA began to purchase high-quality improved varieties fiom Haitian seed-producing firms. Third, in 1994, CIPDSA established a network of Agricultural Input Boutiques (BIA) to facilitate seed distribution in under-served agricultural areas. In 1997, around 50 BIA were functioning, but by December 1999, this number had fallen to 35. The primary reason for this decline is that most BIA cannot generate enough income from the sale of inputs to pay employees’ wages. Fourth, in around 1995, CIPDSA created village-level networks of Artisanal Seed Production Units (UPSAs) to produce and locally distribute improved varieties. In the 45 future CIPDSA hopes to develop these production units into self-sustaining sources of good quality seed for local farmers. However, only three out of the more than 20 original UPSA are currently operational (RESAL, 2000). For the future, the goals of CIPDSA in the seed sector are to facilitate the increased production and availability of local food and promote improved availability and distribution of seed and agricultural inputs for farmers. CIPDSA plans interventions in six areas: research support, seed quality control, seed distribution, technology enhancement, promotion of improved varieties, and farm-level technical and economic development. Research support activities will focus on expanding the inventory of local varieties held by the CRDA and promoting the production of basic seed. Seed quality control efforts will involve the creation of a seed certification laboratory, the SNS. Seed distribution efforts will support and reinforce farmer organizations, such as the UPSAs and BIAs. The technology enhancement initiative will emphasize subsidies to increase the distribution of improved farm inputs. Expanding technical knowledge will promote increased demand for improved seed among farmers. Technical and economic development activities will seek to coordinate agricultural development work. Overall, CIPDSA’s responsibility lies with the coordination and organization of the sector, while responsibility for technical functions remain with MARNDR (RESAL, 2000). 4.3.2.2 Bean Market Interventions Beans have been the primary focus of CIPDSA’s seed market intervention. From the period 1993 to 1999, CIPDSA distributed more than 2,873 Mt of beans in Haiti, or 46 percent of all seed that it supplied (Gachette, 2000, Guiteau, 1999). For the October to December 1999 period, beans represented more than 82 percent of the 783 Mt of seed 46 that CIPDSA distributed to farmers. Improved beans comprised 115 Mt, or 18 percent of the beans distributed in this period, the majority of which was black beans (Guiteau, 1999). Currently, CIPDSA sells farmers and farmer organizations improved beans at about 50 percent of its cost (Guiteau, 1999). This price is set at a level that makes improved bean seed competitive with the price of landraces found in local markets. While contributions fiom the European Union finance this subsidy, the long-tenn sustainability of this program is of concern to CIPDSA CIPDSA estimates that Haitian farmers require approximately 9,000 Mt of beans for planting each year. Thus, the quantity of beans that CIPDSA sells in an average year accounts for only about 4.5 percent of annual Haitian bean requirements. 4.3.3 AgroTechnique Currently, more than 40 AgroTechnique stores throughout Haiti sell farm implements, fertilizer, seeds, and pesticides. Most of these stores are located in the main vegetable and field crop regions of the country: Kenscoff, St. Rafael, Foret de Pins, Port au Prince, the Artibonite valley, and the plain of Les Cayes. AgroTechnique first produced beans under contract with farmers in 1990, which it sold to the FAO/CIPDSA programs at a small premium. Before 1998, AgroTechnique multiplied only local varieties or improved bean landraces. However, in 1998 the company began field trials to test an improved bean variety from the Dominican Republic, Arroyo Loro Negro (ALN). 47 4.3.3.1 Bean Multiplication AgroTechnique chooses its seed multipliers based on the ease of access to their fields and the quality of their land. Before the planting season, AgroTechnique holds a training session for its multipliers during which it explains the multiplication process, the quality standards that they must meet, and how to apply fertilizer and pesticides. Farmers are provided with a technical information sheet in Creole. Whenever possible, AgroTechnique uses farmers who multiplied seed for it in previous campaigns. Instead of using formal contracts with its multipliers, AgroTechnique sets its purchase price higher than local market prices to convince farmers to sell their crop back to it. AgroTechnique’s main multiplication zones are the high-rainfall Beaumont area and the irrigated plains surrounding Les Anglais and Les Cayes. In 1999, AgroTechnique used more than 280 multipliers, most of who farmed in Beaumont and Les Anglais (Table 4). These growers produced around 100 Mt of ALN on fields averaging approximately 0.25 Ha. For the 2000 season, AgroTechnique used 328 multipliers (Eveillard, 2000). Although final production statistics are not available, of those who had harvested their fields, the average field size was 0.47 Ha, and farmers achieved an average conversion ratio of 1216.6.” This result is similar to conversion ratios found by the survey among AgroTechnique multipliers (1 : 13.2). ‘5 Because yield data fi'om mono-cropped and inter-cropped fields are not comparable, a conversion ratio gives an actual yield. The ratio is Kg harvested divided by Kg planted. Higher conversion ratios indicate a higher yield So, if a farmer planted a one Hafield with 60 Kg of beans, a conversion ratio of 20:1 would indicate a yield of 1,200 KgJHa. 48 Table 4 : AgroTechnique Experience with Improved Beans, Haiti, 1999-2000 Multiplication Statistics December 1999 - July 2000 Variety Arroyo Loro Negro Number of Multipliers 300 Total Ha. Planted 143 Average Parcel Size (Ha) 0.47 Average Yield (Kg) 1,327 Total Seed Given (Kg) 11,440 Total Seed Received (Kg) 189,820 Ratio — Plant : Harvest 1:16.6 Farmers have several incentives for multiplying for AgroTechnique. First, multipliers receive high quality seed on credit, with fiee transportation of the seed to a central location in their community. AgroTechnique treats all its beans with Gaucho, a systemic insecticide, to reduce the white fly infestations that spread of Bean Golden Mosaic Virus (BGMV). After harvest, multipliers receive a quality premium of between $0.14 and $0.28 per Kg, which is approximately 20 percent above the market price, and fiee transport of the crop. AgroTechnique maintains strict quality standards for its multipliers —requiring that seed is 98 percent fine of debris and weed seeds, achieves a germination rate of between 95 and 98 percent, and has moisture content between 12 and 13 percent. During the growing season, multipliers receive technical advice fi'om AgroTechnique technicians, who visit each field approximately every 12 days to check flowering, for disease and insect damage, and proper weeding. Multipliers who fail to maintain their fields according to AgroTechnique standards must still repay their seed loans and risk having their crop rejected. AgroTechnique based its decision to commence full-scale commercial production on its assessment of the superior yield and profit potential of ALN, compared to other 49 bean varieties available in Haiti. However, in 1999, AgroTechnique did not sell Arroyo Loro Negro through any of its stores. According to AgroTechnique staff, this was because production of ALN has not reached the point where widespread distribution was possible. Yet, a more compelling reason is that the price that CIPDSA pays for beans is approximately double the market price for local beans. For example, in July 2000, CIPDSA paid AgroTechnique $2,200 per Mt for 25 Mt of ALN, compared to a market price of about $1,000 per Mt for bean seed sold in local grain markets. CIPDSA purchased an additional 10 Mt of ALN around February 2000. According to AgroTechnique staff, seed production expenses per Mt in the July sale included $237 for treatment, management, and processing and ALN purchases from farmers of $1,489. While the extent of other costs such as salary and equipment depreciation are uncertain, AgroTechnique’s apparent ‘profit’ fiom its sales to CIPDSA is $474 per Mt. 4.3.3.2 Future Market Activities Given the fi'agile nature of Haiti’s foreign aid flows, AgroTechnique clearly cannot depend on the long-run availability of CIPDSA’s subsidy. One factor that works to AgroTechnique’s advantage is that it has a long-established network of input stores, which sell a broad range of agricultural inputs and farm implements. Since farmers who grow improved beans need to use chemical inputs to reduce risk of damage from disease or insects and take advantage of the variety’s superior qualities, AgroTechnique stands to gain fiom farmer use of improved beans from any source. AgroTechnique staff asserts that the company will not use improved beans as a ‘loss-leader’ to promote the sale of complimentary inputs, but as a stand-alone product. 50 AgroTechnique constantly seeks new opportunities in the bean market, evaluating promising improved varieties recommended to it by the CRDA bean researcher. When it identifies a good variety, AgroTechnique selects several contract growers to carry out field trials over several seasons. The main attributes sought are resistance to BGMV and a yield potential of 1.8-2 Mt/Ha. Although AgroTechnique has not yet sold ALN through its stores, it has planted demonstration plots near several stores to promote the seed and attract potential multipliers. A typical demonstration consists of five or six plots of the variety in one area. Field days are held at flowering and harvest. AgroTechnique plans for 100 people to attend each field day, and gives interested attendees a 300-gram seed sample. 4.3.4 ORE The Organization for the Rehabilitation of the Environment (ORE) is a local NGO based in Camp Perrin. ORE started its operations in 1985 and received formal NGO status from the Haitian government in 1989. Its objectives are protecting the environment, improving nutrition, increasing farmer income, and creating a permanent tree-crop industry. ORE’s general goal is to provide farmers with economic incentives to protect the watershed that supplies the Dazak Canal. ORE’s early activities focused on inducing farmers to plant high-yielding varieties of fruit trees such as mango, orange, and avocado on erosion-prone slopes. In 1987 a maize breeder, who had previously worked at the state-operated Levy Research Station in Camp Perrin with maize and beans, joined ORE. At this time, ORE decided to broaden its focus to include field crops because fiuit trees did not produce sufficient incentive to farmers to take marginal land out of production. High-yielding 51 maize and well-selected beans were seen as a way to provide this additional incentive to farmers. Today, maize production remains ORE’s principal activity, with annual production in the range of 150-200 Mt. 4.3.4.1 Bean Breeding Activities ORE produces two varieties of improved beans. The first, Tamazulapa, is a selection from a CIAT line. The second, L’Ore 87, was initially selected from a local heat-tolerant landrace at the Levy Research Station. Formal bean production started in 1993, although limited quantities were previously available. In 1999, ORE multipliers produced approximately 60 Mt of each variety. In the future, ORE hopes to develop a more professional bean research program. One problem with ORE’s existing varieties is their lack of BGMV resistance. Evaluation of promising CIAT BGMV-resistant varieties started in 2000. ORE hopes to identify several varieties with a yield potential of 1.5-2 Mt/Ha, good resistance to BGMV, and adaptability to a range of growing conditions. 4.3.4.2 Bean Multiplication Selection of multipliers is a continual process for ORE. Typically, the technical director searches for prospective multipliers among local farmers with access to good irrigation and a field of more than one Ha. Then, ORE holds seminars to explain the multiplication process. Once a farmer has signed a contract, ORE inspects the field for contamination from previous bean crops, and then provides the basic seed and a 50 percent credit towards fertilizer costs. For the 1999 season, ORE used more than 174 multipliers, most of who farmed in the irrigated plain near Camp Perrin (Table 5). In 1999, ORE produced around 50 Mt of Tamazulapa (average field size of 1.47 Ha) and 52 62.5 Mt of L’Ore 87 (average field size of 1.57 Ha). Conversion ratios for Tamazulapa and L’Ore 87 averaged 1:8.2 and 1:10.] respectively. Since ORE only records the seed that it purchases, rather than the amount that farmers actually produce, these conversion ratios may under represent the actual harvest «given that some farmers may retain some of the seed they produce. Table 5 : ORE Experience with Improved Beans, Camp Perrin, Haiti, 1999-2000 Multiplication Statistics - 1999 1999 Variety Lore 87 Tamazulapa Number of Multipliers 97 77 Total Area (Ha) 152 113 Average Parcel Size (Ha.) 1.57 1.47 Average Yield (Kg) 405 437 Seed Given 9,094 6,149 Seed Received ~ 62,599 50,369 Ratio Plant:Harvest 1:6.9 1:8.2 As with AgroTechnique, farmers have several financial incentives for contracting with ORE. First, multipliers receive bean seed on credit at the current market price, get a 50 percent credit on any fertilizer used, and can buy pesticides from ORE at full price. While ORE does not charge for transportation from the field, only large groups receive free transportation of seed for planting. Multipliers receive the local market price, plus a quality premium of $0.05 - $0.10 per Kg for their beans at the time of purchase, which represents a premium of about 8 percent above the market price. Since the price of beans is usually lower at the time of harvest than at planting, ORE earns a nominal profit on each transaction. However, since the seed is supplied on credit and losses from drying, sorting, and storage amount to almost 20 percent by weight, ORE gains little, if anything, from the price differential. ORE has strict quality standards «requiring that seed is 98 53 percent free of debris and weed seeds and has a moisture content of around 17 percent.16 Farmers who do not meet these standards risk losing their price premium or having the entire crop rejected. During the growing season, ORE technicians check germination rates, look for disease, and observe the weeding schedule. ORE will not purchase the farmer’s crop if serious disease or husbandry problems have damaged the seed, but still requires him to repay the original credit. ORE technicians also monitor the harvesting and threshing. Until transportation arrives, the farmer must store the crop properly. After the first campaign, ORE managers decide whether or not to continue a relationship with the farmer in firture campaigns. On occasion, ORE sells beans directly from its storage facility to local farmers at the local market price. More commonly, ORE sells directly to CIPDSA or an NGO such as CARE at a price of $2,000 per Mt, which reflects the firll costs of production and storage. After ORE negotiates a sale contract, it treats the seed with insecticide and puts it in 100-pound sacks for shipment. ORE managers feel that the demand for improved beans is growing, but production beyond 140 Mt per year places a serious strain on their storage and processing facilities. Since ORE is an NGO, it does not technically make a profit from its multiplication operations. The odds that it actually makes a profit are small, given the amount of varietal research that it conducts. ORE managers estimate that USAID and other aid agencies have covered about 50 percent of the cost of its activities between 1993 and the present, and are likely to continue this support into the near future. "5 Additional processing at the ORE facility reduces the moisture content to 13 percent. 54 4.3.5 Farmers The survey of 83 bean farmers in Camp Perrin identifies those who planted local beans and those who planted one of four varieties of improved beans, Arroyo Loro Negro, Tamazulapa, L’Ore 87, and Mersan, between October 1999 and July 2000.17 This section presents the survey findings along a timeline of the farmers’ primary seed production activities: purchasing, planting, harvesting, and disposal of the bean crop. A fifth sub-section covers questions related to farmers’ willingness to pay a premium for improved beans. 4.3.5.1 Bean Cropping Systems In an average year, more than 2,000 mm of rain falls in Camp Perrin. Traditionally, hillside farmers begin to plant beans and sorghum together in early February and harvest the beans in April. These farmers typically plant a second crop of mono cropped beans in July, depending on the start of the second rainy season. Harvest of the second crop takes place in September or October. Since the rains in February are greater in quantity and considered more reliable, farmers in areas where it is only possible to grow one crop a year plant their beans in February. Most bean farmers in the irrigated plain in Camp Perrin plant two bean crops, once in late October and again in February. Bean fields in the plain are usually mono cropped in both seasons, with harvests in late December and April. Some farmers on the lower reaches of the irrigation network may receive only enough irrigation water to plant beans in February, when rainfall can supplement irrigation water. '7 Because farmers in different locations plant at different tims of year, this section presents results both by planing time and by order of season (i.e.: 1" season or 2"" season) where appropriate. 55 For farmers in the plains as well as those in the mountains, the general pattern of bean planting and harvest times means that they need only store bean seed for short periods of time. When faced with a long storage period, farmers know that they can always purchase fiesh, local beans in the market. The proximity of several harvest and planting seasons creates a strong interdependence between farmers in the mountains and plains. 4.3.5.2 Bean Purchases Farmers in Camp Perrin visit a local market an average of 45 times each year, or about once a week. The time spent traveling to market by foot averaged 80 minutes, although those living near the main road can reach the market in less time by bus. Local markets are the primary source of bean seed that farmers plant, although when farmers plant in the agricultural calendar year is an important factor. In the first planting season, 55 percent of farmers obtained their seed fi'om the local market (Table 7). If CIPDSA had not distributed seed through groupement in February, almost 80 percent of farmers would invariably have purchased seed in the market. At 15 percent, ORE also represented an important source of seed. Comparing the farmers who planted improved beans with those who planted local beans reveals that farmers with more education were more likely to have purchased improved beans for the first growing season (Table 6). Similarly, adopters were less likely to visit the local market." " The comparison of means/proportions test approximates the standardized difference between two means/proportions to a t-distribution. The degrees of freedom derive from the sample variances and the number of observations for each group. 56 Table 6 : Education and Frequency of Market Visits by Variety Planted, Camp Perrin, Haiti, 2000 All Local Improved Proportions N Mm_ E Man N Mm E 1 Years of Education 82 4.73 57 3.62 23 7.61 1.1578 0.0015 k F 83 44.96 58 48.33 _2_3 33.61 5.8801 0.0150 Thirty-eight percent of the farmers who planted a second bean crop obtained most of their seed from the preceding harvest, while only 30 percent obtained their seed in the market (Table 7). ORE and AgroTechnique were also important sources of seed for the second planting, representing between them, the sole source of seed for 24 percent of farmers surveyed. Table 7 : Farmer Bean Seed Source by Planting Season, Camp Perrin, Haiti, 2000 Seed Source 1st Planting 2nd Planting Farmers Seed Farmers Seed Number Percent Kgs Percent Number Percent Kgs Percent Market 45 55.6 732 54.4 15 30.0 188 19.2 AgroTech. 0 0.0 0 0.0 5 10.0 183 18.6 ORE 12 14.8 337 25.0 7 14.0 178 18.2 Friend 1 1.2 3 0.2 3 6.0 62 6.3 Groupernent 19 23.5 209 15.5 0 0.0 0 0.0 Self-Stored 3 3.7 61 4.5 19 38.0 350 35.7 CARE 1 1.2 5 0.4 1 2.0 19 2.0 Total 81 100.0 1346 100.0 50 100.0 979 100.0 The survey identified four varieties of improved beans grown by farmers in Camp Perrin. ORE produces two of these, L’Ore 87 and Tamazulapa. AgroTechnique produces Arroyo Loro Negro. The fourth, Mersan, is a selected land race formerly multiplied by ORE. Since local farmers identify Mersan as an improved bean, this analysis includes Mersan in the improved category. 57 Among the farmers who planted beans, local black beans were the most popular type planted in both the first and second planting seasons, averaging 71.3 and 55.1 percent, respectively (Table 8). While, Tamazulapa and Arroyo Loro Negro were the most popular improved varieties planted in the first season (15.0 and 22.4 percent of respondents respectively) and second season (6.3 and 8.2 percent, respectively), farmers planted a greater quantity of local beans in both seasons. Table 8 : Farmer Bean Varieties by Planting Season, Camp Perrin, Haiti, 2000 Variety lst Planting 2nd Planting Farmers Seed Farmers Seed Number Percent Kgs. Av/Kg* Number Percent Kgs. Av/Kg“ Local Black 57 71.3 837 14.7 27 55.1 445 16.5 Improved 23 28.8 509 22. 1 22 44.9 534 24.3 Unknown 2 2. 5 14 7. 1 4 8. 2 66 16.8 L ’Ore 87 2 2.5 61 30.3 2 4.1 26 12.9 T amazulapa 12 15. 0 221 18. 4 11 22. 4 201 18. 2 Arroyo Lora 5 6.3 107 21.4 4 8.2 177 44.3 Mersan 2 2.5 106 52.9 1 2.0 65 64.5 Total 80 100.0 1,346 16.8 49 100.0 979 20.0 *Av/Kg is the total number of Kg for each variety divided by the number of farmers who planted it When asked why they purchased seed for the frrst planting, 81 percent of farmers (N=42) who planted a local bean indicated that they did not have seed for planting or did not store any (Table 9). These data reinforce the finding that Camp Perrin farmers do nOt generally store bean seed, except when growing seasons are closely spaced. About 9 percent of these farmers indicated that they purchased bean seed to get a better yield or germination than their own seed offered. Only 50 percent farmers (N=11) who planted improved beans indicated that they purchased bean seed because they needed seed for planting or had not stored any. Of these same farmers, 23 percent indicated that they purchased improved beans to get a better yield or germination. 58 Table 9 : Reasons Farmers Purchased Bean Seed, Camp Perrin, Haiti, 2000 Reason for Buying Seed Local Beans Improved Beans Total Number % Number % °/o Seed for Planting / Didn‘t Store Any 42 80.8 11 50.0 71.6 etter Yield / Seed Germination 5 9.6 5 22.7 13.5 t was Available in Market 1 1.9 1 4.6 2.7 What Groupenlent Offered 1 1.9 1 4.6 2.7 Credit Offered 0 0.0 1 4.6 1.4 oney for School Fees 1 1.9 2 9.1 4.1 ant Income fiom Beans 1 1.9 1 4.6 2.7 ' her Price at Harvest 1 1.9 0 0.0 1.4 Total 52 100.0 22 100.0 100.0 When asked why they purchased a particular bean variety, more than 28 percent of farmers (N=15) who purchased a local bean responded that they knew or liked the variety or seed (Table 10). More than 30 percent (N=16) answered that the beans purchased were what they found for sale in the market. An additional 26 percent (N=14) liked the qualities of the seed or variety. Among farmers who purchased improved beans, 53 percent (N=10) responded that they liked the qualities of the seed or variety, 26 percent (N=5) purchased them because they knew or liked the variety, and another 16 percent purchased them because their groupement offered this variety. 59 Table 10 : Reasons Farmers Purchased an Improved vs. Local Bean Variety” Why Purchase this Bean Variety Local Improved Total Number % Number % % Variety Known / Liked / Trusted 15 28.3 5 26.4 27.8 Sales Point is Near to Home 1 1.9 0 0.0 1.4 What I Found for Sale 16 30.2 1 5.3 23.6 11 Credit / Good Price / Groupement 6 11.4 3 15.8 12.5 ike Qualities of Seed / Variety 14 26.5 10 52.7 33.4 n't Stored Any to Plant 1 1.9 0 0.0 1.4 [Total 53 100.0 19 100.0 100.0 Many different factors influence farmers’ decision to favor one seed seller/vendor or variety over another when they purchase beans (Table 11). Physical attributes such as appearance, color, size, and cleanliness may indicate the general health of the seed and its genetic potential. The price of the seed may also be important, particularly to poor farmers. Finally, farmers may credit individuals or those from specific regions with having good quality seed. When asked about these factors, 32 of the respondents who purchased local varieties indicated that the appearance of the bean seed influenced their decision. Twenty-five indicated that the seed size was important, while 20 said that seed color was important. Among farmers who purchased improved beans, appearance, size, and color were again the most commonly mentioned factors. More than 85 percent of respondents who purchased local beans said that they were satisfied with the seed they purchased, while 100 percent of those who purchased improved said that they were satisfied. The average price paid per kilogram of beans was $1.71. '9 Several of these categories are aggregates of farme6rso’ responses to an open-ended question Table 11 : Factors Considered in Last Bean Purchase, Camp Perrin, Haiti, 2000 Factors in Transaction Local Beans Improved Total % (N=42) % (N=7) % (N=49*) Price of Seed 7.1 0.0 6.1 Appearance 76.2 71.4 75.5 leanliness 14.3 14.3 14.3 evious Transactions with Seller 4.8 14.3 6.1 eputation of Seller 2.4 0.0 2.0 olor 47.6 42.8 46.9 Size 59.5 71.4 61.2 Satisfied with Seeds Purchased 85.7 100.0 87.8 *Anumberofreqrondemsdidnotpurchasebeans,sototalNislessthaninothercomparisons 4.3.5.3 Bean Planting The average Camp Perrin farmer plants 1.39 hectares of beans in the first planting season and averages 16.8 kilograms of seed per hectare (Table 12). Planting in the second season averages 0.64 Ha., with 20.0 Kg. of seed. The amount of land planted in the second season is, on average, about half of that planted in the first season for both local and improved beans. The slightly higher average seeding rates reflect the traditional switch to bean monocrops in the second planting season. Table 12 : Area and Seeding Rate by Planting Season, Camp Perrin, Haiti, 2000 Bean Type 1st Planting 2nd Planting # Hectares Kg/Ha # Hectares Kg/Ha All Varieties 1.39 16.8 0.65 20.0 Local 1.32 14. 7 0.59 16.5 Improved 1.55 22. 1 0. 72 24. 3 The farmer survey identifies two basic technologies that farmers use to grow their beans (Table 13). Irrigation allows farmers who use it to have a much more predictable yield in any season and to plant a second crop in most years. Fertilizer and chemical pesticides represent the second technology that farmers have available. Of all farmers 61 surveyed, 37 percent planted in the first season in irrigated fields. Almost 52 percent of these farmers used chemical fertilizer and 41 percent used chemical pesticides. Farmers . who planted a second bean crop generally increased their use across all technology categories. A surprising finding is that farmers who plant local bean varieties use approximately the same technological packages as farmers who plant improved bean varieties. Table 13 : Basic Technologies Used by Farmers, Camp Perrin, Haiti, 2000 1st Planting 2nd Planting % Using (N=81) Irrigation Fertilizer Pesticide % Using (N=50) Irrigation Fertilizer Pesticide All Varieties 37 52 41 48 62 48 Local 33 52 40 52 67 52 Improved 48 52 44 44 57 44 Farmers who planted local beans in the first growing season had, on average, total costs of $54.11, while those planting improved beans had total costs of $139.27 (Table 14). Seed costs represent a significant difference between farmers who planted improved beans and those who planted local beans, totaling $40.72 and 23.94 respectively (Table 15), even though the latter group spends a greater proportion of their total costs on seed. The greater area cultivated by farmers who plant improved beans explains this difference. The comparison of means test also indicates a significant difference between the two groups with respect to credit costs, which is not surprising given that most credit schemes necessarily include improved bean seed as part of a package of technologies. The rental cost of land and chemical input costs do not show significant differences between the two groups. 62 Table 14 : Cash Input Costs % Share of Total Costs in First Growing Season, Camp Perrin, Haiti, 2000 Cost Description Farmers Planting... Local Beans Improved Beans Total % (N=58) °/o (N=ZQ % (N=81) Cost of Rented Land 21 25 23 Cost of Seed 44 29 37 Cost of Chemical Inputs 33 21 27 Repayment of Credit 1 25 13 Total 100 100 100 Table 15 : Comparison of Proportions Test on lst Season Production Total Costs, Camp Perrin, Haiti, 2000 Cost Description Total Local Improved Proportions (N=31) (N=58) (N=23) Mean $ Mean $ Mean $ SE p-value ost of Rented Land 17.9 11.4 34.5 14.1962 0.1167 ost of Seed 28.8 23.9 40.7 7.8121 0.0389 ost of Chem. Inputs 21.3 17.9 29.8 9.2462 0.2103 7 epayment of Credit 10.3 0.8 34.3 11.0199 0.0059 4.3.5.4 Bean Harvest Calculating the yield for each hectare of land planted in beans is complicated by the diverse topography in the survey area. Fields in Camp Perrin may be flat or on stony slopes of 40 degrees or greater. Similarly, farmers may monocrop or grow beans in association with a grain such as sorghum or maize. A measure that accurately captures the effectiveness of a farmer’s effort is a conversion ratio, or the number of kilograms planted divided by the number of kilograms harvested. Haitian farmers use this method Camp Perrin farmers commonly cite a for measuring the success of their crop. conversion ratio of between 1:15 and 1:20 as ideal for black beans. 63 The small sample size for several of the bean varieties makes comparison of several varieties difficult. Local black beans were the most common type planted in both seasons, followed by Tamazulapa and Arroyo Loro Negro. Table 16 shows the relative performance of the five varieties of black beans found in Camp Perrin. These results partially reflect the effect of AgroTechnique and ORE’s contract growers. Farmers who grow L’Ore 87 and Mersan are more likely to have obtained their seed in the market and may not use chemical inputs to grow them. Table 16 : Average Farmer Harvest by Variety, Camp Perrin, Haiti, 2000 Variety First Harvest Second Harvest N Harvest Plant/Harv Harvest N Harvest Plant/Harv Harvest Av.# Kg. Ratio Value ($) Av.# Kg. Ratio Value ($) Local Black 58 61 4.1 127.5 18 84 5.1 183.3 Improved 22 129 5.6 324.0 13 283 8.5 762.5 Unknown 2 9 1.0 16.9 3 181 7.5 483.5 L ’Ore 87 2 97 2. 7 243.5 1 23 1.1 59.2 Tamazulapa 11 99 4.5 231.5 4 155 5.9 340.3 Arroyo LN 5 213 12.3 597.9 4 591 15.3 1, 683.1 Mersan 2 290 6.5 719.2 1 129 2.0 309.6 Total 80 80 4.5 181.6 31 167 6.5 426.2 Farmers who planted improved beans in the first season had a bean harvest worth an average of $324.0, versus $127.5 for those who planted local beans (Table 17). Not surprisingly, the value of farmers’ bean crop afier subtracting expenses «indicated as ‘Profit’« averaged $170.7 and $73.8 for improved and local beans, respectively. This profit does not take into account the cost of the farmers’ labor costs. An interesting result from the comparison of means test is that there is no significant difference in profit for farmers who plant local beans and those who plant improved beans. Table 17 : Result of Comparison of Proportions Tests for 1st Season Bean Harvest, Camp Perrin, Haiti, 2000 Variable All Varieties Local Improved Proportions N Megn N Mean N Mean SE p-value Total Production Costs 81 77.9 58 53.7 23 139.3 35.84 0.0245 Value of Harvest 80 181.6 58 127.5 22f 324.0 87.17 0.0332_, 81 1013 58 73.8 23 170.7 65.70 0.1525 Profit I"Resultsforthe2""Seasonharvestarenotavailable 4.3.5.5 Bean Crop Disposition The disposition of the bean crop is an important part of farmer behavior. Again, the number of respondents for several of the bean varieties is too small to draw broad conclusions. Nevertheless, survey results generally confirm that Camp Perrin farmers sell the majority of their bean crop, usually within a few weeks of harvest. After the first season, on average, farmers who grew local beans sold 66 percent of their crop, saved 11 percent for seed, and consumed 23 percent (Table 18). Farmers who grew improved varieties sold a higher percentage of their crop, because many of them were multipliers for AgroTechnique or ORE. After the second harvest, farmers who grew local beans sold 75 percent of their crop, stored only 3 percent, and consumed 21 percent of their crop. This finding supports evidence from interviews with government officials that Haitian farmers do not store bean seed for long periods of time. 65 Table 18 : Average Disposition of Bean Harvests, Camp Perrin, Haiti, 2000 Variety _ First Season N Sold Saved Sale Value Profit . Avg# Kg Am # Kg Ag. $ Ag. $ Local Black 58 40 7 113.8 74.6 Improved 23 1 10 5 289.4 205.0 Unknown 2 5 2 19.4 9.2 L On 87 2 71 0 177.4 107.0 Tamazulapa 12 80 9 183.1 1 73.8 Arroyo Lora 5 191 1 537.2 311.4 Mersan 2 274 0 678.9 419.9 Total 81 58 6 172.4 111.6 Variety Second Season“ N Sold Saved Sale Value Profit Avg # Kg Avg #Kg Avg. $ Avg. 3 Local Black 18 57 4 125.9 NA Improved 13 250 4 678.6 NA Unknown 3 175 1 472.2 NA L On 87 1 23 0 59.2 NA Tamazulapa 4 129 0 277. 4 NA Arroyo Loro 4 514 11 1,481. 7 NA Mersan 1 129 0 309. 6 NA Total 3 1 138 4 357.7 NA ‘Manyfamushadnotcompletedthensecondhawestatthefimemesuweywasmken. 4.3.5.6 Willingness to Pay Farmer willingness to pay greater than market prices for improved beans is the key to building a successful market for improved beans. Because CIPDSA subsidizes the price of most improved beans available in the market, it is interested in understanding farmer’s willingness to pay greater than market prices for improved beans. Three questions in the survey asked farmers about their willingness to pay more than the market price for improved beans. The first question asked: “if the market price for local beans is HTG 50, would you be willing to pay HTG 60 for improved beans?” Two subsequent 66 questions assessed the farmers’ willingness to pay HTG 70 or I-I'TG 80. These prices represent 20, 40, and 60 percent price increases over the hypothetical market price of HTG 50 (the equivalent of $0.89/Kg). The following cumulative distributions display the results from these three questions. ‘Market’ indicates that the percentage of respondents willing to pay at least the market price for improved beans. The ‘20%’ indicates the proportion of respondents willing to pay at least 20 percent more than the market price. ’40%’ indicates the proportion willing to pay at least 40 percent more, and a ‘60%’ indicates those willing to pay at least 60 percent more than the current market price. The first distribution presents the responses of 55 farmers who planted local beans in the first growing season (Figure 4). Of these, 11 answered ‘Market’, 15 20% more, 9 40% more, and 20 60% more. Figure 4 : Willingness to Pay for Improved Beans Among Farmers that Planted Local Beans, Camp Perrin, Haiti, 2000 Market 20% more 40% more 60% more 67 The second distribution presents the responses of 23 farmers who planted improved beans in the first growing season (Figure 5). Of these, 2 answered ‘Market’, 6 20% more, 5 40% more, and 10 60% more. A close examination of the two figures indicates a very similar shape and magnitude among responses. Results of a difference of means test of the two data subsets indicates no significant difference in willingness to pay between farmers who planted local beans and those who planted improved varieties (Appendix C). Figure 5 : Willingness to Pay for Improved Beans Among Farmers that Planted Improved Beans, Camp Perrin, Haiti, 2000 Market 20% more 40% more 60% more 4.3.6 Farmer Groupement Throughout Haiti, groupemenr (lit. grouping) have evolved as a form of local grassroots development committees. The groupenrent movement traces its origins to the ‘community councils’, established during the Duvalier regime. Established by parish 68 priests and lay leaders as grassroots alternatives to the government-controlled community council system, groupenlenr represent a powerful organizing force in rural Haiti. The number of groupernent increased dramatically after the fall of ‘Baby Doc’ Duvalier in 1986. Many groupemeni have strong ties with national and international NGOs. Because of their political involvement in the 1987 and 1990 elections, the military brutally repressed some groupernent following its takeover of Haiti in 1991. The return of Aristide in 1994 inaugurated a period of groupement expansion and development. (White and Smucker, 1998). Leaders from eight groupement were interviewed during the course of this study. Most of these groupement were formed around 1994, although one has existed since 1987. Functions of the groupement vary. OPMAGAT, for example, is a large groupement in Camp Perrin with several hundred members. Its primary concern is increasing member income through various activities, including construction of a cassava processing facility. Primary support for this project comes fi'om the Japanese Embassy in Port au Prince. In 1999, this groupernent initiated a secondary activity that involved the distribution of improved bean seed obtained fi'om the regional DDA in Les Cayes. The price that OPMAGAT and other groupement in Camp Perrin paid for improved beans in 1999-2000 reflected a subsidy of 50 percent below the local market price. In the firture, beans obtained through the DDA will not carry this subsidy, due to the conclusion of post- hurricane Georges relief efforts. Both ORE and AgroTechnique use existing groupement to find and organize their seed multipliers. Groupement members who purchased subsidized seed expressed appreciation for their groupement bringing them the opportunity to buy improved seed. 69 While few groupenlent have the financial resources to extend credit to their members directly, they can provide their members with credit and technical advice through links with aid donors and development agencies. Thus, AgroTechnique and ORE’s seed multiplication programs represent a new way for groupernent to provide benefit to their members (Table 20). Table 19 : Groupement Interviewed in Survey, Camp Perrin Region, Haiti, 2000 Name Purpose I Number Seed Source Kg. Main Activity of Distributed Members [OPMAGAT Income Activities 250+ ORE BIA-Nava Road Maintenance, 60 ORE 1000 Cooperative Farming ' ACOJEB Education, Canal 250 AgroTech. NA“ Maintenance, Cooperative , Marketing Eclair of Terre Soil Conservation 15 PADF 95.5 Rouge Tet Ansanm Soil Conservation, Group 19 OPMAGAT NA" Welfare Souprien Soil Conservation 25 PADF 100 KLS Cooperative Field 22 ORE 250 Preparation Groupe Eleveurs Planting Fodder for Beef 25 ORE NA“ de Mersan Production *NA - Data not available for this group. 4.3.7 Traditional Bean Marketing: Role of Madam Sara The only previous study on the bean marketing system in Haiti focused on the role of female traders known as Madam Sara. Although this study dates fi'om 1973, the role of Madam Sara in bean marketing remains essentially unchanged. At one time or another, most local beans flow through an informal network of these traditional 7O marketers. Madam Sara travel fi'eely around Haiti with their stock and make money through arbitrage: exploiting price differentials between markets. 4.3.7.1 Madam Sara in the Camp Perrin Bean Market The main market in Camp Perrin is held each Friday, although wholesalers hold an impromptu market on Thursday evening as truckloads of goods arrive from Port au Prince and the surrounding large towns. The origin of beans in the Camp Perrin market depends on the time of year. At planting time, beans flow into Camp Perrin fiom other bean-producing regions for sale as seed. At harvest, the process reverses itself and beans flow out of Camp Perrin to other regions of the country for seed and consumption. At the time of the rapid appraisal (early August 2000), most farmers had just completed planting and the new harvest was more than one month in the filture. 4.3.7.2 Traditional Supply of Bean Seed Two interviews in the Thursday evening wholesale market revealed the remarkable extent of the bean trade in Haiti. The first Madam Sara reported that she purchased her bean stock of four 140 Kg sacks in Beaumont, a village about 30 kilometers to the north of Camp Perrin (Table 21). Despite the relatively short distance to Beaumont, the road is very rough and climbs through several mountain passes with elevations of more than 1,000 meters. This journey may take six hours or more by truck. Since Beaumont had recently completed a bean harvest, beans were selling there at $0.71 per Kg. The Madam Sara hoped to sell her stock in the Camp Perrin market for $1.03 per Kg. With transport between Beaumont to Camp Perrin costing $2 per 140 Kg saclg the Madam Sara’s potential total profit for the trip was $154. The actual market price in 71 Camp Perrin on Friday turned out to be $0.81 per Kg, leaving the Madam Sara with a likely total profit of $42.20 A truck driver interviewed during the Thursday night market reported transporting several sacks of beans for a Madam Sara from St. Marc, about 285 Km away. Like Beaumont, St. Marc had just completed a bean harvest. Transport for the beans between St. Marc and Camp Perrin cost the Madam Sara $4 per 140 Kg sack. The purchase price in St. Marc was $0.72 per Kg. With a sale price of $0.81 in Camp Perrin, the Madam Sara’s maximum total profit was about $8. Table 20 : Rapid Appraisal of Madam Sara Trading Costs, Camp Perrin, Haiti, August 2000 Trader’s Distance to Quantity Purchase Transport Maximum Maximum Origin C. Perrin For Sale Cost Cost Revenue Profit Km Kg Total $ Total $ Total $ Total $ amp Perrin 0 28 25 0.00 30 5 eaumont 30 560 400 7.84 450 42 Port au P 200 140 112 1.47 125 11 ort au P 200 420 322 15.54 337 (0.42) Jameson 250 504 360 14.87 405 30 St. Marc 285 140 100 3.99 112 9 The small apparent profits of the Madam Sara do not appear to justify marketing beans. Murray and Alvarez’s study of Madam Sara solves this puzzle «Madam Sara use different sizes of marmit for buying and selling (Murray and Alvarez, 1973). Even a small difference in volume will increase a Madam Sara’s ability to profit from her trading activities. 2" By comparison, the legal Haitian minimum wage is approximately $1.50 per day. 72 Although the four Friday market interviews in Camp Perrin focused on a number of small-volume Madam Sara and individual local retailers, there were also many local women each selling fewer than 10 Kg of beans. The incredible reach of the Madam Sara became apparent during these interviews. Three of the four people interviewed on Friday traveled more than 200 Km. from the place of purchase to Camp Perrin with their stock The magnitude of activity and the narrow potential profit margins indicates the presence of a well-developed informal information system. 4.4 Transaction Costs in the Subsector The Haitian bean subsector consists of four component stages: varietal development, seed production and multiplication, seed processing and storage, and seed sales and distribution. Two parallel tracks exist within the subsector: the traditional and the modern seed system. In the traditional seed system, farmers are the sole providers of varietal development, production, and processing/storage operations, while Madam Swa dominate bean-marketing filnctions. Farmers internalize the vast majority of transaction costs in this vertically integrated system, and have few alternatives for minimizing the external costs that they do encounter. By contrast, the improved bean system is a complex and expansive structure that includes international research organizations, donor agencies and governments, the Haitian government, NGOs, private seed firms, groupement, farmers, and Madam Sara. Participants in this system often have several alternatives in the way they organize their subsector activities to minimize their transaction costs. 73 Douglass North notes that “the costliness of information is the key to the costs of transacting”. These costs arise when measuring the valuable attributes of what is being exchanged, protecting rights, and policing and enforcing agreements (North, 1990). Information costs have a significant impact on the organization of a subsector. For example, the absence of a functioning legal system may lead contracting parties to devise their own system for adjudicating disputes. The remainder of this chapter examines how transaction costs, and information costs in particular, arise at three stages in the subsector, varietal development, seed production and multiplication, and sales and distribution, and how each these costs affect performance in the subsector. 4.4.1 Varietal Development International organizations such as the Bean/Cowpea CRSP and CIAT introduce most new varieties of improved beans into Haiti through the CRDA’s evaluation process. This arrangement appears quite cost-effective for both groups. For the cost of the seed and shipping, the Bean/Cowpea CRSP and CIAT obtain the results of Haiti-specific evaluations. In turn, the CRDA, ORE, and AgroTechnique gain access to a much greater number of bean varieties than they could afford to produce under their own breeding programs. 4.4.1.1 Transparency Non-transparency of seed in the varietal development stage requires CRDA, AgroTechnique, and ORE to conduct expensive and time-consuming evaluations to assess the attributes of each bean line provided to them. The open cooperation of the Bean/Cowpea CRSP and CIAT minimizes some of the evaluation costs by sending 74 moderate quantities of improved beans to the CRDA for evaluation under a wide range of Haitian growing conditions. In return, AgroTechnique and ORE minimize their evaluation costs by using publicly firnded organizations, specifically the CRDA and CIAT, to conduct all the initial research and development activities. At later stages, AgroTechnique and ORE screen process to verify that the new varieties will perform well under Haitian conditions. 4.4.1.2 Subtractability Low subtractability of seed in the varietal development stage leads to competition between firms in the subsector to identify and multiply new varieties as quickly as possible. By working with CIAT, ORE can evaluate new varieties concurrently with the CRDA, and potentially benefit from disseminating a good variety before the CRDA completes its evaluation process. This means that AgroTechnique potentially may lag several years behind ORE in bringing the same CIAT variety to the market. 4.4.1.3 Excludability Low excludability of seed in the varietal development stage arises because no organization patents improved beans in Haiti. Since CIAT and the Bean/Cowpea CRSP are public institutions, their products exist in the public domain. In fact, these organizations encourage farmers to adopt new varieties as part of their mission. Because ORE and AgroTechnique do not conduct their own breeding programs, they do not have patent rights over the varieties they sell. In any case, the lack of seed legislation in Haiti and the considerable effort needed to register and enforce patent rights means that one seed firm can easily acquire and sell a variety that was developed by another firm. 75 4.4.2 Seed Production and Multiplication AgroTechnique and ORE multiply improved beans through individuals and groupement. Land is expensive in Haiti and large and contiguous tracts are very rare. By contracting with multipliers, AgroTechnique and ORE avoid having to purchase and maintain large tracts of land. This arrangement also lessens the risk that they will lose an entire crop due to locally adverse weather. On the negative side, AgroTechnique and ORE give up some control over the quality of their product. Contract farmers gain by accessing credit for seed and by obtaining high-yielding varieties. They also receive training and extension advice from AgroTechnique and ORE supervisors. On the negative side, farmers bear most of the risk for bad weather. Most seed multipliers for AgroTechnique and ORE belong to groupement. Although these are farmer-run organizations, groupement usefillly serve the interests of both farmer and seed firm. Most groupement have a communal meeting place and at least one groupement had a communal demonstration field. ORE and AgroTechnique both use these facilities to conduct meetings and provide safe storage for seed and fertilizer. 4.4.2.1 Transparency Non-transparency in the seed production and multiplication stage creates a complex interdependency between seed company and contract farmer. Since farmers cannot assess the genetic quality of the beans given to them, and are unfamiliar with the newer varieties, they must trust the seed firm to provide them with varieties suited to the local conditions. As a relatively new entrant into the multiplication business, AgroTechnique addresses farmers’ concerns by planting demonstration plots of the new 76 variety in the community. Prospective multipliers can then assess the quality of the variety themselves at field days held during flowering and harvest. ORE has multiplied seed in Camp Perrin for more than 10 years. The varieties that it multiplies, Tamazulapa and L’Ore 87, have good name recognition among farmers. Farmers have the opportunity to evaluate these varieties on their own since there are many local fields planted with them. Non-transparency also extends to evaluating the quality of the farmers’ multiplication effort. AgroTechnique and ORE’s reputations will suffer if they sell poor quality seed to their customers. Since both ORE and AgroTechnique pay a small price premium, farmers gain financially if they add beans from another source to the improved beans. In addition to this, farmers have an interest in misrepresenting the quality of the multiplied beans, for farmers must dispose of rejected seed themselves at market prices. Thus, AgroTechnique and ORE implement time-consuming and expensive inspection processes to verify that farmers’ seed is of good quality. Inspection occurs regularly, particularly at germination, flowering, and harvest. From these visits, the organization knows the approximate yield to expect from each bean field. A significant deviation fiom the expected harvest will signal that the farmer has succumbed to temptation. Ifthis occurs, the seed firm will sever its relationship with the farmer. 4.4.3 Sales and Distribution Both ORE and AgroTechnique are very concerned about the reputation their respective varieties of beans have with farmers. A severe Bean Golden Mosaic Virus (BGMV) infestation in the irrigated fields during the February 2000 growing season put a particular strain on ORE’s reputation with Camp Perrin farmers, since neither of ORE’s 77 varieties is BGMV resistant. Consequently, one farmer surveyed had lost his entire bean crop, which left the farmer in debt to ORE for the seed and fertilizer credits. AgroTechnique advertises the fact that it treats Arroyo Loro Negro with Gaucho to reduce BGMV damage. While ORE does not presently treat its seed with Gaucho, it is actively pursuing a longer-term breeding program to incorporate BGMV resistance in its bean varieties. 4.4.3.1 Transparency Non-transparency of bean seed in sales and distribution is a primary reason why AgroTechnique and ORE have developed their own seed certification standards. The primary reason for ‘allowing’ seed-producing organizations to certify their own product is that Haiti has no formal seed certification process. Even if it did, the Haitian government lacks the funds to enforce seed certification. Because AgroTechnique and ORE desire good relationships with their customers, they both conduct germination tests and use identification tags on each sack that specify the lot number, bean variety and the germination rate. ORE and AgroTechnique each indicated that if a dissatisfied customer brought in a tag from a bag of their seed, that customer would receive at least a partial refirnd. As neither firm treats the bean seed with pesticides until immediately before sale, they can sell seed with poor germination as grain in the market to recover at least a portion of their multiplication costs. Low transparency also leads CIPDSA and aid organizations such as CARE to buy as much of their improved beans as possible from AgroTechnique and ORE. While other organizations have produced bean seed for sale to CIPDSA in the past, quality problems and low yields convinced CIPDSA to only use reliable vendors such as AgroTechnique 78 and ORE. The premium price CIPDSA pays for improved bean seed lowers the incentive of either ORE or AgroTechnique to misrepresent their product. On the other side of the coin, several farmers in one village mentioned that the ORE’s improved bean seed distributed by a particular aid organization had a very poor germination rate. Inquiry with ORE revealed that the aid organization in question had stored the seed in a sealed truck for a considerable period. ORE, which is a member of CIPDSA, can use its voice within CIPDSA to ensure that proper storage protocols are used. 4.4.3.2 Excludability Due to the high excludability of bean seed as a consumable good, AgroTechnique and ORE do not use Madam Sara as part of a broader sales network. Both organizations felt that Madam Sara would re-package their seed for small-volume sales or damage it during transport or storage. An additional and very real risk is that Madam Sara might attempt to wash the pesticide treatment off the improved beans and sell it as food. Since many insecticides, such as the Gaucho that AgroTechnique uses, are systemic, simply washing the seed will not remove the pesticide. In keeping with its non-profit status, ORE does occasionally sell improved bean seed to individual walk-in customers at the local market price. However, since selling bean seed at this price means that ORE loses money, it does not encourage individual farmers to buy their seed directly fi'om their facility. 79 CHAPTER 5 SUMMARY AND CONCLUSIONS 5. 1 Summary The population explosion in the latter half of the 20"I Century has required extraordinary increases in agricultural production to supply food and other agricultural products for human consumption. Over the past 40 years, increased food production has come more from agricultural intensification «producing more per hectare« than fiom agricultural extensification «planting more land. Improved plant genetics, along with fertilizers and pesticides are the three principal technologies behind the broad success of this ‘green revolution’. However, uneven distribution of these intensification technologies, particularly among farmers in developing nations, makes this success a shallow one. Extreme poverty limits farmers’ access to intensification technologies and traps them in a hopeless situation: rising out of poverty requires greater farm income, which requires money to invest in new technologies. Political and economic instability deepens the technology trap by smothering private industry and enervating public institutions. To counteract these effects, NGOs and donor nations seek to replace missing or ineffective government and private sector functions. They accomplish this by funding agricultural research, promoting the growth of domestic markets and industry, and subsidizing agricultural inputs to farmers. Donors and NGOs place a particular emphasis on varietal development «the keystone agricultural technology that allows farmers to bridge the gap between extensive and intensive agriculture. 80 5.1.1 Purpose ofthe Study Wracked by decades of economic and political turmoil, the Caribbean nation of Haiti currently relies almost exclusively upon donor and NGO programs to replace many functions typically performed by government, including promoting economic development in rural areas. Because beans play an important role in Haiti’s rural economy and in the diet of urban and rural Haitians, many donor and NGO assistance programs focus on increasing farmers’ access to and use of improved beans. However, to strengthen the private market for improved beans and move away fi'om large and permanent subsidies, donors and the government of Haiti need to understand farmer demand for improved beans and how the market situation affects their efforts. 5.1.2 Data Sources and Methodology This study uses the subsector analysis approach advanced by Shaffer to describe the Haitian improved bean market and provide insights how government, donors, NGOs, and private interests currently work together. To accomplish this, the study presents results of interviews with Haitian government officials, a private company, a Haitian NGO, and 83 bean farmers conducted during the summer of 2000. Building upon the insights of Commons, Coase, Williamson, and later generations of institutional economists, this study describes the major sources of high information costs in the market and how these costs influence the organization of activities in and performance of the improved bean subsector. 81 5.1.3 Subsector Relationships Government’s chronic neglect of agriculture means that Haiti does not have a national bean-breeding program and that genes fi'om Haitian land-races are not available in most varieties of improved beans. Despite this, Haitian farmers are able to access genetic material from around the Caribbean and Central America through linkages with Bean/Cowpea CRSP, PROFRIJOL, and CIAT bean breeders. These organizations introduce most varieties of improved beans into Haiti in partnership with the Center for Agricultural Research and Development (CRDA) in the Haitian Ministry of Agriculture, Natural Resources, and Rural Development (MARNDR). The CRDA performs initial evaluation of the new varieties and then makes available promising varieties to ORE and AgroTechnique for additional testing, multiplication and sale. Three attributes of improved beans, non-transparency, low subtractability, and low excludability, lead to high information costs in the subsector. The study found that ORE and AgroTechnique respond to these transaction costs by internalizing most of their seed production activities, such as purchasing, processing, and storage. Because chronic political turmoil has eroded confidence in the Haitian legal system, these organizations prefer to structure their external transactions around informal, long-terrn personal relationships, rather than through official contracts and formal relationships. One consequence of this informal transaction system is that seed firms, farmers, and researchers depend upon intermediaries to help enforce agreements, disseminate information, and monitor behavior. Because they represent large numbers of farmers and have strong incentives to satisfy transacting parties, groupement are the most important intermediaries in the subsector. Through groupement, seed firms gain access to local 82 storage facilities, distribution points, and farmers. In turn, farmers use groupement to access the improved seed, pesticides, fertilizer, loans, and technical advice offered by NGOs and seed firms. The study finds that subsidies at the research and development phase «in which the Bean/Cowpea CRSP, PROFRIJOL, and CIAT absorb varietal development costs-- and at the distribution level, subsidized by the European Union, allow ORE and AgroTechnique to profitably produce improved beans. Similarly, the lack of government regulation in the industry allows seed firms wide latitude in the way they conduct their operations and respond quickly to new ideas and technologies. ‘Self-certified’ seed is one example of the flexibility that firms have in the standards that they chose to follow. 5.1.4 Farmer Demand for Beans Survey results indicate that most farmers purchase bean seed because they need seed for planting, want seed with a better germination rate, or seek a variety with a better yield. Farmers reported that they purchase local varieties because they are familiar with the variety and think the seed will grow well, while those who purchase improved beans do so because they appreciate the genetic or physical qualities of the beans or have previous experience with the variety. Market purchases are the primary source of farmers’ bean seed for the first growing season, while self-stored beans are the most important source in the second growing season. The overall appearance, color, and size of the bean are important factors that farmers consider before purchasing them. One surprising finding is that farmers are willing to pay higher than market prices for improved beans. This finding holds true, even for those farmers who did not plant improved beans in 2000. 83 5.2 Policy Implications and Recommendations 5.2.1 Varietal Development Long standing political and economic instability means that Haitian government agencies cannot undertake the long-term financial commitments that activities such as bean breeding require. To date, international donors have responded to this problem by channeling funds through Haitian and international NGOs. One practical consequence of this funding deficit is that Haiti depends almost entirely upon international research organizations to develop new varieties ‘of improved beans that are suitable for Haitian agricultural conditions. As scientific advances make plant breeding an increasingly expensive and specialized task, having these organizations conduct most bean breeding is a cost-effective arrangement for the Haitian government. Using research linkages with several different international organizations to access new varieties, rather than developing uniquely Haitian beans, potentially allows the CRDA to rapidly introduce many different varieties of beans into the Haitian market. The successfiil introduction of Arroyo Loro Negro from the Dominican Republic illustrates this point. One important consideration for the Haitian government is how to strengthen existing relationships with international bean research organizations and increase their use of Haitian genetic material. Although the Haitian climate is not unique to the Caribbean or Central America, the wide dispersion of seed through the markets indicates that varieties of beans best suited to Haitian farmers’ needs must grow well under a wide range of growing conditions and technologies. Inevitably, this requires that international bean breeders have access to Haitian genetic stock. Modest expansion in the ability of 84 the CRDA bean researcher to gather and characterize Haitian varieties with promising genetics is one way to reach this objective. 5.2.2 Seed Production The dwindling numbers of BIAs and UPSAs demonstrate that the Haitian government must be willing to commit resources to train BIA and UPSA personnel and to underwrite their startup costs (and possibly much more) if the effort is to succeed. In reality, the government cannot afford to maintain these programs. The essential question for the Haitian government is how to use scarce resources effectively. Creating input provision systems that compete with, and weaken the private sector simply make little sense. A better solution is to find ways to work together with private industry to reduce marketing costs and improve farmer access to inputs. Through contracting with farmers for bean multiplication, AgroTechnique and ORE impact Haitian agriculture far beyond the immediate financial compensation that farmers receive when they sell their seed crop. In 2000, AgroTechnique and ORE used more than 500 farmers for bean multiplication. As part of their agreement with AgroTechnique and ORE, these farmers received training and improved beans on credit, and those who multiplied for ORE also received a 50 percent credit towards their fertilizer purchases. Additionally, AgroTechnique and ORE technicians visited each farmer’s bean field at least three times each growing season to check for disease and other problems with the crop. In effect, AgroTechnique and ORE have created a defacto extension service that replaces several functions of the understaffed government extension service. Although the benefits of these relationships do not extend directly to every farmer in the community, the cumulative effect of long-term and intensive 85 interaction with farmers who have multiplied beans will contribute to increasing agricultural productivity. Currently, Haitian seed firms produce seed using their own ‘self-certification’ standards. These standards are generally consistent with those adopted by many nations. Future plans by the Haitian government to certify seed through the National Seed Service (SNS) recognize that seed firms may chose to ignore their own standards when convenient, and that government has a role in reducing consumer information costs. However, these plans may overestimate the improvement that a formal certification process will have on the quality of seed sold. Although AgroTechnique and ORE may have slightly different motivations for doing so, they both appear eager to provide the best quality seed possible. To induce farmers to purchase its bean varieties, AgroTechnique must sell beans with some combination of physical and genetic qualities clearly superior to those available in the market. For its part, ORE strives to produce high quality seed as part of its broader social goal of improving farmer income. While a formal seed certification process may theoretically improve the quality of the seed that AgroTechnique and ORE sell, the Haitian government is unlikely to have the resources to implement or enforce a formal process. A more reasonable approach may be to enact general regulations that require tmth in labeling. Under this regime, firms set their own standards, but are held accountable if the product does not perform as described. 5.2.3 Storage Unlike AgroTechnique, ORE does not plan to increase the quantity of beans it multiplies each year. One reason is that ORE’s limited financial resources simply do not allow expansion of its existing processing and storage facilities. Furthermore, ORE’s 86 mission to protect the watershed of the Ravine du Sud gives it little reason to multiply more improved bean seed than local programs require. This situation suggests that both ORE and AgroTechnique may want to explore working together to increase farmers’ access to improved beans. The scale of ORE’s operation and its renewed bean breeding program means that it could contract with AgroTechnique to develop and multiply stable lines of improved beans. This specialization of tasks in the subsector would allow ORE to focus on bean breeding and direct its energy into programs that improve agricultural productivity in Camp Perrin. For its part, AgroTechnique could bring new varieties to market in less time and concentrate on national level multiplication and sales. Any organization that wishes to sell or distribute improved beans in Camp Perrin benefits from the fact that most farmers seldom store their bean seed for more than a few months after harvest and usually purchase fresh seed in the market just before their first planting. Because farmers do not store seed, AgroTechnique should be able to convince farmers to purchase their seed directly from its retail stores or through their groupement. Dependence on the market for fresh seed also increases the rate at which farmers adopt new varieties. The episodic lawlessness that accompanies political instability and poverty make long term on-farm seed storage a risky and expensive option for farmers. Government agencies and NGOs should evaluate whether promoting on-farm storage or improving the operation of existing markets better serves farmers’ interests. 5.2.4 Sales At present, CIPDSA and NGOs pay higher-than-market prices to AgroTechnique and ORE to cover their costs of producing, processing, and storing improved beans. While recognizing the expense of this subsidy, CIPDSA and NGOs cite farmers’ pressing 87 need for new technology and the Haitian government’s inability to coordinate activity in the market to justify their interventions. However convenient for AgroTechnique and ORE at the present time, this subsidy may ultimately impede the development and growth of the market for improved beans. Furthermore, government and NGO initiatives that provide highly subsidized agricultural inputs to farmers undermine AgroTechnique’s efforts to develop farmer demand for its products. For example, two farmers in the survey responded that improved beans should be free because they are “project” seed. Farmers must not equate improved seed with fiee seed. A more sustainable solution may be to reimburse organizations a portion of their marketing costs. The amount of the reimbursement could decrease each year to slowly wean farmers and firms off the subsidy. As long as the current subsidy is in place, AgroTechnique has little incentive to aggressively market improved beans through its stores. The Haitian government and NGOs need to examine how disaster relief impacts the viability of private seed firms. Future relief efforts should seek to include private firms rather than weakening them through giveaway programs. For example, AgroTechnique lost a major portion of its hand tool business after hurricane Georges when donors gave away thousands of the small sickles used to harvest rice. Likewise, fertilizer sold at a subsidy through government channels competes directly with fertilizer already available through private sources. A voucher system that allows farmers to purchase seed and other inputs in their local markets and stores is one way to dispense disaster relief efficiently and strengthen existing agricultural input markets. 88 5.3 Study Limitations and Implications for Future Research Because of the rapid reconnaissance approach of the survey, data collection for farmers occurred in only one area of Haiti. Therefore, survey results may not directly reflect conditions and attitudes in other Haitian regions. Future research should focus on gaining a better understanding of the bean production and seed system in northern Haiti and collecting data from more specific growing seasons. A study that focuses on regional differences should also analyze bean prices in the principal markets and the interactions between these markets. Future study should also examine factors that constrain farmers’ yields. Soil erosion, for example, may have a much more severe impact on yields than lack of quality inputs. This does not suggest that development of improved varieties is irrelevant, merely that increasing yields may require more than simply encouraging farmers to plant improved bean varieties. 89 APPENDIX B. 1‘ Season Survey Variables and Proportions of Means Test Results Total Local Improved Proportions N Mean N Mean N Mean SE p-value 83 0.64 58 0.69 23 0.52 0.1 181 0.1552 83 0.30 58 0.34 23 0.17 0.1125 0.1288 83 48.39 58 48.50 23 47.30 2.7276 0.6626 83 0.69 58 0.62 23 0.87 0.1 138 0.0288 82 4.73 57 3.62 23 7.61 1.1578 0.0015 83 9.52 58 8.41 23 12.34 1.0830 0.0009 81 80.12 56 78.04 23 85.65 6.5496 0.2506 83 44.96 58 48.33 23 33.61 5.8801 0.0150 83 0.54 58 0.58 23 0.38 0.0729 0.0080 81 1.60 58 1.60 23 1.61 0.1960 0.9788 80 1.39 57 1.32 23 1.55 0.2448 0.3471 81 0.37 58 0.33 23 0.48 0.1190 0.2054 81 0.32 58 0.34 23 0.26 0.1150 0.4655 81 359.51 58 228.84 23 689.02 283.9247 0.1 167 81 17.98 58 11.44 23 34.45 14.1962 0.1167 81 12.96 58 13.48 23 11.66 3.1448 0.5654 81 13.19 58 13.69 23 11.91 3.1498 0.5751 81 0.65 58 0.00 23 2.30 0.2978 0.0000 81 1.98 58 1.50 23 3.17 0.4951 0.0014 81 0.28 58 0.00 23 1.00 0.1111 0.0000 80 16.82 57 14.68 23 22.13 3.7902 0.0570 80 575.26 57 478.78 23 814.35 156.2419 0.0389 80 28.76 57 23.94 23 40.72 7.8121 0.0389 81 0.52 58 0.52 23 0.52 0.1231 0.9709 81 0.41 58 0.40 23 0.43 0.1211 0.7522 81 1.30 58 1.24 23 1.43 0.3504 0.5844 81 426.06 58 358.94 23 595.33 184.9236 0.2103 81 21.30 58 17.95 23 29.77 9.2462 0.2103 81 0.21 58 0.12 23 0.43 0.1003 0.0017 81 206.12 58 15.59 23 686.61 220.3990 0.0059 81 10.31 58 0.78 23 34.33 11.0199 0.0059 80 79.67 58 60.93 22 129.06 34.5082 0.0591 79 4.50 57 4.07 22 5.60 1.2627 0.2324 82 57.74 58 39.95 22 109.88 30.6265 0.0315 83 6.10 58 6.71 23 5.10 3.3780 0.6375 83 2.47 58 2.60 23 1.57 0.7147 0.1509 80 31.33 58 13.48 22 78.40 27.9399 0.0293 81 20.72 58 24.84 23 10.32 7.3781 0.0526 81 1.40 58 1.62 23 0.84 1.8286 0.6700 63 3,447.00 42 2,276.68 21 5,787.65 1,612.3894 0.0400 63 172.35 42 113.83 21 289.38 80.6195 0.0400 80 3,63 1.29 58 2,550.54 22 6,480.54 1,743.4608 0.0332 80 181.56 58 127.53 22 324.03 87.1730 0.0332 83 2.81 58 3.21 23 1.26 0.6384 0.0032 91 1" Season Survey Variables and Proportions of Means Test Results, continued L Total heal Improved Proportions V ' N Mean N Mean N Mean SE p-value TIMESTOR 56 2.61 39 2.31 17 3.29 0.6223 0.1255 ROFIT 81 2,232.73 58 1,492.24 23 4,100.08 1,380.3617 0.0701 PROFITS 81 111.64 58 74.61 23 205.00 69.0181 0.0701 WHYBUY 74 0.78 52 0.54 21 1.33 0.4795 0.1078 WHYVAR 67 3.82 47 3.32 19 5.26 0.9085 0.0403 PREVINFO 68 1.62 51 1.29 16 2.75 0.6128 0.0255 INFOACC 34 1.00 19 1.00 15 1.00 0.0000 NA EXPECI'I 74 1.76 53 1.74 21 1.81 0.1591 0.6459 EXPECTII 30 1.83 23 1.83 6 1.83 0.1956 0.9713 DEMO 35 0.11 17 0.18 18 0.06 0.1076 0.2611 FDAY 35 0.11 17 0.12 18 0.11 0.1076 0.9516 FINDGPMT 35 0.60 17 0.71 18 0.50 0.1657 0.2140 FINDFRND 35 0.14 17 0.12 18 0.17 0.1183 0.6787 FINDOTHR 35 0.34 17 0.18 18 0.50 0.1605 0.0439 WHYPRICE 50 0.06 43 0.07 6 0.00 0.1045 0.5043 WHYAPPAR 50 0.74 43 0.74 0.67 0. 1924 0.6870 WHYCLEAN 50 0.14 43 0.14 6 0.17 0.1525 0.8588 WHYREPET 50 0.06 43 0.05 6 0.17 0.1045 0.2501 WHYREPUT 50 0.02 43 0.02 6 0.00 0.0616 0.7059 WHYCOLOR 50 0.46 43 0.47 6 0.33 0.2168 0.5432 WHYSIZE 50 0.60 43 0.58 6 0.67 0.2142 0.6906 SATISFCT 49 0.88 42 0.86 6 1.00 0.1443 0.3223 WILLPAY 80 1.78 55 1.69 23 2.00 0.2688 0.2562 79 0.95 54 0.93 23 1.00 0.0553 0.1801 78 2.46 53 1.79 23 4.22 0.8444 0.0066 76 20.73 52 18.93 22 25.50 4.9466 0.1934 81 77.99 58 53.69 23 139.27 35.8394 0.0245 81 2.78 58 2.91 23 2.46 0.5004 0.3716 81 101.33 58 73.83 23 170.67 65.7040 0.1525 81 1.78 58 1.91 23 1.46 0.5004 0.3716 81 1.63 58 1.55 23 1.83 0.3986 0.4913 81 56.06 58 28.74 23 124.95 55.6287 0.0965 81 0.63 58 0.55 23 0.83 0.3986 0.4913 92 APPENDIX C. Results of Difference of Means/Proportions Test on Willingness to Pay Categories Category # Responses Average SE Difference z-Statistic p-Value ri n T Local Compares 1 to 2 0 11 0.1667 0.0925 0.1130 1.2215 0.2219 1 15 0.2692 0.1101 0.0119 0.1077 0.9143 2 9 0.1795 0.0953 (0.0538) (0.5641) 0.5727 3 20 0.3846 0.1208 (0.0711) (0.5889) 0.5559 Improved 0 2 NA NA NA NA NA 1 6 NA NA NA NA NA 2 5 NA NA NA NA NA 3 10 NA NA NA NA NA 93 APPENDIX D. BEAN FARMER SURVEY Respondentshouldbethepersonwhomadethepurchasing decisions for the household or is most familiar with the Time ; household farming data Code site description (Plain = 0, Vi] Mountain = 1). Give best estimate of altitude if possible. Site /Town: QQN§ENT §TATEMENT; My name is Will Shields. I am conducting a study of bean production and bean seed marketing in Haiti. I ’d like to ask you some questions about your bean production activities. The information that you provide will be used to document the decisions that farmers make when they buy their bean seed and plant their fields. The information that I collect from you and other bean farmers in the area will be used to complete my M.Sc. thesis in the department of Agricultural Economics at Michigan State University. ThisstudyissponsoredbytheHaitian ministry ofagriculture in collaboration with the Bean/Conpea Collaborative Research and Support Project (CRSH at Michigan State University in East Lansing, Michigan USA. Your participation is VOLUNTARY. The intaview will take about 30 minutes to complete. You are free to NOT ANSWER any of the questions that I will ask you. However, I hope that you will agree to answer my questions, as your answers will help me to better understand the bean farming system in Haiti and farmers’ bean seed purchasing decisions. All of the information that you provide will be kept CONFIDENTIAL. This means that your answers to my questions will not be shown to anyone else. No one will know your answers but me. Do you agree to be interviewed? ............................................... (N0 = 0, Yes = l) 1 BACKGROUND INFORMATION: 1.1 What is your name? ........................................ 1.2 Gender of respondent : ........................................................... (Male = 0, Female = 1) 1.3 How old are you? .......................................................................... 1.4 How many people in your family depend upon the crops that you grow? ................ __ 1.5 Have you attended school? ........................................................... (N0 = 0, Yes = 1) 1 If YES, How many years of schooling have you completed? .................................... 1.6 How many members older than 15 years assist you with bean farming? ............... 1.7 In what town is the market where you buy beans? ...................... 1.8 In what town is the market where you sell beans? ....................... 94 1.9 How long does it take you to travel on foot from your home to that market? ...... 1.10 How many times a month do you visit this market? ............................................... 1.11 What are the times of year that you normally plant and harvest your fields? 1 (First growing season) ................................... (planting | harvest) | 2 (Second growing season) .............................. (planting | harvest) | 3 (Third growing season) ................................. (planting l harvest) l 1.12 In the (first) growing season, what FIELD crops did you plant? 1 (Beans) .......................................................................................... (No=0,Yes=l) 2 (Sorghum) ..................................................................................... (No = 0, Yes = 1) 3 (Maize) .......................................................................................... (No=0,Yes=1) 4 (Sweet Potato) ............................................................................... (N0 = 0, Yes = 1) 5 (Other) ....................................................................... (Specify) 1.13 When did you last use commercial fertilizer? .............................................. (Year) If YES: 1 Where do you usually purchase the fertilizer? ..................... (Market=0, Store=1, Friend/Family=2, Groupement=3, Other (specify)) 2 CROPS IN FIRST GROWING SEASON: First I would like to ask you about the field crops that you planted in (first) growing season. If you do not remember an exact number for any of my questions, you may givemean estimateofthatnumber. 2.1 What was the date that you planted your fields for the (first) growing season? ........................................................................................................................ 0000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000000 1 How many carreau did you plant with beans in each field? ............................... (carreag) I 2 3 J 2 Which, if any, of these fields did you irri ate? ....................................... (No = 0, Yes = 1) l 2 3 l 2.3 Who owns each of the fields that you plant? 1 First field .................. (Self=0, Family member=1, Landlord=2, Other(specify)) 2 Second field .............. (Self=0, Family membeFl, Landlord=2, Other(specify)) 3 Third field ................ (Self=0, Family member=l, Landlord=2, Other(specify)) If not self then ask for each field that is appropriate. 4 What are the conditions for your use of the 1" field? . ........ 5 What are the conditions for your use of the 2'“I field? .......... 6 What are the conditions for your use of the 3" field? ........ If respondent indicates that he owns afield: 7 How many years have you owned each field? ......................................................... (years) I 2 3 2.4 What bean varieties did you plant in each field? .................... (if local bean, specify color) 95 2.5 Where did you obtain each of these bean varieties? (Market=0, Agrotechnique=1, CIPDSA=2, ORE=3, Friend/Neighbor=4, nt=5, Self=6, Other(specify)) l 2 3 I If bean seeds were purchased ' 1 What was the price per marmit that you aid? .................................................. ourdes l 2 3 2.6 How many marmit of beans did you plant in each field? .................................... (marmit) l 2 3 I 2.7 Were any of your beans planted in association with another crop? ........ ...(No=0,Yes=1) l 2 3 I If YES i 1 What was the crop each bean variety was associated with? .............................................. ............................... (Maize=0, Cassava=1, So um=2, Banana=3, Potato=4 Other(specify)) 2.8 Did you use commercial fertilizer in any of your bean fields in the (first) growing season? ......................................................................................................... (No=0, Yes=1) If N0, 1 Why not? If YES. 2 What was the amount of fertilizer that you used on each field? ........... (Kgsjmarmitlsack) l 2 3 3 What type of fertilizer did you buy? ................................................... (type) 4 How much did you pay for the fertilizer? ............................................ (cost-Gdes.) 2.9 Did you treat any of your bean SEEDS with a pesticide? ............... (No=0, Yes=1) If N0, 1 Why not? .................... 2.10 Did you treat any of your bean PLANTS with a pesticide? ........... (No=0, Yes=1) If N0, 1 Why not? .................... If YES. 2 Which bean fields were treated with the ticide? .................................... (No=0, Yes=1) l 2 3 l 3 What is the name of the pesticide that you used? ................... (local or trade name)_ " 4 What was the total cost that you paid for the pesticide?. .............................. Gdes. 5 Do you think that using the pesticide improved that bean crop? ............... (No=0, Yes=1) 2 3 I 2.11 Have you received a loan or credit in the (first) growing season? .. (No=0, Yes=1) If YES. 1 How much was the loan or credit: .................................................................. (for each item) 1 for Seeds? .............................................................................................. Gdes. 2 for Fertilizer? ........................................................................................ Gdes. 3 for Pesticides? ....................................................................................... Gdes. 2 From whom did you obtain the loan or credit? ............... (name) 96 NowIamgoingtoaskyou abouttheyieldfromthebeansthatyouplantedin the(first) growing season. 2.12 How many marmit of beans have you harvested from each field? ..................... (marmit) I 2 3 l 2.13 How many marmit of each variety have you: V 1 Sold? ..................................................................................................................... (marmit) l 2 3 I 2 Saved for planting in the next season?.... ............................................................. (marmit) l 2 3 J If respondent indicates that beans were sold: 7 3 Who purchased each bean variety that you sold? ........................................................................ (madam sara=0, sékréte=1, other(specify)) l 2 3 4 When did you sell each bean variety? .............................................................. (give date) I 2 3 I 5 How many marmit of each variety did you sell: H 1 From your home? ....................................................................................... (marmit) l 2 3 J 2 In the market that you usually visit? ......................................................... (marmig l 2 3 3 In a regional market? ................................................................................. (marmit) I 2 3 J 6 What was the price per marmit for each variety that you sold? ........................ (gourdes) l 2 3 ] 7 Who sold each bean variety? .............................................................................................. " .............................. (Self=0, Husband=l, Wife=2, Family=3, Neighbor=4, Other(specify)), l 2 3 8 How did you sell each variety of beans, in cash or on credit? ............... (cash=0, credit-=1) I 2 3 ] If on credit, V 1 How much time usually passed before you received your money? ..... (days) 2.14 How do you usually store your bean seeds for the next planting season? ........................ 2.15 How long do you usually store your bean seeds? ................................ 2.16 What problems do you typically have with the bean seeds you store for planting? 2.17 For the bean fields that you planted, what problems did you have that reduced their yield? 9 7 3 CROPS IN SECOND GROWING SEASON: Now I am going to ask you about the crops that you planted in the (second) growing season. If you do not remember an exact number for any of the questions, you may give me an estimate of that number. 3.1 When did you plant your fields for the (second) growing season? ................. 3.2 How many bean fields did you plant in the (second) growing season this year? If ZERO, ask following, then skip to section 4 1 Why didn’t you plant beans in the (second) growing season? 3 .3 How many carreau did you plant with beans in each of these fields? ................. (carreau) l 2 3 J 1 Which, if any, of these fields did you irri ate? ....................................... (N0 = (LYes = 1) T I 2 3 J 3.4 What bean varieties did you plant in each field? .................... (if local bean, specify color) I 2 3 l 3.5 Where did you obtain each of these bean varieties? (Market=0, Agrotechnique=1, CIPDSA=2, ORE=3, Friend/Neighbor=4, Grou nt=5, Se1f=6, Other(specify)) l 2 ’ l If bean seeds were purchased 1 What was the price per marmit that you aid? .................................................. (gourdes) l 2 3 I 3 .6 How many marmit of beans did you plant in each field? .................................... (marmfi I 2 3 ] 3 .7 Were any of your beans planted in association with another crop? ........... (No=0,Yes=l) l 2 3 I If YES V 1 What was the crop each bean variety was associated with? .............................................. ............................... (Maize=0, Cassava=1, S I'_l'ghum—2 Banana=3, Potato=4 Other(specify)) 3.8 Did you use commercial fertilizer in any of your bean fields in the (first) growing season? ......................................................................................................... (No=0, Yes=1) If N0, 1 Why not? ................ If YES 2 What was the amount of fertilizer that you used on each field? . .......... marmitlsack)l l 2 3 3 What type of fertilizer did you buy? ................................................... (type) 4 How much did you pay for the fertilizer? ............................................ (cost-Gdes.) 3.9 Did you treat any of your bean SEEDS with a pesticide? ............... (No=0, Yes=1) If N0, 1 Why not? .................... 98 3.10 Did you treat any of your bean PLANTS with a pesticide? ........... (No=0, Yes=1) If N0. 1 Why not? .................... IfYES. 2 Which bean fields were treated with the icide? .................................... (No=0, Yes=1) l 2 3 I 3 What is the name of the pesticide that you used? ................... (local or trade name)_ i 4 What was the total cost that you paid for the pesticide? ............................... Gdes. 5 Do you think that using the pesticide improved that bean crop? ............... (No=0; Yes=1) J 3.11 Have you received a loan or credit in the (second) growing season? ....................................................................................................... (No=0, Yes=1) If YES. 1 How much was the loan or credit: .............................................................. (for each item) 1 for Seeds? .............................................................................................. Gdes. 2 for Fertilizer? ........................................................................................ Gdes. 3 for Pesticides? ....................................................................................... Gdes. 2 From whom did you obtain the loan or credit? ............... (name) Now I am going to ask you about the yieldfi-om the beans that you planted in the (second) growing season. 3.12 How many marmit of beans have you harvested from each field? ..................... (marmit) I 2 3 J 3.13 How many marmit of each variety have you: i 1 Sold? ..................................................................................................................... (marmit) I 2 3 J 2 Saved for planting in the next season? ............................................................. (marmit) I 2 3 I If respondent indicates that beans were sold: ,_ 3 Who purchased each bean variety that you sold? ........................................................................ (madam sara=0, sékréte=1, other(specify)) I 2 3 4 When did you sell each bean variety? .............................................................. Jgive date) I 2 3 I 5 How many marmit of each variety did you sell: I 1 From your home? ....................................................................................... (marmit) I 2 3 J 2 In the market that you usually visit? . ........................................................ (mamrit) I 2 s l 3 In a regional market? ................................................................................. (marmit) I 2 3 I 6 What was the price per marmit for each variety that you sold? ........................ (gourdes) 1 2 F 99 7 Who sold each bean variety? - (Self-=0, Husband=1, Wife=2, Family=3, Neighbor=4, Other(specify)) I 8 How did you sell each variety of beans, in cash or on credit? ............... ( cash=0, credit=Q I 3 ’ I If on credit, 1 How much time usually passed before you received your money? ..................................................................................................................... (days) 3.14 How do you usually store your bean seeds for the next planting season? 3.15 How long do you usually store your bean seeds? ............................ 3.16 What problems do you typically have with the bean seeds you store for planting? 3.17 For the bean fields that you planted, what problems did you have that reduced their yield? 4 PURCHASED SEED QUESTIONS: This section should be completed only if respondent has indicated that bean seeds were purchased in either season, otherwise skip to section 5. 4.1 Why did you decide to purchase bean seeds for the (first) or (second) growing season? f 4.2 Why did you choose to purchase this bean variety? 4.3 What information did you have about the bean variety before you purchased it? 4.4 Do you think that the information about the bean seed was accurate? ..................................................................................................................... (No=0, Yes=1) _ If N0, 1 What information do you think was inaccurate? 4.5 For each of the bean seed varieties that you purchased, was the yield from the (first) growing season higher, about the same, or lower than you expected? 1 1" Variety .................................................................. (Higher=0, Same=l, Lower=2) 2 ' 2'“I Variety ................................................................. (Higher=0, Same=l, Lower=2) 4.6 For each of the bean seed varieties that you purchased, was the yield from the (second) growing season higher, about the same, or lower than you expected? I 1" Variety .................................................................. (Higher=0, Same=l, Lower=2) 2 2" Variety ................................................................. (Higher=0, Same=1, Lower=2) 100 Ask thae questions only if seeds were purchased from CIPDSA, ORE, or AgroTechnique. 4.7 If you could buy a bag of bean seed in any quantity, what size bag would you prefer to buy? .................................................................................... (circle one marmit | kg.) 4.8 Before you planted an improved bean variety on each field how many marmit of beans did you typically harvest from each field? ...................................... F 1 F2 F3 1 Was this yield for a monocropped or intercropped field? .............. F 1 F2 F3 4.9 How did you find out about the seed that you purchased this year? 1 (Saw demonstration plot) .................................................................... (No=0, Yes=1) 2 (Attended field day) ............................................................................ (No=0, Yes=1) 3 (Through Groupement) ....................................................................... (No=0, Yes=1) 4 (Through friend / relative / neighbor) .................................................. (No=0, Yes=1) 5 (Other) ............................................................................................... (specify) Ask the following only if seed was purchased through CIPDSA: 4.10 If the seed that you purchased were no longer available through CIPDSA, would you ooooooo 1 4.11 Do you have any comments about the seed that you purchased? be willing to pay more money for the same quality of seed that CIPDSA sold? ............................................................................................................ (No=0, Yes=1) IfNO, Why wouldn’t you be willing to pay more? Ask the following only if the respondent purchased bean seeds from the market. 4.12 Of all the people selling beans in the market, why did you decide to buy your bean \IONUI-tht-i seed from a particular person? (Price of been seed) ............................................................................ (No=0, Yes=1) (Appearance of bean seed) .................................................................. (No=0, Yes=1) (Cleanliness of bean seed) .................................................................. (No=0, Yes=1) (Previous transactions with seller) ...................................................... (No=0, Yes=1) (Reputation of seller) .......................................................................... (No=0, Yes=1) (Color of bean seed) ........................................................................... (No=0, Yes=1) (Size of bean seed) ............................................................................. (No=0, Yes=1) 4.13 Were you satisfied with the yield from the bean seeds that you purchased in the 1 market? ............................................................................................... (No=0, Yes=1) Why I Why not? 101 5 INTENTIONS FOR THE NEXT SEASON: Each respondent should be asked these questions. 5.1 If the price in the market for local bean seed was 50 gourdes for each marmit, would you be willing to pay 60 gourdes for each marmit of improved bean seed? ................................................................................................................... (No=0, Yes=1) 1 If the price for local bean seed was 50 gourdes for each marmit in the market, would you be willing to pay 70 gourdes for each marmit of improved bean seed? ........................................................................................................... (No=0, Yes=1) 2 If the price for local bean seed was 50 gourdes for each marmit in the market, would you be willing to pay 80 gourdes for each marmit of improved bean seed? ........................................................................................................... (No=0, Yes=1) 5.2 Do you intend to purchase bean seeds in the future? ........................ (No=0, Yes=1) If N0, ask following, then skip to section 6 1 Why not? 2 From where will you obtain your bean seeds? ................. If YES. 3 For what planting season do intend to purchase bean seeds for? ........................................................................................................ S 1_82_83_I_ 4 What seed variety(ies) do you intend to purchase? ........................................................... .......................................................................... l) 2) 3) 5 What quantity do you think that you will need of: 1 1" Variety ...................................................................................... (in marmit) 2 2" Variety ..................................................................................... (in marmit) 3 3" Variety ..................................................................................... (in marmit) 5.3 Do you have any additional comments regarding the availability of new bean varieties or their performance in your fields? .. 102 6 POIS CONGO (PIGEON PEA) QUESTIONS: Before we finish this survey, I have a few questions about Pois Congo. 6.1 Have you planted Pois Congo in the last year? .................................. (No=0, Yes=1) _ IfNO, ask following, then conclude interview 1 Why not? ................ If YES. 2 In what growing season did you plant Pois Congo? I 2 3 I 3 How many marmit of Pois Congo seed did you plant? .............................. (marmit) I 4 From where did you obtain your Pois Congo seed? . ......................................................... ............ (Market=0, Store=l, Gifi=2, Self stored=3, Groupement=4,0ther(specify)) If seeds were purchased: 5 How many marmit did you buy? ............................................................... (marmit) 6 What price per marmit did you pay? ............................................................. Gdes. 6.2 What crops, if any, did you plant Pois Congo in association with?.. 6.3 How many marmit of Pois Congo did you harvest? .................................. (marmit) 6.4 If a new Pois Congo seed could be purchased, what qualities would you be most interested in? ..... Thank you for your help with this survey. We have a small gift for you from Michigan State University to thank you for allowing us to ask you these questions. 103 BIBLIOGRAPHY Bandow, D. “Help or Hindrance: Can Foreign Aid Prevent International Crises?” Cato Institute, April 25 1997. CIPDSA (1997) Le Sous-Sector Semencier - Potentialités, Contraintes et Strategic de son développement. Port-au-Prince, Haiti, CIPDSA, pp. 34. Coase, R H “The Nature of the Firm.” Economica 4(1937): 386-405. Coase, R. H. “The Problem of Social Cost.” The Journal of Law and Economics 3(1960): 1-44. Commons, J. R. “Institutional Economics.” American Economic Review 21(193 1): 648- 657. Dominique, J. L. Interview with CIPDSA Director, July 14 2000. Douglas, J. E. “Successfirl Seed Programs : A Planning and Management Guide.” Westview Press. Eveillard, J. P. Personal Communication, December 20, 2000. Fafchamps, M., and B. Minten. “Social Capital and the Firm: Evidence fi'om Agricultural Trade.” The World Bank, September 1999. FAO (2000) FAO STAT Database Query, 2000. FAO (2001) FAO STAT Database Query,. 2001 Gachette, M. “Rapport de Planification de la Campagne d'Aout 2000 et Statistiques de Distribution de Semences d'Aout 1995/ 1996/ 1997/ 1998 et 1999.” CIPDSA, Juin 2000. Gagnon, G. “Food Security Issues in Haiti.” The World Bank, August 1998. Guiteau, P. “Statistiques de Distribution de Semences Sur les Campagnes d'Hiver 1996/ 97 / 98 et Planification de la Campagne d'Hiver 1999.” CIPDSA/PNIS, October 1999. Guzman, J. P., A Salehizadeh, and D. Dunn. “Haiti: Recent Economic Developments.” International Monetary Fund, September 1998. Haggblade, S. 1., and M. S. Gamser. “A Field Manual for Subsector Practitioners.” Development Alternatives, Inc., November 1991. 104 Holtzman, J. S. Rapid Reconnca'ssance Guidelines for Agricultural Marketing and Food System Research in Developing Countries. Working Paper 30. MSU International Development Papers. East Lansing: Department of Agricultural Economics, 1986. Jaifee, S., and J. Srivastava. “Seed System Development: The Appropriate Roles of the Private and Public Sectors.” The World Bank. Jensen, H. H., S. R. Johnson, and G. Stampley. “Food Consumption Patterns in Haiti: Evidence fi'om the Haiti Household Expenditure and Consumption Survey.” Center for Agricultural and Rural Development (CARD), December 1990. Jensen, H. H., S. R. Johnson, and G. Stampley. “Nutrition in'Haiti: Evidence from the Haiti Household Expenditure and Consumption Survey.” Center for Agricultural and Rural Development (CARD), December 1990. Lundahl, M. The Haitian Economy: Man, Land and Markets. London: Croom Helm, 1983. Manigat, S. (1999) Times of Definitions and Choices: The Case of Haiti, FAO. Morris, M. L., J. Rusike, and M. Smale (1998) Conceptual Framework, ed. M L. Morris. Boulder, Lynne Rienner, pp. 401. Murray, G. F., and M. D. Alvarez. “The Marketing of Beans in Haiti: An Exploratory Study.” InterAmerican Institute of Agricultural Sciences, June 1973. Nabli, M. K., and J. B. Nugent. “The New Institutional Economics and Its Applicability to Development.” World Development 17, No. 9(1989): pp 1333-1347. North, D. C. Institutions, Institutional Change, and Economic Performance. New York: Cambridge University Press, 1990. Pray, C. E., and B. Rarnaswami. “A Framework for Seed Policy Analysis in Developing Countries.” International Food Policy Research Institute (IFPRI), May 1991. Prophets, E. Personal Communication, 15 November 2000. RESAL. “Etude d'impact du programme d”appui & 1a filiere semence.” European Food Security Network (RESAL), April 2000. Robison, L. J., A. A. Schmid, and M. E. Siles. “Is Social Capital Really Capital?” Michigan State University, June 1999. Rotberg, R. I. “Haiti's Past Mortgages Its Future.” Foreign Aflairs 67, No. 1(1988): 93- 109. 105 Ruttan, V. W., and Y. Hayami (1990) Induced Innovation Model of Economic Development, ed. C. K. Eicher, and J. M. Staatz, 2nd ed. Edition. Baltimore, The Johns Hopkins University Press, pp. 97-112. Schmid, A. A. Property, Power, and Public Choice .° An Inquiry into Law and Economics. 2nd ed. New York: Praeger, 1987. Shaffer, J. D. “On the Concept of Subsector Studies.” American Journal of Agricultural Economics Vol. 55, no. No. 2(1973): 333-335. Tripp, R. “The Institutional Conditions for Seed Enterprise Development.” Overseas Development Institute, October 1997. USAID. “FY 2000 Congressional Presentation -Haiti.” US. Agency for International Development. Weber, M. T., et a1. “Informing Food Security Decisions in Africa: Empirical Analysis and Policy Dialogue.” American Journal of Agricultural Economics 70, no. 5(1988): 1044-1052. White, T. A., and G. R. Smucker. “Social Capital and Governance in Haiti: Traditions and Trends.” The World Bank, August, 1998. Wiens, T., and C. E. Sobrado. “Rural Poverty in Haiti.” . The World Bank, August 1998. Williamson, 0., E. “The Logic of Economic Organization.” Journal of Law, Economics, and Organization 4, no. 1(1988): 65-93. World Bank (2000) Haiti at a Glance, 2000 World Bank. “Haiti -Sustainable Intensification of Agriculture.” The World Bank, August 12 1998. World Bank. “Haiti: The Challenges of Poverty Reduction.” The World Bank, March 1998. 106 IIlWilli!!![lililfllfllfllllflljfilll 3 2