Accessing credit through social relationships : a case study of cassava farmers in Central Uganda

University essay from SLU/Department of Molecular Sciences

Abstract: The FAO aims to support local farmers in Nakasongola District, Uganda, to tap into value-added cassava market opportunities. This thesis critically examines farmers' experiences in these cassava markets, challenging classical economic assumptions that underpin the FAO project. It specifically focuses on the regulation of credit access in cassava markets, as it significantly affects farmers' and traders' terms of inclusion in agricultural markets. To gain a comprehensive understanding, a five-week qualitative case study was conducted in a sub-county of Nakasongola, using semi-structured interviews as the primary data collection method. The study reveals that farmers' decision-making is guided by a Chaynovian concept of "moral economy" rather than profit maximization principles of the market. The study shows that informal social institutions based on trust, reciprocity, and reputation play a crucial role in the farmers' lives. This includes informal credit institutions that are governed by similar mechanisms where access is based on social relationships including trust, friendship, and reputation. Therefore, social relationships become essential for farmers to meet their reproduction needs. The study implies that to ensure the success of future development projects, it is crucial to understand the local context and how existing institutions will shape the introduction of new ones, a concept known as institutional bricolage. This thesis provides an in-depth empirical example of how real agricultural market function and the reasoning of actors within these markets. In addition, the study has contributes to the theoretical discussion of agrarian change, and extends the theory of access by Ribot & Peluso by applying it to credit relations.

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