Contract farming, contract design and smallholder livelihoods*

Contract farming has gained in importance many developing countries. Previous studies analysed effects of contracts on smallholder farmers’ welfare, yet mostly without considering that different types contractual relationships exist. Here, we examine associations between contract and farm household income the oil palm sector Ghana, explicitly differentiating two contracts, namely simple marketing more comprehensive resource-providing contracts. Moreover, look at sources to better understand how both are linked livelihood strategies. We use cross-sectional survey data regression models. Issues endogeneity addressed through measuring farmers' willingness-to-participate using this indicator as an additional covariate. Farmers with have significantly higher incomes than farmers a contract, notable differences terms sources. allocate labour off-farm activities thus income. In contrast, larger plantations incomes. The findings suggest associated strategies disaggregated analysis is important possible underlying mechanisms.