How socio-economic and natural resource inequality impedes entrepreneurial ventures of farmers in rural India

Ram Ranjan

Research output: Contribution to journalArticleResearchpeer-review

Abstract

Entrepreneurial ventures potentially offer a way out for farmers facing stagnant livelihoods in drought-ridden farming. We develop a model where entrepreneurial success of marginal farmers is linked to their ability to overcome the challenges posed by the existent socio-economic and environmental inequalities. Farmers with lower socio-economic status receive an unequal share of irrigation water from common reservoirs, which impedes their ability to accumulate financial capital and start an enterprise. Findings suggest that less endowed farmers could end up inefficiently dedicating resources towards reducing social inequality through a process of social friction, which adversely affects their livelihood prospects. When both farming and entrepreneurial ventures are prone to failure, farmers may stay within farming for longer despite higher failure risk. When agricultural exit risk is higher and enterprise failure risk lower, farmers are forced to invest more time in farming and mitigating such risks, which, in turn, delays their success in business.

LanguageEnglish
Pages433–460
Number of pages28
JournalEuropean Journal of Development Research
Volume31
Issue number3
Early online date24 Jul 2018
DOIs
Publication statusPublished - Jul 2019

Fingerprint

natural resources
farmer
natural resource
India
economics
livelihood
friction
drought
ability
irrigation
social inequality
socioeconomics
finance
resource
water
resources

Keywords

  • Caste-based conflicts
  • Environmental injustice
  • Non-farm enterprise
  • Rural entrepreneurship
  • Social inequality
  • Water scarcity

Cite this

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How socio-economic and natural resource inequality impedes entrepreneurial ventures of farmers in rural India. / Ranjan, Ram.

In: European Journal of Development Research, Vol. 31, No. 3, 07.2019, p. 433–460.

Research output: Contribution to journalArticleResearchpeer-review

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