Is There a Farm Size–Productivity Relationship in African Agriculture? Evidence from Rwanda

Whether the negative relationship between farm size and crop productivity that is confirmed in a large global literature holds in Africa is of considerable policy relevance. Plot-level data from Rwanda point toward constant returns to scale and a strong negative relationship between farm size and crop output per hectare that is robust across specifications and emerges also if profits with family labor valued at shadow wages are used but disappears if family labor is valued at market rates. In Rwanda, labor market imperfections, rather than other unobserved factors, seem to be a key reason for the inverse farm-size productivity relationship.