Market separations perspective of agricultural markets and successful AMIS: beyond technical rationality

Abstract

Agriculture is an important economic activity and is a primary driver of economic growth of many developing countries. Improving the performance and profitability of agricultural markets will lead to the growth of the agricultural sector. Information and Communication Technologies (ICT) based Agricultural Market Information Systems (AMIS) is a development initiative which promises to empower the stakeholders of the agricultural supply chain with information and aid the development of the agricultural sector. Many attempts have been made by governments in a number of developing countries to provide AMIS, with a poor success rate. It is important to understand the factors that determine the success or failure of these systems. In this paper we take the theoretical lens provided by Bartels’ theory of market separations in order to define the success of AMIS. Using a technical/rational view, we conduct a two level analysis of market separations – those in agricultural markets and those in AMIS services markets. We find that information separation is a strong feature that exists in agricultural markets and AMIS provide good means of reducing this separation. Success of AMIS is defined by the reduction of market separations at both these levels. Later we go beyond technical rationality and note that socio-political issues limit the utilization of market information provided by AMIS. Thus we state that socio-political separation of agricultural markets must also be tackled in order to successfully implement AMIS. A comprehensive policy environment in a region can help reduce these separations.