Household Behaviour under Market Failures: How Natural Resource Management in Agriculture Promotes Livestock Production in the Sahel

Improved water harvesting and soil erosion control using theremarkably simple practice of contour stone bunding is shownto increase grain yields by 41% in low rainfall regions of BurkinaFaso. Empirical results show that yield increases in food cropshelp food-buying farm households import-substitute in food consumption,reduce livestock production and increase seasonal migration,which is more compatible with seasonal agriculture than withthe yearlong livestock activity. Self-sufficient households,by contrast, can take advantage of higher yields to free resourcesfrom food production and allocate these to expand their livestockeconomy, thus benefiting more from the region's comparativeadvantage. We also show that greater effectiveness in cooperationin the management of common property resources helps increaseincome derived from livestock for all categories of households.However, not all forms of cooperation are effective. When cooperationis only formal, individual activities such as crops, non-agriculturalemployment and seasonal migration are pursued, as opposed tolivestock activities that rely on effective community managementof common property resources.