2026-07-01http://hdl.handle.net/123456789/418343The main objective of this paper is to provide estimates of the cost of moving out of subsistence for Madagascar's farmers. The analysis is based on a simple asset-return model of occupational choice. Estimates suggest that the entry (sunk) cost associated with moving out of subsistence can be quite large - somewhere between 124 and 153 percent of a subsistence farmer's annual production. Our results make it possible to identify farm characteristics likely to generate large gains, if moved out of subsistence, yielding useful information for the targeting of trade-adjustment assistance programs.application/pdftext/plainCC BY 3.0 IGOhttp://creativecommons.org/licenses/by/3.0/igo/World BankACREAGEADJUSTMENT ASSISTANCEAGRICULTURAL MARKETSAGRICULTURAL PRODUCTIONAGRICULTURAL PRODUCTSAGRICULTURAL REVENUEAGRICULTURE ORGANIZATIONARBITRAGEBALANCE SHEETSBARRIERS TO ENTRYBENCHMARKCANE SUGARCASH CROPSCASH INCOMECOMMERCIAL AGRICULTURECOMMERCIAL FARMINGCOMPARATIVE ADVANTAGECONSUMER PRICESCONSUMPTION EXPENDITURESCOTTONCREDIT MARKETSCROPLANDDEVELOPMENT ECONOMICSDISCOUNTED VALUEDIVERSIFICATIONDIVIDENDSECONOMIES OF SCALEEQUATIONSEXPECTED RETURNEXPENDITUREEXPENDITURESEXPORTEXPORTSEXTREME POVERTYFAIRFARMFARM OUTPUTFARM POPULATIONFARM SIZEFARMERFARMERSFARMSFEMALE-HEADED HOUSEHOLDSFLAVORFOOD CROPSGDPHOUSEHOLD HEADHOUSEHOLD HEADSHURDLESINTENSIVE FARMINGINTEREST RATELACK OF CREDITLAND OWNERSHIPLANDOWNERLDCSLIVESTOCKLIVESTOCK SALESMARKET DISRUPTIONMARKET ENTRYMARKET ENTRY COSTMARKET FAILUREMARKET FAILURESMARKET PARTICIPANTSMARKET PRICESMARKET REFORMSMARKET SECTORMARKET STRUCTUREMARKETINGMARKETING BOARDSMIDDLEMENMILLSMORAL HAZARDOPPORTUNITY COSTOPPORTUNITY COSTSOWNERSHIP STRUCTUREPOOR COUNTRIESPOOR FARMERSPOVERTY ALLEVIATIONPOVERTY LINEPRICE CHANGESPRICE INDEXPRICE INDICESPRICE VOLATILITYPRODUCER ASSOCIATIONPRODUCER PRICESPRODUCT DIFFERENTIATIONREAL INCOMERISK AVERSIONRISK PREMIUMRURAL AREARURAL CREDITRURAL HOUSEHOLDSRURAL POVERTYRURAL ROADSSALESALESSCHOOLINGSHARECROPPINGSUBSISTENCESUBSISTENCE AGRICULTURESUBSISTENCE FARMERSSUBSISTENCE FARMINGSUGARSUGAR CANESUNK COSTSSURPLUSTRADE FLOWSTRADE REFORMSTRANSACTIONVALUATIONVOLATILITYTHRESHOLD REGRESSIONSWITCHING REGRESSIONUNKNOWN SAMPLE SEPARATIONSUBSISTENCEENTRY COSTS.