An Alternative to Cooperative Marketing System in the Southern Communal Area of Namibia: Are Farmers Willing To Pay?

Abstract

This study investigated an alternative method to improve livestock marketing position amongst communal farmers in the Southern Communal Area (SCA) of Namibia. The investigation includes determining the willingness to pay for the establishment of an alternative market entity and the economic feasibility of such entity. The farmers’ decision was modelled using a logistic probability model while the investment decision was estimated considering uncertainty and its probability distribution. According to the result, on average, there is a probability of 87.91% that farmers’ will pay for a business entity with the future prospect of being a shareholder. The study found that the proposed business entity could generate between N$1.6 to N$3.2 million income annually. The study found livestock farmers in the SCA of Namibia to be mindful of running their enterprise as a business unit. Therefore, a good policy directive is needed for the implementation of the proposed agribusiness entity in Namibia.

EconLit: (C01, C10, C30, D22, D80, D82 & E03)

Keywords: Cooperative, Probability, Willingnes-to-pay, farmers, livestock