Linking the market to competitiveness, the role of innovation in rural agriculture in Oaxaca, Mexico

Abstract

Rafael Rodríguez-Hernández, Pedro Cadena-Iñiguez, Sergio Góngora-González, Sergio Jácome-Maldonado, Andrés Zambada-Martínez, Alejandro Ayala-Sánchez, Roberto RendónMedel

In Mexico 60.7 % of the population living in extreme poverty reside in rural areas, peasant farm families are characterized by low levels of productivity and income as well as insufficient participation in the market. Faced with this situation, technological innovation represents a solution to incorporate rural farmers into the global economy and to reverse rural poverty, for which the objective was to quantify the level of economic impact innovation has on linking the market and competitiveness in farm production units of two communities in the ¨Sierra Sur¨ region of the state of Oaxaca, Santo Domingo Teojomulco and San Jacinto Tlacotepec.Information was compiled directly through surveys with families participating in an innovation project, one given before the innovation and another after. The economic variables were production value, sales value, consumption value and competitiveness measured by the Private Cost Ratio (RCP for its acronym in Spanish.) The results indicated that with innovation the link to the market through sales increased on average 22 times in ratio to the situation before the intervention and reversed the value structure of the production designating to the producers more than 50% of its production value to the market; auto-consumption was not reduced, rather it was increased and diversified. The competitiveness of the production units increased by 61.3 %. We conclude that innovation permitted the strengthening of the production process and market ownership by incorporating rural farmers into the process of global development.