This FAO report sheds light on the economic dimension of rural livelihoods. About 75% of the rural population from developing countries lives in small family farms and works on land plots smaller than 2 hectares. They have limited access to markets, services and often suffer hunger, malnutrition and food insecurity. The report looks into the differences in smallholder farms in nine countries from an economic perspective.
Smallholder farmers are entrepreneurs, economic actors that raise capital and invest in assets under economic considerations of risks and benefits. Nevertheless often they are excluded from markets and services. Their decisions are based on limited information and their active participation in the economy is hampered. Their production remains of high importance and role in rural development advancement is uncontested. FAO looks into the natural resources smallholder farmers dispose of; it discusses their productivity and labour force availability. Furthermore is compares the factors that affect smallholder farmers decisions, while highlighting poverty and income diversification and last but not least analyses the opportunities and disadvantages arising from commercialization and transformation.