Small Farms Show Higher Productivity Than Large Farms, Reveals IIT Bombay–University of Hyderabad Study

A new joint study by the Indian Institute of Technology Bombay (IIT Bombay) and the University of Hyderabad has challenged long-held assumptions about farm size and productivity in India. The research, focusing on semi-arid regions of the country, highlights that farm productivity depends less on the size of landholdings and more on farmers’ access to inputs, credit, and markets.

Key Findings of the Study

The research team analyzed four decades of agricultural data (1975–2014) from the semi-arid tropics of India. Their findings suggest that the inverse farm size–productivity relationship—the belief that smaller farms are always more productive than larger ones—is not as strong or universal as previously thought.

• Early Years Advantage: During 1975–84, smaller farms were indeed more productive, driven by intensive family labour, careful land management, and higher input use per acre.
• Changing Patterns: Over time, particularly between 2009 and 2014, the productivity edge of smallholders diminished due to rising input costs, monocropping, and agrarian distress in dryland regions.
• Complex Relationship: The study concludes that productivity is context-dependent, shaped by access to credit, technology, and markets rather than land size alone.

Expert Perspective

“Smallholders remain vital for food security and rural livelihoods, but their resilience is weakening,” noted Prof. Sarthak Gaurav of IIT Bombay, co-author of the study. “Supporting them with affordable technologies, credit access, and reliable extension services will be critical in sustaining productivity.”

Data and Methodology

The research drew heavily on the ICRISAT Village Level Studies (VLS)—one of the world’s longest-running agricultural panel datasets. Covering regions such as Akola (Maharashtra), Solapur (Maharashtra), and Mahabubnagar (Telangana), the database tracks household and cultivation practices across decades.

To strengthen their analysis, the researchers merged household-level survey data with climate information from the India Meteorology Department (IMD) and other external sources. This allowed them to trace long-term agricultural transitions in areas that missed the early benefits of the Green Revolution.

Policy Recommendations

The study underscores the urgent need to:

• Enhance smallholders’ collective access to markets and farm inputs.
• Promote farmer producer organizations (FPOs) and collectives to help pool resources and negotiate fairer prices.
• Encourage agroecological practices to improve resilience in semi-arid zones.

Broader Implications

By showing that productivity is influenced more by institutional support and resource access than farm size, the study reframes the debate on agricultural policy. Strengthening smallholders through collective action and improved market access may hold the key to addressing rural distress and ensuring long-term food security.