Access to Markets

Overview

Markets have the potential to strengthen resilience by providing sales opportunities and increasing access to inputs, information, and technology that enable households to accumulate assets and diversify incomes. There is evidence in some contexts that access to markets has contributed to improved household resilience, but markets must also function well and be adaptable to currency and other shocks in order to provide these benefits.

Source

Markets give farmers and others the opportunity to increase their incomes through increased sales opportunities, access to quality inputs, market incentives for increased production, and opportunities to diversify sources of income. Access to markets can also increase access to financial services, as households accumulate additional assets to use as collateral, and to more and better risk-reducing information and technology.

These opportunities lead to greater asset accumulation and diversification of livelihood risk, which contribute to resilience. It should be noted that although markets can provide many opportunities to increase incomes and build resilience, markets themselves are also vulnerable to shocks that can have significant negative impacts on households. Markets must therefore be able to withstand and adapt to shocks in order to provide a reliable market for good, services, and employment.

Evidence

One project working in the Sahel region found that access to markets was one of the factors associated with households’ ability to maintain food security and recover from shocks. Another project, in Burma, found that although access to markets had helped increase production and incomes, households remained vulnerable to shocks. It determined that a better understanding of how local markets were influenced by global markets and existing social structures could help improve the market’s ability to improve household resilience.