Pull Mechanisms for Overcoming Market Failures in the Agriculture Sector : Initial Lessons Learned with Case Illustrations from AgResults’ Kenya On-Farm Storage Pilot
After the food crises of 2007-2008and the growing realization that donor resources were notsufficient to meet global agricultural developmentchallenges, the AgResults initiative was launched at theJune 2012 G20 Summit in Los Cabos, Mexico as an innovationto boost private sector engagement in meeting thesechallenges. AgResults initiative comprised of seven pilotprojects that incentivize the private sector to develop anddeliver innovative products to smallholder farmers insettings where markets for these products are otherwiseunderdeveloped. Each pilot provides financial incentives tothe private sector actors to encourage them to enter themarket, but the incentives are paid only after they achievepredefined results. This Knowledge Note reflects the initialfindings from the external evaluator’s ongoing research toevaluate the pilots. The authors conclude by identifying thecritical steps involved in design of a pull mechanism.Throughout, the authors draw on examples from the AgResultsOn-Farm Storage pilot in Kenya to illustrate their guidance.