Constraints on Smallholder Treecropping in Malaysia

Abstract The low yields of Malaysian smallholder tree-crop producers are usually ascribed to technical inefficiency. A more plausible explanation of this exception to the general experience that small farms have higher yields than large ones is capital scarcity on smallholdings engaged in an exceptionally capital-intensive agricultural enterprise. This hypothesis is considered in the light of a decline in smallholder output in South-West Perak, which has occured notwithstanding a rapidly increasing population and an abundant supply of labour. Land tenure problems also appear to depress Malay smallholder output. Proposals are advanced for Kampong Development Corporations, with public financing, to lease derelict smallholder land, to rehabilitate it, and to sublet it at competitive rents to smallholders when the new trees come into production.