A Micro-Economic Analysis of Farm Restructuring in Khorezm Region, Uzbekistan

Abstract

The paper analyses the response of the agricultural producers tointroduction of new agricultural policies in Khorezm, a region of Uzbekistan. Eversince its independence several reforms in agriculture of Uzbekistan have been takenas part of a gradual transition process towards a market-based economy. Theseprocesses include market liberalization, reformation of land relations, structuralchanges, and creation of supporting market infrastructure. Furthermore, there hasbeen considerable promotion of input market liberalization, abolishment of stateprocurement system, introduction of water charges and improvement of thelivestock sector. The understanding of the effects of these reforms on theagricultural producers and consumers in Khorezm is very important for furtherdecision making. In order to formalize the key aspects of sectoral decision making,the major task of this research is to develop a model for policy analysis whichreflects the unique features of the agricultural sector of the study region. The modelresults show that the market liberalization may not lead to an increase in theregional production of cotton and may negatively affect the agriculturalemployment. Furthermore, the livestock sector may serves as a security tool in ruralhouseholds for maintaining their income level when the markets are liberalized.

Keywords

• Agricultural policy analysis
• Sector model
• Khorezm