Interaction of credit and uncertainty in determining resource allocation and incomes on small farms, Surat District, India

The primary data source is a cross-section survey of 120 farmers in Surat District, for 1971-72. The sample is drawn equally from high, middle and low income villages, but is stratified so that the proportion of small farmers is similar to that in India as a whole. The study concludes that expanding cooperative credit availability would increase fertilizer use, and encourage a shift to higher income crops (new varieties and sugarcane) on irrigated small farms. Greater flexibility of loan repayment would make small farmers more willing to use available credit. On unirrigated farms, research must play a vital role both to increase yield levels, and to develop varieties or cultivation practices which will minimize yield losses in years of low rainfall.