Success in pro-poor value chain development linked to asset endowments: this and other lessons from the 5 Capitals tool

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Donovan J A ,  
Fisk J , Muldoon M F , Stoian D
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Success in pro-poor value chain development linked to asset endowments: this and other lessons from the 5 Capitals tool

Abstract: 

This chapter summarizes the lessons learned from case studies based on the 5Capitals tool for assessing the poverty impacts of value chain development (VCD). The lessons are derived from analysis of the assets of smallholders and local enterprises at the onset of VCD, asset building resulting from interventions and interactions in the value chain, and enabling conditions for VCD. A major lesson is that success in VCD is linked to the assets that smallholder households have at their disposal prior to involvement in a value chain initiative. Positive feedback loops-where the building of one asset leads to the building of another-are more likely the higher their original asset endowments. While this is good news for better-off households, the lesson has other implications for poorer households, whose asset endowments are more constrained. Poor house- holds require support in building a minimum stock of productive assets that would allow them to effectively participate in value chains.