A systems approach to agricultural market development expands focus from the farm level to include a broader perspective on all functions and relationships along a value chain, as well as the enabling environment that drives behavior and decisions within the system. The enabling environment, also looked at as the business climate, is considered to encompass both formal rules (policies, laws, regulations, and standards) and informal rules (societal norms and traditions). Given the enabling environment’s influence on all aspects of decision-making and resource allocation within a market system, it presents important leverage points for poverty reduction, food security, economic growth, employment, ecological sustainability, and resilience. 

This technical note explores the role of the enabling environment in agricultural market systems, tools and best practices for enabling environment reforms, and methods for catalyzing reforms. The Feed the Future Enabling Environment for Food Security project and its predecessor, the Enabling Agricultural Trade project, have developed and employed a range of analytical instruments to examine the influence of prevailing rules and institutions within agricultural market systems. This note also explore tools for enabling environment reform, such as AgCLIR and SeedCLIR, as well as benchmarking tools, such as the World Bank's Enabling the Business of Agriculture (EBA) Index, and further analytical methodologies.