The Socio-Economic Dilemma of Smallholder Paddy Farmers in Malaysia: A Critical Literature Review
Abstract
This paper examines the systemic socio-economic challenges confronting smallholder paddy farmers in Malaysia. Despite rice being a strategic staple, producers face a persistent low-income trap exacerbated by rising input costs, climate volatility, and structural inefficiencies. This review aims to synthesize these fragmented issues into a cohesive framework to inform policy and agricultural resilience. A critical literature review was conducted using a sample of 17 high-impact sources retrieved from Scopus (1991–2025). The methodology employed a thematic synthesis guided by the Sustainable Livelihoods Framework (SLF) and Diffusion of Innovations (DOI) theory to evaluate the intersection of economic, environmental, and technological variables. The review identifies four critical dilemmas: extreme financial vulnerability due to a cost-price squeeze; a significant innovation-adoption gap driven by perceived risk; an existential threat from climate change; and a labor crisis caused by an aging demographic and youth migration. Synthesis reveals that isolated subsidies are insufficient without addressing foundational social capital and risk-sharing mechanisms. This paper contributes an integrated dilemma framework that reframes Malaysian paddy farming from a technical productivity problem to a holistic socio-economic crisis. It provides a unique synthesis of the human element in food security, bridging the gap between micro-level farmer behavior and macro-level national strategy. Findings suggest that policymakers must transition from generic subsidies to inclusive risk-management tools, such as agricultural takāful, and focus on digital social networks to attract younger agropreneurs.
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