Global leaders have made the call for identification and implementation of national, regional and international strategies to promote participation of farmers, especially smallholder farmers, in markets. This was stated in the outcome document "The future we want", issued at the conclusion of the United Nations Conference on Sustainable Development (UNCSD) Summit in Rio de Janeiro on 20-22 June 2012. Addressing this appeal, CAPSA has initiated a series of studies in Asia and the Pacific to identify the underlying reasons for limited participation of smallholder farmers in markets. As a part of this initiative, Dr. Upali Wickramasinghe, Regional Adviser on Poverty Reduction and Food Security, gave a presentation titled "Modelling smallholder agriculture in the presence of transaction costs" at the Indonesian Centre for Agriculture, Socio-Economic and Policy Studies (ICASEPS), on 8 November 2012. The presentation showed an approach to incorporate transaction cost in a household model, and discussed estimation procedures. Participants agreed that transaction costs have rarely been used in modelling and analysis of farmer behaviour in Indonesia and emphasized the need to include socio-political and institutional dimensions into the model.