Analysis of Price Efficiency of Smallholder Farmers in Maize Production in Gudeya Bila District, Oromia National Regional State, Ethiopia: Stochastic, Dual Cost approach

Tolesa Tesema Edosa,Zekarias Shumeta,Temesgen Kebede

doi:10.15520/ijcrr.v10i04.690

Abstract

Even if Ethiopia had adopted different strategy and policies the productivity of agricultural production is not as meet the demand of the peoples. The aim of this study was to analyze productivity and price efficiency of smallholder farmers in maize production in the study area. To meet the stated objectives primary data were collected using structured questionnaires from 154 randomly selected sample households during the 2017/18 production year. Copdoglous production function was applied to analysis productivity where as dual cost is used to estimate price efficiency. Tobit model was used to identify factors affecting price efficiency level. Price efficiency were 70.06%. Thus the results reveal exists considerable levels of price inefficiencies in maize production in study area. The Tobit model results revealed that livestock holding and participation in off/non-farm activities had positive effect and distance of maize plot from home were found to had negative effect on price efficiency The result indicated that there exists a room to increase the price efficiency of maize producers in the study area. For realizing significant price efficiency gains policies and strategies of the government should be directed towards increasing farmer’s livestock holding and promoting off/non-farm activities.

Highlights

Agricultural sector in Ethiopia it remains rain-fed and majority of smallholder farming engaging on less than a hectare of land (1)
Agriculture remains the main economic growth and development option in Ethiopia which is estimated to increase at annual average growth rate of 8% during GTP II period (NPC, 2015).Despite such strategies and policies, the sector is characterized by its low productivity, which is attributed to limited access to agricultural inputs such as fertilizer and improved seeds,inefficiency resource use, limited access to finance, agricultural markets and poor land management [3, 1)
This study intended to fill this information and knowledge gaps in Gudeya Bila district where such type of work has not been conducted for efficiency of maize production

Summary

Introduction

Agricultural sector in Ethiopia it remains rain-fed and majority of smallholder farming engaging on less than a hectare of land (1). More recently the second Growth and Transformation Plan (GTP –II) made agricultural growth as its core growth program at the national level and to maintain it as a source of economic growth Besides this fact, agriculture remains the main economic growth and development option in Ethiopia which is estimated to increase at annual average growth rate of 8% during GTP II period (NPC, 2015).Despite such strategies and policies, the sector is characterized by its low productivity, which is attributed to limited access to agricultural inputs such as fertilizer and improved seeds ,inefficiency resource use , limited access to finance, agricultural markets and poor land management [3 , 1). Tolesa Tesema Edosa et al Analysis of Price Efficiency of Smallholder Farmers in Maize Production in Gudeya Bila District, Oromia National Regional State, Ethiopia: Stochastic, Dual Cost approach environmental conditions between 500 to 2400 meters above sea level. This study intended to fill this information and knowledge gaps in Gudeya Bila district where such type of work has not been conducted for efficiency of maize production

Objectives

Methods

Results

Conclusion