Factors Affecting Economic Performance and Willingness to Pay of Agricultural Entrepreneurs in Betong District, Sarawak

Abstract

The agricultural sector in Malaysia exists in a dualism, shared between large conglomerates and smallholders who operate on small parcels of land. Unlike large conglomerates who own numerous plantations throughout Malaysia, smallholders, especially rural farmers are among the poor and they face various issues in maintaining and operating their business operations. Rising costs, low prices for agriculture produce, disease, lack of infrastructure and many others are among some of the challenges that are borne by smallholders. What are the factors that affect the economic performance of rural entrepreneurs? And would the entrepreneurs be willing to pay to improve the facilities surrounding their business operations? This study attempts to investigate not only the background of rural entrepreneurs in Sarawak’s Betong district, it also examined the factors that would affect the performance of the entrepreneurs and identify the amount that they are willing to pay to contribute to the improvement of the facilities surrounding their business operations. Primary data collection and cluster sampling method were used and questionnaire survey were distributed to targeted respondents i.e. agricultural entrepreneurs around the Betong District. The final analysis utilized 420 questionnaires which are analyzed using descriptive analysis, principal component analysis and rotated component matrix, This study found that majority of agricultural entrepreneurs are female, and are above 40 years old. Almost 90 per cent of them are local Bumiputera and 75 per cent are non-Muslim. Business operation and internal and external business relationship were found to be significant factors that affect the economic attainment of the entrepreneurs. Besides that, the entrepreneurs’ willingness to pay is found to be up to RM20.54 per month to the local council for the purpose of maintaining and improving the facilities surrounding their business operations. The findings from this study can be used as an estimate or benchmark figure by the local authority for collection/ fees from agricultural entrepreneurs and can be utilized for improvement and development of the Betong town centre and business area.