The impact of credit constraint on artisanal fishers’ technical efficiency: Stochastic frontier and instrumental variable approach

Abstract

This study investigated the effects of credit constraints on the technical efficiency (TE) of artisanal fishers in Ghana. Survey data was collected from two regions and applied using an instrumental variable (IV) approach to estimate the stochastic frontier of the sector. The study found evidence of inefficiency among fishers. This study identifies fishers’ years of fishing experience, education level, credit constraint, and off-farm income as the most important determinants of technical efficiency. Whiles credit constraint and off-fishing income had a detrimental effect on technical efficiency, years of fishing experience and education level help improve efficiency. The study provides several policies that can promote credit accessibility for the fishers; hence, improving household and national development.