Effect of ECX’s Market Information Service on Smallholder Coffee Farmers’ Livelihood and Transaction Cost: The Case of Gedeo Zone, SNNPR
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Date
2021-06
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A.A.U
Abstract
The aim of the study was to examine EXC’s MIS service effect in coffee smallholder farmers’
livelihood improvement and transaction cost in Gedeo zone, SNNPR. To investigate the study,
descriptive and explanatory (causal) research design and quantitative approach are used.
Probability and nonprobability sampling techniques and multi-stage cluster sampling
technique are used to collect cross sectional data from 287 smallholder farmers using
structured questionnaire. The ECX MIS service users and nonusers are significantly differ in
education level, number of children above 16 years of age, number of languages spoken, in
their radio listening habit, annual production level, annual revenue and expenditure they spend
in farm and harvesting seasons. Logistic model is used to explore factors influencing farmers’
usage of ECX MIS service and to estimate propensity score to match the covariates for ECX’s
MIS service users and nonusers. The result showed that age, education level, mobile
ownership, access to extension service and availability of electricity significantly influenced
household decisions of ECX’s MIS service usage. Propensity score matching (PSM) was used
to determine the impact of ECX’s MIS service on smallholder’s income and transaction cost.
The study found out that ECX’s MIS users’ income is higher than the nonusers and ECX’s MIS
users incurred higher transaction cost than the nonusers. Generally, the study found out that
the net effect from using ECX’s MIS service is positive so that smallholder’s livelihood can be
substantially improved with effective implementation of MIS services. Therefore, the study
recommends ECX’s to look into its MIS implementation practice and correct any miss deeds
that resulted in smallholder incurring higher transaction costs.
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Keywords
Livelihood, Transaction Cost