Technical Efficiency of Cereal Producing Farmers: A Comparative Analysis of Own-operators and Tenants (The Case of Ethiopia)
No Thumbnail Available
Date
1999-06
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
A.A.U
Abstract
Studies on the efficiency of peasant farms are very important sources of policy advise in
agriculture dominated economies such as that of Ethiopia. The importance extends to the
economy at large beyond directly affecting peasants. An important factor that is central to
these studies is land use arrangements' role in determining efficiency levels. Volumes of
theoretical controversies and empirical evidences are documented in the literature on the
impact of land use arrangements on efficiency of farmers. This study tried to investigate and
analyze technical efficiency of farmers and its difference between groups of households
working under different mode of land use arrangements. It also attempted to indicate some
of the factors that might affect the efficiency of tenant farmers. To this effect, Cobb-Douglas
stochastic frontier production function and other econometric tools are employed on a
cross-sectional data of 340 households operating with similar farming practices. The mean
technical efficiency of sample households is found to be around 62.8 percent indicating the
existence of inefficiency and considerable potential for efficiency improvement under the
given state of technology. Efficiency is found to be higher for smaller farms and households
with literate household heads. Wealth of the household, level of credit, amount of fertilizer
used and rainfall are found to contribute significantly to production. Regardless of
differences ill the mode of landholding and tenancy associated problems, no significant
efficiency gap is observed between owner-operators and tenants. On the other hand, in line
with the hypothesis of the Marshallian and others, there is an indication that non-sharecroppers
perform better than sharecroppers are. The way inputs are financed and
decisions are made on activities has some influence on efficiency of tenants. To enhance
efficiency of farmers, efforts towards providing training and extension services, forming and
expanding the coverage of credit and small-scale irrigation schemes should be strengthened.
Indeed, given the land use policy which provides room for land renting, the formation and
functioning of land rent-lease arrangements among farmers would enable better use of
resources and enhance the overall efficiency of the sector.
Description
Keywords
Cereal Producing Farmers, Technical Efficiency