Econometric Analysis of the Determinants of Quantity of Potato Supplied to the Market: The Case of Jeldu District of Oromia National Regional State, Ethiopia

Abstract

Potato has been considered as a strategic crop by the Ethiopian government aiming at enhancing food security and economic benefits to the country. However, potato sub-sector in Ethiopia is relatively undeveloped and it is faced with low productivity of less than 14 t/ha which in turn diminishes the quantity supplied to the market. This study applied the two stage least squares econometric model to analyze the determinants of the quantity of potato supplied to the market. Results of the model confirmed that four variables namely education level, quantity of potato produced, membership to cooperatives and area allocated to potato production affected quantity of potato supplied to the market significantly and positively. Contrary to these, livestock holding affected quantity of potato supplied to the market significantly and negatively. Based on the findings, the study suggests that the government and stakeholders should focus on distributing quality inputs, fertilizers and chemicals timely, assisting and encouraging establishments of cooperatives and memberships, identifying and disseminating high yielding and disease resistant potato seed varieties, strengthening the provision of formal and informal education, improving rural infrastructure and promoting coordination among market actors.

Keywords: Potato; Endogeneity; Two-stage least squares regression