Technical Efficiency of Tef Producers: Evidence from West Shewa, Ethiopia

Abstract

Tef (Eragrostis tef) is a major staple food crop and is important for generating farm income in Ethiopia and cultivated by more than 6.9 million farmers. The objectives of the study were to measure the level of technical efficiency and identify factors that cause efficiency differences among tef cultivating farmers in West Shewa, Ethiopia. The study was conducted based on the data obtained from 206 randomly selected households. For the analysis, both descriptive statistics and econometric models were used. A Cobb-Douglas stochastic frontier production model with the inefficiency effect was used to simultaneously estimate technical efficiency and identify the determinants of efficiency variations among tef producer farmers. The maximum likelihood estimates of stochastic frontier production showed that tef output was positively and significantly influenced by areas cultivated, and negatively affected by the increased seed rate and labour used. The estimated mean technical efficiency of sampled households in the study area was 84.3%, this shows that it is possible to raise tef output by about 15.7% without using additional inputs and by employing inputs on hand efficiently and there is a room to increase the output from the existing input combinations if farmers operate in an efficient manner. Livestock owned, use improved tef seed and proximity to the district market were found to negatively and significantly affect the technical inefficiency of tef producing farmers. Thus, stakeholders engaged in agriculture should emphasize on resources of farmers and the proximity to input and output market to improve the efficiency level of those less efficient farmers.

Keywords: Stochastic frontier analysis; Technical efficiency; Tef; West Shewa

DOI: 10.7176/JESD/13-9-03

Publication date:May 31^st 2022