Analysis of Smallholder Farmers’ Technical Efficiency of Maize Production: The Case of Fogera District, South Gondar Zone, Ethiopia

Abstract

Ethiopian agriculture is characterized by low productivity. As a result, the country has been a scene of poverty and persistent food insecurity. To solve this problem studying the level of technical efficiency becomes more important. The main inspiration of efficiency and productivity studies are the need to investigate and understand the forces that drive maize technical efficiency in order to analyze. Therefore, this study was conducted in Fogera district of South Gondar zone to measure the level of technical efficiency and identify socio-economic factors affecting the efficiency of smallholder farmers in maize production. A three-stage sampling technique was employed to select 120 maize growing smallholder farmers. Stochastic production functions were employed to estimate technical efficiency levels. The estimated results showed that the mean level of technical efficiency of maize producers was 73%. The estimated gamma parameters (discrepancy ratio γ), which measures the relative deviation of output from the frontier level due to inefficiency, was about 84%. The estimated stochastic production frontier (SPF) model also indicates that DAP, Urea and maize plot size are significant determinants of maize production level. The estimated SPF model together with the inefficiency parameters shows that education, improved seed and credit access were found to determine technical efficiencies of farmers positively while participation in off-farm income, slope and fragmentations were found negative relationship with technical efficiency. Hence, emphasis should be given to more on timely supply of DAP, Urea, improved seed and socioeconomic significant variables such as education, credit access and slope to improve farmers’ efficiency in production of maize.

Keywords: Technical efficiency, Maize production, stochastic frontier, Fogera district

DOI: 10.7176/JESD/13-23-02

Publication date: December 31^st 2022