Determinants of economic efficiency among smallholder Common beans farmers in Igamba and Itaka divisions in Mbozi district, Songwe region

Masters Thesis

Common beans are the most exported pulses in Tanzania and contributes about 62% of all Tanzanian pulse exports. This crop has significant importance in the growth of the national economy. The average common bean yield in the country which has been recorded at 991 kgha-1 is lower than the potential yield of 1500-3000 Kgha-1. Using data from 131 randomly selected smallholder common beans farmers from six villages in three wards of Magamba, Bara and Halungu, this study analyzes the determinants of the economic efficiency of smallholder common beans farmers in the study area. Specifically, the study attempts to estimate the levels of technical, allocative, and economic efficiencies among the sampled smallholder common beans farmers in the study area. The stochastic frontier approach was used to estimate the production function, and from a Cobb-Douglas stochastic frontier function and its dual, enables the estimation of the technical, allocative and economic efficiencies. The efficiency determinants were simultaneously assessed along with the frontier functions through the FRONTIER 4.1 software. The results show that common bean production was positively influenced (P<0.1) by plot size, quantity of seeds and planting fertilizers. Furthermore, the results show that, farmers’ membership to farmer group, education level, experience in farming and household size were found to be negatively and significantly (P<0.1) associated to technical inefficiency. Similarly, farmers’ membership to farmer group, experience of the farmer, education level and extension services were found to be negatively and significantly (P<0.1) related to allocative inefficiency. Results further show that the mean technical, allocative, and economic efficiency indices of smallholder beans farmers are 64.8%, 52.7%, and 43.62%, respectively, meaning that the sampled farmers were relatively technically efficient than they were allocatively and economically, with 56.38% room to expand productivity with current input use and technology. The study concludes that, inputs such as improved seed and fertilizers which were the major inputs that increase the output of common bean production in the study area should be made available by all stakeholders (government and private sectors) on time, in right amounts and at affordable prices to the farmers. The study recommends that policies should be developed to improve the provision of extension services to the farmers.