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Agricultural Economics

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Agricultural Economics applies economic principles to solve agricultural and agribusiness problems. Our degrees equip graduates for professional and senior management positions, and are highly valued by employers. They give our graduates the flexibility to pursue a wide range of career opportunities. The Agricultural Economics major can be taken as part of a BScAgric (4 year) degree. Students taking the BScAgric option must major in Economics and Agricultural Economics, and take subjects such as Biometry and Statistics, Animal Science, Crop Science, and Horticultural Science.

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    An assessment of the maize structure, channel choice and market participation by the smallholder maize farmers in Zimbabwe: a case of Mazowe district=Ukuhlolwa kwesakhiwo semakethe yommbila, ukukhethwa komgudu kanye nokubamba iqhaza emakethe ngabalimi abancane bommbila eZimbabwe: ucwaningo ngesifunda saseMazowe.
    (2023) Munyati, Vincent Tinashe.; Mudhara, Maxwell.; Sinyolo, Sikhulumile.
    Marketing plays a crucial role in alleviating poverty, as well as in achieving food security and sustainable development goals, especially among smallholder maize farmers. Maize marketing has the potential to improve the resilience of households against food insecurity, which is caused by multiple factors which may be natural factors, socio-economic and institutional factors. Smallholder maize farmers find it difficult to participate in the maize market because of a range of limitations, such as poor transport facilities, information asymmetry and the lack of a market infrastructure, which reduces their motivation to partake and which may be echoed in concealed expenses that make it challenging to enter the markets and productive resources. This study ascertained the factors that determine the likelihood and intensity of smallholder maize farmers participating in the maize markets, and it also assessed the market choices made by the smallholder farmers in the Mazowe District of Zimbabwe and analysed the maize marketing structure and its effects on the maize marketing performance. Questionnaires were used to collect data from 382 smallholder farmers and 27 agro-dealers in the Mazowe District. The study adopted a mixture of tools for data collection, including a questionnaire, observations and discussions. The Heckman Selection Model was used as the main analytical tool to estimate market participation and the intensity of this participation, while the Multinomial Logit Model was used to assess the market choices of the farmers and the Herfindalf-Hirschman Index and Gini coefficients were used to measure the concentration of maize traders in the Mazowe District. Due to the narrow index of the maize marketing options in the country, only three distinct alternatives were isolated, namely, the farm gate, the local market and the Grain Marketing Board (GMB), a government parastatal. The results indicated the significant factors that were associated with the likelihood and intensity of the farmers’ market participation, namely, the age of household head, the number of maize buyers at the district level, their extension contacts, membership of a marketing association and the distance to the output market. Contrary to the apriori expectations, the distance to the market had a positive and significant impact on their intensity to participate in the maize market. Other factors that significantly influenced the market choice selection of the smallholder farmers were the age of household head, the extension contacts, market information, the distance to the market and the price offered to maize producers at the market. The number of visits by extension workers significantly increased the likelihood that a maize producer would sell his produce at the local market, rather than at the farm gate. The distance to the market significantly influenced the probability of choosing the local market over the farm gate. As the distance to the local market increases, the smallholder farmers in the Mazowe District preferred the farm gate for selling their produce. In this study, the popular marketing channel for the smallholder farmers was the farm gate; although the prices offered here were often not competitive, the farmers opted for it because of the low transaction costs. The results also indicated that the number of buyers in the maize grain market is too small to make it competitive. The few traders exhibited collusive behaviour with regard to price-setting. The local market channel and G.M.B had a lower Shepherd Marketing Efficiency Index. While both indices were low, when they were compared to the standard in literature, the GMB channel was the least efficient. Most farmers indicated that selling their grain to the GMB involved bureaucracy and late payments, which have negatively affected the marketing efficiency. These late payments have short-circuited the ability of small-scale farmers to generate a cash-flow with which to fund their agriculture activities. The study recommends that there should be mechanisms for developing the capacity of farmers to access marketing information, in order for them to make an informed decision regarding which marketing channel to choose. Governments need to think about how to help smallholder maize farmers to engage better with the existing profitable market channels. Being a member of an association increases the probability of a farmer selling to more lucrative markets. Farmer groups have the advantage of bulking and hence increasing the economies of scale. There is need for farmers to invest more in collective action. It is also easier and cheaper for traders to enforce quality and grade requirements by reaching farmers groups, rather than individual farmers. Iqoqa Abalimi bommbila abancane bakuthola kunzima ukubamba iqhaza emakethe yommbila ngenxa yohlu lwemikhawulo, njengezindawo zokuthutha ezingezinhle, ulwazi olungaxhumani, kanye nokuntuleka kwengqalasizinda yemakethe, okunciphisa ugqozi lwabo lokuhlanganyela futhi okungase kuzwakaliswe ngezindleko ezifihliwe ezenza kube yinselela ukungena ezimakethe kanye nezinsiza ezikhiqizayo. Lolu cwaningo lwaqinisekisa izinto ezinquma amathuba nokujula kwabalimi bommbila abancane ababambe iqhaza ezimakethe zommbila, lwaphinde lwahlola ukhetho lwemakethe olwenziwe ngabalimi abancane eZimbabwe. IHeckman Selection Model yasetshenziswa njengethuluzi eliyinhloko lokuhlaziya ukulinganisa iqhaza lemakethe kanye nokujula kwalokhu kubamba iqhaza, kanti iMultinomial Logit Model yasetshenziselwa ukuhlola ukukhetha kwemakethe futhi iHerfindalf- Hirschman Index yasetshenziselwa ukulinganisa ukuhlanganiswa kommbila. Ngenxa yenkomba encane yezinketho zokumaketha ummbila, kwatholakala izindlela ezintathu kuphela ezihlukile, okungukuthi, isango lepulazi, imakethe yendawo kanye neBhodi Lokumaketha Okusanhlamvu. Imiphumela ikhombise izinto ezibalulekile ezihambisana namathuba nokujula kokubamba iqhaza kwemakethe yabalimi, okungukuthi, iminyaka yenhloko yasekhaya, inani labathengi bommbila ezingeni lesifunda, abaxhumana nabo ukwandisa, ubulungu benhlangano yokumaketha kanye nebanga eliya emakethe yokudayisa. Imiphumela ikhombise ukuthi inani labathengi emakethe yommbila lincane kakhulu ukuthi lingayenza ibe nokuncintisana. Ucwaningo luncoma ukuthi kufanele kube nezindlela zokuthuthukisa amandla abalimi okuthola ulwazi lokumaketha, ukuze benze isinqumo esinolwazi mayelana nokuthi yimuphi umgudu wokumaketha okufanele bawukhethe. Ukuba yilungu lenhlangano kwandisa amathuba okuthi umlimi athengisele izimakethe ezinenzuzo. Kunesidingo sokuthi abalimi batshale imali eningi esenzweni esihlangene. Kulula futhi kushibhile kubathengisi ukuphoqelela izidingo zekhwalithi nebanga ngokufinyelela emaqenjini abalimi, kunabalimi ngabanye.
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    Ghana’s fertilizer subsidy program (gfsp) and complementarity of agricultural intensification technologies: any role to build household food security resilience?
    (2024) Alhassan, Nuhu Jinbaani.; Zegeye, Edilegnaw Wale.
    There is a decline in recent times of Ghana’s agricultural sector’s contribution to national GDP. In addition, the position of the crops sub-sector slipped from being the second largest economic activity in 2018 to being the third largest economic activity in 2019. Agriculture in Ghana remains largely subsistent, contributing almost 80% of the national food consumption. These declines have risen concerns among policy makers about meeting the country’s food security needs and achieving SDGs 1 and 2. Food insecurity persists in Ghana. For instance, Ghana remains not self-sufficient in maize production. This situation is often blamed on poor yields from farmers’ fields. Decline in soil fertility has been cited in the literature as the cause of low yields. Subsequently, increased use of mineral fertilizers is being promoted in Ghana since it is considered as the alternative to improving crop yields. Climate change/variability and other shocks including increased cost of mineral fertilizer have compelled the government of Ghana to implement the Ghana’s Fertilizer Subsidy Program (GFSP). Consequently, increasing application of mineral fertilizers has been reported in the literature of between six to ten times more since 2010 than it was in the 2000s. The number of farmers using mineral fertilizers has also increased due to Fertilizer Subsidy Programs (FSPs). In the long-run, crop yield tends to increase with the application of mineral fertilizers only when integrated with that of organic materials. This calls for implementation of sustainable production systems that enhance efficiency of mineral fertilizers and soil health. Without widespread adoption of sustainable intensification practices among smallholder farmers, declining soil fertility and food insecurity will persist in SSA. This study is, therefore, aimed at addressing three identified empirical knowledge gaps in the literature regarding FSPs, farmers’ own investments in promoting intensification practices, rural development, and food (in)security. Firstly, there was the dearth of assessment that is rigorous of the impact of FSPs on sustainable intensification practices. Earlier empirical assessments on FSPs centered on their evolution and concepts, advantages and disadvantages associated with their implementation. These disadvantages finally led to their halt. Evidence exists regarding the impacts of Fertilizer Subsidy Programs (FSPs) on household welfare and input market development. However, studies in the past have not looked at the contribution of FSPs to sustainable intensification practices and, farm inputs in general, among smallholder farmers. Addressing this gap could help policy makers in designing and implementing agricultural policies and programs that address environmental sustainability, climate change-related issues and rural development. The second identified gap was the paucity of literature on the contribution of FSPs to all the four food security dimensions. Empirical evidence remains limited in explaining food security’s complex nature and its drivers to policy makers and development practitioners. The current approach does not] offer a holistic pathway in addressing food insecurity since it results from multiple drivers such as availability, access, utilization and stability of food. Evaluating what policies, socio-economic characteristics and institutional factors positively impact on these multiple dimensions of food security could help government formulate policies that could reduce food insecurity in Ghana. The third gap identified was limited attention given to the complementarity of ISFM practices in improving household food security. In addition, exit strategy has not been provided in the current literature for FSPs despite reported evidence of their unsustainability due to capture by people of influence, inefficiencies and poor targeting of program beneficiaries. Widespread adoption of ISFM practices could serve as exit strategies for FSPs, not only in Ghana but SSA as a whole. Empirical studies on the impact of ISFM practices in improving soil organic carbon has largely been limited to field experiments in Ghana. This makes it difficult to relate the impact of ISFM practices to household food security. With proper empirical evidence on the impact of complementarity of ISFM practices on households’ food security using household survey data, policies could be designed to enhance adoption of the complete package of ISFM practices at the plot level. Following the knowledge gaps identified, the specific objectives of the study were to: (i) assess the extent to which GFSP affected adoption of agricultural intensification technologies and gross farm inputs; (ii) investigate the impact of GFSP on multiple dimensions of household food security; and (iii) examine the impacts of the complementarity of Integrated Soil Fertility Management (ISFM) technologies on multiple dimensions of food security. First, two-stage least squares with instrumental variables (2SLS-IV) and endogenous switching regression (ESR) were used to study the effect of participation in Ghana’s Fertilizer Subsidy Program (GFSP) on the adoption intensity of Sustainable Intensification Practices (SIPs) and gross farm inputs. A nationally representative dataset of 4,365 maize-growing households for two survey periods (2012/13) and (2016/17) who purchased mineral fertilizers was used for the study. The study finds that participation in the GFSP increased the adoption intensity in both SIPs and gross farm inputs. The implication is that investments into climate-smart technologies and gross farm inputs by beneficiaries of GFSP is attributable to participation in the program. This finding explains the crucial role of GFSP as a pro-rural development policy beyond just the provision of mineral fertilizers to smallholder maize farmers to achieve increased productivity. This is because of the forward and backward linkages between rural agricultural input markets and farmers’ direct purchases of farm inputs. The study also found mutual aid schemes, farmer cooperatives, agricultural loans, household wealth, and connection of a farm household dwelling to the national electricity grid to positively and significantly increased adoption intensity of SIPs and gross farm inputs. This finding highlights the fact that besides government policy such as GFSP towards improving adoption of SIPs and rural development, rural infrastructure and farmer institutions also have a critical role to play. Secondly, the impact of participation in GFSP on multiple dimensions of food security was examined using propensity score matching without replacement, nearness neighbor matching, inverse probability weighting, and inverse probability weighted regression adjustment. The food availability dimension in terms of average yield of maize was 1.5 ton/Ha, still lower than the potential yield estimate of 5.5 tons/Ha by Ghana’s Ministry of Food and Agriculture. It implies that complementary adoption of technologies is key to bridging this productivity gap. Food access and stability dimensions increased in 2017 compared to 2013. However, the utilization dimension of food security declined, implying that the diversity of food intake may not necessarily be explained by increases in the access dimension of food security in terms of food and total household expenditures. The empirical results indicate that the overall average treatment effect of the GFSP was positive and statistically significant for food availability and food access. The GFSP increased maize yield/Ha between 29 to 34 percent at p < 0.01 among program beneficiaries. For food access, the GFSP increased household consumption expenditure by 37 percent at p < 0.01. The effect of GFSP on the stability dimension of food security was also positive, though weaker statistically against robustness checks. There was, however, negative effect of GFSP on food utilization. The study could not find a straight forward relationship between participation in the GFSP and household food security, as food availability may not necessarily lead to better utilization or nutrition. The less impressive performance of GFSP on utilization and stability dimensions of food security implies that maize growing households who benefited from the program are still food insecure. The positive and significant relationship between the value of agricultural equipment owned and engagement in off-farm enterprise with participation in GFSP may imply that smallholder farmers who may have 2Ha or less of farmland under cultivation but can afford the full cost of fertilizer are benefitting from the subsidy program. The study also found significant and negative correlation between increasing farm size and participation in the subsidy program. It means that farmers with farm sizes greater than 2Ha have not benefitted from the program. Finally, the study examines the impacts of the complementarity of Integrated Soil Fertility Management (ISFM) technologies on multiple dimensions of food security using the Multinomial Endogenous Switching Regression (MESR). Regarding the complementarity of adoption of ISFM technologies, the results show very low adoption of complementary technologies among maize growing households in Ghana. The empirical results from the MESR showed that all the ISFM choices positively and significantly determined all the dimensions of food security. Joint adoption of the complete ISFM package gives the highest gain in all the dimensions of food security, except the stability dimension. Joint adoption of mineral and organic fertilizers gave the highest gain for achieving household food stability. The implication is that the availability dimension of food security can be met whilst households’ food utilization can still fall below acceptable threshold. Rural development interventions have to focus on the adoption of the complete ISFM package. Otherwise, the piecemeal adoption of any one or two components will not have the desired impact. Input subsidy programs should include organic fertilizers to optimize program benefits. The implication is that policy makers and farmers should see organic and mineral fertilizers as complementarities but never as substitutes as it is currently the case in Ghana. From the multinomial logit results, the study found that household characteristics (e.g., number of years a household spent in school, land ownership, and household head engagement in off-farm work) and institutional factors (such as presence of a mutual aid scheme, access to extension visits, and distance to agriculture office) positively and significantly increased the likelihood of joint adoption of all the ISFM technologies. This finding underscores the need for a dual approach in promoting the adoption of ISFM practices among smallholder farmers by policy makers. This approach should take into account the role of government in increasing the number of extension staff and provision of the necessary infrastructure and logistics and the role of pro-farmer institutions such as farmer credit schemes and cooperatives. Future studies could quantify the potential contribution of ISFM technologies, and broadly, SIPs to the national GDP. Such an effort could add empirical evidence on the pay-offs associated with these technologies for increased adoption by smallholder farmers. Examining these and other related questions employing panel data could result in better understanding of the temporal and spatial dimensions of ISFM practices and their food security impacts and environmental sustainability.