African Journal of Agricultural Economics and Rural Development

African Journal of Agricultural Economics and Rural Development ISSN 2375-0693 Vol. 12 (3), pp. 001-008, March, 2024. Available online at www.internationalscholarsjournals.org © International Scholars Journals

Full Length Research Paper

Assessing allocative efficiency among Kenyan smallholder farmers: A case study of Irish potato producers in Nyandarua North District

Gideon A. Obare^1,2*, Daniel O. Nyagaka³ Wilson Nguyo¹ and Samuel M. Mwakubo⁴

¹Department of Agricultural Economics and Business Management, Egerton University, Kenya.
²Food Security Center, University of Hohenheim, Germany.
³Research Extension Liaison Division, Ministry of Agriculture, Kenya.
⁴Department of Economics and Agricultural Resource Management, Moi University, Kenya.

Accepted 28 January, 2024

Abstract

Irish potato production in Kenya has been on the decline, yet this crop is a major staple and a source of cash from sales. Using a random sample of 127 smallholder farmers in Nyandarua North district this paper applied a dual stochastic efficiency decomposition technique and a two - limit Tobit model, after disaggregating economic efficiency components using a dual stochastic frontier function, to analyze resource allocative efficiency in Irish potato production. This is in view of the unclear determinants of declining potato production trends in Kenya and considering that the Irish potato is a major staple and cash crop. The paper establishes that Irish potato production in Nyandarua North district is characterized by decreasing returns to scale with a mean allocative efficiency of 0.57. It was further established that farming experience, access to extension and credit, and membership in a farmers’ association positively and significantly influenced allocative efficiency. Implications of the study results are drawn.

Key words: Efficiency, productivity, stochastic frontier functions, Irish potato, Kenya.