Economic Efficiency of Smallholder Farmers in Barley Production in Meket District, Ethiopia
Vol. 10(10), pp. 328-338, October 2018 DOI: 10.5897/JDAE2018.0960 Article Number: 12FCF3758529 ISSN: 2006-9774 Copyright ©2018 Journal of Development and Agricultural Author(s) retain the copyright of this article http://www.academicjournals.org/JDAE Economics Full Length Research Paper Economic efficiency of smallholder farmers in barley production in Meket district, Ethiopia Getachew Wollie1*, Lemma Zemedu2 and Bosena Tegegn2 1Department of Economics, College of Business and Economics, Samara University, Ethiopia. 2Department of Agricultural Economics, College of Agriculture and Environmental Sciences, Haramaya University, Ethiopia. Received 10 May, 2018; Accepted 31 July, 2018 This study analyzed the economic efficiency of smallholder farmers in barley production in the case of Meket district, Amhara National Regional State, Ethiopia. A cross sectional data collected from a sample of 123 barley producers during the 2015/2016 production season was used for the analysis. Two stages random sampling method was used to select sample respondents. The translog functional form was chosen to estimate both production and cost functions and OLS estimation method was applied to identify allocative and economic inefficiencies factors, while technical inefficiency factors were analyzed by using single stage estimation approach. The estimated stochastic production frontier model indicated input variables such as fertilizer, human labor and oxen power as significant variables that increase the quantity of barley output, while barley seed had a negative effect. The estimated mean levels of technical, allocative and economic efficiencies of the sample farmers were about 70.9, 68.6 and 48.8%, respectively which revealed the presence of a room to increase their technical, allocative and economic efficiencies level on average by 29.1, 31.4 and 51.2%, respectively with the existing resources.
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