Agricultural Production and Economic Welfare in Uganda, a Case Study of Kyazanga Sub County, Lwengo District
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AGRICULTURAL PRODUCTION AND ECONOMIC WELFARE IN UGANDA, A CASE STUDY OF KYAZANGA SUB COUNTY, LWENGO DISTRICT. KAYESU DOREEN BEC/45225/ 143/ DU A RESEARCH REPORT SUBMITTED TO THE DEAPRTMENT OF ECONOMICS AND APPLIED STATISTICS IN PARTIAL FULFILLMENT FOR THE REQUIREMENTS OF THE AWARD OF BACHELOR OF ARTS IN ECONOMICS OF KAMPALA INTERANTIONAL UNIVERSITY JUNE, 2017 DECLARATION I, KAYESU DOREEN declare that, this research report is my own work and has never been produced by anybody else for any award in any institution and that material which is not mine has been fully acknowledged. Signature_______________________ Date~J4th1~/~ ~ KAYESU DOREEN BEC/45225/ 143/ DU APPROVAL This is to satisfy that this research has been done under my supervision and submitted for examination with my approval. Signature ~ ~ Date O~ Q_O1 ~( MR. MUHEREZA FRANKLIN Supervisor DEDICATION I dedicate this work to my parents Mr. and Mrs. Ssakyindi Peter for his entire patience and love he accorded to me throughout my entire academics. III ACKNOWLEDGEMENT I would like to thank the Almighty God, for providing me with his grace and opportunity to finish this academic study. I would also like to extend my sincere gratitude to all those who have contributed towards the successful completion of this research report. I would also like to extend my sincere appreciation to my parents Mr. Ssakyindi Peter and Mrs. Ssakyindi Ruth for their commitment, financial support and guidance, they have been willingly offered to me, through my academics because without them, it would not be a success. My special thanks goes to my Supervisor Mr. Muhereza Franklin for the time and patience taken to supervise this research report and for his valuable, intellectual and tireless guidance may the almighty God I serve, bless him in his enter life. I owe much gratitude to all my friends especially; Ezra, Viola, and my brother Stephen, Sam, Grace,paul,yosa m,David,Winnie,Harriet,Saul,oliver,Nathan,Shema,Annet,Fred and the entire Economics and management and staff at Kampala International University MAY GOD BLESS YOU ALL iv TABLE OF CONTENTS D ECI~ARA1°ION APPRO~1’AL D EDICAT’ION DUo 00000 U COOn o 0000000 DUO 0000000 USD00000000000000 DO 0000000000U000000 D0U000 00 00U000000U000U0U0000U0005 ACKNOl~AILEDGEMENT 000000U0000000000000000000D0000008U0000000U00000000UUU000000UU00000UOUU0000000005000000 fl~I C IIIAPTER ONE I NTRODLJC°TION Duo noon 0000000 ODDS 00000 U U 0 Don 000 U DUO 000000 USD00008 U U 000000000000000 US U 000000 U U U 0000000000 U 0000 CD 01, 1000 Introduction 1 101 Back ground to the Study ~00~•ooo000O0•o000nOO00oonno000D00n00OOO0UOoooO00U000ooU00OO0DDOO0O0UoOOU0D.00UU00OO 1 1.2 Problem Statement 00 D00U00U00D.0U00..~ 4 1~3 Objectives of the Study0..0•00000..0•.0000.00•000000.00000000000000000~00000000000000000000000000000000000000005 1.3.1 General Objective! Purpose of the study 000O~Un0nO0O00OOnOO0OOUoDD0O000U00000O000D000Oo000OU.0OOO0.. 5 1~3.2 Specific 5 1.3.3 Research Questions ~ 1.4 Scope of the study 00O000000~n0000000•0O0n00UO0O0OU0O00O00O0O0on0n0O0U00000OOOO0Dn000O0000000..00.O00.O.Uoo.OOOD. 5 1.4.1 Content Scope ~ 5 1.4.2 Geographical Scope ooo..ooooooo.ooo...o.ooo.......o.oo.o..o.6 1.4~3 Time Scope 6 1.5. Significance of the Study 6 1.6 Operational Definitions 7 CHAPTER 1~AIO LITERATUR REVIEW 0000000000D0000000U00005flfl00000fl0000U000000UDUOUOU0UUOUOUU00000UOUO0UOUD5005D0OUO9 2.0 Introduction g 2.1 Related Studies g V 2.2 Theoretical Reviews .10 2.3 Conceptual framework 18 C ~1AP1ER TIiREE RESEARCh ME~T’C1ODOL.OG’Y,,,,,..,,,.,,,,.,.,,,,,,,,..,,,..20 3.0. Introduction 20 3.1 Research Design 20 3.2 Study Population 20 3.3 Study Sample 20 3.4 Data Collection methods 21 3.5 Sampling Strategy/technique 21 3.6 Data types and sources 22 cglAplER DATA PRESENTATION, ANALYSIS AND INTERPRETATION,,,,,,,,,,,.,,,,,,,,,,,,,,,,,23 4.0 Introduction 23 4.1 Response Rate 23 4.2 Demographic characteristics of the respondents 23 C FIAPTER.. FIVE ~ DISCUSSION, CONCLUSIONS AND RECOMMENDATIONS ~ 5.0 Introduction 39 5.1 Discussions of the Findings 39 5.1.1 Findings on Agriculture Production 39 vi 5~1.2 Findings on Economic Welfare ~ 41 5.2 Conclusions 42 5.3 Recommendations ..... ......... ...... ........ ....... ..................... 44 5.4 Areas of further study~ 45 REFERENCES 46 APPENDIX 1: QUESTIONNAIRES 55 VII LIST OF TABLES Table 4.2 Gender of the respondents ~ 24 Table 4.3 Marital status of the respondents ~ 25 Table 4.4 Age of the respondents ~ 26 Table 4.5 Level of education of the respondents .....~.. 27 Table 4.3: Agriculture production ~ 28 Table 4.4: Economic Welfare 33 Table 4.1 Response rate 23 VIII LIST OF FIGURES Fig 4.2 Gender of the respondents 24 Fig 4.3 Marital status of the respondents ~ 25 Fig 4. 4 Age of the respondents ~ 26 Fig 4.5 Level of education of the respondents ~ 27 ix CHAPTER ONE INTRODUCTION LO. Introducfion The study is an investigation on agriculture production and economic welfare in Uganda, a case study of Kyazanga Sub County, Lwengo district. The study has two variables that’s the independent variable which is agriculture production and economic welfare as the dependent variable. Therefore, this chapter presents the background to the study, the statement of the problem, the purpose of the study and its objectives, the research questions, hypothesis, the study scope, significance and justification and operational definitions of key terms and concepts of study. Li Back ground to the Study During the 1960s a new consensus emerged to the effect that agricultural growth is critical (if not a precondition) for industrialization and general economic growth. Nevertheless, the process of agricultural growth itself has remained outside the concern of most development economists. Both technical change and institutional evolution have been treated as exogenous to their systems. In this paper we review the evolution of thought with respect to the process of agricultural development that is implicit in much of the literature on agricultural and economic development; we elaborate the concept of induced technical and institutional innovation which we have employed in our own research on the agricultural development process; and we discuss the implications of the induced innovation perspective for the design of national and regional strategies for agricultural development. (UNDP 2014) Historically in the 1990s, developing countries, including Uganda, witnessed wide- ranging reforms in the agricultural sector. In Uganda, these reforms included, among others, liberalization of trade in agricultural inputs services and output; privatization of state-owned enterprises that supported production and marketing; and downsizing of civil servants who provided extension services. The reforms had both positive and negative consequences. Some of the negative effects of the reforms were income inequality and an increase in the proportion of the very poor in the early 1990s 1 (Muwanga 2001); the collapse of public extension, credit and marketing services (Semana 2004); and falling agricultural productivity, according to the Ministry of Agricultural, Animal Industry and Fisheries (MAAIF 2010). To overcome the negative consequences of agricultural reforms, the government of Uganda, with support from the World Bank and other donors, restructured the country’s extension system, as part of the Plan for Modernization of Agriculture (PMA), from unified public extension to a public-private partnership (PPP) extension system. The reforms of the agricultural sector culminated in 2001 with the establishment of the National Agricultural Advisory Services Organization (through an act of Parliament, the National Agricultural Advisory Services Act of 2001) as a semiautonomous agency of the MAAIF, to manage the 25-year National Agricultural Advisory Services (NAADS) program. (World Bank, 2001). Agrkufture is the cultivation and breeding of animals, plants and fungi for food, fiber, bio-fuel, medicinal plants and other products used to sustain and enhance human life.~11 Agriculture was the key development in the rise of sedentary human civilization, whereby farming of domesticated species created food surpluses that nurtured the development of civilization. The study of agriculture is known as agricultural science. (Ted.R. Schultz, 2005) Agricultural production is measured as the ratio of agricultural outputs to agricultural inputs. While individual products are usually measured by weight, their varying densities make measuring overall agricultural output difficult. Therefore, output is usually measured as the market value of final output, which excludes intermediate products such as corn feed used in the meat industry. This output value may be compared to many different types of inputs such as labor and land (yield). Egli, D.B. (2008). These are called partial measures of productivity. Agricultural productivity may also be measured by what is termed total factor productivity (TFP). This method of calculating agricultural productivity compares an index of agricultural inputs to an index of outputs. This measure of agricultural productivity was established 2 to remedy the shortcomings of the partial measures of productivity; notably that it is often hard to identify the factors cause them to change. (Mundlak, Yair, 2007). Agricultural Productivity has been defined by several scholars depending on their disciplines. In economics, agricultural productivity refers to the output produced by a given level of input(s) in the agricultural sector of an economy (Fulginiti and Perrin, 2008). It may also