Access to credit and farm productivity: Evidence from food crop production in Rwanda

Abstract

The purpose of this paper is to assess how access to agricultural credit affects farmer productivity in Rwanda. The paper uses secondary  data collected by National Institute of Statistics of Rwanda (NISR), for three survey rounds (2011, 2014 and 2017) where the average  sample size is 14,400 households, which is represented at district level by consideration geographical location (NISR,EICV, 2017/2018).The  analysis was carried out employing the Endogenous Switching Regression Model (ESRM). The findings indicated that difference existed  between farmers who had access to credit and those who do not. Furthermore, farmers who had access to credit are more productive  than those without. Thus, access to credit is critical for increasing agricultural productivity. Rwandan policymakers must prioritize  mechanisms that would promote access to agricultural credit when developing their agricultural policies.