Does Technical Efficiency Matter for Ethiopia’s Sorghum Producer Farmers? A Study on its Implication for Productivity Improvement

Abstract

Efficient use of the existing resources by farm households improves their productivity and thereby increases their production and achieves the goal of food security. This study examined the technical efficiency of Smallholder Sorghum Producer households and also identifies its major determinants as the case of smallholder farm households in Southwestern Ethiopia. Purposive sampling technique was employed to draw an appropriate sample of 543 sorghum producer farm households for this cross-sectional survey study. Data analysis tools such as descriptive statistics and econometrics model (stochastic frontier model) were used in combination in this study. The stochastic frontier model shows inorganic fertilizer, labor, seed amount, and oxen power were found to be an important input variable that positively affects the production of sorghum. The results show the mean technical efficiency estimate for sorghum producers was 70 percent. This indicates that there exists a room for improving the existing level of sorghum production through enhancing the level of farm household’s efficiency. The stochastic frontier model results from inefficiency estimates shows that education level, of-f-farm income, frequency of extension contact, credit amount, livestock holding, proximity to farm, and total cultivated land were significantly determined the level of technical inefficiency of sorghum production. Hence, to improve the production efficiency, level extension package efforts should give focus to those less efficient farm households. As policy implications, agricultural policy packages should direct towards those important socio- economic factors to improve the productivity of smallholder farmers.