Socio Economic Drivers Influencincing Smallholder Maize Production in Tobacco Growing Zones of Migori County, Kenya

Known by its scientific name Zea Mays, maize is the staple food for most households in Kenya. It is mostly produced by small scale farmers. Maize is also an important livestock feed both as silage and as crop residue, grain and is also used industrially for starch and oil extraction. It is an important source of carbohydrate, protein, iron, vitamin B, and minerals. Kenyans consume maize in a wide variety of ways (ugali, porridges and beer). Green maize, fresh on the cob, is eaten roasted or boiled separately or mixed with legumes. Every part of the maize plant has economic value: the grain, leaves, stalk, tassel, and cob can all be used to produce a large variety of food and non-food products. The general objective of this study was to investigate the socio economic constraints to smallholder maize production in Tobacco growing regions of Migori County, Kenya. However, it was guided by the following specific objectives; to determine the effect of tobacco farming on maize production and to assess the impact of socio-economic factors on smallholder maize production. This study used time series techniques to investigate the relationship between tobacco farming and smallholder maize production in Migori County, during the period 1967 to 2010.The data was collected from Kenya National Bureau of Statistics. The data that was parametrically analyzed using E-views to giving descriptive statistics and inferential statistics. Descriptive statistics involved comparison of means, cross tabulation, use of tables, pie charts and bar graph. A fitted Cobb-Douglas production model was adopted in this study and using the framework of error correction mechanism, it was found that the lagged capital input, fertilizers, labor, research and extension services significantly propagate maize production. Unit root and Granger-causality tests were carried out to make adequate allowance for the dynamic relationship, on stationary and spurious regression problems. However, in the structural macroeconomic model, the individual lagged variables, the aggregated co-regressed variables resulted into a positive R squared at 0.01 significant levels.  Surprisingly, the coefficient of the lagged maize production was found to be negative (- 0.4747) and insignificant only at the 10% level. Keywords: Smallholder Maize Production, Error Correction Model and Food Securit

The Relevance of Educational Investment to Economic Growth in Kenya

It is commonly assumed that education has an important positive effect on economic growth, but to date the evidence for this assumption has been surprisingly weak. This study explores the relationship between the role of investment in education and economic growth. The study is guided by two specific objectives; to determine the significance of physical capital formation on economic growth and to establish the contribution of labour input to economic growth. It uses time series techniques to investigate the relationship between government education expenditure per worker and economic growth in Kenya during the period 1963 to 2014.The data were collected from Kenya Government Ministries, Kenya National Bureau of Statistics and from the World Bank. The study has used the multiplicative Cobb-Douglas production function, in which human capital is treated as an independent factor of production, as in the human capital augmented growth model. Unit root and Granger-causality tests are carried out to make allowance for dynamic relationships, non-stationarity, and spurious regression problems. Empirical results show that education expenditure per worker has a positive and significant impact on economic growth, both in the long run and in the short run. Cointegration estimates show that an increase of 1 percent in education per worker raises output by 0.5 percent in the long run. Also, in the long-run, a 1percent increase in fixed capital formation raises output by 0.15 percent, and a 1 percent increase in the use of labour leads to a 0.21 percent decrease in output in the long run.  Correlation tests also show that there is a positive relationship between investment in education and economic growth. These results suggest that it is worth investing in education because it contributes to economic growth. The Government of Kenya and the private sector of Kenya need to consider increasing their investment in education. Keywords: Educational Investment and Economic Growt

The Role of Mobile Phones in Marketing Nile Perch Fish: A Case Study of Homa Bay County, Kenya

The introduction of Nile perch to Lake Victoria in 1950’s, while ecologically negative, has stimulated the establishment of large fishing companies in Kenya though away from the lake. It has earned the government and other stakeholders of the industry billions of Kenyan shillings yet the fishermen continue to wallow in poverty. The major objective of this study was to investigate the use of mobile phone technology in marketing Nile perch fish in Homa-Bay County and specifically: to examine the use of mobile phone technology to facilitate Nile perch fish marketing and to identify the determinants of variations in the frequency of mobile phone use for Nile perch fish marketing among agents involved in the marketing chain. A survey was conducted and data gathered through questionnaires where the target population included all fishermen in Homa-Bay County. A multistage sampling technique was used and a sample of two hundred and seventy respondents was selected using systematic random sampling. Descriptive and Poisson regression model were used to analyze the data. The study identified the use of mobile phone along five communication channels used for Nile perch fish marketing. Annual income generated from Nile perch fish business was significant in explaining variations observed in the frequency of mobile phone use.  Findings imply that use of mobile phones can assist in the commercialization process of the Nile perch fish marketing and may help to forestall possible market failure. The study recommends the need for policymakers and the private sector to facilitate means of enabling access to mobile use by the fishermen. Keywords: Nile perch fish, Communication Channels, Market Information, Poisson mode

Role of Educational Investment on Economic Growth and Development in Kenya

The Government of Kenya spends 30% of its budget on education. It is commonly assumed that education has an important positive effect on economic growth, but to date the evidence for this assumption has been surprisingly weak. This study aimed at exploring the relationships between the amount of investments in education and economic growth. It was an attempt to explore the extent to which education level of the Kenyan labor force affects its economic growth that is its output level. It was guided by the following specific objectives; to examine the impact of physical capital formation on economic growth and to investigate the contribution of labor input on economic growth. This study used time series techniques to investigate the relationship between government education expenditure per worker and economic growth in Kenya during the period 1967 to 2010.The data was collected from Kenya National Bureau of Statistics and the World Bank. The study used the multiplicative Cobb-Douglas production function where human capital was treated as an independent factor of production in the human capital augmented growth model. Unit root and Granger-causality tests were carried out to make adequate allowance for the dynamic relationship, on stationary, and spurious regression problems. The empirical results show that education expenditure per worker has a positive and significant impact on economic growth both in the long run and short run. The cointegration estimates show that an increase of 1% of education per worker raises output by 0.5% in the long run. Similarly, in the long-run, a 1% increase in fixed capital formation raises output by 0.15%. Also, a 1% increase in labor leads to 0.21% decrease in output in the long run. Correlation tests also show that there is a positive relationship between investment in education and economic growth. These results justified that it is worth investing in education since it contributes to economic growth. The Government of Kenya and the private sector who are the beneficiaries of this study need to increase the amount of investment in education. Keywords: Educational Investment, Economic Growth and Error Correction Mode

Evaluation of the Factors Leading to Loan Default at Equity Bank, Kenya

This paper gives an evaluation of the causes of loan default among the customers of Equity bank. A sample of 80 respondents out of 240 respondents which comprised of both the bank managers and loan defaulters at Equity Bank was used in the study. This represented 33% of the target population. The population was stratified into bank managers and loan defaulters while loans were stratified into performing and nonperforming loans. Data was collected using two sets of questionnaires which were administered separately to the target population. Data was analyzed using Microsoft Excel Data Analysis Tools. In the evaluation of the causes of nonperforming loans, the paper considered the contribution of the factors such as the banks’ lending practices as well as the economic backgrounds and financial decision making among loans recipients at Equity Bank Ltd. Microsoft Excel Data Analysis Tools were used to establish the relationship between amounts of loan advanced to an individual and the amount of loan defaulted. The paper established that the major factors influencing nonpayment of borrowed loans at Equity Bank Ltd were both internal and external. The paper recommended that banks’ credit policies be reviewed to match the highly volatile economic trends within financial markets with a strong emphasis on institutional appraisals on credit worthiness. Keywords: Loans, Bank, Default

Evaluation of the Factors Leading to Loan Default at Equity Bank, Kenya

This paper gives an evaluation of the causes of loan default among the customers of Equity bank. A sample of 80 respondents out of 240 respondents which comprised of both the bank managers and loan defaulters at Equity Bank was used in the study. This represented 33% of the target population. The population was stratified into bank managers and loan defaulters while loans were stratified into performing and nonperforming loans. Data was collected using two sets of questionnaires which were administered separately to the target population. Data was analyzed using Microsoft Excel Data Analysis Tools. In the evaluation of the causes of nonperforming loans, the paper considered the contribution of the factors such as the banks’ lending practices as well as the economic backgrounds and financial decision making among loans recipients at Equity Bank Ltd. Microsoft Excel Data Analysis Tools were used to establish the relationship between amounts of loan advanced to an individual and the amount of loan defaulted. The paper established that the major factors influencing nonpayment of borrowed loans at Equity Bank Ltd were both internal and external. The paper recommended that banks’ credit policies be reviewed to match the highly volatile economic trends within financial markets with a strong emphasis on institutional appraisals on credit worthiness. Keywords: Loans, Bank, Default

Lending Rates and its impact on Economic Growth in Kenya

After the liberalization of interest rates in Kenya in 1992, there has been an upward trend in the interest rates. Therefore, there is a need to investigate the factors influencing lending interest rates and their impacts on the general performance of the economy. This study examined various factors influencing lending interest rates and their impacts on the general performance of the economy. Specifically, it: investigates the effects of international interest rates on local lending interest rates in Kenya and determines the effects of budget deficit financing on lending interest rates. Annual secondary time series data spanning from 1980 to 2010 obtained from the World Bank annual reports, IMF annual reports, annual government publications and reports and other relevant publications were used. This data was parametrically analyzed using EVIEWS to present descriptive and inferential statistics. Unit roots, cointergration tests and the Error Correction Model were carried out to investigate the dynamic behavior of the model. Results of the study indicates that the impact of budget deficit and inflation on interest rates in Kenya were positive and significant. This implies that any attempt to control the rise in interest rates must pay attention to expansionary macroeconomic policies and reduce the budget deficit. Such policies should address structural and non-structural causes of inflation. For instance, it involves enacting policies to reduce the cost of doing business in Kenya. Keywords: Lending rates, Economic growth and Error Correction Mode

Impact of Fertilizer Input Subsidy on Maize Production in Nandi North District, Kenya.

This study addressed the interface between Fertilizer Input Subsidy use and maize productivity. The context is set by confronting the first Millennium Development Goal which targets increased and satisfactory access to food for half of those currently undernourished by the year 2015. Due to the decline of maize production in the country, it