Non-Credit Services of Group-Based Financial Institutions: Implications for Smallholder Women’s Honey Income in Arid and Semi Arid Lands of Kenya

This paper analyses the effect of non-credit services of joint liability credit institutions on smallholder women beekeepers’ honey income. The non-credit services offered to the beekeepers are mainly enterprise development services (training on marketing, business, production and subsector analysis). The study uses cross-sectional data from a survey of women beekeepers participating in group-based credit programmes; the survey was conducted in September 2005 in Makueni district of Kenya. The findings indicate that the number of enterprise development related trainings attended by women beekeepers that are offered by the group-based financial institutions positively and significantly influence honey income. The results confirm that non-credit services contribute positively to the enhancement of honey income. These results imply that extension and strengthening of group-based financial institutions’ non-credit services in the marginal areas will enhance development of smallholder agriculture for improved income generation.Credit, Finance, Honey, Makueni, Agricultural and Food Policy, Agricultural Finance, Community/Rural/Urban Development, Consumer/Household Economics, Demand and Price Analysis, Food Consumption/Nutrition/Food Safety, Food Security and Poverty, Labor and Human Capital, Marketing, Productivity Analysis, Research and Development/Tech Change/Emerging Technologies,

Awareness and use of m-banking services in agriculture: The case of smallholder farmers in Kenya

Smallholder farmer access to agricultural finance has been a major constraint to agricultural commercialization in developing countries. The ICT revolution in Africa has however brought an opportunity to ease this constraint. The mobile phone-based banking services that started in Kenya urban centers have spread to rural areas and even other countries. Using these services farmers could receive funds invest in agriculture finance transactions. This study examines the awareness and use of m-banking services among rural farmers in Kenya. It also assesses the factors conditioning the use of such services. The study finds high awareness of m-banking services among the smallholder farmers. It also finds that education, distance to a commercial bank, membership to farmer organizations, distance to the m-banking agents, and endowment with physical and financial assets affect the use of m-banking services. It discusses the implications of these findings for policy and practice.Mobile phones, m-banking services, awareness and use, smallholder farmers, Kenya, Financial Economics,

Determinants for Use of Certified Maize Seed and the Relative Importance of Transaction Costs

The rising world prices for major tradable staples such as maize have been a concern for sub- Saharan countries such as Kenya which are maize deficit countries. Maize is a major staple food for over 80 percent of Kenya’s population. Kenya relies on maize for up to 40 percent of its dietary energy supply and is accordingly searching for ways to increase maize productivity. Maize productivity has been rising in the last decade manly as a result of the use of improved germplasm and fertilizer. However, the proportion of farmers using these technologies is low and the aggregate productivity in maize is low compared to other countries and its potential. Previous studies on input adoption have often assumed the existence of perfect supply and product markets, tending to ignore the important but significant role played by institutions as well as the role of transaction costs associated with market exchange. This study makes use of qualitative information from institutions and actors in seed input value chains as well as quantitative information collected from a sample of 150 farmers, in the Moist Transitional Maize Zones of Kenya. A two stage regression model was applied to analyze determinants of adoption and factors affecting degree of adoption of certified improved maize seed. The results show that as farmers adopt certified seeds, they incur higher transaction costs than non adopters, rural infrastructure, social capital such as membership in groups and trust play an important role in the decision of whether or not to use certified seed.Crop Production/Industries,

Economic Evaluation of Organic and Inorganic Resources for Recapitalizing Soil Fertility in Smallholder Maize-based Cropping Systems of Central Kenya

Structural adjustments programs (SAPs) in the last two decades have eliminated all farm-support programs leading to low usage of fertilizers by Kenyan smallholders. One way of addressing this problem is use of organic nutrient resources. This paper examines their cost-effectiveness as capital investments in replenishment of Nitrogen (N), Phosphorus (P), Potassium (K) and soil organic matter (SOM) in smallholder, Maize-based cropping systems. On-farm trials were established in Maragwa and Kirinyaga Districts in 2003/04. Maize was planted in 3 replicates in randomised complete block design (RCBD) using different levels of organic and inorganic fertilizer resources. A blanket rate of 40kg P/ha was applied in all treatment except the control to increase organic N-utilization efficiency. The test crop was harvested, oven-dried and weighed. Net Present Values (NPV) were computed using Partial Budgeting Analysis Model. Increasing levels of inorganic N increased maize yields significantly (P<0.05). However, higher yields were necessary but not sufficient criteria to determine profitability of different treatments. Manure + 60 kg N/ha gave highest NPV (USD 564), Manure + 40kg N/ha gave second highest NPV (USD 511) in Maragwa District while Manure + 60kg N/ha gave highest NPV (USD 633) and Manure + 40kg N/ha second highest NPV (USD 618) in Kirinyaga District. These results suggested that higher N-levels were not necessarily the most economical. Use of organic resources with modest amounts of mineral fertilizers seemed more profitable and held the key to enhancement of nutrient budgets, food security and rural livelihoods.Natural resource capital, Net present values (NPV), Nutrient budgets, Smallholder farmers, Soil organic matter (SOM), Structural adjustment programs (SAPs), Crop Production/Industries, Land Economics/Use,

Access to Land, Income Diversification and Poverty Reduction in Rural Kenya

The increasing land scarcity and the worsening trend of poverty in Kenya in recent years have raised concerns about the focus on land-based agriculture as the basis of growth in the rural areas. This paper combines two complementary data sets obtained from two locations in Kenya, drawn against distinctively different land availability patterns, to examine the diverse rural asset base and key sources of livelihood in the rural areas. The analysis reveals that while access to productive land is still an important determinant of livelihoods in the rural areas, even where land holdings are very small, growth in farm productivity alone may not guarantee households sufficient incomes to escape poverty. We find evidence to suggest that growth of non-farm sector is necessary and may be much more important in reducing risks and vulnerability to poverty and should be equally emphasized if households in such regions are to escape poverty. Off-farm earnings accounted for at least 50 percent of total household incomes in the two research locations. The study further revealed existence of significant barriers to entry to remunerative livelihoods both at farm and off-farm level. The study advocates for expansion of educational services, infrastructure and strengthening of rural institutions to spur broad-based development in the rural areas.diversification, livelihoods, land holding, assets, Kenya., Community/Rural/Urban Development, Q12, Q15, Q18, O18, O13,

Farmer Perception of Technology and its Impact on Technology Uptake: The Case of Fodder Legume in Central Kenya Highlands.

Technology adoption by farmers is crucial to increasing agricultural productivity hence meeting food and nutrition challenges in Africa. Economists investigating consumer demand have accumulated considerable evidence showing that consumers generally have subjective preferences for product attributes. However, when investigating adoption of new agricultural technologies, economists have lagged behind in analysing how farmers' (the consumer of agricultural technologies) subjective perceptions of technology characteristics affect their adoption decisions. Focusing on farmer perceptions of technologies may provide a better understanding of technology adoption since they deal with the technologies and probably perceive technologies differently from researchers and extension agents. The objective of this paper is to investigate farmers' perception of technology and its impact on adoption using a case study of legume forages in central Kenya highlands. Data from a random sample of 131 farm households in four districts in central Kenya was used. Using participatory techniques, four most important fodder legume attributes to farmers in their adoption decision were identified. These were then used in conjoint analysis. An ordered probit model was estimated to assess relative importance of each attribute to the farmer. A tobit model was also estimated to show the effect of farmers' perception of calliandra and desmodium on probability and intensity of adoption. Results showed that dry season tolerance and economy on land are most important characteristics of fodder legumes to the farmers. It was also found that Calliandra and desmodium were more relevant to the farmers in the area than other fodders. Farmers' perception of the two fodders had a significant impact on their adoption. Consequently, it was recommended that before introducing a technology in an area, it is necessary that the farmers' perception of the technology be analysed Conjoint analysis, ordered probit and tobit estimates, fodder legume adoption.Research and Development/Tech Change/Emerging Technologies,

Classification and influence of agricultural information on striga and stemborer control in Suba and Vihiga Districts, Kenya

This paper reports on findings of a study to examine the sources used by farmers in search of agricultural information on striga and/or stemborers control technologies and factors that influence acquisition of such information in Western Kenya region. A random sample of 476 households in Suba and Vihiga districts were interviewed and 15 information pathways were identified. Using principle component analysis (PCA) to derive few latent variables that encapsulate maximum variance in the pathways, two components (latent variables) proxying for ‘agricultural knowledge’ were extracted. Type I-knowledge (first component) loaded heavily with sources that had ‘group’ information searching. Type II-knowledge (second component) loaded heavily with sources requiring individual farmer search. Both types of knowledge positively and significantly influenced the likelihood of households using improved technology to control stemborer, while only Type-II knowledge and social economic factors were important in influencing the farmers’ likelihood of using an improved technology to control striga. This study shows that information is an important factor in the households’ likelihood of using improved technologies in the control of striga and stem borer in Vihiga and Suba, Kenya. Methods of individual interaction are important to striga control.Agricultural information, improved technology, striga, stemborers, control technologies, Kenya, Agricultural and Food Policy, Community/Rural/Urban Development, Demand and Price Analysis, Farm Management, Food Consumption/Nutrition/Food Safety, Food Security and Poverty, Institutional and Behavioral Economics, International Relations/Trade, Marketing, Productivity Analysis, Research and Development/Tech Change/Emerging Technologies, Resource /Energy Economics and Policy,

Financing Smallholder Agricultural Production in Kenya: An Analysis of Effective Demand for Credit

Financing smallholder farming has been one of the major concerns of Kenya’s development efforts. Many credit programs have evolved over the years but with dismal performance. In a study that sought to find the best way to fund smallholder agriculture, it became necessary to analyze and document smallholders’ effective demand for credit. Of particular interest was the comparison of the existing production plans and production plans under strictly profit maximization. Linear programming model was used to formalize observed plans and determine those under profit maximization. Both the activities and the values of outputs under different objectives were compared. Farm Investment Analysis was undertaken to determine the suitability of funding farm activities through credit. The study was undertaken in selected zones of Murang’a and Kisumu districts, being typical smallholder areas. Sample farmers were visited and structured questionnaires administered to cover farm events and physical resources of short rains 1995 and long rains 1996. This formed a basis of formulating the farm plans. Ten years down the road, objectives of smallholders have not changed as have been observed during outreach programs. The results showed that: (i) farmers’ activities in the observed plans were different from those under strictly profit maximization; (ii) the observed plans had significantly lower profit than those under profit maximization; and (iii) meeting constraints through credit was only feasible when the objective was profit maximization. Smallholder agriculture, characterized by subsistence production, does not exhibit effective demand for credit, and funding it therefore requires means other than the competitive market

Financing Smallholder Agricultural Production in Kenya: An Analysis of Effective Demand for Credit

Financing smallholder farming has been one of the major concerns of Kenya’s development efforts. Many credit programs have evolved over the years but with dismal performance. In a study that sought to find the best way to fund smallholder agriculture, it became necessary to analyze and document smallholders’ effective demand for credit. Of particular interest was the comparison of the existing production plans and production plans under strictly profit maximization. Linear programming model was used to formalize observed plans and determine those under profit maximization. Both the activities and the values of outputs under different objectives were compared. Farm Investment Analysis was undertaken to determine the suitability of funding farm activities through credit. The study was undertaken in selected zones of Murang’a and Kisumu districts, being typical smallholder areas. Sample farmers were visited and structured questionnaires administered to cover farm events and physical resources of short rains 1995 and long rains 1996. This formed a basis of formulating the farm plans. Ten years down the road, objectives of smallholders have not changed as have been observed during outreach programs. The results showed that: (i) farmers’ activities in the observed plans were different from those under strictly profit maximization; (ii) the observed plans had significantly lower profit than those under profit maximization; and (iii) meeting constraints through credit was only feasible when the objective was profit maximization. Smallholder agriculture, characterized by subsistence production, does not exhibit effective demand for credit, and funding it therefore requires means other than the competitive market.Credit, Finance, Kenya, Smallholder, Agricultural and Food Policy, Demand and Price Analysis, Farm Management, Food Consumption/Nutrition/Food Safety, Food Security and Poverty, Institutional and Behavioral Economics, International Relations/Trade, Marketing, Productivity Analysis, Research and Development/Tech Change/Emerging Technologies,

Gender-differentiated stochastic meta-frontier analysis of production technology heterogeneity among smallholder cassava farmers in Ghana

This paper assesses the differences in technical efficiency of, and the cassava production systems employed by, male-managed (MMF) and female-managed (FMF) cassava farms in the Fanteakwa District of Ghana. The study employs the translog stochastic meta-frontier model to analyse data obtained from 300 randomly selected smallholder cassava farmers and finds an average meta-frontier technical efficiency (MTE) of 0.06 and 0.03 among MMF and FMF respectively. The technology gap ratios (TGR) are 0.25 and 0.04 for the MMF and FMF respectively. The results suggest that both MMFs and FMFs are technically inefficient. However, the production technology operated on MMFs is relatively superior to that operated on FMFs, as shown by the relatively higher TGR for MMFs. The results also reveal that proximity to markets, extension access, off-farm economic activities and formal education are the major contributors to the technical efficiency of the farmers