Productivity Analysis, Downloads July 2008 - July 2009: 20,

Clay, Daniel C.

Crawford, Eric W.

Jayne, Thomas S.

Kelly, Valerie A.

Reardon, Thomas

Savadogo, Kimseyinga

English

Research Papers in Economics

Page 1
Global Bureau
Office of Sustainable
Development
Office of West Africa
Affairs
Sahel Regional Program    Country Missions
POLICY SYNTHESIS
for Cooperating USAID Offices and Country Missions
Number 22          October 1996
DETERMINANTS OF FARM 
PRODUCTIVITY IN AFRICA:
 A SYNTHESIS OF FOUR 
CASE STUDIES
By
Thomas Reardon, Valerie Kelly, Eric Crawford,
Thomas Jayne, Kimseyinga Savadogo, and Daniel Clay
Food Security II Cooperative Agreement Between U.S. Agency for International Development, Global Bureau, Economic Growth Center, Office of
Agriculture and Food Security and Department of Agricultural Economics, Michigan State University
BACKGROUND: Over the past two decades, many FINDINGS
cropping systems in Africa have been in a major
transition--from land-abundant to land-constrained.
Pressure to produce more from less and lower quality
land has increased soil degradation.  Yields of many
major staple crops have fallen or stagnated.  Rural
households have diversified incomes into noncropping
activities, and farming has become increasingly linked
to the market economy.  Structural adjustment
programs have cut fertilizer subsidies and farm-
support services, but have increased incentives for
export crop production. 
OBJECTIVES: The bulk of studies on farm produc-
tivity were done in the 1960s and 1970s before land
became constraining.  Our understanding of African
farm productivity needs to be updated to see how
farmers are responding to recent policy, economic, and
environmental changes.  We aim in this report to “dig
below” aggregate trends to uncover differences in
patterns and determinants of productivity over
agroclimatic zones, types of technology, degrees of
environmental degradation, and levels of improved
inputs.  The report synthesizes studies in four
countries.  The Burkina Faso, Rwanda, and Senegal
studies use detailed farm-survey data from the past
decade.  The Zimbabwe study uses aggregate data from
the past two decades which is stratified by farm type
(commercial and smallholder). 
I. Productivity Patterns
Rates of growth in yields (output per hectare) and
returns per labor day were generally low in the four
study countries but differed by crop, zone, technology,
and farm size, providing some success stories. 
a. Yields increased for government-promoted cash
crops in Burkina Faso (cotton and maize) and in
Rwanda (maize, wheat, and soybeans).  Total factor
productivity of smallholder maize in Zimbabwe grew
over 1980-1986, then fell when government support
was cut.  
b. By contrast, yields were stagnant or declined for
many subsistence staples, such as millet in Burkina
Faso and Senegal or tubers in Rwanda.
c. Yields in more favorable agroclimatic zones were
2 to 3 times greater than those in poorer zones. 
d. Large swings in yields occurred between years of
good and bad rainfall in the semi-arid zones, making
farming very risky and analysis of longitudinal trends
very sensitive to years covered.  
FS II Policy Synthesis No. 22 
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II. Productivity Determinants acreage shift from peanuts to millet (hence less
1. Fertilizer 
a. Farmer-managed trials in Senegal show physical
response and profitability (but also riskiness) of fertil-
izer use.  Survey data from Burkina Faso show positive
fertilizer impacts on crop output.
b. Observed fertilizer use varied widely by zone and
crop (from under 10 to over 110 kg/ha, compared with
an African average of 8 kg/ha).  Greatest use was in
higher rainfall areas, on cash crops, where parastatal
agencies handled distribution, credit, marketing and
credit recovery, and where households had more
noncropping income.
c. The elimination of credit and fertilizer subsidies
and a switch from government to private-sector
distribution (reducing the area served) reduced
fertilizer use in the study countries. In Senegal,
fertilizer use on peanuts went from 38,000 t in 1976 to
3,000 t in 1988.  Overall consumption of fertilizer
went from 75,000 tons in 1980/81 (roughly its average
in the 1970s) to 27,100 tons in 1985/86, 19,900 in
1986/87, and 22,400 in 1987/88.  Farmers used much
of the fertilizer on cotton, irrigated rice, and
vegetables, i.e., where subsidies and credit remain
(cotton) or where water is controlled (rice, vegetables).
In Zimbabwe, elimination of fertilizer credit/subsidy in
the mid 1980s caused a decline in fertilizer use on
hybrid maize by small farmers. 
2. Seed
a. The case studies in Senegal and Zimbabwe point to
seed as an important determinant of productivity.  
b. Plant-breeding programs have developed improved
cultivars that have increased productivity (hybrid
maize in Zimbabwe) or maintained productivity in the
face of worsening environmental conditions (short-
cycle peanuts in Senegal).
c. For seed to make its full contribution to produc-
tivity, public and private sector institutions must assure
seed quality, availability, and affordability, through
both research and supportive policies.
d. In Senegal the government seed distribution and
credit programs have been cut back and seed prices
increased by structural adjustment programs.  In
Senegal, the result was limited access to seeds, a
marked drop in use of peanut seed, and a substantial
nitrogen fixation by peanuts).
e. Given previous constraints on the development of
private sector input supply networks and rural
financial markets, seed distribution in Africa has
tended to work better when a single organization (1)
provides seeds on credit in conjunction with comple-
mentary inputs and (2) recovers credit by controlling
output marketing (e.g., cotton and confectionery
peanuts in Senegal, and cotton in Burkina Faso).  This
approach has tended to deal more effectively with the
problems of coordinating input delivery, credit, and
output markets than more decentralized and
unintegrated networks found in much of Africa.  The
integrated approach has also tended to work better for
cash crops than for food crops, which have scattered,
small marketing outlets.
3. Animal traction
a. The main effect of animal traction shown in Africa
to date has been to reduce field labor inputs and
facilitate area expansion (especially on light soils),
rather than to increase yields.
b. However, our case study in Burkina Faso showed
strong positive farm-level impacts of animal traction
on land productivity and labor returns in cotton in the
favorable agroclimates as well as on supply
responsiveness, efficiency of resource allocation, and
manure use.
c. Investment in animal traction is more likely for
households that have access to more land, earn more
noncropping income, and grow cash crops.
4. Organic inputs and conservation investments
  
a. Practices that add organic matter to soil, conserve
soil (prevent erosion) and help water retention (e.g.,
bunds, tied ridges, terraces) increase productivity by
increasing soil moisture and the effect of fertilizer.
Conservation investments are complementary with
improved inputs and organic matter.  The effects can
be dramatic on the farms of the poor who are
struggling to survive in fragile environments.  In
Rwanda, increasing soil conservation investments
(moving from “low” to “high”) increased yields by 25
percent.  By contrast, moving from low to high erosion
decreased yields by 35 percent. 
b. Investment in soil conservation is more likely for
farmers with smaller holdings (hence have less ability 
FS II Policy Synthesis No. 22
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to fallow), earn more noncropping income, and grow b. Well-functioning markets help farmers acquire and
cash crops. use improved inputs and profitably sell outputs by
5. Farm size and land tenure  imperfect information, or price volatility due to a thin
a. In Rwanda, land rental (as compared to ownership) improved productivity will be passed on to consumers.
discourages use of fertilizer, organic matter, and soil
conservation.  c. Parastatals assured vertical integration and
b. Smaller Rwandan farms, which had much higher marketing) for cotton (Senegal, Burkina Faso), maize
land productivity than did larger farms, tended to have (Senegal),  and  coffee  (Rwanda).    In  Zimbabwe,
surplus labor.  They also made more soil conservation government marketing depots and loans helped spur
investments,  though  they  had  similar  levels  of adoption of hybrid maize and use of fertilizer.  The
improved inputs per hectare compared to larger farms. costs of these programs were high, however.  Higher
c. Commercial farms in Zimbabwe tended to have movement controls that forced the bulk of marketed
higher yields than smallholders, mainly because of grain output into the State marketing channels and
better access to improved inputs and better land. onward into private large-scale milling (that tends to
6. Noncropping income  alternative channels). 
a. Noncropping  income  is  an  important  indirect d. Nevertheless, in situations with poor farming con-
determinant of productivity via its effect on farm input ditions, market proximity can act to pull rural people
acquisition and investments.  out of farming and provide them alternatives.
b. Noncropping income can increase purchased inputs
or capital investments where credit is unavailable or
costly to use, or where other sources of cash income for
loan repayment are lacking. Case study reports provide specific recommendations
c. Noncropping income helps pay for soil
conservation investments, for which credit is rarely 1. To improve long-term food security in Africa,
available.    Noncropping  activities  reduce  household farmers must be able to pursue sustainable
income instability and help to reduce risk by intensification  of  farm  production  by  use  of  improved
diversifying  income  sources. inputs.  Use of fertilizer, organic inputs, animal
d. The poor tend to have less access to noncropping dramatically. 
jobs and less ability to start small businesses.  This is
worrisome because unequal access to noncropping 2. Strategies will need to differ, however, between
income translates into unequal access to farm inputs in favorable and unfavorable agroclimatic zones. With
the face of limited credit access. proper conditions, increased productivity can be
e. Noncropping  income  generally  is  correlated  with cropping intensification are more modest for the
improved input use (fertilizer and animal traction in agroclimatically unfavorable and fragile zones where
Burkina Faso and Senegal, peanut seed in Senegal, and attention will need to be paid to alternative income
conservation investments and fertilizer in Rwanda). sources off-farm.  This will promote food security in
Yet in some areas, more noncropping activity is related the agroclimatically unfavorable zones and increase
to  poorer  farm  performance,  with  the latter pushing the effective demand for farm products from favorable
former. zones.
7. Well-functioning input and output markets 3. The environment and the farm productivity agendas
a. Markets are also an indirect determinant of farm lands  cannot  be  halted  without  raising  farm
productivity as they affect profitability of farming, productivity.    Intensification  of  already-cultivated  land
outlets, and input access. reduces pressure to crop fragile marginal lands.  Yet
reducing transaction costs and risks (e.g., from
market).  They also assure that more benefits from
coordination functions (input supply, credit, output
consumer prices were increased due to grain
make grain more expensive to consumers than do
POLICY IMPLICATIONS AND
RECOMMENDATIONS
per country.  The general findings are as follows.
traction, and conservation investments needs to rise
expected in the favorable zones. Expectations for
are linked.  Degradation and pressure on marginal 
FS II Policy Synthesis No. 22 
Page 4
interventions to improve farm productivity must be Thus the debate should be reopened on identifying
accompanied by conservation investments.   cost-effective  ways  of  increasing  access to inputs,
4. Noncropping  employment  and  the  farm find ways to earn cash income to pay for them.  This
productivity agendas are linked.  In many areas, effort is especially appropriate in countries whose
noncropping income is a critical means to pay for farm macroeconomic  environment  has  become  more
inputs  and  investments  and  achieve  food  security. favorable through structural adjustment.  This should
Moreover, much noncropping activity is linked to the be a priority policy issue in Africa in the 21st century.
farm sector (downstream or upstream).  Micro-
enterprise promotion programs that provide rural
employment while reducing the cost of farm inputs and
increasing the off-farm multipliers from farm output
growth are desirable. 
The flip-side of this argument is that new cropping
technology proposed for farmer adoption must not only
be financially and economically profitable, but also
attractive relative to alternative uses of household
resources outside of cropping.
5. Cash-cropping programs spur productivity by
providing cash for improved inputs.  Depending on
how they are organized, they can increase access (from
the supply side) to improved inputs and to low-risk
output marketing.
6. Promotion of improved inputs will need to be
innovative to be consistent with widespread fiscal
constraints and the goals of structural adjustment.
Input use has traditionally been promoted in ways that
are not economically sustainable.  Yet the reduction of
government programs and subsidies associated with
structural adjustment appears to have discouraged the
use of fertilizer and improved seed by raising costs and
reducing access. 
The upshot is that farm input costs must be reduced
without returning to generalized subsidies. We
advocate a “middle path” between fiscally unsus-
tainable government outlays and complete government
withdrawal from support to agriculture. Policy reform
(exchange and interest rate policy, market
liberalization) is necessary but not sufficient to spur
higher farm productivity.  The “middle path” addresses
long-term structural problems via substantial public
and private investment in agricultural research, human
capital, and production and market infrastructure.
Governments and donors need to invest in
understanding how to promote the economic use of the
tools of sustainable intensification--fertilizer, animal
traction, organic inputs, water, and soil conservation.
Public investment should complement and spur private
investment on-farm, in the input distribution system,
and in primary product processing and distribution. 
improving the delivery of inputs, and helping farmers
Funding for this research was provided by the Food Security II
Cooperative Agreement (AEP-5459-A-00-2041-00) between Michigan
State University and the United States Agency for International
Development, through the Office of Agriculture and Food Security in
the Economic Growth Center of the Global Bureau (G/EG/AFS).
Supplemental funding for this research was also provided to the FS II
Cooperative Agreement by the Africa Bureau, through the Food
Security and Productivity Unit of the Sustainable Development
Division, Productive Sector, Growth and Environment
(AFR/SD/PSGE/FSP). 
Thomas Reardon is Associate Professor, Valerie Kelly is Visiting
Assistant Professor, Eric Crawford is Professor, and Thomas Jayne is
Visiting Associate Professor in the Department of Agricultural
Economics, MSU.  Daniel Clay is Professor in the Institute for
International Agriculture, MSU.  Kimseyinga Savadogo is Professor,
FASEG, Université de Ouagadougou, Burkina Faso.  The views
expressed in this document are exclusively those of the authors.
This paper is a summary of a report entitled: “Determinants of Farm
Productivity in Africa: A Synthesis of Four Case Studies,”
International Development Paper No. 22.  It can be obtained by writing
to:
MSU Bulletin Office
10-B Agriculture Hall
Michigan State University
East Lansing, Michigan 48824-1039
This paper is also forthcoming as a SD Publication Series technical
paper.  It can be obtained through USAID’s development information
system (CDIE) (catalog number forthcoming).

Determinants of Farm Productivity in Africa: A Synthesis of Four Case Studies

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