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Technical, Allocative, and Economic Efficiency of Potato Producers in Central Oromia, Ethiopia

Received: 6 May 2022     Accepted: 1 June 2022     Published: 14 June 2022
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Abstract

Potato is the most important food and cash crop in mid and highlands for its potential in high yielding, good nutritional values, early maturing, improving food security, reducing poverty, serving as a main source of income for farmers, and improving the livelihood of millions of farm households, especially in developing countries like Ethiopia. Therefore, assessment of the technical, allocative, and economic efficiency of potato farmers is paramount important, and this study was intended to achieve this objective. Accordingly, primary data were collected from 301 potato-producing households from two districts, Walmara and Ejersa Lafo districts from central Oromia, Ethiopia. The stochastic frontier model of truncated normal distribution and Cobb-Douglas production function was employed, and the result revealed that households from both districts were not efficient in potato production as the mean technical, allocative, and economic efficiency scores were 61.21, 79.56, and 50.23 percent respectively, indicating the possibility that the households can increase their potato production by 38.78%, and the possibility of reducing potato production cost by 49.76%. Gender of the head and experience in potato production were the variables that positively affected households’ technical efficiency, while Age of the head, the occurrence of potato diseases, and distance from institutions like farmers’ training centers and cooperative unions were the variables that negatively affected households’ technical efficiency in potato production.

Published in International Journal of Business and Economics Research (Volume 11, Issue 3)
DOI 10.11648/j.ijber.20221103.17
Page(s) 158-165
Creative Commons

This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.

Copyright

Copyright © The Author(s), 2022. Published by Science Publishing Group

Keywords

Technical Efficiency, Allocative Efficiency, Economic Efficiency, Stochastic Frontier, Potato, Ethiopia

References
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  • APA Style

    Gadisa Muleta, Addisu Getahun. (2022). Technical, Allocative, and Economic Efficiency of Potato Producers in Central Oromia, Ethiopia. International Journal of Business and Economics Research, 11(3), 158-165. https://doi.org/10.11648/j.ijber.20221103.17

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    ACS Style

    Gadisa Muleta; Addisu Getahun. Technical, Allocative, and Economic Efficiency of Potato Producers in Central Oromia, Ethiopia. Int. J. Bus. Econ. Res. 2022, 11(3), 158-165. doi: 10.11648/j.ijber.20221103.17

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    AMA Style

    Gadisa Muleta, Addisu Getahun. Technical, Allocative, and Economic Efficiency of Potato Producers in Central Oromia, Ethiopia. Int J Bus Econ Res. 2022;11(3):158-165. doi: 10.11648/j.ijber.20221103.17

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  • @article{10.11648/j.ijber.20221103.17,
      author = {Gadisa Muleta and Addisu Getahun},
      title = {Technical, Allocative, and Economic Efficiency of Potato Producers in Central Oromia, Ethiopia},
      journal = {International Journal of Business and Economics Research},
      volume = {11},
      number = {3},
      pages = {158-165},
      doi = {10.11648/j.ijber.20221103.17},
      url = {https://doi.org/10.11648/j.ijber.20221103.17},
      eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ijber.20221103.17},
      abstract = {Potato is the most important food and cash crop in mid and highlands for its potential in high yielding, good nutritional values, early maturing, improving food security, reducing poverty, serving as a main source of income for farmers, and improving the livelihood of millions of farm households, especially in developing countries like Ethiopia. Therefore, assessment of the technical, allocative, and economic efficiency of potato farmers is paramount important, and this study was intended to achieve this objective. Accordingly, primary data were collected from 301 potato-producing households from two districts, Walmara and Ejersa Lafo districts from central Oromia, Ethiopia. The stochastic frontier model of truncated normal distribution and Cobb-Douglas production function was employed, and the result revealed that households from both districts were not efficient in potato production as the mean technical, allocative, and economic efficiency scores were 61.21, 79.56, and 50.23 percent respectively, indicating the possibility that the households can increase their potato production by 38.78%, and the possibility of reducing potato production cost by 49.76%. Gender of the head and experience in potato production were the variables that positively affected households’ technical efficiency, while Age of the head, the occurrence of potato diseases, and distance from institutions like farmers’ training centers and cooperative unions were the variables that negatively affected households’ technical efficiency in potato production.},
     year = {2022}
    }
    

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  • TY  - JOUR
    T1  - Technical, Allocative, and Economic Efficiency of Potato Producers in Central Oromia, Ethiopia
    AU  - Gadisa Muleta
    AU  - Addisu Getahun
    Y1  - 2022/06/14
    PY  - 2022
    N1  - https://doi.org/10.11648/j.ijber.20221103.17
    DO  - 10.11648/j.ijber.20221103.17
    T2  - International Journal of Business and Economics Research
    JF  - International Journal of Business and Economics Research
    JO  - International Journal of Business and Economics Research
    SP  - 158
    EP  - 165
    PB  - Science Publishing Group
    SN  - 2328-756X
    UR  - https://doi.org/10.11648/j.ijber.20221103.17
    AB  - Potato is the most important food and cash crop in mid and highlands for its potential in high yielding, good nutritional values, early maturing, improving food security, reducing poverty, serving as a main source of income for farmers, and improving the livelihood of millions of farm households, especially in developing countries like Ethiopia. Therefore, assessment of the technical, allocative, and economic efficiency of potato farmers is paramount important, and this study was intended to achieve this objective. Accordingly, primary data were collected from 301 potato-producing households from two districts, Walmara and Ejersa Lafo districts from central Oromia, Ethiopia. The stochastic frontier model of truncated normal distribution and Cobb-Douglas production function was employed, and the result revealed that households from both districts were not efficient in potato production as the mean technical, allocative, and economic efficiency scores were 61.21, 79.56, and 50.23 percent respectively, indicating the possibility that the households can increase their potato production by 38.78%, and the possibility of reducing potato production cost by 49.76%. Gender of the head and experience in potato production were the variables that positively affected households’ technical efficiency, while Age of the head, the occurrence of potato diseases, and distance from institutions like farmers’ training centers and cooperative unions were the variables that negatively affected households’ technical efficiency in potato production.
    VL  - 11
    IS  - 3
    ER  - 

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Author Information
  • Ethiopian Institute of Agricultural Research (EIAR), National Agricultural Biotechnology Research Center (NABRC), Holeta, Ethiopia

  • Ethiopian Institute of Agricultural Research (EIAR), Holeta Agricultural Research Center (HARC), Holeta, Ethiopia

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