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Credit access and technical efficiency of smallholder farmers in Northern Ghana

Author

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  • Paul Kwame Nkegbe

Abstract

Purpose - The purpose of this paper is to examine the relationship between credit access and technical efficiency of smallholder crop farmers in northern Ghana. Design/methodology/approach - The study uses a random sample of 445 farming households in the three northern regions of Ghana. The two-stage double bootstrap DEA approach was used to consistently estimate technical efficiency scores as well as the determinants. Findings - The results revealed that, given the current technology, there is substantial yield or productivity gap among the sample of producers in northern Ghana used for the study. This is because producers can reduce input use by over 50.0 percent while still achieving the same output levels. It is further revealed that proportion of household income from off-farm activities, distance of farm from homestead, location and credit access are significant determinants of technical efficiency. Originality/value - The current study differs from previous studies in two basic ways. First, it takes into account the fact that smallholder farmers practise mixed or inter-cropping by using value of output so that various crops on a given plot of the farmer can be aggregated; and second, a nonparametric approach is adopted so that the inherent inconsistencies in using the two-step model within a parametric framework can be avoided.

Suggested Citation

  • Paul Kwame Nkegbe, 2018. "Credit access and technical efficiency of smallholder farmers in Northern Ghana," Agricultural Finance Review, Emerald Group Publishing Limited, vol. 78(5), pages 626-639, August.
    • Handle: RePEc:eme:afrpps:afr-03-2018-0018
    DOI: 10.1108/AFR-03-2018-0018
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    Citations

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    Cited by:

    1. ANANG, Benjamin Tetteh, 2022. "Two-Stage Dea Estimation Of Technical Efficiency: Comparison Of Different Estimators," Review of Agricultural and Applied Economics (RAAE), Faculty of Economics and Management, Slovak Agricultural University in Nitra, vol. 25(1), March.
    2. Dokyi Emmanuel & Anang Benjamin Tetteh & Owusu Victor, 2021. "Impacts of Improved Seed Maize Technology Adoption on Productivity and Technical Efficiency in Northern Ghana," Open Economics, De Gruyter, vol. 4(1), pages 118-132, January.
    3. Samuel Sekyi & Benjamin Musah Abu & Paul Kwame Nkegbe, 2020. "Effects of farm credit access on agricultural commercialization in Ghana: Empirical evidence from the northern Savannah ecological zone," African Development Review, African Development Bank, vol. 32(2), pages 150-162, June.

    More about this item

    Keywords

    Technical efficiency; Ghana; DEA; Credit; Truncated model; O12; Q12; Q14;
    All these keywords.

    JEL classification:

    • O12 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Microeconomic Analyses of Economic Development
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q14 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Finance

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