IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v12y2020i16p6528-d398205.html
   My bibliography  Save this article

An Economic Comparison between Alternative Rice Farming Systems in Tanzania Using a Monte Carlo Simulation Approach

Author

Listed:
  • Ibrahim L. Kadigi

    (School of Agricultural Economics and Business Studies, Sokoine University of Agriculture, Morogoro P.O. Box 3007, Tanzania
    Soil-Water Management Research Programme, Sokoine University of Agriculture, Morogoro P.O. Box 3003, Tanzania)

  • Khamaldin D. Mutabazi

    (School of Agricultural Economics and Business Studies, Sokoine University of Agriculture, Morogoro P.O. Box 3007, Tanzania)

  • Damas Philip

    (School of Agricultural Economics and Business Studies, Sokoine University of Agriculture, Morogoro P.O. Box 3007, Tanzania)

  • James W. Richardson

    (Department of Agricultural Economics, Texas A&M University, 600 John Kimbrough Blvd/AGLS Blg, College Station, TX 77843-2124, USA)

  • Jean-Claude Bizimana

    (Department of Agricultural Economics, Texas A&M University, 600 John Kimbrough Blvd/AGLS Blg, College Station, TX 77843-2124, USA)

  • Winfred Mbungu

    (Department of Engineering Sciences and Technology, Sokoine University of Agriculture, Morogoro P.O. Box 3003, Tanzania)

  • Henry F. Mahoo

    (Department of Engineering Sciences and Technology, Sokoine University of Agriculture, Morogoro P.O. Box 3003, Tanzania)

  • Stefan Sieber

    (Leibniz-Centre for Agriculturald Landscape Research, Eberswalder Straße 84, 15374 Müncheberg, Germany
    Department of Agricultural Economics, Faculty of Life Sciences Thaer-Institute, Humboldt-Universität zu Berlin, Unter den Linden 6, 10099 Berlin, Germany)

Abstract

Tanzania is the second-largest producer of rice ( Oryza sativa ) in Eastern, Central, and Southern Africa after Madagascar. Unfortunately, the sector has been performing poorly due to many constraints, including poor agricultural practices and climate variability. In addressing the challenge, the government is making substantial investments to speed the agriculture transformation into a more modernized, commercial, and highly productive and profitable sector. Our objective was to apply a Monte Carlo simulation approach to assess the economic feasibility of alternative rice farming systems operating in Tanzania while considering risk analysis for decision-makers with different risk preferences to make better management decisions. The rice farming systems in this study comprise rice farms using traditional practices and those using some or all of the recommended system of rice intensification (SRI) practices. The overall results show 2% and zero probability of net cash income (NCI) being negative for partial and full SRI adopters, respectively. Meanwhile, farmers using local and improved seeds have 66% and 60% probability of NCI being negative, correspondingly. Rice farms which applied fertilizers in addition to improved seeds have a 21% probability of negative returns. Additionally, net income for rice farms using local seeds was slightly worthwhile when the transaction made during the harvesting period compared to farms applied improved varieties due to a relatively high price for local seeds. These results help to inform policymakers and agencies promoting food security and eradication of poverty on the benefits of encouraging improved rice farming practices in the country. Despite climate variability, in Tanzania, it is still possible for rice farmers to increase food production and income through the application of improved technologies, particularly SRI management practices, which have shown a promising future.

Suggested Citation

  • Ibrahim L. Kadigi & Khamaldin D. Mutabazi & Damas Philip & James W. Richardson & Jean-Claude Bizimana & Winfred Mbungu & Henry F. Mahoo & Stefan Sieber, 2020. "An Economic Comparison between Alternative Rice Farming Systems in Tanzania Using a Monte Carlo Simulation Approach," Sustainability, MDPI, vol. 12(16), pages 1-22, August.
    • Handle: RePEc:gam:jsusta:v:12:y:2020:i:16:p:6528-:d:398205
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/12/16/6528/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/12/16/6528/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Richardson, James W. & Herbst, Brian K. & Outlaw, Joe L. & Gill, Robert Chope, II, 2007. "Including Risk in Economic Feasibility Analyses: The Case of Ethanol Production in Texas," Journal of Agribusiness, Agricultural Economics Association of Georgia, vol. 25(2), pages 1-18.
    2. J. Brian Hardaker & James W. Richardson & Gudbrand Lien & Keith D. Schumann, 2004. "Stochastic efficiency analysis with risk aversion bounds: a simplified approach," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 48(2), pages 253-270, June.
    3. Richardson, James W. & Klose, Steven L. & Gray, Allan W., 2000. "An Applied Procedure For Estimating And Simulating Multivariate Empirical (Mve) Probability Distributions In Farm-Level Risk Assessment And Policy Analysis," Journal of Agricultural and Applied Economics, Southern Agricultural Economics Association, vol. 32(2), pages 1-17, August.
    4. Rezende, Marcelo L. & Richardson, James W., 2015. "Economic feasibility of sugar and ethanol production in Brazil under alternative future prices outlook," Agricultural Systems, Elsevier, vol. 138(C), pages 77-87.
    5. Namara, Regassa E. & Weligamage, Parakrama & Barker, Randolph, 2003. "Prospects for adopting system of rice intensification in Sri Lanka: A socioeconomic assessment," IWMI Research Reports 44561, International Water Management Institute.
    6. Norman Uphoff, 2007. "Reducing the Vulnerability of Rural Households through Agroecological Practice : Considering the System of Rice Intensification (SRI)," Mondes en développement, De Boeck Université, vol. 0(4), pages 85-100.
    7. Glover, Dominic, 2011. "Science, practice and the System of Rice Intensification in Indian agriculture," Food Policy, Elsevier, vol. 36(6), pages 749-755.
    8. Norman Uphoff, 1999. "Agroecological Implications of the System of Rice Intensification (SRI) in Madagascar," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 1(3), pages 297-313, September.
    9. Stoop, Willem A. & Uphoff, Norman & Kassam, Amir, 2002. "A review of agricultural research issues raised by the system of rice intensification (SRI) from Madagascar: opportunities for improving farming systems for resource-poor farmers," Agricultural Systems, Elsevier, vol. 71(3), pages 249-274, March.
    10. Lutengano Mwinuka & Khamaldin Daud Mutabazi & Stefan Sieber & Jeremia Makindara & Jean-Claude Bizimana, 2017. "An economic risk analysis of fertiliser microdosing and rainwater harvesting in a semi-arid farming system in Tanzania," Agrekon, Taylor & Francis Journals, vol. 56(3), pages 274-289, July.
    11. Aliou Diagne & Steven Glover & Ben Groom & Jonathan Phillips, 2012. "Africa's Green Revolution? The determinants of the adoption of NERICAs in West Africa," Working Papers 174, Department of Economics, SOAS University of London, UK.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Phemelo Tamasiga & Helen Onyeaka & Adenike Akinsemolu & Malebogo Bakwena, 2023. "The Inter-Relationship between Climate Change, Inequality, Poverty and Food Security in Africa: A Bibliometric Review and Content Analysis Approach," Sustainability, MDPI, vol. 15(7), pages 1-35, March.
    2. Daniele, Bertolozzi-Caredio & Barbara, Soriano & Isabel, Bardají & Alberto, Garrido, 2021. "Economic risk assessment of the quality labels and productive efficiency strategies in Spanish extensive sheep farms," Agricultural Systems, Elsevier, vol. 191(C).
    3. Warut Pannakkong & Parthana Parthanadee & Jirachai Buddhakulsomsiri, 2022. "Impacts of Harvesting Age and Pricing Schemes on Economic Sustainability of Cassava Farmers in Thailand under Market Uncertainty," Sustainability, MDPI, vol. 14(13), pages 1-19, June.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Kadigi, Ibrahim L. & Richardson, James W. & Mutabazi, Khamaldin D. & Philip, Damas & Mourice, Sixbert K. & Mbungu, Winfred & Bizimana, Jean-Claude & Sieber, Stefan, 2020. "The effect of nitrogen-fertilizer and optimal plant population on the profitability of maize plots in the Wami River sub-basin, Tanzania: A bio-economic simulation approach," Agricultural Systems, Elsevier, vol. 185(C).
    2. Bizimana, Jean-Claude & Richardson, James W., 2018. "Agricultural Technology Assessment for Smallholder Farms in Developing Countries: An Analysis using a Farm Simulation Model (FARMSIM)," 2018 Annual Meeting, February 2-6, 2018, Jacksonville, Florida 266589, Southern Agricultural Economics Association.
    3. Ly, Proyuth & Jensen, Lars Stoumann & Bruun, Thilde Bech & Rutz, Dominik & de Neergaard, Andreas, 2012. "The System of Rice Intensification: Adapted practices, reported outcomes and their relevance in Cambodia," Agricultural Systems, Elsevier, vol. 113(C), pages 16-27.
    4. Sarr, Mare & Bezabih Ayele, Mintewab & Kimani, Mumbi E. & Ruhinduka, Remidius, 2021. "Who benefits from climate-friendly agriculture? The marginal returns to a rainfed system of rice intensification in Tanzania," World Development, Elsevier, vol. 138(C).
    5. Morris, Brittany D. & Richardson, James W. & Frosch, Brian J. & Outlaw, Joe L. & Rooney, William L., 2009. "Economic Feasibility of Ethanol Production from Sweet Sorghum Juice in Texas," 2009 Annual Meeting, January 31-February 3, 2009, Atlanta, Georgia 46852, Southern Agricultural Economics Association.
    6. Benavidez, Justin R. & Thayer, Anastasia W. & Anderson, David P., 2019. "Poo Power: Revisiting Biogas Generation Potential on Dairy Farms in Texas," Journal of Agricultural and Applied Economics, Cambridge University Press, vol. 51(4), pages 682-700, November.
    7. Maisashvili, Aleksandre & Bryant, Henry L. & Richardson, James W., 2016. "Economic feasibility of tobacco leaves for biofuel production and high value squalene," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 19(4), September.
    8. Asci, Serhat & Borisova, Tatiana & VanSickle, John J., 2015. "Role of economics in developing fertilizer best management practices," Agricultural Water Management, Elsevier, vol. 152(C), pages 251-261.
    9. Lyman, Nathaniel & Nalley, Lawton Lanier, 2013. "Stochastic Valuation of Hybrid Rice Technology in Arkansas," 2013 Annual Meeting, February 2-5, 2013, Orlando, Florida 142505, Southern Agricultural Economics Association.
    10. Frikkie Maré & Bennie Grové & Johan Willemse, 2017. "Evaluating the long-term effectiveness of crop insurance products to provide cost effective and constant cover for maize producers under stochastic yields and prices," Agrekon, Taylor & Francis Journals, vol. 56(3), pages 233-247, July.
    11. Hristovska, Tatjana & Watkins, K. Bradley & Anders, Merle M., 2012. "An Economic Risk Analysis of No-till Management for the Rice-Soybean Rotation System used in Arkansas," 2012 Annual Meeting, February 4-7, 2012, Birmingham, Alabama 119676, Southern Agricultural Economics Association.
    12. Asci, Serhat & VanSickle, John J. & Cantliffe, Daniel J., 2014. "Risk in Investment Decision Making and Greenhouse Tomato Production Expansion in Florida," International Food and Agribusiness Management Review, International Food and Agribusiness Management Association, vol. 17(4), pages 1-26, November.
    13. Fumasi, Roland J. & Klose, Steven L. & Kaase, Greg H. & Richardson, James W. & Outlaw, Joe L., 2008. "Viability of cellulosic feedstock production from producer to biorefinery," Integration of Agricultural and Energy Systems Conference, February 12-13, 2008, Atlanta, Georgia 48716, Farm Foundation.
    14. Lien, Gudbrand D. & Flaten, Ola & Schumann, Keith D. & Richardson, James W. & Korsaeth, Audun & Eltun, Ragnar, 2005. "Comparison of Risk Between Cropping Systems in Eastern Norway," 2005 International Congress, August 23-27, 2005, Copenhagen, Denmark 24663, European Association of Agricultural Economists.
    15. Asci, Serhat & VanSickle, John J. & Fry, Curtiss J. & Thomas, John, 2015. "Where is Risk in Fumigation Choice: Methyl Bromide versus Alternatives?," 2015 Annual Meeting, January 31-February 3, 2015, Atlanta, Georgia 196862, Southern Agricultural Economics Association.
    16. Williams, Jeffery R. & Llewelyn, Richard V. & Pendell, Dustin L. & Schlegel, Alan J. & Troy, Dumler, 2009. "A Risk Analysis of Converting CRP Acres to a Wheat-Sorghum-Fallow Rotation," 2009 Annual Meeting, January 31-February 3, 2009, Atlanta, Georgia 45985, Southern Agricultural Economics Association.
    17. Hochman, Zvi & Horan, Heidi & Reddy, D. Raji & Sreenivas, Gade & Tallapragada, Chiranjeevi & Adusumilli, Ravindra & Gaydon, Don & Singh, Kamalesh K. & Roth, Christian H., 2017. "Smallholder farmers managing climate risk in India: 1. Adapting to a variable climate," Agricultural Systems, Elsevier, vol. 150(C), pages 54-66.
    18. Berkhout, Ezra & Glover, Dominic & Kuyvenhoven, Arie, 2015. "On-farm impact of the System of Rice Intensification (SRI): Evidence and knowledge gaps," Agricultural Systems, Elsevier, vol. 132(C), pages 157-166.
    19. Noltze, Martin & Schwarze, Stefan & Qaim, Matin, 2013. "Impacts of natural resource management technologies on agricultural yield and household income: The system of rice intensification in Timor Leste," Ecological Economics, Elsevier, vol. 85(C), pages 59-68.
    20. Thomas R. Harris, 2017. "Incorporating Risk in Analysis of Tax Policies for Solar Power Investments," International Journal of Energy Economics and Policy, Econjournals, vol. 7(6), pages 112-118.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:12:y:2020:i:16:p:6528-:d:398205. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.