Economic Efficiency of Smallholder Farmers in the Production of Grass Pea: Case Study of Dawint District, North Wollo Zone, Amhara Region, Ethiopia

Abstract

The study's main aim was to measure the economic efficiency of grass pea production in Dawunt Woreda. The Stochastic production frontier model has been used to estimate economic efficiency score, whereas the Tobit model has been used to identify factors affecting economic inefficiency. The study result shows that the average economic efficiencies of sampled households were 0.66. Results of the Tobit model show that the farmer's experience, credit access, soil fertility, household head, education, and farming system positively and significantly affect economic efficiency. Whereas, the distance from the market has a negative and significantly affects economic efficiency. The grass pea producer farmers in the study area could increase their economic efficiency by 0.34. Therefore, the study suggested the above-mentioned significant variables are necessary for policy implications in agricultural development so that the government may give fruitful attention to the existing level of inefficiency of farmers in grass pea production in the study area.