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Value Addition and Productivity Differentials in the Nigerian Cassava System

Temitayo A. Adeyemo () and Victor O. Okoruwa ()
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Temitayo A. Adeyemo: Department of Agricultural Economics, University of Ibadan, Ibadan, Nigeria
Victor O. Okoruwa: Department of Agricultural Economics, University of Ibadan, Ibadan, Nigeria

Sustainability, 2018, vol. 10, issue 12, 1-22

Abstract: There is an increasing need to improve value addition in order to get maximum utility from agricultural systems. Using a retrospective panel data from 482 cassava farmers covering the years 2015–2017, this study examined the effect of value addition on productivity of farmers in the cassava system in Nigeria. We analysed a non-parametric Data Envelopment Analysis to examine productivity across cassava production systems over the three year period. We also examined the impact of value addition on productivity using an endogenous switching regression to account for unobservables that determine the decision to add value and productivity of the farmers. The study found that cost and revenue outlays increased with value addition. Cassava farmers in general operated below the efficiency frontier, with total productivity declining over the 2015–2017 period. However, higher value addition farmers had better efficiency and non-reducing productivity in the periods studied. We found evidence of selection bias in the decision to add value and productivity of the farmers. The conditional and unconditional outcome estimates revealed positive gains in productivity with value addition, confirming the hypothesis that value addition increases farming households’ productivity. We recommend that essential services such as extension services, agricultural training, and ease of enterprise registration that drive agricultural value addition be made available to farmers.

Keywords: cassava farmers; value addition; productivity differentials; impact; endogenous switching regression (search for similar items in EconPapers)
JEL-codes: Q Q0 Q2 Q3 Q5 Q56 O13 (search for similar items in EconPapers)
Date: 2018
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