Impact of access to credit on farm income: policy implications for rural agricultural development in Lesotho
Abiodun A. Ogundeji,
Charmaine Motsoari and
Agrekon, 2018, vol. 57, issue 2, 152-166
In this era of rapidly increasing food demand, a sustainable food supply is required to meet such demand. This suggests that capital investment through adequate access to credit is needed to develop the agricultural sector in developing countries including Lesotho. Therefore, this paper examined farmersâ€™ access to credit and its impact on farm income using a three-stage model, namely: Probit, Tobit, and propensity score matching. The study was conducted in Lesotho with a sample size of 100 farmers. The empirical results reveal that access to credit increases net farm revenues by US$116.608 to US$136.894. Furthermore, savings, scale of production, membership of farmer associations and financial record keeping exert significant positive effects on access to credit, while higher interest rates reduce farmersâ€™ likelihood of securing credit from a financial institution. We conclude that adequate access to credit is necessary to promote a sustainable agricultural development and the livelihoods of rural farmers in Africa.
References: Add references at CitEc
Citations: View citations in EconPapers (2) Track citations by RSS feed
Downloads: (external link)
Access to full text is restricted to subscribers.
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:taf:ragrxx:v:57:y:2018:i:2:p:152-166
Ordering information: This journal article can be ordered from
Access Statistics for this article
Agrekon is currently edited by A. Jooste, National Agricultural Marketing Council
More articles in Agrekon from Taylor & Francis Journals
Bibliographic data for series maintained by Chris Longhurst ().