ANALYSIS OF FACTORS INFLUENCING SMALLHOLDER FARMERS' PARTICIPATION IN TOBACCO CONTRACT FARMING AND ITS IMPACT ON LAND PRODUCTIVITY. A CASE OF HURUNGWE DISTRICT, MASHONALAND WEST PROVINCE, ZIMBABWE

Prosper Ziyadhuma

Working Papers from African Economic Research Consortium

Abstract: This study used farm level data from Hurungwe district in Mashonaland West province of Zimbabwe to estimate a logistic regression to identify factors that influence smallholder farmers' decision to participate in tobacco contract farming. The results reveal that age and distance to the main road negatively influence while gender, farming experience, education level, access to internet and firm reputation positively influence smallholder farmers' decision to participate in contract farming. To determine the impact of contract farming on land productivity (yield per hectare) between contract farming participants and their counterparts who did not participate, the treatment evaluation model with the associated propensity score matching (PSM) was used. The model permits comparison in terms of yield per hectare between the two groups after controlling for other observable and non-observable smallholder farmer characteristics. The estimated results support the hypothesis that contracted tobacco farmers obtain higher yield per hectare than non-contracted farmers do. The study recommends that the government of Zimbabwe through the ministry of agriculture should create an environment comfortable for tobacco contracting firms and tobacco farmers to work together since tobacco contract farming increase farmers' yield. More so, policies that aim to encourage farmers' education and farmer's access to internet are important since educated farmers participate more in tobacco contract farming

Date: 2020-12-08
Note: African Economic Research Consortium
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