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Meta regression analysis of economic efficiency in farm households in Ethiopia

Author Affiliations

  • 1Agricultural Economics Department Haramaya University, Ethiopia
  • 2Agricultural Economics Department Haramaya University, Ethiopia

Res. J. Agriculture & Forestry Sci., Volume 7, Issue (4), Pages 1-9, October,8 (2019)

Abstract

The focus of this review paper was to analyze the economic efficiency in farm households in Ethiopia by using meta-regression analysis of previous studies conducted so far on the specified issue. For this purpose, a total of 20 (twenty) frontier studies conducted in different parts of the country on economic efficiency in farming households were compiled and a total of 22 observations were identified for data extraction. The extracted data were analyzed through descriptive statistics as well as econometric models (Tobit model). The descriptive statistics shows that the mean economic efficiency and technical efficiency estimates for the observation were 0.422 and 0.792 respectively. On the other hand, the mean technical efficiency score for reviewed empirical studies for grain crops and other crops were 0.764 and 0.700 respectively. The t-test statistics shows that, the mean economic efficiency score for reviewed empirical studies in different grouping variables (study product type, location of study and method of efficiency analysis) does not have significant difference whereas the test shows the existence of significant difference in mean technical efficiency score for grain crops and other crops indicating that the mean technical efficiency score for grain crops is higher than other crops. The econometric model result shows that out of six explanatory variables included in the model study product type, location of study area and method of efficiency analysis does not have significant influence on the mean economic efficiency score of empirical studies whereas sample size, number of explanatory variables and mean technical efficiency score have significant influence on the mean economic efficiency score of empirical studies at 5, 1 and 5% level of significance respectively. Sample size and mean technical efficiency score have negative influence whereas number of explanatory variables has positive influence. It is obvious that, for clear policy recommendation, accurate estimates of economic efficiency especially for commercial crops are crucial. In such issues, meta-analysis has paramount importance. Therefore, though the findings of this analysis shows and identifies the relationship between different explanatory variables and economic efficiency, it is better if further analysis covering large number of studies, wide geographic area and different agricultural commodities is conducted.

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