Agricultural Inputs and Efficiency in Tanzania Small Scale Agriculture: A Comparative Analysis of Tobacco And Selected Food Crops

Abstract

This study compares the relative efficiency between tobacco and selected food crops (maize, groundnut and rice) among small scale farmers in Tanzania. A brief discussion on the contribution of tobacco to the Tanzanian economy, as well as the substantial health care costs emanating from tobacco related diseases, is highlighted. We hypothesize that the comparative efficiency of tobacco is not different when compared, even though preferential treatment is given to tobacco growers in the provision of inputs such as fertilizers better seed and the like. The method of analysis is the frontier production function. The study uses the data of householder farmers collected by the NBS in the 2007/08 agriculture census survey. The study is confined to the Tabora region of Tanzania—the major tobacco growing area of the country. It shows that a high preferential treatment is given to tobacco at the expense of maize and others crops. The frontier production results show that the efficiency indices for tobacco, maize, groundnut and rice as being 75.3%, 68.5%, 64.5% and 46.5% respectively. The 7.3% difference in efficiency between tobacco and maize is not substantial when modern inputs allotted to formers are taken into consideration. The most important explanatory variable that explains efficiency in tobacco is modern inputs. This is not so for other annual crops such as rice, groundnut and rice.