Kenyan Small Farm Household Consumption And Production Behavior
Abstract
This thesis develops an empirical model which can be used for the
prediction and evaluation of the effects of price and non-price food production
policy incentives in Kenya's smallholder subsector. The small
farm households consumption and production behavior are jointly modelled.
An attempt is also made to model both the continuous and discrete
households choice behavior.
The econometric specifications of the farm households continuous
and discrete choice behavior are based on both theoretical and practical
considerations. The empirical continuous and discrete choice models are
estimated using full maximum likelihood(FIML) estimation technique. The
FIML estimation 1S based on the 1977 long rains cross-section data from
the Monitoring and Evatuation Unit in Kenya's Ministry of Agriculture.
Most of the FIML parameter estimates have the appropriate economic
signs and are statistically significant. The computed discrete choice
probabilities are meaningful. Using a joint test on the production parameter
estimates, I cannot reject the hypothesis of constant returns to
scale in the food and nonfood crops production technologies.
The parameter estimates are used further for partial ex post policy
simulations .The relevant policy variables are the wage rate and the
quantity of the land input. Three main policy conclusions arise from the
analysis of the results of the policy simulation exercises. A 25 per
cent wage reduction affects both the annual cropping pattern discrete
choice probabilities and the magnitudes of the continuous choice variables,
namely the food and nonfood crops output, and the labour input.
Second, households labour absorption is found to be highly wage rate
elastic. Finally, the. cropped acreage elasticities are found to be,
generally, less than unity implying that a percentage change in cropped
acreage will lead to a less than proportionate change in both other inputs
and output.
Citation
Doctor of Philosophy (1985)Publisher
University of Nairobi Boston University Graduate School