Supply of Kenyan Pyrethrum
Abstract
Kenya's pyrethrum industry provides self employment to over
eighty thousand rural families. Over two thousand people find wageemployment
in the Pyrethrum Marketing Board's factory. Others earn
regular incomes from collection and transportation networks.
Pyrethrum is Kenya's fourth most important export crop, accounting
for about SlX per cent of .Kenya's total foreign exchange earnlngs
each year.
Knowledge of farmers" responsiveness to changes in economic
variables is iQportant in formulating agricultural policies. This
study attempts to estimate Kenyan pyrethrum farmers' responsiveness
to price changes.
Time series data on output, acreage and price are used to
estimate aggregate and regional supply flllctions. Nerlove's Partial
Adjustment model fits the Kenyan pyrethrum data better than the
Fisher distributed lag model.
Fmpirical results suggest that Kenyan pyrethnm farmers are
highly responsive to price cbanges and that the price-elasticity of
pyrethrum supply varies from one region to another. Some policy
implications are drawn from these results.
Citation
Master of Arts, University of Nairobi 1975Publisher
University of Nairobi. Faculty of Arts