| dc.description.abstract | Organic agriculture is defined as farming system that sustains the health of soils, ecosystems and people. This technology combines tradition, innovation and science in agriculture to benefit the shared environment and good quality of life for all actors involved. Compared to conventional agriculture, organic farming is viewed as appropriate and affordable farming technology for small scale coffee farmers in developing countries who cannot afford high costs of production due to continuously increasing prices of inorganic inputs and falling prices of coffee in the market. However, it is apparent that there is no consensus among researchers and policy makers on how organic farming technology affects profit and production efficiency when applied in coffee farming system in Moshi rural district. Therefore, this study compares economic efficiency of organic and conventional coffee farming system in Moshi rural district in Tanzania. The main objective of study was to examine and compare economic efficiency of organic and conventional coffee farming systems. The data related to input and output prices, production factors and socio-economic characteristics were collected from 115 coffee farmers following both farming systems in Moshi rural district in Tanzania. The profit function approach was used in this study. Analytical tools included descriptive statistics and seemingly unrelated regression (SURE).
The study results reveal that the cost of physical input of organic coffee per acre was 45% lower than that of conventional coffee while the gross profit received from organic coffee farms per acre was 65% lower than that obtained from conventional coffee farms. Based on Cobb-Douglas profit function estimation, coefficient of land, capital, extension services and education was found to be positive and statistically significant in the profit function model. Efficiency analysis conducted by using profit function, jointly estimated with wage share equation indicates that, economic and technical efficiencies were in favour of conventional farms.
Irrespective of the disadvantages found in organic coffee farming technology, it is necessary to narrow down its technological gap when compared to conventional farming. Therefore, the research results may assist policy makers and agricultural institutions concerned with sustainable farming to take necessary measures to increase efficiency of organic farming and to enhance environmental benefits and farmer’s income | en |
