The response of agricultural sector to adjustment policies in Kenya 1970-1999

Abstract

The prime objective of our study was to investigate the response of agriculture sector to adjustment policies (SAPs) in Kenya with the aim of suggesting policy options to improve agricultural production and growth. In doing this, our study employed a modified Nerlove model (1958) to estimate the sub-aggregates of the selected tradable crops (crops traditionally exported) and non-tradable crops (crops not traditionally exported) and we analyzed using the ordinary least square (OLS) regression method as 3 tool for evaluating the effects of the policies.

The study found that the SAP policies have contributed negatively to agricultural output. This result supports the existing literature that SAPs have had negative impact on output supply. However other factors included in the model such as output price. the amount of rainfall received in a given period of time. Public expenditure on agriculture, loan to agriculture sector and area planted were significant factors in influencing agricultural production in the three models estimated.

Policies recommended emerging from the findings of the study include output price be made favourable for the farmers. The government needs to devise an effective way of generating credit to the farmers especially small-scale and methods of expanding land be implemented. Intensive rather than extensive methods of production are also recommended as a means of increasing agricultural output supply per hectare.