Analysis of growth of productivity in Kenya’s agricultural sector
Abstract
The study is concerned with agricultural growth and
productivity in Kenya between 1960 and 1980. The principal
objectives were to dete rmi.ne the rates and sources of growth
in output and producti vi ty in economic and physical terms.
Two approaches were used. The firs t was growth
accounting procedures using Laspeyer's Index and the index
fo rmul.a of Divisia. The second approach involved estimation
of a Cobb-Douglas production function.
Total agricultural output grew at 3 percent per year
between 1960 and 19,80. The increase was nos t rapid after
1969, averaging 5 percent both in physical and economic
teras.
Agricultural inputs increased more rapidly in the first
decade before 1969 than after 1969. Total inputs increased
at 2 percent per year from 1960 to 1980. Agricultural 18..11d;;
farm machinery, the ratio of land to labour, and non-Farm
current inputs had declining trends. Ag-ricultural labour
increased more or less corrinuous ly at a rate of 2 percent
per year.
Growth in agr icul tur al output was closely as soc iat ed
with product ivity of the pr imary resources than the growth
in totalinputs par t icul arly after 1969. Product ivi ty
accounted for over 50 percent of t.hc growth in output ,
Prices of agricultural commodities also influence the
pattern of production and value of output. Between 1969 and
1980, the prices of export crops and industrial crops were
relatively more favourable than the prices for food crops.
Export crops increased faster than food crops during this
period.
Regression analysis, showed that the coefficients for
labour and capital were significant at 5 percent level of
significance, while the coefficients for land and current inputs
were not significant at 5 percent level of significance.
Marginal productivity analysis yielded marginal
producti vity for labour of K£528 per worker. The marginal
product for fertilizer was K£l54 per ton, while those for
land and capital were 1\£51 per hectare anJ K.£6 per .£ invested,
respectively.
Future growth in agricultural output must come from
increased producti vity of the inputs, because growth m
inputs, especially land input, has cleclined. The key factor
to improvements in land productivity seems to be increased
fertilizer use, which has a higher marginal product than
land and capital. Increased use of labour rather than
capital is also an important factor for future growth in
output. In addition, a sound price policy which offers
incentives to fanners is another .unpor t ant factor for
sustaining rapid output growth in future.
Citation
Degree of Master of Science in Agricultural EconomicsPublisher
University of Nairobi Department of Agricultural Economics
Description
A thesis submitted in part fulfillment for the
Degree of Master of Science in Agricultural Economics
in The University of Nairobi