Efficiency Effects of Access to Information on Small-scale Agriculture: Empirical Evidence from Uganda using Stochastic Frontier and IRT Models

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Abstract

Low power home electrical items such as radios, mobile phones and televisions are an important source of agricultural information for small scale farmers in developing countries. To empirically test the effects of access to information from these items on efficiency in agriculture, we formulate a stochastic frontier model augmented with a technical efficiency model that controls for an index capturing farmers’ ‘ability to access information’. The index is constructed with a 2-parameter item response theory (IRT) model based on farmers’ access to the electrical items. Using 6 rounds of panel data on small scale farmers in Uganda, we find empirical evidence of a significant and positive relationship between farmer ability to access information and farm efficiency. There is also evidence that the size of these effects is larger for more literate hence better educated farmers. Greater access to information also appears to be associated with increased variance of (in)efficiency and output although the form of the increased variances is underpinned by low risk of lower efficiency and output realisations and high likelihood of higher efficiency and output realisations. Our findings imply that access to limited quantities of electricity needed to power these electrical items can have positive farm efficiency effects, and hence the importance of off-grid electricity (e.g. standalone solar panels) for small-scale farmers in typically isolated communities in developing countries.
Original languageEnglish
Pages (from-to)494-517
Number of pages24
JournalJournal of Agricultural Economics
Volume68
Issue number2
Early online date9 Sept 2016
DOIs
Publication statusPublished - Jun 2017

Bibliographical note

The first author would like to acknowledge the University of Aberdeen and the Henderson Economics Research Fund for funding his PhD studies in the period 2011–2014 which formed the basis for the research presented in this paper. The first author would also like to acknowledge the Macaulay Development Trust which funds his postdoctoral fellowship with The James Hutton Institute. The data used in this paper come from a nationally representative survey of households in Uganda. The survey was designed and implemented by the Uganda Bureau of Statistics with the assistance of the World Bank Living Standards Measurement Study – Integrated Surveys of Agriculture program. We thank both institutions for making these data openly available. Special thanks are due to David Harvey (Editor-in-Chief) and two anonymous referees for a variety of comments leading to a substantially improved paper. All usual caveats apply.

Keywords

  • Agricultural policy
  • development economics
  • efficiency
  • energy
  • information
  • policy
  • productivity analysis
  • welfare economics

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