Efficiency in Uganda’s seed potato systems

Abstract

PurposeThis paper aims to examine the level of economic efficiency and factors that influence economic efficiency among seed potato producers in South-western Uganda.Design/methodology/approachThe paper analyses the economic efficiency of 499 informal and 137 formal seed producers using primary data collected through a structured questionnaire. A multi-stage sampling technique was used to select the study sites and specific farmers. A one-step estimation procedure of normalized translog cost frontier and inefficiency model was employed to determine the level of economic efficiency and the influencing factors.FindingsThe results showed that mean economic efficiencies were 91.7 and 95.2% for informal and formal seed potato producers, respectively. Furthermore, results show significant differences between formal and informal seed potato producers in economic efficiency at a one percent level. Market information access, credit access, producers' capacity and experience increase the efficiency of informal while number of potato varieties, market information access and producers' experience increase economic efficiency for formal counterparts.Research limitations/implicationsMost seed potato producers, especially the informal ones do not keep comprehensive records of their production and marketing activities. This required more probing as answers depended on memory recall.Practical implicationsFuture research could explore panel data approach involving more cropping seasons with time variant economic efficiency and individual unobservable characteristics that may influence farmers' efficiency to validate the current findings.Social implicationsThe paper shows that there is more potential for seed potato producers to increase their economic efficiency given the available technology. This has a direct implication on the economy through increased investment in the production and promotion of high yielding seed potato varieties to meet the growing national demand for potatoes.Originality/valueThe paper bridges the gap in literature on economic efficiency among seed potato producers, specifically in applying the normalized translog cost frontier approach in estimating economic efficiency in the context of potato sub-sector in Uganda.Peer reviewThe peer review history for this article is available at: https://publons.com/publon/10.1108/IJSE-10-2021-0641