Thesis

Investment in fencing and its contributions to agricultural production in semi-arid Kenya

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Awarding institution
  • University of Strathclyde
Date of award
  • 2012
Thesis identifier
  • T13299
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Abstract
  • Good land management strategies are known to play an important role in improving agricultural production. Fencing is an example and for this reason, this study builds on the existing literature to find out its contribution to agricultural production in semi-arid Kenya. The motivation is that there is lack of empirical data that has evaluated the contribution of fence as a productive investment in Kenya. Fencing was treated as a productive input in the production function alongside capital, labour, land and land quality. Cross-sectional primary data is used to achieve the objectives of the study. The Cobb-Douglas (CD) specification was used in measuring the contribution of fence to production. The instrumental variable technique was applied to test for endogeneity of the fence variable. Technical efficiency was estimated and two alternative approaches were applied, stochastic frontier analysis (SFA) and data envelopment analysis (DEA). In the DEA analysis, the output-oriented frontier was estimated under the specifications of constant and variable returns to scale. Ordinary least squares (OLS) results indicated that fencing improves agricultural production. Findings from the two stage least squares (TSLS) regression show that the decision to fence can be affected by cost of fencing, age and education level of household head and the farming activity undertaken by households but the effect is insignificant. Maximum likelihood estimates (MLE) from the SFA also show that fencing has an impact on production. Further results from both SFA and DEA also indicated that there are substantial production inefficiencies among the sample farmers. Analysis of variance (ANOVA) results showed that there are differences in the means of fence variable and that fenced households are more efficient than unfenced homesteads though the difference is insignificant. Further, the Spearman rank coefficients show that the correlation between SFA and DEA is positive and significant at 5 percent level. More results show that the importance of fencing in different regions does not vary significantly and the aggregated data showed a positive impact of fence on production. It was therefore concluded that fence improves production and the policy implication is that since fencing has led to a series of positive benefits, there is need for the government to recognize the positive impact of fence and empower those communities who would wish to fence their land. Last but not least, the results are consistent with the theoretical view that fencing is expected to improve output.
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DOI
Date Created
  • 2012
Former identifier
  • 948585

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