Mw. Beatrice Sakwa Salasya : An Economic Analysis of Households in Western and Central Kenya

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25 Feb 2005 13:30
Unit: Wageningen University
Location: Aula (gebouw 362), Gen. Foulkesweg 1, Wageningen
Promotor: prof.dr. A. Kuyvenhoven (Development Economics)
Co Promotor: dr. C.P.J. Burger, dr. P. Thornton (ILRI, Nairobi, Kenia), dr.ir. J.J. Stoorvogel

 The study examines how a combination of socio-economic and household factors influences farm household decisions on soil nutrient management and on crop production in two regions of Kenya, Kiambu and Vihiga. Data are collected through a formal survey among 471 households. Various methodological approaches are employed including cluster analysis, the dual and primal approach to analysing the farm production, and mathematical programming. The dual model results show that demand for fertiliser is price elastic and also responds to output prices. In Kiambu, outputs are hardly responsive to fertiliser prices, however. Results from the primal approach show that currently labour is the constraining factor, particularly in kale production, making the impact of fertiliser obscure. If only the market price of fertiliser and of the outputs is considered, a higher level of fertiliser use on all the crops would be profitable for the households. However, the households’ shadow price of fertiliser appears higher than the market price. A possible reason is that credit is hardly available. Results from mathematical programming confirm that households are liquidity constrained and require more credit to enable them to increase their use of fertiliser.
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