Determinants Of Total Factor Productivity Of Maize In Ruvuma Region, Tanzania: The Effect Of Input Subsidies

ABSTRACT

Ruvuma Region has been receiving subsidy fertilizer since the reintroduction of the NAIVS programme by the government of Tanzania in 2003/04 crop season. The current study examines the performance of small holder farmer’s maize production in terms of Total Factor Productivity (TFP) and its determinants in Tanzania especially in Ruvuma Region, since it is one of the major maize’s producing regions in Tanzania. More specifically the study was undertaken to estimate the TFP of maize production in Ruvuma region, to determine socio-economic factors influencing TFP of maize production and to assess the effect of input subsidy on TFP of maize. The study used secondary data for the year 2008 before the National Agricultural Input Voucher Scheme (NAIVS) and 2012 after NAIVS programme. The data was obtained from the Department of Agricultural Economics and Business, University of Dar es salaam office. Factors that affected maize TFP growth were also identified using Ordinary Least Square (OLS) model while the Chow test was used test the effect of input subsidy of TFP for maize produced by smallholder farmers. The Results reveled that NAIVS programme had a significant effect on TFP for maize production. In 2012 farmers maize TFP growth was higher (TFP=2.35) compared to 2008 (TFP=1.30) and this is equivalent to average productivity growth of 1.05 between 2008 and 2012 and the difference was highly significant (t= 3.282). There are also factors affecting TFP of maize in 2008 and 2012. Such factors are; household age, farm size, maize quantity harvested, quantity of fertilizer and voucher receipt. The Chow test indicates that the NAIVS programme positively contributed to improving maize. The study recommends that NAIVS should be upscaled and made sustainable. It also suggests that, the productivity of smallholder farmers can be enhanced by the use of fertilizers to improve agricultural