Impacts Of Agricultural Machine Renting on Cereal Crop Productivity and Commercialization in West Gojjam Zone, Ethiopia

Abstract

This study investigated the impacts of agricultural machine renting on cereal crop productivity and commercialization. The study used cross-sectional data collected from 192 agricultural machine users and 208 non-users from West Gojjam zone, Northern Ethiopia. The data were analyzed using descriptive statistics and econometric models. The econometric model includes Trans log production function, Endogenous switch regression and propensity score matching. The result of descriptive statistics showed that the total factor productivity index of the cereal crop was 2.89, and the mean commercialization index for the sample households was .0.506. The results of Trans log production function model showed an average level of Technical Efficiency of 80.6%. The result of endogenous switching regression and propensity score matching models showed that agricultural machine renting had a positive and significant impact on the selected outcome variables, total factor productivity, technical efficiency and output commercialization index. Based on the findings, the study suggests that the government and stakeholders should focus on strengthening the provision of formal and informal education, development of infrastructures, extension service, to promote agricultural machine renting service, and enhance cereal crops productivity and commercialization.