An economic analysis of small-holders agriculture in the central highlands of Ethiopia : a system simulation approach Public Deposited

http://ir.library.oregonstate.edu/concern/graduate_thesis_or_dissertations/6t053j770

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  • In the majority of the less developed countries the small-scale peasant agriculture is the dominant sector of the countries' economies. The successes of major agricultural programs in order to increase the potentials depend primarily on the understanding of the economic organizations of the peasant households. This study analyzed over a period of five years the production/ consumption behavior of small-holders peasant agriculture at the micro-level in a case study region representing the Central Highlands of Ethiopia. The consequences of increased resource productivities as a result of assumed technologica forces, on the production/consumption behavior of a typical farm househlold were evaluated. A dynamic system simulation framework was employed to describe and analyze the economic growth process given the farm household's goals. The system framework or model was specified by four interconnected components consisting of cultivated land area; production-inventory; income-consumption; and agricultural investment. In the absence of increases in resource productivities the system simulation model predicted over the specified period of time a relatively stable consumption pattern. In addition, land area allocated to crops such as teff and wheat increased by over 50 percent resulting in modest increase in output and income. However, nearly half of the potential arable land was left uncultivated during this period of time. With an intermediate increase in the level of capital productivities the results showed wide fluctuation in income and consumption with an upward trend over the specified period. Land areas under teff and wheat doubled and also resulted in slight increases for barley and pulses. Production based on further increased capital productivities indicated that all of the potential available land would be put under cultivation over a period of four years and in addition the conditions of unstable consumption and income patterns would be more exasperated. The reason for these unstable situations appeared to be the behavior of the level of investment which was in turn assumed to depend on the situation of the supply of and demand for household food. In view of the circumstances pointed out changes would be required in order to meet the goals and aspirations of the farm household and to promote the farmer's welfare. The findings of the study suggested that increased welfare would be accompanied by increased risks to meet adequately the food needs of the household over time. The study concluded that the resolution of the conflicting goals of the individual farm household would require the intervention of the public agencies and particularly those engaged in research, extension and agricultural service activities. However, careful considerations should be given to the goals expressed by the individual household units at the micro-level and those expressed goals of the public at large, to increase the level of resolution and to bring about changes with positive and desirable consequences to the farming communities.
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