Assessing the effect of contract farming on sorghum land productivity: an endogenous switching regression approach
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Date
2025-11
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Journal ISSN
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Publisher
Elsevier
Abstract
In low-and middle-income countries, contract farming handles agricultural problems facing
small-scale growers. This study analyzes the extent to which sorghum productivity can be
enhanced under contract farming in Tanzania. Using cross-sectional data from 400 sorghum
growers in Tanzania and an endogenous switching regression model, we observed that contract
farming significantly improves the productivity of contract farmers compared to non-contract
farmers. The findings show a 12 % increase in productivity for contract farmers, while non-
contract farmers could potentially increase their productivity by 28 % if they participated in
contract farming. Moreover, the study identifies significant variables such as age, off-farm in
come, location, hired labor, the mix of owned-hired labor, farm size, financial services, household
size, gender, experience, and the number of groups as determinants of contract farming partici
pation among sorghum farmers. The results call for policies emphasizing contract farming as a
viable approach to improve sorghum productivity, especially for small-scale farmers. Further
more, policy adjustments matching the specific requirements of farmers in the target area are
needed to maximize the positive impact of contract farming, factoring in the heterogeneity among
producers.
Description
Journal Article
Keywords
Smallholder farmers Contract farming system Sorghum yield Endogenous switching regression East Africa