Abstract:
This research explores how small-scale farmers in River Njoro Watershed in Kenya allocate resources to production of the main food crops in order to understand the underlying causes of enterprise productivity differentials. The River Njoro watershed stretches from the Mau forest to Lake Nakuru; it is part of the on-going research under the Sustainable Management of Watersheds (SUMAWA), Collaborative Research Support Programme (CRSP). The study was done in the five locations that fall within the watershed, namely: Nessuit, Njoro, Ngata, Baruti and Kaptembwa. A representative sample of 120 small scale farmers was studied. It was only possible to collect cross-sectional data during the study. The study basically used primary data, collected using a Schedule, which was administered to the sampled farmers using face-to-face interviews. A translog specification of production function and linear programming procedures were used to analyse the data. SAS and GAMS software‟s were used for the analysis. Results indicate that farmers in the study area allocated the biggest portion of their farms to Maize-bean intercrop and that Potatoes were not included in the optimal programme. The Allen and Morishima elasticities of substitution among pairs of inputs and price elasticities of factor demands were computed. The results indicate that all the three enterprises are substitutes except in the Maize-bean intercrop, which are in the inelastic range. In the three enterprises seeds are very sensitive to their own price changes while land in maize-bean intercrop and labour in potato and wheat enterprises are sensitive to the changes in the prices of other inputs but least sensitive to their own prices. The results further indicate that the increase in prices of seeds, labour and fertilizers used in the Maize-bean intercrop is not favourable since it will trigger more land use. Policies should thus dwell on the increment of output without the expansion of land under cultivation
