Determinants of Agricultural Productivity in Kenya

Abstract

Agriculture in Kenya accounts for about a third of gross domestic product; 76 percent of the population live in rural areas; agriculture employs 85 percent of the rural labour force. Rural labour force has been growing at 3.5 percent while agriculture has been growing at 2.6 percent (World Bank 1991; GOK 1993). Seventy percent of Kenya’s merchandise exports are agricultural; and 33 percent of manufacturing sector output is based on agricultural products (Pearson 1995). Because of agriculture’s contribution to total output and employment, for sometime to come, attempts to improve living standards must give particular attention to increased incomes and productivity in the agricultural sector. Enhancement of agricultural productivity is thus an important condition in alleviating rural poverty, and increasing household food security and stimulating growth in non-farm activities. Unfortunately, there is limited household-level information available in Kenya to allow planners, policy makers and donors to make a comprehensive assessment of the factors that determine agricultural productivity in Kenya. Such information would be extremely valuable in identifying major constraints on productivity growth and in formulating strategies to overcome them. This is especially important as the country adjusts to market liberalisation process. Kenya like many countries in the Eastern and Southern Africa region, is undergoing rapid transition and adjustment in its agricultural sector. Throughout the adjustment process, concerns have arisen regarding the overall implications of the market liberalization process for national agricultural growth and food security. This paper examines the determinants of agricultural productivity variations across households. The main objectives of this paper are threefold: (1) to describe agricultural productivity across households; (2) examine factors that explain variations in agricultural productivity across households; and (3) to identify strategies for enhancing smallholder agricultural productivity in Kenya.