Economic efficiency of smallholder farmers on chickpea production in the central highlands of Ethiopia

Improving the economic efficiency of smallholder agriculture is critical for enhancing food security and rural livelihoods in developing economies, particularly in regions characterized by resource constraints and climatic variability. This study investigates the economic efficiency of chickpea-producing smallholder farmers in the central highlands of Ethiopia, with the aim of identifying efficiency levels and key factors influencing productivity. Primary data were collected from 362 randomly selected chickpea-producing households across the Akaki, Ada’a, and Gimbichu districts using a structured household survey, supplemented by field observations. The data were analyzed using a stochastic frontier production function to estimate technical, allocative, and economic efficiency, complemented by descriptive statistics. The results reveal mean technical, allocative, and economic efficiency levels of 82.93%, 66.03%, and 54.00%, respectively, indicating substantial inefficiencies in resource use. The findings suggest that, without increasing input quantities, chickpea output could be raised by up to 17% through improved technical efficiency, while optimal allocation of inputs could reduce production costs by approximately 34%. Under full economic efficiency, overall chickpea output could increase by nearly 46%. These results highlight considerable scope for productivity gains through improved management practices and enhanced access to modern agricultural technologies. The study recommends targeted interventions focusing on technology adoption, capacity building, and improved input-use decisions to enhance efficiency and sustainability of chickpea production among smallholder farmers in Ethiopia and similar agro-ecological settings.