Economic efficiency of maize production among smallholder farmers in Hoko district, Sidama national regional state, Ethiopia

Although maize is a key crop, the levels of efficiency and their determinants among smallholder farmers in the study area remain poorly understood. Hence, this study aimed to evaluate the economic efficiency of maize production among smallholder farmers in the study area. A multi-stage sampling procedure, combining purposive and random techniques, was used to select 351 sample farmers. Data were collected from both primary and secondary sources. Primary data were obtained from the 351 randomly selected farmers. Data analysis involved descriptive statistics and econometric models. Qualitative data were analyzed using thematic content analysis. The stochastic production frontier (SPF) model was employed to estimate technical, allocative, and economic efficiency levels, while the Tobit regression model was used to identify the socio-economic, demographic, and institutional factors influencing efficiency among smallholder maize farmers. The mean technical, allocative, and economic efficiency levels were 72.76%, 71.14%, and 51.39%, respectively, indicating considerable inefficiency in maize production in the area. Tobit regression model results showed that education level, family size, farm size, frequency of extension contacts, credit use, and off-farm participation had significant positive effects on technical efficiency. Livestock holding and off-farm activities positively influenced allocative efficiency, whereas distance from home to the maize plot had a negative effect. The qualitative findings also indicated that limited access to credit and inadequate extension services constrained maize productivity and efficiency. The government policies should focus on enhancing farmers’ education and livestock holdings, promoting off-farm activities, and facilitating access to credit and extension services.