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Household Market Participation, Access, and Farm Productivity in AJK: Evidence from Farm Household Data

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  • Khush Bukhat Zahid

    (Subject Matter Specialist, at Department of Agriculture, Muzaffarabad AJK)

Abstract

The goal of the study is to get insight into agriculture production and market constraints in the AJK region. To achieve the objectives of the study, in the first stage, production function is estimated to obtain technical efficiency scores that are explicitly dependent on the farm and farm-specific variables. For this, single-step stochastic production estimation was applied. Tobit regression was employed in the second phase, with the market participation index as the dependent variable and market accessibility factors and efficiency as explanatory variables. The findings show that all inputs contributed favourably and considerably to farm production, with a mean technical efficiency of 58 percent, indicating that sample farmers might achieve the maximum production frontier by raising their efficiency to 42 percentage points. Among the determinants of technical efficiency farm size, land fragmentation and traction power negatively contributed to efficiency. Market participation was low as approximately 47 percent of the sampled farmers had less than 50 percent market participation and 20 percent did not participate in the market. The remaining 33 percent had market participation greater than 50 percent. The major factors that affect market participation were production efficiency, distance from roads and the market, credit facility, training, experiences, and internet and refrigerator facilities. All these variables were positive and significantly contributed to market participation.

Suggested Citation

  • Khush Bukhat Zahid, 2023. "Household Market Participation, Access, and Farm Productivity in AJK: Evidence from Farm Household Data," The Pakistan Development Review, Pakistan Institute of Development Economics, vol. 62(3), pages 375-394.
  • Handle: RePEc:pid:journl:v:62:y:2023:i:3:p:375-394
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    More about this item

    Keywords

    Market Participation; Stochastic Production Estimation; Technical Efficiency Scores; Farm Productivity;
    All these keywords.

    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • Q12 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Micro Analysis of Farm Firms, Farm Households, and Farm Input Markets
    • Q13 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Agricultural Markets and Marketing; Cooperatives; Agribusiness

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